Home >Budget >News >Govt’s 35,000 cr outlay for shots to boost demand

Vaccine manufacturers and ancillaries are anticipating strong demand from the government for covid-19 vaccines alone after the government announced plans to procure covid shots worth 35,000 crore, estimated to be enough to vaccinate roughly half the population.

“The generous outlay of 35,000 crore for covid vaccination will cover the procurement of vaccines and auto-disable syringes, as well as the logistics and drug delivery costs for a substantial number of high risk and vulnerable population," said Rajiv Nath, managing director, Hindustan Syringes and Medical Devices, one of the world’s largest makers of syringes for vaccination.

The company is producing 2.4 million syringes per day and will scale it up to 4 million by September to meet demand from India and the rest of the world.

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Hindustan Syringes’ capacity expansion plans were already in place, while one of India’s largest glass vial manufacturers, Schott Kaisha, late Monday announced further capacity expansion after the budget presentation.

“This year’s unprecedented increase in the budget allocation is reassuring for the pharma industry as it is working to provide for the mammoth task of immunizing 1.3 billion Indians. As the first phase of the vaccine drive continues, Schott Kaisha has today announced a fresh investment to further increase vial production capacity by 100 million pieces from its manufacturing sites based in Gujarat and Daman," Rishad Dadachanji, the director of Kaisha group of companies, said.

Schott Kaisha, a supplier to Serum Institute of India, had already begun investing 122 crore to boost annual capacity by 300 million pieces to 1.5 billion vials by December and the further 100 million increase will be completed by mid-2022, he said.

Bharat Biotech International chairman and managing director Krishna Ella said the 35,000 crore budget for covid-19 vaccination and the finance minister’s commitment to providing more funds “will provide an effective, smooth path for the vaccination scheme".

Most industry executives expect the allocation to be sufficient for procurement of vaccines for all those above 50 years of age as well as those below 50 years but with comorbidities, apart from the healthcare and other frontline workers who are being vaccinated.

The 35,000 crore could be enough to procure around 1.5 billion doses if the average procurement price is similar to Serum Institute’s Covishield vaccine and if the entire cost is borne by the Union government, according to an industry official who spoke on condition of anonymity.

“It is difficult to say whether 35,000 crore is enough this year or more will be required. The requirements for vaccine doses and its funding will have to be reviewed based on whether the pandemic is in control in India or not, whether there is increase in the number of cases because of mutant strains, the availability of more vaccines and their volumes, and whether more vaccines would lead to fall in prices," said K. Srinath Reddy, president of Public Health Foundation of India.

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