Tag: department of pharmaceuticals

EXCLUSIVE | Double-digit pharma export growth proof PLI scheme a resounding success: Pharma Secy

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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As the government aims to give manufacturing a desired push, the Production-Linked Incentive (PLI) Schemes under the pharma sector have achieved resounding success, said Arunish Chawla, Secretary of the Department of Pharmaceuticals in an exclusive interview with CNBC-TV18.

On being asked about the success of PLI schemes under the Department of Pharmaceuticals, Chawla shared, “We should celebrate the moment. Pharma PLIs have been a resounding success.” The government had announced three PLI schemes under the sector covering pharmaceuticals, bulk shrugs and medical devices.

“The pharmaceutical scheme has exceeded all expectations, already ₹25,000 crore plus of investment has come in and production targets have been succeeded,” Chawla said.

Also Read: Indian govt notifies new marketing code to restrain unethical practices for pharma industry

He said, “Exports have ballooned. And in the closing year (FY24), the Indian pharma industry exported more than 50% of its output,” stating that the performance of the sector “is a big landmark.”

“The bulk drugs and medical devices are difficult schemes and they have succeeded too. Greenfield plants have come up in India and 50 of them were inaugurated last month. With that happening, a lot of energy came in and 50 Greenfield plants started working and started producing bulk drugs and medical devices, which hitherto fore were entirely imported in the country.”

Not just this, Chawla added that “independent data which shows that in the Meditech sector, in the medical devices. For the first time — the imports came down in absolute terms.”

In a first, Chawla said, “Exports are growing in double digits. That is the best independent evidence that PLI schemes have been a resounding success.”

Also Read: EXCLUSIVE | Novartis CEO says India holds incredible strategic potential in pharma R&D

On being asked, what would be one message that you would like to give to the pharma sector, he said, “Take off is the word. India has arrived and India’s pharma and medi-tech industry will be the start of the future and you will see India shining on the global stage in this sector.”

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Reputation key to curbing unethical marketing, ‘name and shame’ policy just the beginning: Pharma Secy

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Secretary Arunish Chawla of the Department of Pharmaceuticals stressed the significance of reputation in deterring unethical marketing practices within the sector. He asserted that as the department ensures adherence to ethical standards, the “name and shame” policy represents just the initial stride towards this objective, in an exclusive conversation with CNBC-TV18.

“A reputational play is the best defence against unethical market practices. A company which has a standing in the market, if it is reprimanded and the reprimand is put up in the public space and across the social media space, the damage it causes to the reputation and value of that company is immense,” said Chawla.

He added that the “name and shame” policy is where it begins and that the story will go further.

Chawla made these comments on being asked how the government would look at penalising those who do not comply with the provision of the newly notified Uniform Code on Pharmaceutical Marketing Practices (UCPMP) 2024 which was notified on March 12.

The code will curb pharmaceutical companies from extending personal benefits to healthcare professionals or their family members. The restricted benefits include gifts, travel facilities, hospitality, and cash or monetary grants for marketing activities.

He mentioned that the new code applies to both the government and the entire corporate sector.

Chawla held a comprehensive meeting on Monday with stakeholders to discuss the implementation of the recently notified Uniform Code for Pharmaceutical Marketing Practices 2024. The meeting included representatives from various Pharma associations, which Chawla highlighted as pivotal for enforcing the code.

Regarding the meeting participants, Chawla noted, “It comprised representatives from key pharma associations, including the Indian Pharmaceutical Alliance (IPA) representing the largest 25 Indian pharma companies; OPPI, which serves a similar role for multinational pharma companies in India; IDMA, a significant association comprising 1,100 medium-sized drug manufacturers across the nation, and the Bulk Drug Manufacturers Association, representing around 300 bulk drug manufacturers nationwide. Collectively, they represent approximately 1,300 to 1,400 pharmaceutical companies operating in India.”

The government has also collected market data, from the market footprints of pharma companies over the last three to four years to ensure strict compliance.

“Today’s meeting was called at the end of the financial year and going forward all the companies have to submit a self-declaration within two months of the end of every financial year to the association. We are preparing a panel of auditors,” Chawla said. The undertaking shall be uploaded on the association website or directly on the UCPMP portal. Those who do not comply will automatically go on a risk-based audit framework.

