Why are experts worried?
The government is taking new steps to keep the raw materials of essential medicines cheap and safe, but experts in the pharma industry are fearing that it may have adverse effects. Experts say that setting Minimum Import Price (MIP) on some important pharmaceutical inputs may increase the burden on common patients and may also affect the government drug procurement system.
An ET report said that the government is considering implementing minimum import price on Penicillin-G. Also, it can be extended to other essential inputs like 6-APA and amoxicillin. These medicines are used in making antibiotics on a large scale in the country. The aim of the government is to stop cheap imports and dumping from China, so that domestic manufacturing can be supported.
Why are experts worried?
According to an ET report, pharma experts say that Pen-G is not a single product, rather it is the ‘mother molecule’ of many essential antibiotics. The medicines made from it are used on a large scale in government hospitals and primary health systems. If a price floor is imposed on this, the cost of dozens of essential medicines will automatically increase.
They believe that taking such a decision without solid evidence could increase the prices of medicines, especially for those who depend on government schemes.
Government tenders also affected
Experts say that government drug tenders already run on very low margins. At current prices, states purchase amoxicillin and related medicines worth thousands of crores of rupees. If the cost of raw materials suddenly increases, many suppliers will go into loss. This may increase the risk of cancellation of tenders, re-bidding and delay in supply of medicines.
Reality of domestic production
Although the government wants to promote domestic manufacturing, the truth is that the current production capacity of the country is much less than the requirement. India still imports Pen-G and 6-APA in large quantities. In such a situation, strictness on imports may lead to shortage of supply, which will have a direct impact on the patients.
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PLI scheme and new risk
In 2020, the government started the PLI scheme to reduce dependence on China. But experts say that if high MIP is also imposed along with PLI, then it can become a permanent security cover. This will reduce the pressure on companies to reduce costs and increase production, while passing the burden directly on patients and government budgets.
what could be the solution
Industry experts believe that it is necessary to strengthen the domestic structure, but for this a balanced approach will have to be adopted. He says that instead of fixing prices, focus should be on increasing production capacity, operational improvements and increasing scale, so that essential medicines remain affordable and supply is also maintained.