NATIONAL 6 -(Spotlight Weekly)]

Prescription Rx

Eyeing foreign markets, domestic pharmaceutical industries complain of unequal treatment by the government

By BHAGIRATH YOGI

Nepali pharmaceutical industry seems to be coming of age, finally. The industry that used to lobby for government's protection only a few years back now is asking for a level playing field against foreign companies.

Drugs : Quality matters

"The government is adopting unequal policies while dealing with imported drugs vis-a-vis the domestic products," said Pradip Jung Pandey, chairman of the Association of Pharmaceutical Producers of Nepal (APPON), Sunday at the Association's eighth AGM.

According to Pandey, the government imposes only 2.5 percent customs duty on the imported drugs whereas domestic industry has to pay up to 24 percent in the form of duty including 10 percent Value Added Tax. "That's why we haven't been able to compete with imported drugs," he said.

Pharmaceutical entrepreneurs say domestic production of drug meets nearly 25 percent of the national demand in the five billion-rupee drug market. The rest is imported mainly from India and, to some extent, from abroad.

"If all sectors extend their cooperation, we can meet nearly 50 percent of the domestic demand, including 80 percent demand for the essential drugs, within the country," said Pandey. More than 50 percent of 273 essential drugs are manufactured within the country.

According to the association, 33 pharmaceutical companies, with an investment of nearly three billion rupee, had a capacity to manufacture nearly three billion rupees' worth of medicines per annum. Ten more companies were in the pipe line, industry sources said.

With increasing share in the domestic market, Nepali pharmaceutical companies are now eyeing at foreign markets for their products. "The number of companies adopting Good Manufacturing Practices (GMP) is increasing. We can compete with foreign companies by acquiring latest technology and good quality," said Hari Bhakta Sharma of Deurali-Janata Pharmaceutical Company, who is also a General Secretary at APPON.

Hukum Pharmaceuticals, a leading industry, has recently acquired ISO 9002 certificate for maintaining quality in its manufacturing. "This has proved that Nepali companies too can produce world-class drugs here," said Vijay Dugar, managing director of Hukum Pharmaceuticals.

Entrepreneurs say Nepali drugs have emerged as one of the new export products from Nepal. They say growth of the industry will create new jobs and promote national enterprises, thereby contributing to national economy.

Officials say the government is serious in promoting pharmaceutical industry in the country. "We have provided duty concessions in importing raw materials and other facilities to our domestic industries," said Chandi Prasad Shrestha, spokesman at the Ministry of Industry. Commerce and Supplies. "The government will provide every support to the industry if they want to export their products."

Shrestha clarified that the low customs on imports of drug was meant to provide drug to general public at affordable costs. "At a time when we are not self sufficient in drug production and there are obligations related to social justice, we can't provide tariff protection to domestic industry," Shrestha said. "The government, however, can consider introducing tariff barriers on certain products and categories in which our domestic production is self sufficient."

Nepal's drug industry has now become pro-active while advocating for policies related to the industry. "Since the quality of drug is directly related to public health, we have demanded from the government that certain standard should be specified to domestic industry. We are ready to improve our shortcomings, if any," said Sharma. "Equally important is monitoring the quality of imported drugs from across the open border."

Official cite lack of adequate manpower to monitor sub-standard drugs. "Nearly 4,000 brands of medicines are available in Nepali market produced from more than 350 companies around the world," said Dr. Asfaq Sheikh, director at the Department of Drug Management, the government agency responsible for monitoring quality of drugs within the country. Industry sources, however, say there are up to 12,000 brands of medicines being sold freely in the market.

"Nepal has one of the highest per capita drug brands available in the country. This must be regulated," said Sharma.