The code states that the complaints of violation will be handled by the ‘Ethics Committee for Pharma Marketing Practices’ in each association. This committee will comprise three to five members and will be headed by the chief executive officer (CEO) of the board, who will be responsible for adherence to the code.

The Department of Pharmaceuticals pointed out that pharma companies, distributors, agents, wholesalers or retailers should not offer gifts for the personal benefit of any healthcare professionals or their family members. The Department of Pharmaceuticals last brought out UCPMP in 2014.

Chawla shared that given its dynamic and evolving nature, the industry is undergoing a fast transformation. “The technology is evolving, telemedicine is coming in, digital health is taking off, online prescriptions are coming, blockchain technology is coming in, generative AI is coming in. There’s so much happening on that front. So. we needed to evolve a framework which is mandatory and yet flexible enough to adapt to these changes which are coming in the market and technology,” he said.

The government decided to adopt the code after a High-Level committee, led by a member of NITI Aayog, was formed to examine marketing practices. This committee, which included members from the Pharma and health sectors, along with the chairman of the Central Board of Direct Taxes, gathered input from all stakeholders. Their recommendations formed the basis for the new code, as explained by Chawla.

According to him, the key feature of the code is its mandatory nature, distinguishing it from previous voluntary codes.

Why it is mandatory?

Chawla says that the new code ensures that “there is a government oversight, there is a risk-based audit, there is a self-certification and there is a redressal mechanism.” He also clarified that the new code is quasi-statutory.

The new code combines four significant statutes into a single framework. It’s based on internationally recognised ethical marketing practices established by the World Health Assembly. It incorporates regulations from the Medical Council of India (MCI) for doctors’ conduct, guidelines from the Drugs and Cosmetic Act regarding product claims and marketing practices, and provisions from the Income Tax Act concerning income computation and penalties for violations.

Chawla explained, “The code integrates these key statutes and allows for government assessment of audit findings. It enables penalties, disciplinary actions, or remedial measures as per relevant government agencies or authorities.”

However, critics argue that the code lacks clear penal provisions. In response, Chawla explained that Section 12 of the code outlines five sub-sections detailing the penal provisions.

He said, “When drafting the code, we consider the audience. It’s written in plain language so that medical representatives and healthcare practitioners can easily understand what is permissible and what is not. However, interpretation may vary among those implementing the code and government agencies.”

Chawla continued, “If you carefully review the code, it explicitly references certain statutes such as advertising practices, the Income Tax Act, and MCI regulations. This aspect, in my opinion, is pivotal.”

“In simple terms, maintaining a good reputation is the most effective defence against unethical market practices, which is what the code aims to achieve,” he concluded.

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Pharma secretary to meet industry on new marketing practices code

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Days after the new Uniform Code of Pharmaceutical Marketing Practices (UCPMP) 2024 was notified, the Department of Pharmaceuticals is going to hold a spree of meetings to ensure stricter implementation of the rules under the code.

According to sources, the meeting with key stakeholders from the pharmaceutical industry will be held under the chairmanship of the pharma secretary, Arunish Chawla, and will be held in two parts.

“The Department Of Pharmaceuticals will meet industry stakeholders on implementing the new marketing practices code over the next two weeks. The meetings will begin with deliberations with the vaccine and drug manufacturers initially, followed by a meeting with medical device manufacturers,” sources told CNBC-TV18.

Notably, representatives from industry bodies such as the Indian Pharma Association (IPA), Indian Drug Manufacturers Association (IDMA), and Indian Medical Association (IMA) will participate in both rounds of meetings.

According to sources, the Pharma Secretary is poised to emphasise strict compliance with the newly formulated Uniform Code for Pharma Marketing Practices. The meetings will serve as a platform for delivering a robust message of zero tolerance towards any violation of the marketing code.

The government is also expected to reiterate the need for timely self-declaration filing by CEOs of pharmaceutical manufacturers and other industry stakeholders.

The first phase of the meeting is likely to be concluded in the next fortnight, the sources said.

