India hopes that Hyderabad’s ‘Pharma City’ will loosen China’s grip on the pharmaceutical industry
A vast patch of arid shrubland on the outskirts of Hyderabad, India, the size of about 14,000 football fields, is being used as a test bed for a model that could help the world wean itself off its reliance on Chinese drug ingredients.
The Hyderabad Pharma City, which is marked by scuffed sign posts and a rubble-strewn access road, is expected to attract $8.4 billion in investment and employ 560,000 people in hundreds of sprawling plants. Officials say it will be rolling out vital raw ingredients for medicines like penicillin, ibuprofen, and anti-malarials that travel around the world in two years once land is allotted.
India’s race to wrest control from China, which supplies nearly 70% of the active pharmaceutical ingredients — or “bread-and-butter chemicals” — that go into the medicines produced by the Indian pharmaceutical industry, is at the heart of the effort. It’s a massive undertaking that demonstrates governments’ growing concern about China’s stranglehold on drug supplies, as well as the difficulties they face in loosening it.
Because it supplies the majority of generics sold in American pharmacies and hundreds of countries around the world, India’s ability to secure not only its own drug supply but that of Africa, the Americas, and Europe is at risk. Because the two countries frequently engage in border skirmishes, and China has increasingly used its trade advantages against other countries during political disagreements in recent years, India’s reliance on China to keep raw material supply going is becoming increasingly risky.
The glaring dependence of India’s $42 billion drug manufacturing industry — much of which is headquartered in Hyderabad — was exposed at the start of the Covid-19 pandemic, despite Prime Minister Narendra Modi’s enthusiastic promotion of his country as the “pharmacy of the world.” As the coronavirus spread outside of Wuhan in early 2020, China shut down Hubei province, its own medicine manufacturing heartland. This resulted in missed shipments and shortages, as well as a 100 percent increase in API prices in India and around the world.
Hyderabad, a sprawling metropolis surrounded by hills and beautiful lakes, has been at the forefront of efforts to turn the country into a scientific research hub. The planned Pharma City, about 22 miles south of Hyderabad’s airport, will focus on bulk drugs and promises to cut through India’s treacherous web of red tape surrounding environmental clearance and land acquisition by providing drugmakers plots with pre-approved approvals for the heavily polluting industry.
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