Penicillin-G Prices Expected To Rise

Worldwide prices of penicillin-G, the principal raw material for a range of antibiotics, are expected to climb up from the third quarter of this year, bringing respite to both producers and consumers in India.

The Indian pharmaceutical industry has been hit worse than its counterparts abroad as domestic controlled prices are higher than worldwide rates.

Indian formulators have had to purchase expensive penicillin-G to make antibiotics, which were uncompetitive in a price control environment.

According to an assessment by U K pharmaceutical analyst Michael Barber & Associates (MBA), penicillin-G prices might go up to 80 per cent of prevailing rates. Prices of intermediates of penicillin-G, called 6-APA and 7-ADCA, from which the final antibiotics are made, are likely to be hiked up to 50 per cent.

 

Infections in the post-monsoon period in the tropics and winter diseases in the west are cited as reasons for the increasing demand.

Industry sources say that the penicillin-G prices might go over the government controlled prices by the year end.

Although the import of penicillin-G is banned, except by some export-oriented units, a sizeable quantity is imported from China and sold in the domestic market illegally.

The fall in international prices resulted in several factories in China closing down shop. Clandestine Chinese exports to India has practically ceased since the last two months, industry sources said.

Indian intermediate manufacturers that produce 6-APA and 7-ADCA for export have huge stocks as they bought cheap penicillin-G and could not sell them as their counterparts in other countries did the same.

The industry expects the intermediates to be sold from the next month or two.

After being higher than the Indian price of Rs 1,025 per kg till mid-1996, international penicillin-G price began falling and is now reported to be around Rs 700 per kg.

In spite of a ban on import of penicillin-G, the actual domestic price has shown a continued fall which has been most pronounced since the beginning of the year.

In the middle of 1995, the government licensed five private sector companies - Max GB, Alembic, Torrent Gujarat, JK Pharma and the joint sector SPIC. Massive quantities produced by these companies to take advantage of the higher Indian price over international rates is cited as the other reason for excess availability.