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Monday, March 19, 2007

Philippines set to source generic drugs from India

The Philippines, which needs drugs worth $2 billion every year, is opening up its government procurement to generic drugs from India. A team of officials from Philippines’ food and drug authority and the government’s procurement arm — the Philippines International Trading Corporation — told the chemicals ministry earlier this week that Manila wants to import inexpensive generic drugs from India. At present, the country does not allow imported generics to participate in government procurement.

The delegation has also informed India that Philippines is amending its food and drug law to open a window for Indian generics, official sources told ET. The delegation, comprising government and industry representatives, held buyer-seller meets in Delhi and in Mumbai over the past few days, said pharmaceutical export promotion council’s Raghuveer Kini. Philippines has a pharma industry that is one-third the size of India’s pharma industry.

For India’s pharmaceutical sector, government procurement by some of the nations is an attractive opportunity, while countries like the US that spend significantly high amounts on healthcare, are yet to let Indian firms to participate. India too does not allow foreign firms to participate in state procurement, as there is no consensus between rich and poor countries under WTO on opening up government procurement. The matter remains sidelined along with a host of other outstanding WTO issues.

In India, the greatest beneficiary of government procurement would be PSUs like Hindustan Antibiotics and Bengal Chemicals and Pharmaceuticals as the government has reserved more than 100 products for purchase from them. With a 21.9% increase in the budget allocation for health and family welfare spending this year, and the government’s commitment to increase spending on healthcare to 3% of GDP, state-owned companies have reasons to cheer. Besides, with the government’s commitment to expand its immunisation programme to more diseases, private sector firms also stand to benefit.

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