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China eyes Indian pharma as U.S. trade turns cloudy
Why it is in news?
- China is preparing to give swift regulatory approvals to India-manufactured drugs as Beijing looks for new commercial partners ahead of what could be a protracted trade war with the United States.
- Indian firms are looking to fill gaps in Chinese demand for generic drugs, software, sugar and some varieties of rice.
- No concrete deals have been signed but the outlook for pharmaceutical sales from India is positive.
- Chinese authorities have issued instructions that EU-approved Indian suppliers should be granted the industrial drug licence in an expeditious manner so they can enter the Chinese market within six months.
Significance
- India dominates the world’s generic drugs market, exporting $17.3 billion of drugs in the 2017/18 (April-March) year, including to the U.S. and the EU.
- But only 1% of that went to China, the world’s second-largest market for pharmaceuticals.
- The EU is already one of India’s key export markets for medicines and accounted for about 15% of overall drug exports in 2016/17.
- Swift regulatory approvals in China would allow Indian companies to boost revenue at a time when pricing scrutiny and regulatory troubles have hurt U.S. sales.
- It will help India reduce its trade imbalance with China.
- In the month of May, China exempted import tariffs on 28 drugs, including all cancer drugs.
- China has been touting greater access to cancer drugs and pushing to lower prices in a bid to soothe a major social issue in the country, where traditionally many patients with serious illness have had to pay out of their pocket for cutting-edge drugs or have had to buy medicines through unapproved grey market channels.
- China also lags far behind in terms of drug approvals versus developed markets.
Source
The Hindu