Growth of the Indian pharmaceutical industry hit a four-year low in 2017-18, registering a percentage increase of only 3.03 % from 29.01 % in 2014-15.
When the 54th Parliamentary Standing Committee on Chemical and Fertilizers (2018-19) asked the Department of Pharmaceuticals the reason for the reduction in percentage growth of the pharmaceutical industry from 29% to 3%, the Department, in a written note, explained that “though the percentage increase has reduced, the annual turnover has increased continuously.’’
Slow-moving stocks
Sakthivel Selvaraj, director, health economics, financing and policy, Public Health Foundation of India (PHFI), said that the domestic consumption reduced in 2017 because of the Goods Services Tax (GST) roll-out which forced the pharmaceutical industry to manage slow-moving stocks.
“Domestic growth, however, picked up from 2018 till January 2019 as per our records which shows 8-9 % growth. The sales have registered a robust domestic growth.”
Delhi State Medical Representative Organisation president K.K. Mittal said: “It is not just GST; even demonetisation had a very negative impact on the market growth.
“Sadly, the industry hasn’t managed to recover yet. We demand that the Central government bring in 0% GST on medicines and life-saving drugs. This will increase the purchasing power of the consumers and push up sales which will increase the business for us,” added Mr. Mittal
The government, on its part, has maintained that its policies are driven by the need for regulating pricing of drugs so as to ensure availability of essential medicines at reasonable prices even while providing sufficient opportunity for innovation and competition to support the growth of pharmaceutical industry.
A spokesperson from the drug manufacturing industry, on condition of anonymity, said that the industry was just recovering from the onslaught of GST as well as demonetisation, which had forced the retailers to reduce their stocks to 10 days from 40-45 days earlier.
Added Indu Bhushan, CEO, Pradhan Mantri Jan Arogya Yojana, “With Ayushman Bharat, the demand for treatment will go up and with that all medical-related businesses, including pharmaceuticals will grow.’’
