India's pharmaceutical industry reflects on its reliance on China in hopes of regaining global API dominance

Sort out the . . An outbreak of Chilin-Pepper has changed the situation in the whole world, and the hidden contradictions have quickly surfaced.
is increasing global attention to supply chains, especially those for life-threatening pharmaceutical products, and India is no exception.
under the general trend, confidants know each other and plan ahead in order to achieve snoopathy, timely adjustment, reasonable response.
Recently, Forbes India published a special report detailing the Indian pharmaceutical industry's reliance on Chinese API and discussion of the current state and solutions of the API industry in India, citing an in-depth analysis published in April by KPMG and the Confederation of Indian Industry, which analyzed comparative studies of the API industry in India, China and India, and made recommendations on measures and actions that the Indian government and industry need to take.
let's take a brief look at the main content of this article.
India's pharmaceutical industry imports nearly 70% of APIs from China and APIs from the United States (4%), Italy (3%), Singapore (2%) and Hong Kong (2%).
India accounts for 20 per cent of the world's generics and meets more than 60 per cent of global demand for vaccines and antiretroviral drugs.
Indian generics meet 25% of the UK's demand for drugs and a third of the US's demand for solid oral generics.
india's API imports have been growing, despite the strength of the industry.
india's pharmaceutical industry began decades ago, when multinationals controlled two-thirds of india's pharmaceutical market in the early 1970s.
India created a number of companies that produced APIs.
the early 1970s, India amended the Patent Act to abolish product patents, making it available to the Indian pharmaceutical industry to produce and sell almost any drug internationally available in India.
this provides the basis for Indian pharmaceutical companies to move from API to finished, complex generics and biosimilars.
, but there are also problems, including the U.S. FDA's beatings and penalties for GMP deficiencies and data reliability deficiencies at some Indian plants, as well as some major corporate governance scandals.
the 1990s, as China began to invest in pharmaceutical capacity, it began to dominate the API market.
Dr Reddy's Chairman and President of the Indian Pharmaceutical Alliance (IPA), Satish Reddy said, "As soon as China enters the API market, it can quickly achieve better cost structures through government funding, tax incentives and economies of scale."
Sanjay Singh, partner, trading consultant and head of life sciences at KPMG India, said: "China is the first to encourage and help the API industry by providing economic incentives and building large factories, which makes it much cheaper for Chinese drugmakers than Indian drugmakers, especially in bulk and fermentation products.
this point, Indian companies began to shift from APIs to focus on finished preparations.
"Today's Indian API drugmakers include Dr Reddy's, Aurobindo Pharma, Cipla, Sun Pharma, Lupin, and Ranbaxy in a highly fragmented industry.
pandemic has prompted a rethink of India's pharmaceutical industry's dependence on Chinese imports.
is re-examining its dependence on a single source of imports," said Sudarshan Jain, secretary-general of the IPA.
indian pharmaceutical industry has also been hoping to revive the bulk of the API industry over the past few years.
this requirement with COVID-19 and provides the driving force for the development of a new API or KSM (Key Starting Material) policy.
" Indian Prime Minister Naodi announced a 994 Indian rupee ($1.3 billion) stimulus package on March 21st to reduce dependence on Chinese API and boost API domestic production in India over the next eight years.
plan will cover 53 key APIs and KSMs that India currently relies heavily on for imports, and will establish three API parks over the next five years.
, however, the Indian pharmaceutical industry says it will need more resources to make APIs self-secissive.
Cipla Executive Vice Chairman Samina Hamied said, "The production of low-cost API in India requires strategic initiatives that can only be achieved through a support policy that makes API production in India a viable option."
must provide sustainable production-related incentives on a larger scale;
' view is also reflected in a report published by KPMG and the Confederation of Indian Industry (CII) in April 2020 entitled "India's API Industry - Reaching Its Full Potential".
report notes that while India's strengths lie in world-class technical capabilities, a strong chemical industry, a skilled workforce and high quality and production standards, its challenges include inadequate support for infrastructure, utilities and research and development, inadequate government support and multi-level regulatory agencies, high financial costs, and delays in land expropriation and environmental clean-up.