The government notified the Uniform Code of Pharmaceutical Marketing Practices (UCPMP) 2024 on March 12. This was done to curb pharmaceutical companies from extending personal benefits to healthcare professionals or their family members. The restricted benefits include gifts, travel facilities, hospitality, and cash or monetary grants for marketing activities.

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Health Minister Mansukh Mandaviya launches National Medical Device Policy 2023

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Minister of Health and Family Welfare Mansukh Mandaviya on Friday launched the National Medical Device Policy 2023 at an annual conference on Indian pharmaceuticals and medical devices in Delhi.

He also launched the Export Promotion Council for Medical Devices and the Scheme for Assistance to Medical Devices Clusters for Common Facilities (AMD-CF) and released six reports on pharmaceuticals and medical devices.

In the coming days, the health ministry will also bring forth a basic chemical and API-related PLI, Mandaviya said. APIs or active pharmaceutical ingredients are the biologically active components of medicinal products that produce the intended effect.

The Cabinet approved the National Medical Device Policy 2023 on April 26, but the policy and its official strategy document were officially released and unveiled by Mandaviya today.

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Bargaining with the quality of medical products will damage India’s growth, competitiveness and reputation, Mandaviya said. He emphasised that he will not tolerate that.

This statement comes days after India made the quality check of cough syrups exported from India mandatory. India-made syrups, in the past year, have been linked to dozens of deaths in Gambia and Uzbekistan.

“I hope the industry will cooperate in the actions taken by the government to maintain the quality,” Mandaviya said.

As India holds the title of “Pharmacy of the World,” our responsibilities have now doubled, Mandaviya added. He emphasised on the importance of innovation in order for the nation to survive the pharma race.

His thoughts were echoed by Kallam Satish Reddy, the Chairman of Dr Reddy’s Laboratories, who said that looking forward, the goals India sets for its pharmaceutical and medical devices industry are critical. While there is opportunity and support from the government and the industry, innovation is required at all levels.

If we are able to discover drugs and market them ourselves, we can push India from being a $42 billion industry to its 2024 goal of being a $65 million industry, Reddy said.

Co-hosted by the Department of Pharmaceuticals and the Federation of Indian Chambers of Commerce and Industry (FICCI), the annual International Conference on India Pharma and India Medical Devices marked its 8th edition today. While day 1 of the two-day event focuses on medical devices, the May 27 sessions will centre around pharmaceuticals.

The conference is aimed at establishing India as a cost-effective, high-quality manufacturing and innovation centre for the pharmaceuticals and medical device industry.

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The event was attended by eminent dignitaries, senior officials of the Government of India and representatives of the industry and academia.

These include Union Minister of Health and Family Welfare and Chemicals and Fertilizers of India Mansukh Mandaviya, Union Minister of State for Chemicals and Fertilizers and New and Renewable Energy Bhagawanth Khuba, Department of Pharmaceuticals Secretary S Aparna, Joint Secretaries N. Yuvaraj (pharmaceuticals) and Srikar K Reddy (Commerce). Principal Scientific Adviser to the Government of India Ajay Kumar Sood, FICCI Secretary General Shailesh Pathak, Transasia Bio-Medicals Ltd. CEO Aravind Viswanathan and Dr Reddy’s Laboratories Chairman Kallam Satish Reddy also attended day 1 of the conference.

The inaugural event was followed by a CEO roundtable which Mandaviya will attend. The health minister just yesterday conducted bilateral meetings with member countries at the 76th World Health Assembly in Geneva, Switzerland.

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Centre announces QR code on labels of top 300 drugs to ensure authenticity 

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The Centre on Friday announced to introduce Quick Response (QR) Code or bar code on the packaging label of the top 300 drug formulations including Calpol, Allegra, Betadine ointment, Gelusil, and Dolo 650, under the new Drugs Rules or the Drugs (Eighth Amendment) Rules, 2022.

The new rule will be effective from August 1, 2023, as per a notification issued by the ministry of health and family welfare. These QR codes will help verify the authenticity and traceability of the drugs.

The ministry of health and family welfare in June this year issued a draft notification for the same which stated,  “The manufacturers of drug formulation products as specified in Schedule H2 shall print or affix Bar Code or Quick Response Code on its primary packaging label or, in case of inadequate space in primary package label, on the secondary package label that store data or information legible with a software application to facilitate authentication.”

