New Delhi : Wondering if the FDI policy in pharma sector is yielding the desired results as more domestic firms are being acquired by multinationals, the Department of Industrial Policy and Promotion (DIPP) said current norms must lay down the foundation of what should be the nature of Indian drug companies in the long term, reports PTI.
The DIPP is concerned that an overwhelming majority of foreign direct investment in pharma is coming only in existing units.
“More than 90 per cent of the FDI is coming in brownfield pharma. There must be some reason why FDI is not coming in new projects. Is it giving the desired outcome of the policy. Whether they meet public concern,” DIPP Secretary Saurabh Chandra said.
The big acquisitions of the domestic companies include Shantha Biotechnics by French pharma company Sanofi-Aventis.
In 2008, Japanese firm Daiichi Sankyo had bought out the country’s largest drug maker Ranbaxy for USD 4.6 billion.
US-based Abbot Laboratories had acquired Piramal Health Care’s domestic business for USD 3.7 billion.
US-based Mylan bought Matrix Lab while Dabur Pharma was acquired by Singapore’s Fresenius and Orchid Chemicals by US-based Hospira.