Bangladesh has announced a corporate tax holiday bulk drug, or API, makers till 2032, and many other incentives to encourage local pharma manufacturing
New Delhi: India set out to encourage local manufacturing of bulk drugs (active pharmaceutical ingredients, or APIs) by declaring 2015 as the Year of APIs, but there has been little progress on the ground.
Meanwhile, Bangladesh on 24 May announced a corporate tax holiday for API and laboratory reagent manufacturers till 2032, as well as many incentives to encourage local manufacturing of drug ingredients. These steps aim to boost pharmaceutical exports and lower the cost for domestic consumers as, in the absence of local APIs, Bangladesh relies on imports from China, South Korea and India.
Indian drug makers have long been demanding a similar policy to attain self-sufficiency.
In 2013, the government formed a panel headed by the then director general of Indian Council of Medical Research V.M. Katoch, which submitted its report in 2015.
However, there has been no action on the report yet.
“Bangladesh is putting in place a policy for the domestic production of pharmaceutical APIs—which India did in the 1970s and dismantled in the last two decades. With backward integration of API and finished formulations production, Bangladesh could emerge as an important supplier especially for new medicines that are patented in India and cannot be supplied by Indian generic suppliers," said Leena Menghaney, head, South Asia, MSF Access campaign.
“A number of new cancer medicines such as Dasatinib are already being generically produced by Bangladesh, even as Indian companies like Natco Pharma have had to withdraw such medicines from the Indian market because of patent enforcement proceedings," said Menghaney.
Over 60% of APIs in India are sourced from other nations and for some specific APIs, the dependence is over 90%, according to the department of pharmaceuticals under the ministry of chemicals and fertilisers.
India’s pharma exports grew 2.91% to $17.27 billion in 2017-18, according to the Pharma Export Promotion Council , but experts claim that exports will be severely hit in the long run if the country does not upgrade. On the other hand, Bangladesh can boost its pharmaceutical exports on the back of a patent waiver available to the least developed countries till 2032.
“Bangladesh is a small country compared to India. However, their presence in the global scenario in formulations as well as in API industry is phenomenal. In a short span of a couple of years, they have started exporting to more than 80 countries. If this tempo continues, it will be a big competition to India," said B.R. Sikri, president of the Federation of Pharma Entrepreneurs.
“They are able to achieve such milestones because of governmental support like China. India declared 2015 as the year of API but unfortunately in the last three years, we have not been able to do much although it is more than three years when the Dr. Katoch committee report was submitted to government," Sikri added.
In April, the government formed a high-level task force to study global practices and draw up a plan aimed at boosting domestic production of APIs. “The specific areas of focus may include research and development, acquisition and commercialization, development of the industry, regulatory framework, potential impact on the industry, investments, contribution to the economy, exports, integration with value chains etc," the memorandum by department of Pharmaceuticals had said.
The government needs to do a lot without further delay, experts said. “The government needs to encourage its API industry by giving incentives to the industry. We have had a lot of discussions but unfortunately, not much has happened," said, V.V. Krishna Reddy, president of Bulk Drugs Manufacturers Association of India.
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