Finance

DoP yet to select applicants for 15 molecules out of 41 under first PLI scheme to boost domestic pharma industry

In continuation to this DoP notice of even number dated April 30, 2021, June 14, 2021 and July 2, 2021, applications have also been invited for Ofloxacin under the PLI Scheme.

The Department of Pharmaceuticals (DoP) is yet to select applicants for 15 molecules out of the total 41 molecules under the PLI scheme since its launch in July 21, 2020 to boost domestic pharma industry.

DoP on July 21, 2020 notified Rs. 3,000 crore bulk drug parks promotion scheme and Rs. 6,940 crore PLI scheme for promotion of domestic manufacturing of critical Key Starting Materials (KSMs)/ Drug Intermediates (DIs) and Active Pharmaceutical Ingredients (APIs) in India. The gazette notification dated July 21, 2020 superseded the earlier notification of DoP issued on this subject on June 2, 2020.

The DoP has recently re-invited applications for Ofloxacin under the PLI scheme.

APIs like such as valsartan, losartan, levofloxacin, sulfadiazine, ciprofloxacin, and ofloxacin among others, will be manufactured under the PLI scheme.

In total, 215 applications were received until February 2021 under the PLI scheme for the 36 products spread across the 4 target segments.

According to an industry source, “The budget for the first PLI scheme is too less considering the fact that alone Research and Development of a new molecules costs around Rs 21, 000 crore alone. Besides, the budget allocated to Micro, Medium and Small Enterprises (MSMEs) is only Rs 1600 Crore. One third of PLI scheme is still redundant as DoP is yet to select applicants for 15 molecules out of the total 41 molecules under the PLI scheme. Around 35 to 40 per cent of existing brownfield API unit’s capacity need to be utilized. It has been learnt that around 20 molecules can be manufactured by synthetic chemistry within a period of two to three months. This can be done considering the fact that the earlier PLI scheme of Rs. 6,940 crore announced in the month of July, 2020 will take minimum two years to fructify. Fermentation based units alone will take three to four years as setting up of greenfield units generally entail a time period of two years time.”

The three categories which have been identified and included in the PLI scheme for pharma will boost biopharmaceuticals, complex generic drug, patented drugs or drugs nearing patent expiry, cell-based or gene therapy products, orphan drugs, special empty capsules, complex excipients, APIs/KSMs and Dls, repurposed drugs, auto-immune drugs, anti-cancer drugs, antidiabetic drugs, anti- infective drugs, cardiovascular drugs, psychotropic drugs, anti-retroviral drugs, in-vitro diagnostic devices (IVDs) and phytopharmaceuticals.

On April 30, 2021, the Department invited applications to produce Neomycin, Gentamycin, Clindamycin base, Tetracycline, Streptomycin, Vitamin B1, Dicyandiamide (DCDA), Norfloxacin, Artesunate, Aspirin, Vitamin B6. On June 14, it added Cyclohexane Diacetic Acid (CDA) and Artesunate to the list of applications invited for setting up manufacturing facilities. On July 2, it also called for applications from those who are interested to set up facilities for Erythromycin Thiocyanate (TIOC).

In continuation to this DoP notice of even number dated April 30, 2021, June 14, 2021 and July 2, 2021, applications have also been invited for Ofloxacin under the PLI Scheme. The last date of submission of online application has been extended till August 31, 2021 for the first PLI scheme.

The DoP has extended the timeline for submission of applications under the first PLI scheme, till August 31, 2021.

Government had launched first PLI scheme for promotion of domestic manufacturing by setting up greenfield plants with minimum domestic value addition in four different Target Segments (in two fermentation based – at least 90% and in the two chemical synthesis based – at least 70%) for 41 products with a total outlay of Rs. 6,940 crore for the period 2020-21 to 2029-30.

“The setting up of these 16 plants will lead to total committed investment of Rs. 348.70 crore and employment generation of about 3,042 by the companies. The commercial production of these plants is projected to commence from 1st April 2023 onwards,” the union ministry of chemicals and fertilizers stated.

The DoP had earlier extended the deadline for submission of application for the production linked incentive (PLI) second scheme for pharmaceuticals till August 15, 2021.

The Union cabinet also cleared the second PLI second scheme in June 2021 for the domestic pharmaceutical sector for financial years 2020-21 to 2028-29. About Rs. 15,000 crore worth of incentives is envisaged to be provided under the scheme, with total incremental sales worth Rs. 2.94 trillion and incremental exports of Rs. 1.96 trillion expected during the six years.

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