Approval accorded under Production Linked Incentive (PLI) Scheme for Promotion of Domestic Manufacturing of critical Key Starting Materials (KSMs)/ Drug Intermediates and Active Pharmaceutical Ingredients (APIs)

The Indian pharmaceutical industry is the 3^rd largest in the world by volume. It has high market presence in several advanced economies such as the US and EU. The industry is well known for its production of affordable medicines, particularly in the generics space. However, the country is significantly dependent on the import of basic raw materials, viz., Bulk Drugs that are used to produce medicines. In some specific bulk drugs, the import dependence is 80 to 100%.

With an objective to attain self-reliance and reduce import dependence in these critical Bulk Drugs - Key Starting Materials (KSMs)/ Drug Intermediates and Active Pharmaceutical Ingredients (APIs) in the country, the Department of Pharmaceuticals had launched a Production Linked Incentive (PLI) Scheme for promotion of their domestic manufacturing by setting up Greenfield plants with minimum domestic value addition in four different Target Segments (In Two Fermentation based - at least 90% and in the Two Chemical Synthesis based – at least 70% ) with a total outlay of Rs. 6,940 crore (US$ 954.87 million) for the period 2020-21 to 2029-30.

In total, 215 applications have been received for the 36 products spread across the 4 Target Segments. The guidelines prescribed that the applications would be processed and decided within a period of 90 days, i.e., up to February 28, 2021. Nineteen applications with a committed investment of Rs. 4,623.01 crore (US$ 636.08 million) have already been approved under Target Segment I, II and III.

174 applications were received for 23 Eligible Products under Target Segment IV - Other Chemical Synthesis Based KSMs/ Drug Intermediates/APIs. Out of 174 applications, 79 applications received for 11 eligible products were considered as per the decided evaluation and selection criteria by the Empowered Committee in its meeting held on February 27, 2021. The applications of following companies, which have committed minimum/more than the minimum proposed annual production capacities and fulfil the prescribed criteria, have been approved, as under:

The setting up of these plants will lead to total committed investment of Rs. 459.47 crore (US$ 63.22 million) and employment generation of about 3,715 by the companies. The commercial production of these plants is projected to commence from April 1, 2023 onward.

With this approval, a total of 33 applications with committed investment of Rs. 5,082.65 crore (US$ 699.32 million) have been approved by the Government under the PLI Scheme for Active Pharmaceutical Ingredients (APIs). Setting of these plants will make the country self-reliant to a large extent in respect of these Bulk drugs. The disbursal of production linked incentive by the Government over the six years period would be up to a maximum of Rs. 5,440 crore (US$ 748.49 million).

It has been further decided to take up the remaining 95 applications under the Target Segment-IV till March 31, 2021 for scrutiny and approval.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.