It’s one of the lesson that our country learnt the hard way during the pandemic. While we are the leading players in Pharmaceutical products, our domestic companies lost out the capacity to produce Key Starting Materials and Drug Intermediates and APIs in a cost effective manner.
The applications of a number of companies, which have committed more than the minimum proposed annual production capacities and fulfil the prescribed criteria have been approved under Production Linked Incentive (PLI) Scheme for Promotion of Domestic Manufacturing of critical Key Starting Materials (KSMs)/Drug Intermediates and Active Pharmaceutical Ingredients (APIs) in the country.
These include Aurobindo Pharma Limited through Lyfius Pharma Pvt. Ltd. will produce a combined production capacity of 15,000 MT of Penicillin G with a committed investment of Rs 1392 crores.
Another Aurbindo investment through Lyfius Pharma Pvt. Ltd. will produce 2000 MT of 7 – ACA with an investment of Rs 813 crore. Aurobindo Pharma Limited through Qule Pharma Pvt. Ltd. will produce 1600 MT of Erythromycin Thiocyanate at a cost of Rs 834 crore. Karnataka Antibiotics & Pharmaceuticals Ltd will produce 7 – ACA with a combined production capacity of 1000 MT with a committed investment of Rs. 275 crores. Kinvan Pvt. Ltd. will produce 300 MT of Clavulanic Acid at an investment of Rs 447.17 crore.
The setting up of these plants will lead to total committed investment of Rs. 3,761 cr. by the companies and result in an employment generation of about 3,825. The commercial production is projected to commence from 1st April, 2023 and the disbursal of production linked incentive by the Government over the six years period would be up to a maximum of Rs. 3,600 cr.
With an objective to attain self-reliance and reduce import dependence in these critical Bulk Drugs – Key Starting Materials (KSMs)/ Drug Intermediates and Active Pharmaceutical Ingredients (APIs) in the country, the Department of Pharmaceuticals had launched a Production Linked Incentive (PLI) Scheme for promotion of their domestic manufacturing by setting up greenfield plants with minimum domestic value addition in four different Target Segments with a total outlay of Rs. 6,940 cr. for the period 2020-21 to 2029-30.
The applications under four different Target Segments were invited with 30th November, 2020 as the last date. In total, 215 applications have been received for the 36 products spread across the 4 Target Segments. The guidelines prescribed that the applications would be processed and decided within a period of 90 days, i.e., up to 28th February, 2021.
The Target Segment-I includes 4 Eligible Products, viz., Penicillin G; 7-ACA; Erythromycin Thiocyanate (TIOC) & Clavulanic Acid, in which the country is presently fully import dependent, were considered on priority as per the decided evaluation and selection criteria.
Further, applications under the other three segments are proposed to be taken up for approval in the next 45 days.
The Indian pharmaceutical industry is the 3rd largest in the world by volume. It has high market presence in several advanced economies such as the US and EU. The industry is well known for its production of affordable medicines, particularly in the generics space. However the country is significantly dependent on the import of basic raw materials, viz., Bulk Drugs that are used to produce medicines.