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Budget should support innovation in pharma sector, say experts

The panellists called for expanding the ongoing PLI scheme to include manufacturing of active pharmaceutical ingredients.Premium
The panellists called for expanding the ongoing PLI scheme to include manufacturing of active pharmaceutical ingredients.

The experts also called for expanding the ongoing production-linked incentive (PLI) programme to include manufacturing of active pharmaceutical ingredients (API) so that the pharmaceutical sector can make a stronger push to achieve self-reliance in raw material production

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The budget should offer incentives for innovation in the pharmaceutical sector to encourage new drug discovery and enable local drugmakers to tap more developed markets, industry experts said at Mint Budget Conversations recently.

The experts also called for expanding the ongoing production-linked incentive (PLI) programme to include manufacturing of active pharmaceutical ingredients (API) so that the pharmaceutical sector can make a stronger push to achieve self-reliance in raw material production.

India is a major generic drug producer globally though it lacks in new drug discovery.

“The pharma sector no longer requires crutches but needs a competitive edge," said C.K. Mishra, adviser, Serum Institute of India.

“How do you become the best in the world? And two critical things I would like to mention. One is (being) competitive in terms of production, competitive in terms of price, and the second is quality. And we need to work very strongly on this," he added.

He further said that the pharmaceutical industry needs to sharpen its competitiveness to capture more markets overseas.

“I think we are reaching a situation in India where the pharma sector thinks that we’ve done enough right. So, we need to inject that additional incentive into the pharma sector to grow further," Mishra said.

“This is the sunrise sector of India and we must focus on it, even if it means some budget outgo, because ultimately it will bring in revenues to compensate for what you spend right now. One of the requirements is the understanding that pharma is a sensitive sector and we are talking about drug and health security. It’s not just production and commerce; it’s drug security, certainly. We need to be looking at institution building," Mishra said.

He said India’s pharmaceutical sector needs to further enhance its capabilities in research and development.

“As far as fiscal incentives are concerned, the pharmaceutical sector can do well on its own if we are able to push them with R&D and human resources in a big way. Science must come in from the government. And then new molecules will come, new drugs will come in. India will be a big player," Mishra said.

The fertilizer and agrochemical sector is also struggling with insufficient innovation and technological progress, said Chhabilendra Roul, former secretary, department of fertilizers. For instance, he said that the technology used for ammonia and urea processing is old.

“But we have now new frontiers of technology coming up, particularly, green ammonia and green hydrogen. But for that you need a lot of technological push, a lot of incentive from the government," he said.

“The gestation period for repaying the benefits from R&D is quite long and you need deep pockets for that. Most of the fertilizer or agrochemical companies in India don’t have that," Roul said. “There are very small and marginal players in the sector. There are large players but still they don’t have the deep pockets to spend on R&D," he said.

Mishra said with the ongoing climate crisis, any sector that wants to progress needs to have strong foundation in going green.

“We need to invest in green technology," he said.

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