Introduction

The Indian pharmaceutical industry, now a $17 billion(over Rs 68,000 crore) Industry, has shown tremendous progress in terms of infrastructure development, technology base creation and a wide range of products. It has established its presence and determination to flourish in the changing environment. The industry now produces bulk drugs belonging to all major therapeutic groups requiring complicated manufacturing technologies. Formulations in various dosage forms are being produced in GMP compliant facilities. Strong scientific and technical manpower and pioneering work done in process development have made these possible. The country now ranks 4th worldwide accounting for 8% of world’s production by volume and 1.5% by value. It ranks 17th in terms of export value of bulk actives and dosage forms. Indian exports are destined to more than 200 countries around the globe including highly regulated markets of US, Europe, Japan and Australia.

              The country is also showing excellent performance on the Pharma export front. The figures of exports under this category during the current decade have been:

                                   (Figures in Rs. Crores)

        2001-02      2002-03       2003-04       2004-05      2005-06      2006-07

           9751             12826             15213          17857        22116        24942

[Source DGCIS]

Technological Strengths

The following attributes constitute the basis of the technological strengths of the Indian Pharmaceutical Industry: --

a.                          Self-reliance displayed by the production of 70% of bulk drugs and almost the entire requirement of formulations within the country

b.                          Low cost of production

c.                          Low R&D costs

d.                          Innovative Scientific manpower

d.                          Excellent and world-class national laboratories specialising in process development and development of cost effective technologies.

f.                          Increasing balance of trade in Pharma sector

g.                          An efficient and cost effective source for procuring generic drugs especially the drugs going off patent in the next few years.

h.                          An excellent centre for clinical trials in view of the diversity in population.

Restricted Items for Imports

1 Import of most of the bulk drugs, intermediates and formulations under Chapters 29 & 30 is free. However, quite a few narcotic drugs & psychotropic substances, that were restricted as per Exim Policy 2002-2007(Appendix 1) at the instance of the Department of Revenue. On account of structural similarities and non availability of specific codes for many narcotic drugs & psychotropic substances, a large number of organic chemicals including vital bulk drugs & intermediates required by the Pharma industry were also put under restricted category by virtue of their coverage under 9 residual categories of “Others”. Keeping in view the difficulties of a large number of genuine actual users of these substances, at the instance of this Department import restrictions on the narcotic drugs & psychotropic substances including those under “others” were lifted. At the same time a new regime for import of narcotic drugs & psychotropic substances has been brought in by DGFT vide Notification No.52(RE-2005)2004 dated 9th March 2006. According to new guidelines a new Annexure V was added to the schedule I(Imports) of the ITC(HS) Classification of Export & Import items, 2004-09. A copy of the said Notification is available vide (Appendix 2):

2. Import of all Drugs & Pharmaceuticals is subject to registration and other requirements as administered by Drug controller General of India under the provisions of Drugs & Cosmetics Act.

Small Scale Units in Drugs & Pharmaceuticals

As per the guidelines issued by the Ministry of Micro, Small & Medium Enterprises, the investment limit for units to qualify as a small-scale unit is Rs.5 crore. After latest amendments in the list of items reserved for SSI units in March 2007 only following four items having relevance to the drugs & pharmaceutical industry are left as reserved for exclusive manufacture by the small-scale units:

1.      Niacinamide
2.      Pyrazolones 
3.      Lanolin anhydrous
4.      Potassium Citrate- industrial grade

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Pharmaceutical Advisory Forum

Through Drug Policies announced from time to time, Government of India has been trying to ensure abundant availability of good quality essential pharmaceuticals of mass consumption at reasonable prices. At the same time strengthening the indigenous capability for cost effective quality production of medicines has been an important objective. To help realize this and in order to provide a Forum for a meaningful dialogue amongst all the stakeholders on various issues concerning the drug policy, it was decided to constitute a Pharmaceutical Advisory Forum in the Department of Chemicals & Petrochemicals.