As per the notification, the QR code will have to store data of the unique product identification code, proper and generic name of the drug, brand name, name and address of the manufacturer, batch number and date of manufacturing and expiry, and manufacturing licence number.

Also Read: Soon, medicines to come with QR code to check sale of fake drugs

According to the sources, the pharmaceutical industry has sought a period of 18 months from the date of final notification to implement the same. To implement this, the union ministry of health made necessary amendments to the Drugs Rules, 1945.

Earlier this year, the health ministry had asked the department of pharmaceuticals to enlist 300 drug brands for the implementation of mandatory QR codes. Following the instructions, the National Pharmaceutical Pricing Authority (NPPA) identified the list of 300 drugs which are used for blood sugar, hypertension, painkillers, contraceptives and vitamins.

The Centre had said active pharmaceutical ingredients (APIs) or bulk drugs that are manufactured on imported in India shall bear a QR code on its label at each level, packaging that stores data or information readable with the software application to facilitate tracking.

According to reports, the World Health Organisation earlier estimated that around 35 percent of the drugs sold globally in the market come from India. The officials from the industry said that the step is a good move to avoid the circulation of fake drugs in the market. However, the implementation of the QR code may push the prices of the drugs up by 3-4 percent.

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Pharma PLI weighed down by low subsidies, caveats but market indicates scheme will take off now

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The Narendra Modi government’s dream project — Production Linked Incentive (PLI) scheme for the pharmaceutical sector, which will benefit domestic manufacturers and create more employment — is crawling due to insufficient subsidy and many caveats for investment.

Currently, the government, through the Department of Pharmaceuticals (DoP), is implementing three PLI schemes — bulk drugs (Rs 6,940 crore), medical devices (Rs 3,420 crore), and pharmaceuticals (Rs 15,000 crore) — to promote manufacturing activity.

PLI, first rolled out two years ago aiming to increase indigenous manufacturing and create more employment, is currently a mixed picture. While government data indicates that investments have not taken off till a year ago, feedback from some large companies indicates they are already accruing benefits from it.

Let’s break it down

The PLI scheme for key starting materials, drug intermediates, and active pharmaceutical ingredients had a financial outlay of Rs 6,940 crore. In this, 239 applications were received, and 49 were selected for 32 products. As of December 2021, only 21 percent or Rs 775 crore of the total investment committed of Rs 3,685 crore was deployed, and three projects were commissioned.

In the PLI scheme for medical devices, for which the financial outlay was Rs 3,420 crore, 42 applications were received, of which 21 were approved. As of December 2021, Rs 167.3 crore was invested, which is close to 16 percent of the total commitment of Rs 1,059.3 crore.

The largest was the PLI scheme for the pharmaceutical sector, entailing an outlay of Rs 15,000 crore, which is spread across biopharma, APIs, and autoimmune to anti-diabetic drugs. The operational guidelines were issued in June 2021. A total of 278 applications were received, and 55 were selected.

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Reasons for poor offtake and the readings

Though the offtake has been slow till now, market feedback indicates movement to pick up. According to sources, the little deployment is likely because the PLI scheme coincided with most companies focusing on COVID-19 critical investments, resulting in delays in commissioning PLI projects.

Also, companies take at least a few months to maybe a year to sometimes finalise investment projects, which is why we could now see more projects commissioned under PLI versus what we saw last year.

In fact, large companies such as Aurobindo Pharma have their PLI project commissioned, with the company investing around $8 million in the first quarter and the project likely to come on stream by April 2024.

Even the likes of Sun Pharma and Dr Reddy’s Laboratories (DRL) did benefit from PLI in the quarter gone by. While the quantum is not known, Sun and DRL have begun accruing benefits as they invested the mandated capex to scale up existing products that were a part of the PLI scheme.

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But, are there hiccups when in the PLI scheme?

Yes. Not all are going through with their investments. According to some companies, the subsidy provided by the government was insufficient, and they managed to complete the capex at a lesser amount.

For example, the investment sought by a typical company was Rs 60-80 crore. However, the capex by the same company was completed at Rs 30 crore, so the company withdrew from the PLI scheme.

