Unable to upgrade, 144 pharma units in Himachal Pradesh close operations

Ambika Sharma

Solan, July 16

As many as 144 micro, small and medium enterprises (MSME), 36 per cent of the total 400 units, in the pharmaceutical sector had closed their operations in the state by June end due to their failure to upgrade to new Schedule M norms in the absence of adequate funds.

New norms will burden investors

The MSMEs support quality but adopting the new Schedule M norms within a year will burden investors with Rs 5 crore to Rs 10 crore investment to make the required changes by December 31 at a time when they are still to repay loans secured during the Covid breakout period. — Dr Rajesh Gupta, President, Himachal drug manufacturers association

The Central Government had granted a year’s time to them to upgrade to the revised Schedule M stipulations, which are considered more stringent than the World Health Organisation Good Manufacturing Practices (WHO-GMPs). The deadline to upgrade expires in December end.

The Laghu Udyog Bharti and the Himachal Drug Manufacturers Association (HDMA), a conglomerate of more than 500 pharma entrepreneurs, had sought two years’ time for upgrade but the government had not obliged them till now.

“The Schedule M upgrade requires a minimum investment of Rs 5 crore to Rs 10 crore depending upon the size of the unit and the operational cost. As per the industry estimates, this cost can translate into minimum Rs 40 lakh to Rs 1 crore per month for fulfilling various regulatory parameters,” said Dr Rajesh Gupta, President, HDMA.

He added that many entrepreneurs, who had adopted WHO-GMPs, were also on the verge of closure as they no longer had to make a one-time investment but were facing an incremental increase of crores of rupees in the operational cost.

Gupta claimed that 144 units comprising 36 per cent of the total 400 MSMEs in the state had closed down up till June end and this number could rise. “The MSMEs support quality but adopting the new Schedule M norms within a year will burden investors with Rs 5 crore to 10 crore investment to make the required changes by December 31 at a time when they are still to repay loans secured during the Covid breakout period,” he said.

The Central Government has enforced the revised Schedule M norms to improve the quality of drugs manufactured in the country, especially in light of the cases of substandard and spurious drugs bringing disrepute to the nation. The consumption of an adulterated cough syrup had led to the death of 20 children in Gambia and similar cases were reported from Uzbekistan last year.

One of three drugs produced in the country is manufactured in Himachal in various industrial clusters like Baddi-Barotiwala-Nalagarh, Parwanoo, Kala Amb, Paonta Sahib, Solan, etc. In Himachal, out of 655 pharma units, 255 are WHO-GMP certified and also have European Union-GMP and other international certifications like from the USFDA. The remaining 400 units working under the existing Schedule M rules are supposed to upgrade as per the revised GMP norms till December end or else could face closure as well.