Approvals not coming, pharma production takes a beating

BADDI: With export-oriented units (EOUs) of the Baddi-Barotiwala-Nalagarh (BBN) area facing problems in availing approvals from the US-based Food and Drug Administration (FDA), the production activities in several such units have been unduly delayed.

Ambika Sharma

Tribune News Service

Baddi, January 14

With export-oriented units (EOUs) of the Baddi-Barotiwala-Nalagarh (BBN) area facing problems in availing approvals from the US-based Food and Drug Administration (FDA), the production activities in several such units have been unduly delayed.

Several pharmaceutical units in the BBN had switched over to exports after major incentives of the Centrally-sponsored industrial package had lapsed. This step was taken by the units as EOUs are exempted from Central excise and allows them to pocket larger profits.

Since Central excise exemption was a major attraction, its discontinuation had forced the units to either shift their products to their sister concerns in other states or switch over to exports.

But with the US FDA acquiring a tough posture in giving approvals for manufacturing of various drugs, the units banking on exports are now unable to begin production.

Head of a major EOU based in Baddi said they had not only constructed a new plant to cater to the exports but had also invested Rs 70 crore in meeting the high-end requirements of an EOU catering to the US FDA. But despite fulfilling these requirements, the approval was yet to come through.

This had not only put their investment on hold but was economically weighing heavy on their unit as they had availed loans worth crores to set up such facilities. Since the US FDA visited the plant after two years to conduct a subsequent inspection, the plant had failed to initiate any operation on this facility, he added.

He, however, said they were proposing to shift some products from the existing plant.

Experts in the industry opined that international drug regulatory authorities had adopted a stringent posture in according approvals to the Indian pharmaceutical companies as few cases of drugs not confirming to their standards had come to the fore and they had detected violation of norms in the manufacturing facilities.

The BBN area houses nearly 350 pharmaceutical firms and has earned the sobriquet of being the pharmaceutical hub of Asia where renowned groups like Ranbaxy, Torrent, Panacea Biotech, Cadila, Cipla, USV, Glenmark, Alkem, etc have their units.