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HomeEconomyIndia’s oldest drug maker can’t help Modi govt revive penicillin production

India’s oldest drug maker can’t help Modi govt revive penicillin production

Pharma PSU Hindustan Antibiotics has told the Modi govt that it's in 'revival mode', not equipped to take up big projects like penicillin production.

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New Delhi: India’s first drug maker Hindustan Antibiotics Ltd (HAL) has expressed its inability to support the Narendra Modi government’s move to revive the production of penicillin in the country, ThePrint has learnt.

To support its flagship Make in India scheme, Hindustan Antibiotics was the government’s first choice to restart the production of one of the world’s oldest antibiotics.

The public sector unit (PSU) works under the Department of Pharmaceuticals (DoP), an arm of the Ministry of Chemicals and Fertilisers. It was established in 1954.

Speaking to ThePrint, a senior DoP official said the department has informed the ‘inability’ of the top pharma PSU to support the move. Instead, it has advised “to invite tenders from private drug makers”.

“We have informed the Department of Health Research (DHR) that Hindustan Antibiotics won’t be able to produce penicillin considering the financial crisis of the sick PSU. It is still in revival mode but not equipped to take up big projects,” said the official who didn’t wish to be identified.

The move comes after the DHR informed the Ministry of Health and Family Welfare that India needs over 13,000 million doses of penicillin in the next three years — 600 million doses of injectable penicillin (Benzathine) and 12,600 million tablets of oral penicillin (phenoxymethyl), ThePrint reported last week.

“We have suggested the DHR to invite tenders from the drug makers to start the production instead of depending on Hindustan Antibiotics. However, if government plans to fund the PSU additionally for this project, we will abide (by) the final call,” added the official.

In its recommendations, the DHR had asked the drug price watchdog, National Pharmaceuticals Pricing Authority, to chalk out a plan to encourage private manufacturers to produce penicillin in India by relaxing the price controls.


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Hindustan Antibiotics woes

According to its website, Hindustan Antibiotics was the first drug manufacturing unit in India to undertake commercial production of antibiotics like penicillin, streptomycin, gentamicin, ampicillin and amoxicillin.

However, the pharma company has been categorised as a “sick” PSU due to its financial struggle over the last few years.

In the 2018-19 fiscal, the company reported a turnover of Rs 67 crore, with net liabilities of around Rs 821.17 crore, according to a June report in the Hindu Business Line.

“Last year, the government had approved a waiver of loans and interest amounting to Rs 307 crore and deferment of various dues amounting to Rs 128 crore as part of the relief efforts. Once all these measures are implemented, the company expects to start afresh,” added the report.

Revival of penicillin production

The Modi government’s decision to revive penicillin was taken after doctors across the country requested the Centre to procure this crucial antibiotic. It is a must to prevent Strep A bacterial infection, which can lead to serious complications such as rheumatic fever and rheumatic heart disease if left untreated.

The government plans to procure penicillin for three years and give it to all children between 5 and 15 years of age who suffer from sore throat, at least once.

Penicillin was once the most widely used antibiotic in the world to treat many types of infections caused by bacteria — in the stomach and intestines, blood, bladder and kidneys.


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HAL’s response

A week after the publication of the report, HAL Monday responded, saying it is working in close coordination with the (health) ministry and other forums concerned such as the Indian Council of Medical Research to manufacture doses required by the Department of Health Research and is “very positive” on this aspect.

“HAL is having valid licence and manufacturing facility for manufacture of various strengths of penicillin tablets and injections,” the company said in its response.

It also said that “it is awaiting orders from the concerned authorities to enable us to take up production on large scale… It is true that company is in revival mode with financial help of the government and the company would welcome any step by the government to revive the oldest PSU to cater to the needs of DHR”.

However, the reporter clarifies that the article clearly mentions that because of the financial stress the company, at present, is unable to take the load of this project. The article says if the government plans to fund the PSU additionally for this project, HAL will be able to take it up — as mentioned in the report: “If government plans to fund the PSU additionally for this project, we will abide (by) the final call.”

The report doesn’t mention that HAL is ill-equipped to undertake the manufacture of penicillin due to lack of infrastructure, rather it points out the company’s inability to start production on its own.

The report quotes, “in the 2018-19 fiscal, the company reported a turnover of Rs 67 crore, with net liabilities of around Rs 821.17 crore.”

This report has been updated to include HAL’s clarification as well as ThePrint’s response.

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1 COMMENT

  1. penicillin production is a problem in a country and it will not be touched with a ten foot pole by other countries, India has a serious problem.

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