Government to seek tariff parity on patented drug exports to US

NEW DELHI: Government plans to raise the issue of the US decision to impose a 100% duty on patented drug imports from India, seeking tariff parity to safeguard the interests of domestic manufacturers. The matter is expected to figure during the trade negotiations with Washington, with New Delhi seeking tariff concessions in line with the UK and countries in the European Union, following industry representation, sources told TOI.The tariffs announced in April, following the Section 232 probe, could place domestic companies exporting innovator drugs at a sharp disadvantage compared with the UK and EU countries, which enjoy concessional tariff rates of 15-20%, they added.Industry experts said these duties threaten the viability of India’s drug exports and future investments in the CRDMO (Contract Research, Development, and Manufacturing Organisation) sector. The tariffs are expected to be implemented in phases beginning July this year.Domestic CRDMO companies. including Syngene International, Aragen Life Sciences and Aurobindo Pharma’s TheraNym have built partnerships with global innovator companies. including Bristol Myers Squibb and MSD, while investing in biologics discovery, development and manufacturing capabilities.Industry experts said the proposed tariffs could undermine the sector’s competitiveness and weaken India’s position as a destination for contract manufacturing of biologics.“India holds a 2-3% share of the $140-145 billion global CRDMO market but has the potential to become a global leader. The domestic CRDMO market is growing at a 15% CAGR, fuelled by its cost advantage over the West and 90% faster project startup times. Global supply chain realignments are unlocking a $10 billion opportunity for Indian CRDMOs, with Western pharma companies looking for alternative hubs,’’ according to a BCG-Innovative Pharmaceutical Services Organization report last year.