The pandemic Coronavirus which originated from China has adversely affected several countries across the globe including the USA, India, Italy and many more. Many countries have been put under lockdown which affected many businesses. Here’s a complete report for you prepared after extensive research on the Impact of Coronavirus on manufacturers & Export of HCQ or Hydroxychloroquine.
Amid coronavirus outbreak, India the leading manufacturer and exporter of generic drugs banned the export of 26 active pharmaceutical ingredients (API) and drugs including paracetamol, antibiotics such as tinidazole and erythromycin, the hormone progesterone and vitamin B12. These 26 API’s amount to 10% of the total exports of India.
Here’s a timeline to understand What Led to ban on export of HCQ or Hydroxychloroquine & then lifting of ban::
March 03, 2020
The restrictions were imposed on March 03, 2020, due to lockdown in China as Indian manufacturers depend on China for the imports of their API. As a result of the impact on pharma industries after the coronavirus outbreak, the prices of materials required for generic increased due to less availability and slow production of API’s. So to prevent a shortage of generic products in India, it restricted the export of 26 API’s.
The coronavirus cases were increasing day by day, so the Prime Minister of India Narendra Modi announced a lockdown from March 25, 2020, for 21 days for the containment of the virus. Due to the lockdown in the country, there was a shortage of staff in the pharma companies to run the operations.
March 25, 2020
So India on March 25, 2020, banned the export of HCQ or hydroxychloroquine and their formulation along with 26API’s to ensure its enough supply for domestic use. Hydroxychloroquine is an anti-malarial drug that is being used to treat COVID-19 patients.
Hydroxychloroquine received global attention when the President of the USA said that the drug is found to be effective in treating COVID-19 patients. India is the largest manufacturer of Hydroxyxhloroquine, so SAARC nations along with UAE and Indonesia requested India to remove the ban on the export of HCQ or Hydroxychloroquine as there is an acute shortage of this in their country. Donald Trump said in a press conference that he will talk to Narendra Modi to ensure the supply of Hydroxychloroquine and if India declines to the request then there may be retaliation.
April 6, 2020
On April 6, 2020, India lifted the ban on the export of HCQ or hydroxychloroquine & 24 API’s on the basis of humanitarian grounds following the conversation with the US President Donald Trump and requests from other countries. Indian officials said that they will allow the export of HCQ or hydroxychloroquine and paracetamol depending upon the stock after meeting domestic usage and existing orders.
The Top Manufacturers of HCQ of India
The top manufacturers of HCQ in India are – IPCA, Zydus Cadila, Wallace, Cipla, and Microlabs. Other leading manufacturers of HCQ are Intas Pharmaceuticals, McW Healthcare, Macleods Pharmaceuticals, and Lupin. Leading API suppliers for the drug include Abbott India, Rusan Pharma, Mangalam Drugs, Unichem Remedies, Laurus Labs, Vijayasri Organics, etc.
By the end of this month, Indian pharmaceutical companies are increasing the monthly production of antimalarial drug hydroxychloroquine (HCQ) by four times to 40 metric tonnes. The plan to increase production came after the government of India removed the ban on the export of HCQ and other drugs to help other countries in fighting this pandemic.
The highest capacity of India is to produce 35 crore tablets of 200 mg dosage every month. India needs only 10 crore tablets every month for domestic use for which the government of India has already placed an order with Zydus Cadila and IPCA laboratories. The cost of the HCQ pill in India is less than Rs 3. The remaining products can be exported to neighboring countries as well as needy countries such as the USA.
But the problem is most of the companies are dependent on China for their API’s. Many companies usually keep stock for about 6 months but if the situation of China does not get to normal soon, then who depends on China for API can face supply chain issues leading to a shortage of many drugs.
The director of Srushti Pharmaceuticals, Jatish Sheth said that pharmaceutical companies in India are worried about the situation. He further added that if the situation in China starts getting back to normal then there will not be an acute shortage but if it does not then it can be a serious issue.
HCQ – The game changer for Indian pharma companies
The stocks of Indian pharma industries like Zydus Cadila, Cipla, IPCA rose when India partially lift the ban on the export of drugs..The shares of IPCA Laboratories rose by 10.06 percent to close at Rs 1524.15 and share of Zydus Cadila rose by 16 percent on April 7, a day after the lift of ban on export.
What makes IPCA more special now is its anti-malarial drug hydroxychloroquine which is being used as a prophylactic drug to prevent COVID-19 infection among patients and healthcare workers. There are a lot of companies in India that make hydroxychloroquine pills but most of them depend on China for API.
Due to a shortage of supply from China amid coronavirus outbreak, prices of hydroxychloroquine API rose from Rs 80,000 per kg to more than Rs 1,50,000 now. This is where IPCA which is one of the largest producers of both API and hydroxychloroquine pills has an edge over many companies. But US FDA had banned the import of drugs from IPCA three years back due to which IPCA could not supply this drug to the USA.
However, due to the COVID-19 outbreak, the US partially removed the ban on imports from IPCA. It allowed the import of APIs of hydroxychloroquine sulphate and chloroquine phosphate from its manufacturing units.
Before COVID-19, IPCA was not doing great due to import ban and competition. This led to declination in their anti-malarial segment from 17 percent in FY13 to 6 percent in FY19. This year is going to be very fruitful for Indian pharma industry especially for IPCA.
Till now there is at least limited supply due to restriction of COVID-19 but if the pandemic continues the stocks of pharmaceuticals and API’s may decrease resulting in a shortage of certain drugs. So the pharmaceutical companies should monitor the evolving situation and must ensure that enterprises are aware of the clauses in their contracts that may create problems in the future. The world is facing problems due to the shortage of pharma supplies because manufacturing is concentrated in China. India should decrease its dependency on China for API. Kedar Upadhye,the CFO of Cipla,one of the India’s largest pharmaceutical company said that to decrease dependence of India on China, we are making efforts to increase our supply. He also added that at this stage we do not see large disruption but situation can get worse if it continues. The companies should spread their products across different markets so that any such situation in the future can be avoided.
That was all you needed to know about the impact of coronavirus on Indian Pharma & export of HCQ. You May also be intrested in learning about Impact of Coronavirus on other industries::
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