Medicines likely to cost more

The prices of certain medicines, including vitamin B complex, are set to rise following certain changes in its export policy by China, according to sources in the pharmaceutical industry. The sources say China has recently decided to either withdraw or reduce incentives on the export of about 300 items, Medicines likely to cost more.including basic drugs used as raw material by the Indian pharmaceutical industry.

Though the Chinese authorities have made known their intention to withdraw or slash the sops sometime back, the decision has become effective from July 1, the sources say.

The price of riboflavin, used in a wide range of vitamin preparations, is being quoted at Rs 5,000 per kg in the market today as against Rs 1,000 a kg just two months ago.

The sources say as a result of unprecedented rise in the price of riboflavin several brands of multivitamin tablets will become costlier in the coming days. The major reason for the sudden spurt in price is the steep shortfall in supplies from China. They say the production of riboflavin in that country has gone down after the Chinese government enforced stricter environment and anti-pollution measures.

The Indian pharmaceutical industry has been importing active pharmaceutical ingredients (APIs) from China because many of them were about 15 per cent cheaper than those produced in India. Even many Indian API manufactures depended a lot on raw material from China, as it was much cheaper than what it costs in India.

Besides the raw material, certain types of pharmaceutical machinery like the ALU-ALU blister packing machines from China were also favourite with Indian manufacturers for its lower costs. The cost of such machinery was 25 per cent to 30 per cent lower than that in the Indian market.

Dr Sunil Sethi, managing director-cum-CEO of Sanchez Pharmaceutical, Tohana, who is also setting up a unit at Baddi in Himachal Pradesh where tax concessions are very attractive, says the recent developments will not only hit the pharmaceutical industry badly but will also make the drug formulations dearer.

Dr Sethi, who has recently come back after attending a pharmaceutical expo at Shanghai, says the move has disappointed the Chinese drug industry and it will affect the export of bulk drugs and intermediates from that country.

He says though it is not possible to assess the exact fall out of the development at this stage, but the Indian pharmaceutical industry will have to bear 10 per cent to 15 per cent extra cost on inputs.

The price of an ALU-ALU blister-packing machine from China starts from $ 15,000 while in India its price starts from Rs 10 lakh. Similarly, an automatic capsule-filling machine with an output of 1,200 capsules per minute is available for $ 20,000, which is equivalent to the cost of a semi-automatic machine in India.