If 2015 was the ‘Year of the API’, why is there a Remdesivir shortage six years later?

• Whether it is the production linked incentive or the waiver of duty on Remdesivir, these are steps that could have been taken six years ago.
• In 2015, the Indian government decided to boost the manufacturing of API, the most important ingredient in a drug, but the policy remained on paper and as a catchphrase on headlines.
• In fact, since 2015, the year when the government resolved to promote the manufacture of bulk drugs in India, the imports have only gone up.

Catchphrases don’t cure, actual drugs do.

In 2021, everyone from the mighty Serum Institute of India (SII), the world’s largest vaccine maker, to the whole host of companies that make Remdesivir are scrambling for inputs while the COVID-19 pandemic ravages through a densely populated country with a lot of poor people and inadequate health facilities.

However, six years ago, the same government had celebrated ‘the year of API’. The acronym stands for active pharmaceutical ingredients⁠ or simply put, key inputs needed to make a particular medicine. The event was possibly a hit, the tagline was well promoted, but nothing happened after that.

In fact, since 2015, the year when the government resolved to promote the manufacture of bulk drugs in India, the imports have only gone up.

The idea was to encourage local manufacturing of APIs on a bigger scale but after six years of stated intent, India is still dependent on China for nearly 70% of its API, also called bulk drugs, needs.

Now, more than a year into the pandemic, drug makers and vaccine makers in India⁠ — which proudly carries the tag ‘pharmacy of the world’ ⁠— are pleading for access to key raw material. The list includes Adar Poonawalla, the chief executive officer (CEO) of SII, who urged the United States on April 16 to allow export of key inputs needed to make the COVID-19 vaccine.
There are many factors why API manufacturing hasn’t picked pace in India. The following are the reasons cited by consulting firm PwC.

• stricter implementation of pollution control norms, leading to higher costs of manufacturing APIs in India
  issues in interpretation of the Drug Price Control Order (DPCO), 2013
• no financial incentives like lower tax, cheaper utilities and land subsidy to lower capex requirement
• lack of large-scale mega parks to manufacture bulk drugs -- collapse of the fermentation industry in India.

Before 1991, India was dependent on China only to the extent of 0.3% of its bulk drug needs. Today, 70% of it comes from China.

The chaos around Remdesivir is one of the examples of how slow the policy wheel moves in India, no matter who is in charge of government. The demand for Remdesivir has been off the charts for a while, for a variety of reasons.

The manufacturing process has been stalled by the lack of APIs but the government did not waive off the customs duty on this crucial import, until April 20, about a year after the drug has been allowed to be used as a last resort for COVID-19 patients.

Of course, the government has approved a ₹6,940 crore production-linked incentive scheme to boost the manufacturing of APIs too, among other pharmaceutical products. The policy was announced as part of the Aatmanirbhar Bharat (self-reliant India) programme, at the peak of the pandemic.

If the same measures had been announced earlier in 2015, when we were celebrating the year of the API, at least a few deaths and some anxiety could have been avoided.


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