Laudable move by Pharmexcil

The Pharmexcil came up with clarifications for its members and representations to the government highlighting some difficulties

Last week, the Centre restricted the export of several active pharmaceutical ingredients (API) and formulations made from those ingredients. 

In a laudable move, the Pharmaceuticals Export Promotion Council (Pharmexcil) came up with clarifications for its members and representations to the government highlighting some difficulties. Two weeks ago, the finance minister met several business leaders to get their inputs regarding the disruptions caused by the outbreak of coronavirus in many parts of the world. The pharmaceutical manufacturers said that, besides other problems, almost 70 per cent of the API required for making formulations are imported from China. Disruptions of those supplies will quickly be felt in the availability of drugs in the country. 

So, the latest move to curb exports of some APIs and formulations to meet the essential needs of our people was not unexpected. The transitional arrangements prescribed at Para 1.05 of the Foreign Trade Policy read with Para 2.17 and 9.12 of Handbook of Procedures allow export of goods at the ports/airports/inland container depots awaiting shipment, where shipping bills have been filed and bills of lading or airway bills issued before notification of the restrictions. 

Exporters with irrevocable commercial letter of credit for export of goods can get them registered with the regional offices of the Director General of Foreign Trade (DGFT) within 15 days of the notification of restriction and export. Also, consignments handed over to Customs for examination and subsequent exports before the date of notification will not be held up.  Pharmexcil gave relevant information of the transitional arrangements to its members and said for execution of other orders, exporters have to apply (form ANF-2N) for licence with the DGFT. 

However, exporters say they are unable to upload applications on the website. Also, the basis on which the applications will be considered is not clear.

Clear DGFT guidelines will help. Pharmexcil said some of the orders for institutional supplies mandate supply of all items committed in their contracts. Non-supply of even one item would lead to cancellation of entire order for all other products and result in blacklisting of firms by procurement agencies and imposition of penalties. 

Also, the formulations manufactured for exports in accordance with the requirements of specific countries  cannot be diverted or utilised in the domestic market. 

Even the APIs manufactured with USP/BP specification cannot be utilised for manufacture of domestic formulations, which require compliance with Indian Pharmacopeia as per the requirements of national regulatory authority. Hence, restriction on exports of these manufactured drugs would lead to wastage of drugs manufactured and objective of imposing the restriction (to improve their availability in the domestic market) will also not be met. So, Pharmexcil has requested the government to examine the feasibility of exempting the ‘drugs manufactured for export purpose only’ from the restrictions. 

In FY19, India exported nearly $20 billion pharmaceuticals, about 55 per cent of them to developed countries and 18 per cent to African countries. Most are heavily dependent on India and China for medicines. Unless the spread of virus is quickly contained, its adverse impact can be very severe. 

email : tncrajagopalan@gmail.com