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Peethaambaran Kunnathoor, Chennai December 28 , 2020
Demanding a change in procurement policy, the drug makers in Madhya Pradesh wanted the state government to provide maximum support to the domestic players who supply to the government requirements of other states, but not able to supply to the requirements of their own state.
According to industry sources from MP, when the government agencies and stockists of other states purchase medicines manufactured by the small and medium scale pharma enterprises (MSMEs) of MP, the state government agencies in the state seem to be turning averse to the products produced by the domestic companies. They are incapable in taking part in the tender process of the state government.

Only a few of the domestic companies in Madhya Pradesh are taking part in government tenders and majority of them are kept away from the tendering citing noncompliance of WHO-GMP norms, alleges Himanshu Shah, president of the MP Small-scale Drugs Manufacturers Association (MPSDMA).

“They are issuing manufacturing licences, but they don’t procure medicines from us”, he says.

“Majority of us cannot supply to the government’s requirements. A few major players are only the participants in the tenders. Government is unwilling to procure medicines from domestic companies. They argue that we do not comply with WHO-GMP norms. We are all GMP-complied. But we supply to the government requirements of other states. If our government doesn’t want our products, why do they license our companies for production,” he asks.

The MP industry leader says, “Day by day the government is imposing several amendments. The SSIs cannot afford all the requirements of the government with regard to drug production and marketing. All the amendments require a huge amount of investments. Only the few major players in the state can cope with them, but the medicinal requirement of the people in any state is met by the contribution of small and medium enterprises (SMEs). The authorities have to understand this fact”.

Going back, Himanshu said, two decades ago, MP was a promising destination for all pharmaceuticals and APIs for the entire nation. It was a perfect ‘pharmaceutical manufacturing hub’ with strength of more than six hundred companies. Today, the number has gradually dwindled to 150 from the earlier six hundred.  Except eight major companies with WHO-cGMP, all the other existing units come under the SSI categories.

He says there are some underlying causes for the decline of the industry. The industry’s technology upgradation in production facilities to GMP status and the occasional amendments in the regulatory norms by the central and state governments were major hiccups for the growth of the sector. The financial status of most of the manufacturers was not viable for elevating their facilities into the global standards. This had forced many units to close down their operations. Correspondingly, some states in the northernmost part of the country designated tax free zones for pharma enterprises and exempted them from state sales tax. Seeing these as promising destinations, a good number of manufacturers from Madhya Pradesh moved their manufacturing base to the SEZ areas in the north. Accordingly, the number of domestic players in MP has come down.

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