Swiss pharmaceuticals giant Novartis is planning to shut its only manufacturing facility in India, at Mahad in Maharashtra, because of increasing competition.
Novartis makes the anti-tuberculosis bulk drug rifampicin here, but cheaper imports, primarily from China, have hit the Indian unit hard, according to a report in India's Business Standard newspaper. The company may consider putting the plant up for sale, said Novartis India managing director Ranjit Shahani.
The Swiss company said that other factors to consider are the periodic lowering of prices by the National Pharmaceutical Pricing Authority and the excess capacity in the market. Moreover, the removal of import duty on rifampicin has led to a flood of imports of the drug from countries like China.
The market price of rifampicin has dropped to Rs 3,400 (€65.88) per kilo, far lower than the government-determined price of Rs 4,200, and Novartis says that it now considering buying rifampicin on the open market instead of making it.
Bulk rifampicin contributes around 6 per cent to Novartis India's total turnover of around Rs 471 crore.