Updated on 17 June 2013
About four applications for investments in drug firms have been pending for discussion in the FIPB
New Delhi: Concerned over spate of acquisitions of domestic pharma firms by multinationals, India's Department of Industrial Policy and Promotion (DIPP) will soon send a comprehensive proposal to the PMO (Prime Minster's Office) for review of the current policy for FDI (Foreign Direct Investment) in existing drug companies, Indian media reports said.
According to the sources, before sending the proposal to PMO, Commerce and Industry Minister Anand Sharma will meet both Health and Pharmaceutical minister to discuss the matter.
The DIPP has raised concerns over large number of acquisitions of domestic firms by foreign multi-nationals. It has asked the Foreign Investment Promotion Board (FIPB) not to take decision on any related proposal. "The DIPP will soon send a comprehensive proposal to the PMO. On an average, about 25 percent of the FIPB agenda is related with pharma sector. Pharma related proposals are regular feature in the FIPB meetings," sources said. They said continuing acquisitions of Indian pharma firms by foreign companies would pose serious problems in availability of life saving drugs to consumers in near future.
Recently, Shantha Biotechnics, pioneers in the Hepatitis-B vaccine, was acquired by French pharma company Sanofi-aventis. Indian Pharmaceutical Association (IPA) has suggested that the foreign firms acquiring domestic companies should be asked to invest in the manufacturing facilities. Although, a committee has put some conventionalities for acquisition of Indian companies, sources said, "those are fairly lenient".
About four applications for investments in drug firms have been pending for discussion in the FIPB. The proposals included two related to US-based Mylan Laboratories; Japan- based Terumo, and another of Medreich, a domestic firm.