Other reasons for lower participation are a large number of caveats by the government to invest, and sometimes the pricing of the API or final product moved lower. Hence, sometimes even with the incentive, the production of the product might not be competitive. 

So, what can be done differently?

Companies say the PLI scheme needs to be opened up for more products.

For example, the medical devices space should be open to encourage investments in products that are consumed in bulk, such as glucometers, thermometers and not just high-end devices.

Also, some more feedback is that companies should be able to apply for the PLI scheme on tap with longer timelines to achieve the targets put out.

The Indian pharmaceutical industry is the third largest in the world by volume and is worth $40 billion.

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Dolo-650 makers under Health Ministry scanner after I-T Dept sniffs out ‘unethical practices’

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Taking cognisance of the recent findings shared by the Income Tax Department post its search operations against Bengaluru-based Micro Labs, the Ministry of Health and Family Welfare and the Department of Pharmaceuticals has tasked the Ethics Committee under the National Medical Commission to probe into the matter.

This comes after the Central Board of Direct Taxes (CBDT) had accused the makers of the widely-known Dolo-650 medicine tablet of indulging in “unethical practices” and distributing freebies of about Rs 1,000 crore to doctors and medical professionals in exchange for promoting products made by the pharmaceutical group.

“Mansukh Mandaviya, Minister for Health and Family Welfare and the Department of Pharmaceuticals have directed the ethics committee under National Medical Commission to look into the nexus of pharma companies and medical practitioners and doctors doing undue promotion and prescription of select medicines,” senior government sources told CNBC-TV18.

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Also, the Ethics Committee has asked to submit their report as soon as they can with the findings on how the nexus exploited the market and excessive sales.

Further, the government has issued show cause notices to medical practitioners and doctors who were covered under the income tax action for irregularities and unfair practices, sources said.

The CBDT said the department has seized “unaccounted” cash of Rs 1.20 crore and gold and diamond jewellery of Rs 1.40 crore. The CBDT is the administrative body for the I-T department.

The CBDT alleged that “freebies by Micro Labs included travel expenses, perquisites and gifts, etc. to doctors and medical professionals for promoting the group’s products under the heads ‘promotion and propaganda,’ ‘seminars and symposiums,’ ‘medical advisories’ etc.”

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“During the course of the search operations, substantial incriminating evidence, in the form of documents and digital data, has been found and seized. The initial gleaning of the evidence has revealed that the group has been debiting in its books of account unallowable expenses on account of the distribution of freebies to the medical professionals under the head ‘sales and promotion’,” the Income Tax Department said.

Dolo-650, an analgesic (pain killer) and antipyretic (fever-reducing ) oral tablet, was being extensively prescribed by doctors and medical shop owners for coronavirus patients to reduce pain and fever, common symptoms experienced by those infected.

The company website showcased a news article, published in February, that said: “The company has sold 350 crore tablets (of Dolo-650) since the COVID-19 outbreak in 2020, and earned revenues of Rs 400 crore in a year.” The CMD of the company, Dilip Surana, was quoted in the story.

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Other irregularities

The CBDT also alleged certain other irregularities on part of the group that has a presence in more than 50 countries and manufactures pharma products and active pharmaceutical ingredients (API).

It alleged that the group was found to have claimed artificially-inflated deduction under special provisions in respect of certain incomes, by resorting to suppression of expenses and over-appropriation of revenue to the unit eligible for such deduction.

“Various other means of tax evasion, including inadequate allocation of research and development expenses to eligible units and inflated claim of weighted deduction under Section 35 (2AB), have also been detected,” the CBDT said. The quantum of tax sought to be “evaded” through such means is estimated at over Rs 300 crore, the statement said.

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It added that the department also found instances of “violation” of provisions of tax deduction at source (TDS) under Section 194C of the I-T Act in respect of transactions under contracts forged with the third-party bulk drug manufacturers.

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Govt launches pharma manufacturing schemes; fruits to be visible in next two years

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The central government on Monday launched four schemes of Department of Pharmaceuticals for promotion of domestic manufacturing of bulk drugs and medical devices parks in the country.

