Pharmaceutical majors feel neglected

The pharmaceutical industry chieftains in Gujarat, who hold a majority stake in the country's total revenue generation from the industry, believe that the sector was neglected by P Chidambaram, the Union finance minister in the Budget.

The industry also feels that the agriculture sector overshadowed the pharmaceutical sector and it all happened when the industry is set to take up challenges after the patent regime expires by the end of this year.

"The exemplary work done by the Indian pharmaceutical industry has totally missed the attention of the finance minister. The pharmaceutical Industry today is growing at a great pace and making deep inroads into the developed countries. The government is aware that from 2005, the existence of the industry will largely depend on research," said I A Modi, chairman of Cadila Pharmaceuticals Ltd.

Modi said, "Pharmaceutical research should have sufficient funds to develop drugs through non-infringing processes where the Indian pharmaceutical Industry has made commendable achievement. A large number of molecules have already been registered in the developing countries. The industry has been in need of research funds due to the drug price control order. The finance minister should have paid enough attention to remove hurdles posed by the order."

The Mashalkar Committee set up by the government had submitted a report to overcome the research fund crisis of the pharmaceutical industry. But no action has been taken on the report so far.

"We expected that the finance minister would propose measures to strengthen the efforts of this knowledge-based industry which has been substantially contributing to the country's revenues. The industry will have to face stiff competition from companies in the developed countries where various government agencies have been extending support to pharma firms for research. Surprisingly, this Budget does not have any much provision for the industry," said a senior member of the Indian Drug Manufacturers' Association (IDMA).

Kamlesh Udhani, executive director of J B Chemicals and Pharmaceuticals Ltd, said, "Pharmaceutical is a high growth-oriented industry and the industry was expecting renewal of incentives under provisions of the Income Tax Act to avail of exemption on profits earned from exports."

The industry also demanded incentives on upgradation in small and medium sectors to increase competitiveness but there is no mention about this in the Budget.

Udhani said, "Incentives declared for biotechnology will give boost to research and development."

Nayan Rao, director of Claris Life Sciences Ltd, said, "Research and Development oriented units should have given some more incentives to increase competitiveness of small units against industrial giants."