Indian media: China has solved the urgent need of Indian pharmaceutical industry
"Economic Times" is an English-language daily newspaper in India. It was published in 1961. It is the world's second largest English-language business newspaper after the Wall Street Journal, with a readership of more than 800,000. On July 24, it published an article stating that the supply of raw materials from China has returned to normal, alleviating the concerns of the Indian pharmaceutical industry: since the outbreak of the coronavirus, the Indian pharmaceutical industry has been facing shortages of raw materials and rising costs.
In terms of volume, India is the world's third largest drug producer, and 70% of the active pharmaceutical ingredients (API) used by its drug manufacturers are imported from China. For certain APIs, especially antibiotics, the dependence exceeds 90%.
Industry executives said that API prices are currently in a downward trend. As a result, the cost of most APIs in India has fallen by 20% from the highest level from May to June.
Dinesh Dua, chairman of the Pharmaceutical Export Promotion Committee, said: "Prices have dropped to normal levels and there is sufficient supply."
After the coronavirus outbreak, API producers in China's major industrial provinces (such as Guangdong, Jiangsu, Zhejiang, Shandong, and Fujian) closed their factories earlier this year.
In India, API prices rose sharply in May and June due to reduced supply. For example, the price of paracetamol (the bulk drug used in many formulations) has increased by 27% compared to before the outbreak. The prices of the antibiotics ciprofloxacin and penicillin increased by 20%.
With the current pandemic under control in China, production and supply have returned to normal levels.
Industry experts say that the short-term impact on the Indian pharmaceutical industry is now over. BR Sikri, Chairman of the Federation of Pharmaceutical Entrepreneurs, said:
"The price of paracetamol has reached 425 rupees (about 40 yuan) per kilogram, and it is now 350 rupees (about 33 yuan). Now the supply is very smooth."
Mehul Shah, a pharmaceutical expert familiar with the Chinese industry, said that Chinese suppliers are ready to sign contracts for two to three months. This sign indicates that supply will not be interrupted in the coming months unless the Chinese government changes related policies. He said that Chinese suppliers are also offering credit lines to Indian customers.
Major Indian companies, including Lupin, Sun Pharmaceuticals, Glenmark, Mankind, Dr. Reddy's Laboratories and Torrent all rely on APIs imported from China. According to Pharmaxcil's data, India imported Rs 17.4 billion worth of APIs from China in 2018-19.
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