Minister for Chemicals and Fertilizers DV Sadananda Gowda said that the move is in line with the vision of Prime Minister Narendra Modi’s call for making India AtmaNirbhar in pharma sector.

The government had approved four schemes, two each for Bulk Drugs and Medical Devices parks, in March.

Earlier, on July 21, the government had notified schemes to boost pharmaceutical manufacturing in the country.

Gowda said that both the industry and the States have started showing interest to come forward and participate in these schemes.

“India is often referred to as ‘the pharmacy of the world’ and this has been proved true especially in the ongoing Covid-19 pandemic when India continued to export critical life-saving medicines to needy countries even during the countrywide lockdown.

However, despite these achievements, it is a matter of concern that our country is critically dependent on imports for basic raw materials, viz. Bulk Drugs (Key Starting Materials (KSMs)/ Drug Intermediates (DIs) and Active Pharmaceutical Ingredients (APIs)) that are used to produce some of the essential medicines. Similarly, in the medical devices sector, our country is dependent on imports for 86 percent of its requirements of medical devices,” Gowda said.

Talking to CNBC-TV18, Gowda said that it was too early to judge how soon India would be able to reduce its import dependence completely.

However, adding to this, Secretary, Department of Pharmaceuticals, PD Vaghela said, “API manufacturing requires a gestation period of 2 years so we expect that within the next two years these manufacturing facilities will be up and running. Some of the chemical-based API manufacturing can begin even before two years; we are pushing for that.”

MoS (i/c) for Shipping and MoS for Chemicals & Fertilizers Mansukh Mandavia also said that the announcement of schemes was an important initiative towards further developing Indian pharmaceutical capacities.

“The Production Linked Incentive (PLI) schemes for promoting domestic manufacturing of KSMs, DIs and APIs and medical devices will go a long way including to boost domestic manufacturing of 53 bulk drugs, on which India is critically dependent on imports. The list of 41 products contained in the scheme guidelines will enable domestic production of 53 bulk drugs. Financial incentives will be given to a maximum of 136 manufacturers selected under the scheme as a fixed percentage of their domestic sales of these 41 products manufactured locally with required level of domestic value addition,” Mandaviya said.

According to the contours of the scheme, the incentives would be subject to annual ceilings communicated in the approval letter. The incentives would be given for a period of 6 years. In the case of fermentation-based products, the rate of incentive is 20 percent for the first four years, 15 percent for the fifth year and 5 percent for the sixth year.

In the case of chemically synthesized products, the rate of incentive is 10 percent for all six years.

The selected manufacturers shall have to complete committed investment above a threshold investment mandated for each product and achieve a prescribed minimum installed capacity before they are eligible to receive incentives.

The threshold investment is Rs 400 crore for four fermentation-based products and Rs 50 crore for ten fermentation-based products. Similarly, threshold investment is Rs 50 crore for four chemically synthesized products, and Rs 20 crore for 23 chemically synthesized products.

The minimum installed capacity to be achieved for each of the 41 products is prescribed in the guidelines. The incentives for fermentation-based products would be available from FY 2023-24 i.e. after a two year gestation period during which the selected applicant has to complete the committed investment and install the committed capacity.

For chemically synthesized products the incentives would be available from FY 2022-23 i.e. after a gestation period of one year during which the selected applicant has to make the committed investment and install the committed capacity.

Any company, partnership firm, proprietorship firm or an LLP registered in India and possessing a minimum net worth (including group companies) of 30 percent of the proposed investment is eligible to apply for incentives under the scheme. An applicant can apply for any number of products.

The applicants will be selected on the basis of transparent composite evaluation criteria which include the annual production capacity committed by the applicant and the sale price of the product quoted by the applicant. Applicants quoting low sale price and higher production capacity will get higher marks in the evaluation.

Amitabh Kant, CEO Niti Aayog also highlighted that India produces a huge number of Generic medicines as well as more than 500 API, still, it has to import a large quantity of API. He said prime mnister wants to reduce dependency on imports.

Secretary pharmaceuticals P D Vaghela said that the schemes are expected to make India not only self-reliant but also capable of catering to the global demand for the selected bulk drugs and medical devices.