The Pharmaceutical Advisory Forum was constituted in July 2004 having following composition:

(1) Hon’ble Minister for Chemicals & Fertilizers                                     (Chairman)

(2) Hon’ble Minister of State for Chemicals & Fertilizers                          (Member)

(3) Health Ministers of All States/UTs                                                (Members)

(4) Secretary, Deptt. of Chemicals & Petrochemicals Government of India. (Member)

(5) Secretary, Deptt. of Health Government of India.                             (Member)

6) Chairman, NPPA                                                                          (Member)

(7) Drugs Controller General of India                                                   (Member)

(8) Joint Secretary (Pharmaceuticals), Department of Chemicals & Petrochemicals (Member Secretary)

(9) Member Secretary, NPPA                                                               (Member )

(10) Director (Pharmaceuticals), Department of Chemicals & Petrochemicals (Convener)

(11) Drugs Controller of all States/Uts                                                (Member )

(12) Joint Secretary (Drugs), Deptt. of Health, GOI                               (Member)

(13) Two representatives of Consumer to be nominated by Deptt. of Chemicals & Petrochemicals from each States/Uts.                                                 (Member)

(14) One representative of Chemist Associations from each States/Uts.   (Member)

(15) One representative each of Drug Industry Association viz., IDMA, BDMA, OPPI, IPA and AISSPMA.                                                                                (Member)

So far, three meetings of the Pharmaceutical Advisory Forum have been held at Vigyan Bhavan, New Delhi on 11.02.2006, 23.09.2006 and 15.5.2007 respectively. Important suggestions emanating from the deliberations of these meetings have already received serious consideration and steps are being taken to act upon them.

Pharmaceutical Export Promotion Council

Pharmaceutical Export Promotion Council (Pharmexcil) having its Headquarters at Hyderabad and Regional offices at Mumbai and Delhi, was set up by the Ministry of Commerce and Industry, Government of India vide Notification No 64 dated the 12th May, 2004. Under Para 3.12.1 of Export and Import Policy 2002-2007, Pharmexcil is the only Designated Agency for issue of Registration and Membership Certificates for Pharmaceutical Exports dealing in products/services like: -

Bulk Drugs (APIs), Drug Intermediates, Drug Formulations, Biotechnology, Biological Products, Herbal Products (Ayurveda, Siddha & Unani ), Medicinal Plants, Homeopathy, Nutraceuticals and Physiochemical, Diagnostics, Contact Research; contract Manufacturing , Clinical Research, Surgical, Collaborative Research and Technologies/ Consultancy.

Objectives The objectives of the Council (Pharmexcil) are to extend all assistance to the pharmaceutical industry in India to explore their opportunities. Towards achieving this aim, the Council is taking delegations to various countries, organizing Business meets etc. encouraging export activities by arranging fund support under MAI programmes of the Government.

Services This Council is a Government sponsored single window contact to the world of Pharmaceuticals from India and an only authorized agency for issue of Registration cum Membership Certificate (RCMC) for pharmaceutical exports under Foreign Trade Policy of Government of India. Apart from this, the Council is also providing following assistance: -

(a) Trade Enquiries received from foreign Embassies /Buyers

(b) Market Development assistance as provided by Ministry of Commerce for business tours to foreign countries.

(c) Arrange one to one Buyer/Seller Meets in India/Abroad.

(d) Arrange Exhibitions in India and Abroad for market promotion.

(e) Assist in Regulatory matters with domestic and Foreign Government agencies.

(f) Provide financial assistance for Product Registration charges, Research and Development, Product showcasing etc. as per rules.

(g) Arrange Conferences/Seminars in domestic and foreign countries - for market and technical up-gradation of information

Working Groups/ Joint Working Groups / Sub-Groups

India-EU Joint Working Group

Under India-EU Sub-Commission on Trade, India-EU Joint Working Group (JWG) on Pharmaceuticals and Biotechnology was set up under the Co-Chairmanship of Joint Secretary (Pharma) since 2006. D.G. Enterprises is the counterpart from the EU side. The first meeting of the said JWG was held on 18th July 2006 at Brussels where in the Terms of Reference for the JWG was finalized. Its 2nd meeting was held on 30th and 31st May 2007 at New Delhi.

Indo Tunisia Joint Working Group

A Joint Working Group on Drugs & Pharmaceuticals under the Aegis of the Indo-Tunisian Joint Commission has been constituted since 2004. Three meetings have since been held. The   Tunisian Government has given permission to 5 Indian Companies for registering their products in Tunisia.

Sub Group on Pharmaceuticals under the aegis of Indo-Russian Working Group on Trade and Economic Cooperation (IRWGTEC)

Under the Indo-Russian Working Group on Trade and Economic Cooperation (IRWGTEC) a sub group on pharmaceuticals is functioning under this Department and provides inputs to IRWGTEC.

