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COVID-19 impact: Labour shortage causes 50% drop in pharma production; Baddi, Daman worst hit

healthcare | IST

COVID-19 impact: Labour shortage causes 50% drop in pharma production; Baddi, Daman worst hit

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Continued unavailability of workers during the 21-day lockdown period is affecting the most essential pharmaceutical supply chain. Despite being part of the essential commodities and allowed to continue manufacturing, many pharma units are struggling to operate their capacities as workers are not available in desired numbers.

Continued unavailability of workers during the 21-day lockdown period is affecting the most essential pharmaceutical supply chain. Despite being part of the essential commodities and allowed to continue manufacturing, many pharma units are struggling to operate their capacities as workers are not available in desired numbers.
Industry sources tell CNBC-TV18 that many pharmaceutical plants are currently operating at 40-50 percent of manufacturing capacity, some affected more than the others.
Pharma industry officials say if production is not ramped up then in the coming days India could see a shortage of certain medicines.
Unavailability of contractual workers, who are mostly migrants, has been the biggest reason. A pharma industry executive said, with workers migrating back to their native villages and towns, the entire movement of materials, packaging, and also ancillary support is affected. Logistics of raw material consignment from ports and airports has also been slow owing to unavailability of workers at these trade points.
Manufacturing plants located close to state borders, like in Baddi in Himachal Pradesh and Daman are worse affected. With interstate borders being sealed, workers coming to these plants and manufacturing clusters from neighboring states has been stopped.
Local workers are also unwilling to report to work on fears of infection and also due to strict restrictions on movement by local authorities.
“We have ensured social distancing and sanitation protocols are followed, but many local workers do not want to step out,” said another pharma executive.
With discussions that the lockdown may need to be extended beyond April 14, and certain states already moving to extend it, the pharma industry is seeking support from the government. The pharma industry has requested the government’s help in ferrying these workers back to the manufacturing sites and support on movement of raw materials from ports and airports.
Just as the lockdown period had started, the National Pharmaceutical Pricing Authority (NPPA) had asked all district administration and concerned authorities to facilitate the pharma companies and ensure smooth movement of stock and manpower during the lockdown period.
India’s domestic pharma market is worth over Rs 1.43 lakh crore as per the March 2020 report from pharma market research organization AIOCD AWACS.
Despite the COVID crises, the domestic Indian Pharma market had seen a growth of 8.9 percent in March 2020, as people stocked up on chronic medicines (for eg. Drugs for diabetes, hypertension) and those that treat flu and respiratory ailments.
Industry observers say April could see a slump owing to extended lockdown and a possible shortage if production is not ramped up to early March levels.
India’s drug export, mostly generics, was at $19.13 billion in FY19 and was reported at $9.36 billion till October FY20.
“Pharma companies also has export commitments and we need our inventories to go up to be able to service both exports and domestic market,” said an executive from an industry association.​
 
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