look news india
The prices of active pharmaceutical ingredients (APIs) used in medicines have been falling for the last several months. Due to which the API sector is suffering huge losses. On the contrary, the margins of drug manufacturers have increased.
Of course, experts in the sector believe that this situation is due to the unfair pricing strategy of Chinese companies. That is, undermining India's production linked incentive scheme from China by pricing the respective goods manufactured in China in such a way that such goods produced domestically in India are at an economic disadvantage. Also, there is a possibility that there will be no stability in API prices in the near future. Prices of key APIs such as paracetamol, penicillin (antidiabetic), sitagliptin (antidiabetic) and telmisartan (antihypertensive) have fallen sharply in recent months.
The price of paracetamol API is currently $4.6 per kg. This represents a 53 per cent drop from its peak. The reduction in price is 31 per cent year-on-year. Similarly, the price of a kg of amlodipine (antihypertensive) has fallen 60 per cent from its peak. The price is currently $64 per kg. The reduction in price is 26 per cent year-on-year. While on a monthly basis, the reduction is 36 per cent, the data showed.
According to the Indian Pharmaceutical Alliance, which heads major pharmaceutical companies in India, such volatility in API prices will continue for some time as the market is dependent on imports. While prices are falling at the moment, prices of essential APIs will rise again in the next few months. It has been specifically noted by industry experts that whenever API production in India increases, Chinese companies resort to unfair or unreasonable pricing. API prices will have to wait for some time to stabilize. The production-linked incentive scheme (PLI) and increased production will help in API price stabilization. But we are still a long way from reducing our dependence on Chinese companies.
An official of the Indian Drug Manufacturers Association also reiterated this and said that the main reason for the fall in API prices in India is the unfair pricing practices observed by Chinese companies. Such efforts are being made deliberately by China to undermine India's PLI scheme. The PLI scheme implemented by the Indian government is to increase domestic production but China is against this scheme. This price pressure will continue for some time.