Business Today

Elixir for IDPL?

Union Minister of State for Chemicals & Fertilisers Hansraj Gangaram Ahir has announced a Rs 900-crore revival package for IDPL, which has almost come to a standstill in terms of operations.

twitter-logo E Kumar Sharma        Last Updated: March 30, 2015  | 20:10 IST

E Kumar Sharma, associate editor, Business Today
Union Minister of State for Chemicals & Fertilisers Hansraj Gangaram Ahir has announced a Rs 900-crore revival package for public sector undertaking Indian Drugs & Pharmaceuticals (IDPL).

IDPL evokes sharp reactions in the Indian pharmaceuticals space, more so, in Hyderabad, where in the 1960s it had stood out as a shining example of a PSU that built a wherewithal for large scale manufacturing of drugs and the capability of drug discovery.

But then, this was also an institution that ended up becoming a source of trained technical manpower and experts for the private sector in Indian pharma. It also spawned entrepreneurs. The most well known among them being the founder of Dr Reddy's, Kallam Anji Reddy, who began his career as a senior scientific assistant at IDPL.  
 
Today, the PSU has almost come to a standstill in terms of operations, and the minister is reportedly keen to revive its lost glory. He wants IDPL to begin making formulations from July.
 
But those who have seen the rise and decline of the PSU are not quite convinced that this is indeed the right move and the most appropriate manner to handle it.

There are doubts also on the quantum of fund allocated for its revival. As for the funds, though Rs 900-crore seems big in an absolute sense, seen from a global pharma perspective it translates into just 15 per cent of the cost of one new drug development.

More importantly, there is no clarity on the mandate and the team that will take the plans forward. Some argue that it may make sense if it were to focus on essential drugs for which India is dependent on China for raw material.

For instance, India is dependent on China to source raw material (bulk drugs) for Penicillin, an antibiotic. They feel the unit, which is spread over 800 acres at Balanagar, in Hyderabad, could start making the drug and be India's back up in case of an emergency.

But then, bulk drug manufacturing within the city will only mean that the cost of controlling pollution levels will be more than the cost of manufacturing.
 
But a more fundamental point: revisiting history is not the same as rewriting history.

Which is why some feel there could be a case for changing its line of activity.

Instead of manufacturing drugs it may make sense to look at developing IDPL as a research hub.

The same amount of Rs 900 crore, an argument goes, could be used to hire some of the best global talent (typically Indians working abroad) - a biotech expert, a chemical engineer and pharmacologist and a turnaround expert - from top universities and organisations abroad.

This team of experts, supported by a decent salary, could then focus on innovation and drug discovery.

The move could well enthuse a group of talented individuals to take up the challenge and join the organisation and focus on research, be it related to antibiotics or anti-virals.

The over 800 acres of land and central government funds for R&D could be innovatively channelised into this. What finally happens, however, remains to be seen.

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