Indian drug-makers, especially those who operate in oncology segment, are sitting on a multibillion dollar opportunity in China, thanks to cut in tariff and taxes.

“The Chinese government has waived import tariffs for 28 drugs, primarily anti-cancer drugs and antibiotics, from 5-6 pc to zero,” Udaya Bhaskar, Director, Pharmaceutical Exports Promotion Council (Pharmexcil), told BusinessLine on Friday.

The valued added tax has also been reduced significantly on 103 of 138 antineoplastic drugs, he added.

Cost-cutting measures

The Chinese authorities are also adopting measures to lower costs, such as price negotiations with manufacturers, greater use of centralised government procurement and the inclusion of a wider range of anti-neoplastic drugs in the national healthcare insurance programme. The reduction in tariff and taxes was a part of this endeavour.

The approval process is also being eased by the Chinese regulator for new medicines from overseas, especially for those treating rare and life-threatening ailments.

Since April 2018, the imported chemical pharmaceuticals are no longer tested in trading ports and are randomly checked in the market.

Potential for Indian firms

“With the acceleration of inspection and approval procedures of drugs developed overseas, we see a huge scope for India Pharmaceuticals to export lifesaving drugs, antibiotics and anti-infective products to China,” Phamexcil director said.

According to industry estimates, the market for oncology drugs alone in China is around $17-19 billion. India exports about $17-billion-worth drugs, most of them to the US and the European Union.

“Exports to China last year were at $200 million, which registered 37 percent growth over previous year. While these are mostly API, we expect other segment of drugs to go up going forward,’’ he said.

Major firms such as Dr Reddy’s Laboratories see an opportunity in China. According to its Chief Financial Officer Saumen Chakraborti, business growth for the company in the Rest of the World (RoW) market category is being driven by China and other new markets.

“We have a subsidiary in China and there is business opportunity beyond it too,’’ he told Business Line.

Natco Pharma Ltd has also indicated that it is stepping focus on Rest of the World markets. According to Pharmexcil data, there are nearly 50 Indian companies engaged in business with China.

Buyer-seller meet

To identity business opportunities, medicinal requirements of China and regulatory aspects, Pharmexcil and China Chamber of Commerce of Import & Export of Medicines and Health Products (CCCMHPIE) along with Consulate General Office of India are organsing an Indo-China buyer-seller conference during August 20-22, 2018 in Shanghai, China.

“We are also going to enter into an MoU with the China Chamber,’’ Bhaskar said.

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