The Indian pharmaceutical industry is undergoing a major transformation as the government has revamped the Pharmaceuticals Technology Upgradation Assistance Scheme (PTUAS) to support drug companies in upgrading their facilities to produce medicines conforming to global standards. The scheme now extends beyond MSMEs to pharmaceutical manufacturing units with a turnover of less than Rs 500 crore that require technology and quality upgradation.
Why PTUAS is important
The PTUAS scheme was launched in 2016 to help MSMEs in the pharma sector to upgrade their technology and quality standards to meet the revised Schedule-M and WHO-GMP norms. These norms are essential to ensure the safety, efficacy and quality of pharmaceutical products manufactured in the country. The scheme also aimed to enhance the competitiveness of the Indian pharma industry in the global market, which is expected to reach USD 1.5 trillion by 2023.
However, the scheme had some limitations, such as a credit-linked approach, a narrow scope of eligible activities, and a lack of integration with state government schemes. These factors limited the adoption and impact of the scheme among the pharma units.
How PTUAS has been revamped
The Department of Pharmaceuticals (DoP) has revamped the PTUAS scheme to address these limitations and make it more attractive and accessible for the pharma units. The key features of the revamped scheme are:
- The eligibility criteria has been expanded to include any pharma manufacturing unit with a turnover of less than Rs 500 crore that needs technology and quality upgradation. Preference however remains for MSMEs, supporting smaller players in achieving high-quality manufacturing standards.
- The financing options have been made more flexible, emphasizing subsidies on reimbursement basis, over traditional credit-linked approach. This flexibility is designed to diversify the financing options of the participating units, facilitating a more widespread adoption of the scheme.
- The scope of eligible activities has been broadened to support a wider range of technological upgrades, such as HVAC systems, water and steam utilities, testing laboratories, stability chambers, clean room facilities, effluent treatment, waste management etc. ensuring comprehensive support for participating units.
- The scheme allows integration with state government schemes, enabling units to benefit from additional top-up assistance. This collaborative approach aims to maximise support for the pharma industry in their technology upgradation efforts.
- The scheme introduces a robust verification mechanism through a project management agency, ensuring transparency, accountability and the efficient allocation of resources.
What are the benefits of PTUAS
The revamped PTUAS scheme is expected to have multiple benefits for the pharma industry and the public health system. Some of these benefits are:
- The scheme will help the pharma units to upgrade their technology and quality standards to meet the revised Schedule-M and WHO-GMP norms, enhancing the quality and safety of pharmaceutical products manufactured in the country.
- The scheme will also help the pharma units to improve their productivity, efficiency and profitability by adopting modern and innovative technologies and processes.
- The scheme will enable the pharma units to access new markets and opportunities by complying with global standards and regulations. India is already one of the leading exporters of generic drugs and vaccines, accounting for 20% of the global supply volume and 60% of global vaccine production.
- The scheme will boost the competitiveness and innovation of the Indian pharma industry in the global arena, contributing to its growth and development. From FY18 to FY22, the Indian pharmaceutical industry logged an average growth rate of 9.47% to USD 42.34 billion, primarily driven by an increase in exports and a rise in the domestic market. It is expected that the Pharma sector is likely to reach USD 65 billion industry by 2024 and USD 120 billion by 2030.
- The scheme will ultimately benefit the public health system by ensuring the availability of affordable, safe and effective medicines for various diseases and conditions.
The revamped PTUAS scheme is a welcome step by the government to support the pharma industry in its technology and quality upgradation journey. The scheme will help the industry to overcome its challenges and leverage its potential to become a global leader in pharmaceutical manufacturing.
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