HYDERABAD: The India Pharmaceuticals Association (IPA) urged the Finance Ministry to come up with a policy framework with regard to incentives to drug innovation and ease dependence on import of essential APIs (Active pharma ingredients) from China.
Currently, India is dependent on China for import of some of the API and it may become a serious concern, if problems arises in the supply-chain system, IPA President K Satish Reddy, told reporters here today.
"If there is breakdown in the supply chain for whatever reasons in China, we will suffer, because India does not have the capacity to meet those kind of need and it will lead to higher costs," he explained.
A policy frame work can can ease the dependence on China for some of the essential drugs, he added.
The association also suggested that government should concentrate on setting up industrial clusters to manufacture some of the essential bulk drugs to reduce dependence on the neighbouring country.
It also demanded that weighted deduction of 200 per cent of R&D expenses should be increased to 250 per cent in the upcoming union Budget.
"So if we would like to spur innovation in this country we expect a policy framework which would incentives innovation," Reddy said, who is chairman of Dr Reddy's Laboratories.
He said though the NDA Government in its first term (1999- 2004) had announced Rs 1,000 crore fund created for the purpose of extending loans to encourage innovation, the move did not produce any remarkable result due to various reasons.
According to him, the current system is not conducive for incubating innovative ideas and pressed that the incubation centres linked with universities should be encouraged.