Under the said JWG the issues discussed were various areas of cooperation like promotion of Trade and exports of pharmaceuticals to these countries, Joint Venture Cooperation in manufacture as well as R&D, regulatory cooperation, HRD and Training taking part in Exhibitions and Trade Fairs.

Sub Group on Pharmaceuticals and Medical Devices

High Technology Cooperation Group (HTCG) on Biotechnology and Life Sciences Working Group has recently been augmented by two subgroups covering Biotechnology, Pharmaceuticals & Medical Devices. The Department was requested to identify a nodal point for Subgroup activities. The nodal point on the U.S side is Mr. Jeffrey Gren, Director of the Commerce Department (Office of Health & Consumer Goods). Joint Secretary (Pharma), from this Department has been nominated as the Nodal Officer for the Sub-Group on Pharmaceuticals and Medical Devices. However the alternate officer will be the concerned Deputy Secretary (Pharma) in this Department. The last DVC  meeting of this group was held on 13th Dec. 2007.

Working Group on Drugs and Pharmaceuticals

In the context of formulation of the Eleventh Five Year Plan (2007-12), the Planning Commission has set up a Working Group on Drugs and Pharmaceuticals under the Chairmanship of Secretary (C&PC). Subsequently, the Department of C&PC constituted three Sub Groups for different Terms of Reference (TOR) of Working Group. Report of the Working Group on Drugs and Pharmaceuticals for the eleventh five-year plan (2007-12) has already been submitted to the Steering Committee, Planning Commission on 1st December 2006.

The report includes a number of measures aimed at accelerating the growth of Indian Drugs and Pharmaceuticals Industry in the globalize scenario and at the same time benefit the common man in line with the Common Minimum Programme of the Union Government. Some of the important measures for the welfare of common man and ensuring growth of the domestic Drugs and Pharmaceuticals Industry as envisaged in the Report include: -

I. Creation of 5 new NIPER like institutions to generate requisite HR in this field.

II. Interest subsidy to Pharma Industry for Schedule M compliance.

III. Setting up 10 Pharma Parks to provide global environment to the Pharma industry.

IV. Creation of District Drug Banks for BPL families.

V. Provision for Price and availability of Cancer medicines Fund.

VI. Measures for Pharma PSUs welfare including revival of sick PSUs.

VII. Strengthening and up gradation of infrastructure at NPPA and NIPER and Pharmexcil.

Pharmaceutical Export Promotion Cell

An Export Promotion Cell in the Pharmaceutical Division has been functioning with the objective of boosting pharmaceutical exports and to act as a nodal center for all queries/issues regarding pharmaceutical exports.

In order to give adequate attention to day-to-day problems faced by the exporters, there were interactions with various Ministries/Departments and our Missions abroad. The Cell collects statistical data on export and import of pharmaceuticals in the country and provides commercially useful information for developing and increasing drugs and pharmaceutical exports. It is acting as nodal center for all queries and issues regarding Pharma exports. The Cell also undertakes promotional activities for acceleration of pharmaceutical exports and considers suggestions for modifications in EXIM POLICY from the industry. The Cell has also been entrusted with the organization of seminars and workshops on standards, quality control requirements of important countries so as to prepare the domestic companies for exporting their products. Database on the status of pharmaceutical industry in many countries is available in the cell for the benefit of Indian exporters.

The Department has been associated with Department of Commerce in the promotion of exports and various events by way of GCC Africa and Latin America meets at Hyderabad and CIS meeting in Mumbai were organized. In these events there were interaction between Indian exporters and foreign buyers and regulatory officials.

Pharma exports touched a level of over Rs. 24942 crores during 2006-07. Exports constitute a substantial part of the total production of Pharmaceuticals in India. Another note worthy feature of export is more of dosage form export to advanced markets like Europe, US, CIS Africa etc. The trend of exports is as follows: -

(Source:-Directorate General of Commercial Intelligence and Statistics - DGCIS, Kolkata)

Industrial Licensing for all bulk drugs cleared by Drug Controller General (India), all their intermediates and formulations has been abolished, subject to stipulations laid down from time to time in the Industrial Policy. 100% FDI is also permissible for the manufacture of Drugs and Pharmaceuticals.

                    (This section was last updated on 4th Jan 2008)