New Delhi: The year was 1928. After a weekend holiday, when the Scottish physician and microbiologist Sir Alexander Fleming When he returned to his lab at St Mary’s Hospital in London, a big surprise was waiting. He found a blue-green fungus growing in a petri dish. Out of curiosity his mind started searching for the cause of pollution. Fleming soon realized that he had made a discovery that would be considered one of the world’s greatest medical breakthroughs. Coincidentally, Fleming discovered that the mold had destroyed the colonies. staphylococcal bacteria From all around.

penicillin – the nemesis of the deadliest bacterial infection – was born. After this hard work was done. In 1945, Fleming was awarded the Nobel Prize in Physiology or Medicine along with his famous team of researchers Ernst Chain and Sir Howard Florey. As World War II spread death and misery, a miracle weapon armed doctors against life-threatening bacterial infections. Until then, there was a risk of death from minor injuries or bruises. Penicillin saved the lives of seriously injured soldiers during the war.

An article in the Science Museum describes the rapid creation of the drug. It says the demand was such that scientists used every imaginable object – from bed pans to bathtubs – to store quantities of broth for the fermentation process. The article stated that gallons of mold broth were required to obtain one ounce of penicillin. Over time, as scientists developed better methods of extraction, it gave rise to dozens of producers in Europe and the Americas.

game of ownership
Nearly a century after its discovery, the relevance of this wonderful drug in combating the scourge of bacterial infections has only increased. Even the latest generation of anti-infectious treatments, such as carbapenems, are derived from penicillins. This miracle continues to attract scientists. But it didn’t take long for Fleming’s humble penicillin to find itself at the center of a heated global trade war.

“The dominators (in drug production) have the keys to the supply and control the prices as they wish. If supplies were stopped, a global health crisis was inevitable,” says an experienced industry source. On its part, in the sixties, India was self-reliant in making penicillin but over the next three decades, the game changed and it became completely dependent on China. But lessons were learned from the Covid-19 pandemic. Due to heavy dependence on supplies of basic materials from China, the supply of essential medicines posed a serious challenge.

One officer said, “China can win this war without firing a single shot.” With that threat looming, India is attempting to recapture some of its former glory. Last month, based in Hyderabad Aurobindo Pharma Commissioned a manufacturing plant to produce penicillin with a capacity of 15,000 metric tonnes per annum at a cost of approximately Rs 2,400 crore. The government’s production-linked incentive (PLI) scheme for drug manufacturers, offering tax and duty exemptions for five years, is a shot in the arm.

The India Story
But how India lost its grip and saw a dramatic decline from self-reliance to complete dependence on the Chinese. “Earlier, large European drugmakers like Britain’s Glaxo (now GSK) and Slovakia’s Biotica dominated,” says the official quoted above.

In the fifties and sixties, the leading pharmaceutical companies of that time were based in Baroda such as flare up, Sarabhai Chemicals, Hindustan Antibiotics and India Drugs and Pharmaceuticals, seeing a huge opportunity, took the first steps in making penicillin. They invested heavily in large fermentation facilities, a maze of processes that at the time typically involved 2,000 steps.

Having seen those days closely, he says, ”India destroyed the Europeans (in making penicillin a low-cost product), and then the Chinese killed the Indians in the same way.” Penicillin Gave a badge of identification. Alembic developed its technology from Japan’s high-yielding Meiji Seiko Kaisha variety. Other companies like SPIC, Torrent Pharma and Kolkata’s Standard Pharma followed suit.

IDPL, an Indian government-backed entity, received technology know-how from Russia. In his quaint office in the bustling industrial town of Goregaon in Mumbai, Dinesh Shantilal Patel, executive chairman of Themis Medicare, opens up like an encyclopedia on the subject. He remembers the days when India had established its dominance in penicillin.

“Around the seventies or eighties, the government had reserved the production of penicillin, gentamicin, streptomycin, oxytetracycline only for public sector undertakings.”

“Even till the nineties, pharmaceutical companies (those manufacturing finished products or medicines) were keen to acquire indigenous sources of raw materials. But then the big Chinese invasion wiped out the market in no time. API producers have been killed by Indian formulators sourcing their raw materials from China,” he says.

enter the Dragon
According to an estimate, amoxicillin, a widely used derivative of penicillin, was dumped by the Chinese at $9-10 per kg, while the fixed international rate was $25-30 per kg. It was the same story for many other products. This tilted the scale against Indian drug manufacturers.

“Neither the formulation industry was helping, nor was the government listening. It was a dead end,” says Patel. “When the government saw that the prices of raw materials imported from China were quite low and the prices of drugs were high, they played the DPCO (Drug Price Control Order) card. Indian producers of raw materials suffered losses and ultimately had to shut down operations,” he added.

DPCO is part of the government’s policy to monitor and regulate prices of hundreds of essential medicines, which are adjusted periodically according to the cost of production. Patel says implementation of DPCO was the beginning of the end Indian API Sector During the nineties.

“The government did not see the tsunami coming. There was no proactive approach in enhancing protection against indiscriminate Chinese dumping,” he further said. But it didn’t take long to see the Chinese game plan. As Indian drug manufacturers switched completely to Chinese intermediates and raw materials, they raised prices to 4 times their lowest rates.

In a detailed study in 2021, Reji K Joseph and Rama Arun Kumar of the Institute for Studies in Industrial Development traced the rise and fall of the Indian API industry. In one quote, they say that excess production in China led to dumping of Pen-G (penicillin) in India at a price below 40 percent of the actual cost of production. As a result, the price of Penn-G fell from $24/bu to $6/bu between 1985 and 2003.

“There was also a big reduction in import duty. Import duty on organic chemicals including KSM (key starting material), DI (drug intermediate) and API was reduced from 120 per cent in 1990-91 to 7.5 per cent in 2007-08. By 2012, Pen-G production capacity in India had declined to 2500-3500 MMU (mega-million units) and China’s production capacity had increased to 160,000 MMU,” the study notes.

“In 2003, Pen-G was removed from the negative list. After the ban on import of Pen-G was lifted, domestic producers gradually withdrew from production – HAL (2003), JK Pharma and Torrent (2007), and Alembic (2011).

Critics say that although the government has finally woken up to the risks posed by Chinese imports, considerable concerns remain over self-reliance plans. “What is the guarantee that sugar prices will not fall again?” An analyst says. Already, prices of many raw materials from China are at half of the peak pandemic period. “This is also the reason for the reluctance to take it PLI scheme,” He says.

There is complete dependence on China for many other products like vitamins. India’s penicillin crisis is not over yet.