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Even though the Indian on foreign sources for both nation’s
pharmaceutical industry faced several pharmaceutical supply chain and
backlashes in the last two years, the achieve affordable medicine resilience.”
country continues to consolidate its “The time has come to restore
position as the pharmacy to the world. balance and build resilience in
In fact, India exported drugs and these critical networks. This is not
pharmaceuticals worth $28 billion in merely prudent – it is crucial,” said
FY2023-24, an increase of 10 percent Sharvil Patel, vice president, IPA
from the previous financial year, and managing director of Zydus
according to the Ministry of Commerce Lifescience.
& Industry. Also, in FY23-24, Indian In fact, an April 30, 2024 analysis
pharmaceutical exports expanded from IIFL Securities reported that
their global footprint to countries export-focused Indian generic
like Montenegro, South Sudan, Chad, companies are likely to benefit from the
Comoros, Brunei, Latvia, Ireland, situation of drug shortage in the US.
Sweden, Haiti, and Ethiopia while the “Our analysis suggests that among
top markets for Indian pharma exports the Indian generic players – Aurobindo,
were the US, the UK, the Netherlands, Sun Pharma and Gland Pharma have
South Africa, and Brazil. the highest exposure to products under
The United States of America, which shortage in the US,” it reads.
accounted for over 31 percent of the However, the supply chain that
country’s pharma exports in FY223-24, supports the exports of Indian
has been recently reporting historically pharmaceuticals is met with several
high levels of drug shortages. Even disruptions including long transit times
though there are several factors due to geopolitical issues in the Red
affecting the shortages, one of the Sea and high airfreight rates due to
important factors is the supply chain increased demand.
disturbances. In fact, in April 2024, the For instance, Pratyush Kumar,
U.S Department of Health and Human senior general manager, demand
Services produced a white paper on planning and logistics excellence,
“policy considerations to prevent drug Glenmark Pharmaceuticals, informed
shortages and mitigate supply chain that both the US and Europe routes are
vulnerabilities in the United States.” affected very badly.
The white paper points out key issues “The sea freight transit time for
including a broad lack of transparency, Europe has gone up from 24 to 45 days,
n April 30, 2024, India's concentration among middlemen, which is almost double. The rates have
central regulatory body for and prices for generic drugs that are also gone up along with the increase
pharmaceuticals Central driven to levels so low that they create in nautical miles. Thus it has become
ODrugs Standard Control insufficient incentives for redundancy unviable to send our products by sea.”
Organization (CDSCO) withdrew the or resilience-oriented manufacturing, To keep the inventory intact in their
power of state governments to issue distribution, and purchasing. target markets and make sure that
no-objection certificates (NOC) for It reads. “These market failures lead there is no shortage, airfreight is the
manufacturing unapproved, banned or to pharmaceutical supply chains that only other option. However, airfreight
new drugs for export purposes. are brittle, disruption-prone, and too rates have also gone up forcing
This comes after Indian slow to recover from shortages.” pharmaceutical companies to take
pharmaceutical companies came On April 30, 2024, The United States the hit on their margins, which has
under international scrutiny for Food and Drug Administration (FDA) been already shrinking for the generic
exporting adulterated drugs, Commissioner Robert Califf met with pharma industry.
particularly cough syrups sold the Indian Pharmaceutical Alliance He also pointed out that the crisis
in Gambia and Uzbekistan which (IPA), comprising 23 Indian generic has also changed the percentage
also caused the deaths of several pharmaceutical companies, to discuss of pharma sent by each mode of
children. There were also instances advancing drug quality in India. transport. “On the Europe lane, we
of big pharmaceutical manufacturers The IPA wrote the purpose of used to send 40 percent by air and 60
recalling their products due to the meeting as “to urge a US-India percent by sea. Right now I’m sending
manufacturing defects. trade partnership to reduce reliance 85 percent by air.”
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