Govt To Probe Diversion Of Imported Penicillin-G

The government has initiated a probe into the diversion of imported Penicillin-G into the domestic market.

The commerce ministry will be conducting the investigations upon a request by the ministry of chemicals and fertilisers. Specified Penicillin-G imports are allowed under the advance licence scheme solely for the purpose of manufacturing antibiotics for export.

Official sources said of the 500-odd tonnes brought in through this route, a large quantity is being diverted to the domestic market by unscrupulous exporters to take advantage of the higher prices.

Recently, domestic Penicillin-G manufacturers MaxGB, Torrent, SPIC and two others had complained to the ministry of chemicals and fertilisers that the diversion had reached alarming proportions and was leading to unsold stocks piling up with them.

 

The sources said the government will re-examine the present scheme of allowing imports even before the fulfilment of the export obligation.

Sources say Penicillin-G from China, which is around 30 per cent cheaper than the domestic product, found a ready market in the domestic Penicillin-G formulators.

After a brief period of price rise, the price of Penicillin-G in the international market has again fallen below $18 (Rs 700).

Apart from the PSU drug companies, the government has allowed five companies to manufacture Penicillin-G. Despite IDPL shutting operations, there is still a glut in the Penicillin-G market.