Hamied added, "The measures taken by the government to promote domestic production of key API are undoubtedly a step in the right direction."
, but much more needs to be done, especially in providing tax aid and expanding the list of molecules.
addition to these requirements, Reddy has increased the demand for uninterrupted and low-cost supplies of utilities, as well as policy support in the form of licensing renewals and capital subsidies.
"For the pharmaceutical industry, loan rates are generally high and short terms are short."
governments must develop similar infrastructure regulations.
first, you can borrow from insurance companies (and other funds) for longer periods and at lower interest rates, and second, you can borrow foreign exchange through external commercial lending.
, secretary-general of the IPA, also believes that giving the pharmaceutical industry a position in the infrastructure sector will help to provide credit at competitive interest rates over the long term and raise limits.
"India needs to build an ecosystem to support the development of the domestic API industry," he said.
," he said, which is the ecosystem China has created through subsidies, low-interest loans and tax-free periods.
costs in China are 4 to 5 per cent, while in India they are close to 12 to 14 per cent.
china also ranked higher in the World Bank's convenience business rankings, jumping from 46th place in 2018 to 31st place in 2019, while India rose from 77th to 63rd.
, it takes about a year to build a plant in China, and in India it takes about three years or more to build an API production plant," KPMG-CII said in the report.
"China has added the modern medical and pharmaceutical industries, including those that provide raw materials for the production of cell therapy drugs and large-scale cell culture products, to its list of industries that encourage development," the report adds.
these industries are 15% lower, compared with 22% in India.
api market is another matter than competing in the global API market compared to mass production APIs for the domestic market.
U.S. and European pharmaceutical giants are also looking at the field.
, a former leader in the U.S. camera and imaging industry, received a $765 million U.S. government loan to produce APIs and intermediates for generics.
factors contributing to the current situation in India's API industry is the highly decentralized administration of the Indian pharmaceutical industry.
KPMG-CII reports, there are about 1,500 plants in India that produce APIs.
" fiscal year 2018, the top 14 to 16 companies, including large preparation companies, accounted for only 16%-17% of the total market share.
in addition to serving the semi-regulated and domestic markets, most large and medium-sized enterprises are also exported to lucrative regulatory markets.
other small and medium-sized enterprises are mostly exported to semi-regulated markets and operate in a competitively priced domestic market.
," says Jain, "countries and regions such as India and China produce low-cost, bulk API, while Europe and the United States produce powerful, proprietary APIs."
pandemic has undoubtedly demonstrated the need for self-sequestrage, but collaboration approaches are equally critical.
through strategic partnerships and partnerships, India can become a world leader in APIs: production-critical and dedicated APIs.
Singh, of KPMG, says there is no quick solution to regain India's status as an API producer: "Regaining its position in the API industry and being more resilient to China or any other country in the future requires relentless effort."
the pharmaceutical industry and the government should work together.
" Reddy also believes the industry needs to come together to achieve a shared vision.
all stakeholders in the value chain (governments, companies and ancillary industries) need to work together to promote development in this area and ensure cost competitiveness.
only in this way can India become a global leader in the API world.
" new crown outbreak, as the global situation and political attitudes shifted, india's pharmaceutical industry believes the time has come for other countries to choose India as an alternative source of low-cost imports.
rekinding India's API industry is critical, and the time is ripe for us to turn to self-reliance, " says Mr Reddy.
that, the main competitive advantage in the API world is cost.
"Over the next decade, we will have to work with the government to increase our production capacity, invest in new technologies, increase automation, and leverage digital capabilities to increase efficiency," reddy said.
only then can we continue to produce large quantities of APIs in a cost-effective manner to build and maintain leadership.
, he added , India will need strong capabilities in biosynthics , proprietary products and new technologies over the next 10 to 15 years .
"We must create a vibrant innovation ecosystem that ensures the availability of funds through government funding and venture capital to promote innovation and promote collaboration or sharing of ideas among start-ups, universities, and companies."
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