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First set of five bulk drug, pharma input projects under PLI scheme cleared

Our Bureau New Delhi | Updated on January 22, 2021

The government has approved the first set of five pharma projects, worth a total committed investment of ₹3,761 crore, under the Production Linked Incentive (PLI) scheme for promoting domestic manufacture of bulk drugs and active pharmaceutical ingredients (APIs).

An official statement said on Friday the projects relate to four fermentation-based key starting materials and APIs such as penicillin G, 7-ACA (7-aminocephalosporanic acid), erythromycin thiocyanate and clavulanic acid, which are all entirely imported now.

An expert committee set up by the Department of Pharmaceuticals in the Ministry of Chemicals and Fertilisers identified 53 APIs for which the country is mainly import dependent. These bulk drugs accounted for 63 per cent of the total pharmaceutical imports. Subsequently, an Empowered Committee headed by Amitabh Kant, CEO NITI Aayog, was set up last year to design the PLI scheme that could help India achieve drug security.

The Ministry of Chemicals and Fertilisers had called for applications for manufacturing 36 APIs and bulk drugs in four target segments under the PLI scheme till November 30. The total incentives earmarked for the scheme was ₹6,940 crore.

 

The current approval is for the first target segment and these projects, expected to commence production by April 2023, will get a maximum of ₹3,600 crore over the next six years. If the projects meet the assigned production targets, they will get 20 per cent incentive for FY24 to FY27, 15 per cent for FY28 and 5 per cent for FY29.

Aurobindo Pharma, through its subsidiaries, will launch projects for producing 15,000 tonne per annum (TPA) of Penicillin G, 2,000 tpa of 7-ACA and 1,600 tpa of erythromycin thiocyanate. Karnataka Antibiotics & Pharmaceuticals’ project for producing 1,000 tpa of 7-ACA and Kinvan Pvt Ltd’s 300 tpa of clavulanic acid project have all been green-lighted.

“The setting up of these plants will make the country self-reliant to a large extent in these bulk drugs,” the Ministry statement said. It will approve applications in the other three categories over the next 45 days, it added.

Published on January 22, 2021

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