“This is a golden opportunity for the investors since incentivization to industry and world-class infrastructure support simultaneously will help in bringing down the cost of production significantly. These schemes along with the liberal FDI policy in these sectors and an effective corporate tax rate of about 17 percent (including surcharge and cess) will give a competitive edge to India in the selected products vis-à-vis other economies,” Vaghela added.

The guidelines are available on the website of the Department of Pharmaceuticals.

Salient features of the four schemes are:

The scheme is open for applications for a period of 120 days from the date of issuance of guidelines and the approval will be given to the selected applicants within 90 days from the closure of the application window. Applications will be received only through an online portal. The total financial outlay of the scheme is Rs 6,940 crore.

Scheme for promotion of Bulk Drug Parks: The scheme envisages creation of 3 bulk drug parks in the country. The grant-in-aid will be 90 percent of the project cost in case of North-East and hilly States and 70 percent in the case of other States. Maximum grant-in-aid for one bulk drug park is limited to Rs 1000 crore.

States will be selected through a challenge method. The States interested in setting up the parks will have to ensure assured 24*7 supply of electricity and water to the bulk drug units located in the park and offer competitive land lease rates to bulk drug units in the park. The location of the proposed park from environmental angle and logistics angle would be taken into account while selecting the States.

The ease of doing business ranking of the state, incentive policies of the State applicable to the bulk drug industry, availability of technical manpower in the state, availability of pharmaceutical/chemical clusters in the state will also be factored in while selecting the States.

The interested States will be scored and ranked on evaluation criteria, given in the guidelines, which captures the above parameters. The States getting top 3 ranks will be selected. The States have to submit their proposal within 60 days of the date of issuance of the guidelines. Selection will be done and in-principle approval will be given to three selected States within 30 days of last date of submission of proposals.

Thereafter, the 3 selected States will have to submit a Detailed Project Report (DPR) within 180 days of the in-principle approval based on which final approval will be given. The grant-in-aid will be released in four installments. The first three installments will be 30 percent each and the last will be 10 percent of the grant-in-aid.

The selected States will have to complete the parks per the approved DPR within two years of the date of release of the first installment of the grant-in-aid. It is envisaged to have a single-window system in these parks for all regulatory approvals under one roof. The creation of a center of excellence is also envisaged to enable an ecosystem for Research and Development.

The total financial outlay of the scheme is Rs 3,000 crore.

Production Linked Incentive (PLI) scheme for promoting domestic manufacturing of Medical Devices: The scheme intends to boost domestic manufacturing of medical devices in four target segments by giving financial incentives on sales to a maximum number of 28 selected applicants for a period of 5 years. A financial incentive will be given at a rate of 5 percent of the sales of domestically manufactured medical devices. The incentives would be subject to annual ceilings communicated in the approval letter the incentives would be available from FY 2021-22.

Four target segments are:

Cancer care / Radiotherapy medical devices

Radiology & Imaging medical devices (both ionizing & non-ionizing   radiation products) and Nuclear Imaging devices Anesthetics& Cardio-Respiratory medical devices including catheters of Cardio Respiratory Category & Renal Care medical devices

AII Implants including implantable electronic devices

Any company registered in India and possessing a minimum net worth ( including group companies) of Rs 18 crore (30 percent of threshold investment of first year) is eligible to apply for incentives under the scheme. The applicant can apply for multiple products within one target segment as well as multiple target segments. The selected applicants shall have to complete a threshold investment prescribed for each year and achieve a minimum prescribed sale for that year for them to be eligible to receive incentives.

The application window is 120 days from the date of issuance of guidelines and the approval thereafter to the selected applicants will be accorded within 60 days from the date of closure of the application window. The applications will be received only through an online portal. The total financial outlay of the scheme is Rs 3,420 crore.

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Government’s Rs 10,000 crore pharma package to boost manufacturing, reduce import dependence

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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In a bid to boost domestic manufacturing and reduce import dependence, the department of pharmaceuticals late on Tuesday notified two key policies — Production Linked Incentive (PLI) scheme for promotion of domestic manufacturing of critical Key Starting Materials (KSMs)/ drug intermediates (DIs) and Active Pharmaceutical Ingredients (APIs) and scheme for promotion of bulk drug parks.

