Drugs ban: Gujarat firms stare at Rs 1,000 crore loss

Around 400 companies in the state said to have been hit by the ban, its Food and Drug Control Administration informed

While only less than 1% of the pharmaceutical products manufactured in Gujarat, a state which roughly accounts for 35-40% of India's pharma production, have been hit by the latest ban on 344 fixed dose combination (FDC) drugs, industry feels that the immediate impact is not less than Rs 1,000 crore.

Around 400 companies manufacturing have been impacted by the Centre's latest ban on 344 FDCs, and about 2,000 products have come under the ban, informed H G Koshia, commissioner of the Gujarat Food and Drug Control Administration. 

“There are 2.25 lakh product manufacturing licenses in Gujarat obtained by around 2,250 registered pharma companies. Going by this, less than 1% of the drugs manufactured in Gujarat have been affected as such," Koshia claimed.

 

However, representatives of the pharma industry in the state said that the calculations need to be based on how much of these drugs that are now banned are in some stage of distribution. Viranchi Shah, vice-chairman of the Gujarat State Board of the Indian Drug Manufacturers' Association (IDMA) explained, "The industry standard is that nearly four to five months of goods are in some stage of distribution; be it at the company's warehouse, with the wholesaler or the retailer.”

Shah does some quick calculations to show that while the impact at a national level is estimated to be around Rs 6,000-7,000 crore, going by the four-month rule, the money which is immediately lost would be to the tune of Rs 2,000-2,500 crore. 

“Since Gujarat accounts for nearly 35-40% of the nation's drug production, we can safely assume that around Rs 900-1,000 crore worth of products have been impacted," he claimed. FDCs are essentially those medicines that come mixed in a certain proportion, or more simply put, a combination of two or more drugs in a single pill. While the idea is to benefit the patient in terms of faster recovery, many experts also feel that some therapeutic groups when clubbed together may lead to drug resistance.

The state FDCA, on its part, has started preparing a list of the drugs and its manufacturers that have come under the ban. Koshia, however, informed that they are not yet rushing to take action as many manufacturers have moved court, and they are waiting for more clarity on the issue.