Pharma Industry Worried Over Chinese Supply Disruption

The second wave of Covid-19 in India has made need for pharmaceuticals more than important than ever.  However, India’s pharmaceuticals industry is concerned that the recent disruption due to Chinese logistic carrier might create a problem in deliveries. 

Chinese carrier Sichuan Airlines’ cargo services might be seriously hit. This will hit Indian imports of key raw materials. They have now appealed to the Indian envoy to help find a solution. The service provider is suspending their service to India for a period of 15 days. 

Pharmaceuticals Export Promotion Council of India (Pharmexcil) director general Ravi Udaya Bhaskar is now urging the Indian embassy in Beijing to intervene.

The disruption will also affect Sichuan’s operations to 6 Indian cities and other industries. This is definitely not good news at a time when the country is battling its worst onslaught of the Covid-19 outbreak. 

India is depending somewhat on importing medical supplies, including oxygen concentrators, key starting materials (KSMs) and active pharmaceutical ingredients (APIs). 

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The Director General has shared that industry fears this disruption could lead to shortages of essential medicines as well as hit exports. 

Almost 60-70 percent of drug intermediates, KSM and API requirements are sourced from China. Also, about 45-50 percent of all APIs imported feature in the National List of Essential Medicines. Though the Product Linked Incentive (PLI) scheme for API manufacturing has been rolled out by the government of India, it is “going to take some time to reduce our dependence on import of KSMs,” admits Bhaskar. 

The development also comes at a time when the industry is grappling with increased freight cost and shortage of containers.

India imported drugs and pharmaceuticals from China valuing to around 1.9 billion U.S. dollars between April and December 2019. Out of these total imports from China, bulk drugs and drug intermediates had the highest value, amounting to over 1.7 billion U.S. dollars.