Rising API prices to hit drug firms' profit by 300-500 bps in 2-3 quarters

In the past few months, the prices of APIs from China have gone up in the range of 15-80 per cent, amid a crackdown by the local government on industries allegedly polluting the environment

Increasing prices of active pharmaceutical ingredients (APIs) from China are likely to hit the margins of Indian pharmaceutical companies. According to India Ratings and Research (Ind-Ra), this could hit the operating profit margins of the domestic pharma companies by as much as 300-500 basis points in the next two-three quarters of the current financial year.

APIs are key raw materials used to manufacture pharmaceutical formulations like tablets, capsules, and syrups.

In the past few months, the prices of APIs from China have gone up in the range of 15-80 per cent, amid a crackdown by the local government on industries allegedly polluting