Indore: Small scale drug manufacturers are contemplating on slashing production of controlled-price drugs due to high cost of operations and squeezing margins.Controlled-price drugs under Drug Price Control Order (DPCO) are those whose market rates are fixed by government as per Essential Commodities Act.Some of the drugs under DPCO manufactured by regional manufacturers are Ranitidine tab, Chloroquine tab and oral liquid, Betamathasone tab, Amoxicillin tab, oral liquid and Cefixime tab and oral liquid.MP Small Scale Drug Manufacturers Association president Himanshu Shah said, “When cost of operation goes up, production of DPCO drugs reduces because in these drugs, margins are already very low and higher operating cost takes away all the profit.”Drug manufacturers are contemplating on reducing output for fixed price drugs after cost of operations has gone up by 4 to 5 per cent led by sharp rise in packaging materials, according to MP Small Scale Drug Manufacturers Association.Industry players said production of these drugs comes down as who will manufacture items in which there is no profit.MP Small Scale Drug Manufacturers’ Association member Amit Chawla said, “These are the drugs, where there is no option to hike price. Production becomes very difficult, when margins dry but there is no alternate to negate price rise.”Chawla said if cost of operations for drug manufacturing continues to remain high then in worst scenario, there can be shortage of DPCO drugs in market.Industry official said that efforts should be made on improving quality because by restricting prices, production and quality both may suffer.An official from food and drug administration said, “In case of higher cost of production, manufacturers reduced production of DPCO drugs first because these drugs do not give much profit.”Pithampur Audhyogik Sangathan joint president Dr Darshan Kataria said, “Even exportable drugs are getting impacted due to hike in packaging material prices. Profit margins have gone down and in international market it is not easy to increase prices because of competition.”According to MP Small Scale Drug Manufacturers’ Association, regional pharma industry shells out over Rs 10 crore per month on purchasing packaging materials.According to industry associations, cost of packaging materials such as aluminum blister foil and PVC and boards among others mostly used by pharmaceuticals has risen by over 10 per cent.

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