According to the notification, the PLI scheme for promotion of domestic manufacturing of critical KSMs/drug intermediates and APIs, the government will provide a financial assistance of Rs 6,940 crore. The base year for the scheme will be financial year 2019-20, the notification said.

“The financial incentives shall be given based on sales made by selected manufacturers for 41 products. These 41 products, which cover all the identified 53 APIs,” the notification added.

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The major contours of the scheme are for fermentation based products, incentive for FY 2023-24 to FY 2026-27 would be 20 percent, incentive for 2027-28 would be 15 percent and incentive for 2028-29 would be 5 percent.

For chemical synthesis based products, incentive for FY 2022-23 to FY 2027-28 would be 10 percent. This scheme is applicable only for select greenfield projects and the window for receiving the applications under this scheme shall be open for 120 days.

“The assessment of threshold investment and sales of manufactured products shall be based on details furnished to the departments/ministries/agencies and statutory auditor certificates,” the notification added.

The government has also laid out the eligibility criteria, according to which the support under the scheme shall be provided only to manufacturers of critical KSMs/DIs and APIs registered in India. The eligibility shall be subject to threshold investment in select green field projects and shall not affect eligibility under any other scheme and vice-versa, the notification added.

As per the approval and disbursement process, the government said, “Application under the scheme can be made by any manufacturer registered in India and the initial application, complete in all aspects, shall have to be submitted within the application window. The eligible applications will be appraised and considered for selection. Incentive shall be released to selected applicants, meeting the required thresholds and whose disbursement claims are found to be in order.”

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To monitor the scheme, the government will set up a Project Management Agency (PMA) as the scheme will be implemented through a Nodal Agency. The nodal agency shall act as a PMA and will be responsible for providing secretarial, managerial and implementation support, the government said. “Detailed constitution, functioning and responsibilities of the PMA will be elaborated in the scheme guidelines,” the notification said.

For carrying out activities related to the implementation of the scheme, PMA would be responsible for appraisal of applications and verification of eligibility for support under the scheme, examination of claims eligible for disbursement of incentive under the scheme, compilation of data regarding progress and performance of the scheme including, threshold investment and sales of manufactured goods of applicants selected under the scheme.

An Empowered Committee (EC) will consider the applications, as found eligible by the PMA, for approval under the scheme. “The Empowered Committee (EC) will comprise of CEO, NITI Aayog (Chairman), Secretary, Department of Pharmaceuticals, Secretary, Department of Chemicals and Petrochemicals, Secretary, Department for Promotion of Industry & Internal Trade, Secretary, Department of Commerce, Secretary, Ministry of Environment, Forest and Climate Change, Secretary, Department of Health & Family Welfare and experts may be invited as special invitees, as may be felt necessary, from time to time.

The empowered committee will be assisted by a technical committee of experts constituted by department of pharmaceuticals. This empowered committee will consider claims, as examined and recommended by the PMA, for disbursement as per the laid down procedure and guidelines.

“The EC will conduct a periodic review of the projects of the selected applicants with respect to their investments, employment generation and production under the Scheme. EC will also be authorised to carry out any amendments in the Scheme and the guidelines except revising the incentive rates, ceilings or eligible products,” the notification said.

Detailed constitution, functioning and responsibilities of the EC will be elaborated in the Scheme guidelines, soon by dept of pharmaceuticals.

Meanwhile, the second scheme notified by the government is scheme for promotion of bulk drug parks. Under this scheme, the financial assistance will be provided for creation of common infrastructure facilities in three bulk drug parks proposed by state governments.

Financial assistance to a selected bulk drug park would be 70 percent of the project cost of common infrastructure facilities. In case of North Eastern states and hilly states (Himachal Pradesh, Uttarakhand, union territory of Jammu and Kashmir and union territory of Ladakh), financial assistance would be 90 percent of the project cost.

Maximum assistance under the scheme for one bulk drug park would be limited to Rs 1,000 crore. The total financial outlay of the scheme is Rs 3,000 crore. The tenure of the Scheme is from FY 2020-2021 to FY 2024-2025. The union cabinet in March had approved both these schemes.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow