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GYRATING PRICES OF API

Ramesh Shankar
Wednesday, June 30, 2021, 08:00 Hrs  [IST]

Recently, there were reports that the drug industry in the country is in deep crisis as the prices of APIs have skyrocketed since the second wave of Covid-19 pandemic hit the country in March this year. The steep rise in prices of raw materials over the last some months in the wake of their short supply has hit drug makers who are hard pressed to meet increased demand for pharmaceutical products amid the second wave of the pandemic.  The drug manufacturers in Baddi in Himachal Pradesh, touted as Asia’s biggest pharmaceutical hub, are the worst hit by the steep rise in the prices of APIs and packaging materials as these drug units, which produce several primary life-saving, anti-inflammatory, anti-viral, and Covid-19 drugs, are dependent on China for around 85 per cent of their API demand. Since the outbreak of Covid-19, there has been a decline in the import of APIs from China, leading to its short supply in the domestic market. The shortage and the uncertainty in the raw material supply resulted in their prices skyrocketing in the domestic market. Besides APIs, rates of all packaging materials have also gone up sharply. The abrupt rise in API prices since the second wave of the pandemic has made it unviable for drug manufacturers, especially the MSMEs, to continue production. In fact, the manufacturers are in a real quandary as they cannot increase the prices of the drugs since the prices of the drugs manufactured using these APIs are regulated under the drug price control order.

The kind of price rise can be gauged from the price of Covid-19 drug Favipiravir which has seen almost five fold jump from Rs. 19,000 a kg to Rs. 81,000 a kg, all in a matter of couple of months. There are several key APIs witnessing a steep rise in prices from March to April, 2021. The price of Ivermectin has also gone through the roof from Rs. 18,000 a kg in March to Rs. 54,000 a kg in April. The price of Methylprednisolone sodsuccinate has zoomed 124 per cent to Rs. 1.9 lakh a kg in April from Rs. 85,000 per kg. The price of Meropenam has jumped 72 per cent to Rs. 1.4 lakh a kg in April from Rs. 81,000 per kg in March. Likewise, Doxycycline has also witnessed 60 per cent rise in price as it rose to Rs. 12,000 a kg from Rs. 7,500 a kg. The price of Pipratazo spurted by 50 per cent to Rs. 10,000 a kg from Rs. 6,700 a kg. The price of Enoxaparin has recorded a 47 per cent rise. It has gone up to Rs. 25 lakh a kg from Rs. 17 lakh per kg. The price of Paracetamol has jumped 45 per cent to Rs. 800 a kg from Rs. 550 a kg. The price of Azithromycin has also increased 30 per cent to Rs. 12,300 a kg from Rs. 9,500 a kg during this period. The recent case of price rise of APIs is not a case in isolation in the country. In fact, the pharmaceutical industry in the country has been witnessing this kind of price fluctuation quite periodically. Though the government is seized of the issue and it has already taken some initiatives to boost the domestic production of APIs, it is not enough to control the prices in the domestic market. It should seriously think of setting up an API Monitoring Cell. It will ensure stability of API prices in the domestic market in future.

 

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