Lack of skilled manpower stifles pharmaceutical sector
Himalayan News Service
Kathmandu, January 20:
Despite having a tremendous potential of producing top grade pharmaceuticals, Nepal continues to import drugs worth billions of rupees, due primarily to the lack of skilled manpower and research and development facilities. Following on India’s footsteps, Nepal witnessed a phenomenal growth in pharmaceutical industry following economic liberalisation and restoration of democracy. Although, the southern neighbour has already become a global pharmaceutical leader, Nepal still lags far behind, being able to meet only a third of its domestic demand.
According to available statistics, Nepal consumes about seven billion rupees worth of medicine each year, but domestic production accounts at the most merely 30 per cent of the total demand. Forcing, the country to import drugs worth about five billion rupees, mostly from India. “If proper R&D facilities and policies for medicine production are put in place, Nepal could become self-reliant in medicines and a second hub for pharmaceutical production in the South Asia region,” says Radheshyam Mahato, director marketing, National Health Care Pvt. There are 38 pharmaceutical companies in the country, out of which five have World Health Organisation’s Good Manufacturing Practice (WHO-GMP) certification. However, these companies are not being able to utilise 40 per cent of their total production capacity, mainly due to lack of R&D facilities and skilled manpower.
“Either we have to depend on India or other countries for technical pharmacists or imitate their technology for manufacturing. We also have to import most of the raw materials,” says Mahato, “which makes the cost of production higher here.” Some years back, more than 12,000 medicine brands were available in Nepal. Following the Department of Drug Administration (DDA) tightening the provisions, allowing only WHO-GMP certified companies to market products in Nepal, the number of brands have come down to 1,200 in the last two years, according to DDA.
Mahato asked the government to provide some incentives to domestic manufacturers, as foreign brands produced by the WHO-GMP certified companies and registered with DDA can be imported by just paying five per cent customs duty. “In order to make our products competitive, there should be some protective measures as well as initiatives for strengthening the capacity,” he said. He suggested that reciprocity treatment or hike in duty for at least five years could be a appropriate step. In India, a foreign company has to pay $12,000 for company registration and $500 for brand registration before marketing its products. “Nepal can also create provisions at par with Indian provisions,” said Mahato, adding that such provisions will generate revenue for the government while it will be supportive for domestic industry.
He suggested that the government could allow procurement of raw materials in US dollars from India. This can save 16 per cent excise duty and six per cent sales tax, while buying raw material from India in US dollars rather than Indian currency.