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Pharma sector in Kerala losing its growth momentum due to unsupportive business climate
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Peethaambaran Kunnathoor, Chennai
September 22 , 2021
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While all other states’ growth index posts strong improvements in their pharmaceutical sector, the consumer state Kerala’s pharma industry sector is continuously losing its growth momentum, resulting in a constant dependence on neighbouring states for its medicine use.
The situation is frustrating everyone in the pharma industry as there is no sign of upward growth either in the number of manufacturing units or in the turnover of business by the very few players engaged in pharma manufacturing, according to major industry and supportive associations.
In a period of 30 years, unlike the developments in other states, about 100 manufacturing companies closed down their production units and stopped operations due to negative and unsupportive business climates in Kerala. The leftover small scale units find that the pharma industry in all other states is galloping to higher levels of growth, but the private and public pharma industry sector in Kerala is not only declining but also slowing down to the brink of extinction. The associations KPMA and KPGA have taken this as a subject of concern and decided to hold discussions with all stakeholders before taking it up with the government, says Purushothaman Namputhiri, president of the Kerala Pharmaceutical Manufacturers Association (KPMA).
According to Mathew Kokadu, spokesperson of Kerala Pharmacy Graduates Association (KPGA), it is high time for the industry and also the government to ponder over the situation and find ways to save the industry from complete deterioration. He said the government does not see the potential of the pharma industry in Kerala where 56 pharmacy institutions bring out 3,000 pharmacy graduates every year and which is pioneering in many areas including healthcare facilities, but not in pharma manufacturing. In the 1980s, Kerala had a total of 120 very active pharmaceutical manufacturing companies producing adequate pharma products for the state, whereas the number came down to mere 20 in the year 2018, which is again decreasing year after year.
According to KPMA and KPGA, the total production of these 20 SME units is worth around Rs. 150 crore, but the consumption of medications in the whole state is estimated to be about Rs. 10,000 crore. This shows that Kerala produces less than 1.5% of its total requirements. They feel that this is the right time for the government, industry and the professionals in the pharmacy field to deliberate on the necessity of a corrective measure to make Kerala self-sufficient in its medication production by providing proper support to the industry sector. A total revamping is required for the entire pharma sector in the state, says Mathew Kokadu, spokesperson of KPGA.
“Kerala pharma industry has a track record of about 70 years. In the 1960s, the number of industries gradually started to increase, in the early 1990’s the number of units rose to 120. Then suddenly, it began to decline gradually. Today the number of active units is less than 20 with viable units less than 10. The total production is worth less than Rs.150 crore. This is surprisingly an alarming situation for the state where total consumption of medicines is above Rs.10,000 crore and an average per capita consumption is three fold compared to the national average,” says Kokadu who is also the managing director of Kokadu pharmaceuticals.
The associations plan to hold a stakeholders’ meet very soon to think of immediate remedies to strengthen the existing manufacturing units, attract new investments and tie-up with big pharma houses for contract manufacturing, establishment of pharma clusters/pharma parks for the growth of the industry sector. Along with, new industries on APIs and KSMs (key starting materials) and allied pharmaceutical industries should be set up, said Purushothaman Namputhiri.
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