New U.S. rule a blow to Indian pharma exporters
Local manufacture of ingredients made mandatory
 The government will first try to resolve the issue bilaterally, failing which, it will consider
approaching the World Trade Organisation’s dispute settlement panel, say sources
In a move that will further inflate prices of drugs in the United States — already a burning issue in the current presidential campaign — the U.S. government has made it mandatory for Active Pharmaceutical Ingredients (APIs) to be manufactured locally. At present, nearly 80 per cent of drug raw material requirement is met by India or China.
The decision has already sent Indian pharmaceutical exporters into a tizzy, as it will significantly impact Indian drug exports. Before the new norms came into effect, U.S.-based companies were allowed to procure APIs from countries like India and China, make the fixed formulations (final product) in the U.S. and sell the drugs to the U.S. government.
Pharmexcil — India’s pharmaceutical Export Promotion Council — has approached the Commerce Ministry, requesting authorities to intervene and resolve the issue. The issue comes at a time when Indian API exports have been slowing down. Commerce Minister Nirmala Sitharaman said, “Pharmaceutical exporters raised concerns on restrictions in the U.S. regarding APIs. India will take up this issue [with the U.S.].” Sources said the government would first try to resolve this issue bilaterally, failing which it would consider approaching the World Trade Organisation’s dispute settlement panel.
“Sourcing of APIs is done according to the DMF — Drug Master Files — which means APIs will have to be registered with the U.S. Food and Drug Administration,” said P.V. Appaji, Director-General, Pharmexcil. “For [U.S.] government purchase of medicines, they [U.S.] prefer local companies. That was alright because many [Indian] companies have subsidiaries in the U.S. now.
Local manufacture of ingredients made mandatory
 The government will first try to resolve the issue bilaterally, failing which, it will consider
approaching the World Trade Organisation’s dispute settlement panel, say sources
In a move that will further inflate prices of drugs in the United States — already a burning issue in the current presidential campaign — the U.S. government has made it mandatory for Active Pharmaceutical Ingredients (APIs) to be manufactured locally. At present, nearly 80 per cent of drug raw material requirement is met by India or China.
The decision has already sent Indian pharmaceutical exporters into a tizzy, as it will significantly impact Indian drug exports. Before the new norms came into effect, U.S.-based companies were allowed to procure APIs from countries like India and China, make the fixed formulations (final product) in the U.S. and sell the drugs to the U.S. government.
Pharmexcil — India’s pharmaceutical Export Promotion Council — has approached the Commerce Ministry, requesting authorities to intervene and resolve the issue. The issue comes at a time when Indian API exports have been slowing down. Commerce Minister Nirmala Sitharaman said, “Pharmaceutical exporters raised concerns on restrictions in the U.S. regarding APIs. India will take up this issue [with the U.S.].” Sources said the government would first try to resolve this issue bilaterally, failing which it would consider approaching the World Trade Organisation’s dispute settlement panel.
“Sourcing of APIs is done according to the DMF — Drug Master Files — which means APIs will have to be registered with the U.S. Food and Drug Administration,” said P.V. Appaji, Director-General, Pharmexcil. “For [U.S.] government purchase of medicines, they [U.S.] prefer local companies. That was alright because many [Indian] companies have subsidiaries in the U.S. now.
