What is the impact of Covid-19 crisis on the Indian pharma industry?India has an important position in the global pharmaceutical sector as it is the largest provider of generic drugs globally. In the first 9 months of FY20, India exported pharma products worth US$15.6 bn and imported pharma products (mainly bulk drugs and intermediates) worth US$5.0 bn.

2 With the Lockdown imposed in India, what were the operational issues faced by pharma companies?There are numerous operational issues faced due to lockdown restrictions. Firstly, there is limited availability for cargo flights for finished goods export due to which air freight have gone up by ~4x. This has also affected the supply of non-essential drugs to customers. Secondly, raw materials and intermediaries cargo which are imported via shipping lines are kept quarantined at seaports for 14 days before being allowed for further inland movement. As on April 6, 2020, pharma raw materials and finished goods worth over USD 1bn were stuck at the ports on account of these constraints. Thirdly and more specific to manufacturing, transportation of ancillary supplies like packaging materials has been affected. Further non-availability of contractual workers has led to a shortage of manpower in other ancillary activities related to production.

Most of these challenges are likely to see resolution with the lifting of lockdown restrictions in the coming days and weeks.

4. How will the new guidelines on Lockdown exemption from Ministry of Home Affairs (MHA) help the industry?Lockdown exemption after April 20, 2020 provided by latest MHA guidelines will allow manufacturing units to remain operational and help in addressing some of these issues as pharmaceutical industry and its ancillary industries have been notified in essential category. In the initial days, the ports will have to handle higher cargo which may lead to temporary congestion, but the situation is expected to ease with time. 5.What are the immediate focus areas for pharma companies today?After relaxation in lockdown measures, the immediate focus would be to ramp up production levels, exports and resume supplies to domestic market so that the temporary shortfall caused by reduction in supplies could be compensated. An evaluation of near-term liquidity requirements and possible sources as further clarity emerges is a task that is likely to continue. Also, it is very important that companies continue to ensure proper preventive measures for safety of their employees working in manufacturing units.

6.How can these companies improve their near-term liquidity requirements during these times?The export-oriented units should actively follow up for liquidation of Merchandise Exports from India Scheme (MEIS) scrips for payment of duty or sale in open market and GST refunds, which are expected to get processed faster based on governments direction to Central Board of Indirect Taxes and Customs (CBIC). Also, depending on their liquidity requirements, the companies can avail moratorium on loans and reassessment of their working capital limits.7

7.How are pharma companies ensuring safety and well-being of the employees and other workers in manufacturing facilities?The pharma companies need to comply with regulatory requirements of (United States Foods and Drug Administration) USFDA, UK Medicines and Healthcare products Regulatory Agency (UKMHRA) and other regulatory agencies and therefore, maintain high standards of workplace hygiene and safety. The manufacturing units have been equipped with necessary temperature monitoring devices for early identification of symptoms for COVID-19 in employees, with social distancing and sanitization are being strictly implemented by companies for the workforce within the plant, in canteens and transit buses. Also, Indian Pharmaceutical Alliance and its member companies have come together and developed Best Practices document to safeguard employee safety in pharmaceutical manufacturing.

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Post relaxation in lockdown, the focus for Pharma would be to ramp up production : Ramkumar SV - ETHealthworld.com

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