Withdrawal of customs duty exemption on life saving drugs faces flak

Withdrawal of customs duty exemption on life saving drugs faces flak

The withdrawal of customs duty exemption on imports of life-saving drugs came under criticism today with Biocon chief Kiran Mazumdar-Shaw saying levy of any kind of duty for these medicines does not resonate well with India's affordable healthcare mission.

Echoing Mazumdar-Shaw's view, the Organisation of Pharmaceutical Producers of India Director General Ranjana Smetacek told PTI the government move will be detrimental to Indian patients depending on life-saving drugs.

"We should, as a country, exempt life saving drugs from any kind of levies. Because after all you want affordable access and that is what you are basically touting as your healthcare mission then you know levying any kind of duty on life saving drug does not resonate well," Mazumdar-Shaw, the Biocon CMD told NDTV.

The prices of some of the medicines are likely to increase by 22 to 35 per cent if companies decide to transfer the customs duty to patients, industry analysts said.

Recently, the Central Board of Excise and Customs (CBEC) had issued a notification withdrawing exemption of levy of basic customs duty on as many as 74 drugs including life-saving ones.

The medicines on which customs duty will now be imposed include the ones used for treating kidney stones, cancer chemotherapy and radiotherapy, life-threatening heart rhythm disorders, diabetes, Parkinson's disease, bone diseases and antibiotics to treat infections.

Besides, drugs used for bacterial infections, leukemia, anesthetic medication, human immunodeficiency virus (HIV) or hepatitis B virus cells, allergies, arthritis, lupus and ulcerative colitis might also see spurt in prices.

Smetacek told PTI that the industry body was not consulted on this, adding," We believe the recent hike in duties on life saving drugs will be detrimental to Indian patients."

Withdrawal of concessional custom duty for these drugs will adversely impact patients' interest as it may lead to increase in prices.  This is in complete contradiction to the public interest as mentioned in the notification, she added.

Leena Menghaney, a lawyer who works with Medicins Sans Frontieres, the international humanitarian agency on its campaign for affordable medicines, said imposition of customs duty is expected to affect patients who ask for or need drugs supplied exclusively by foreign manufacturers.

Patients with haemophilia--a blood disorder which requires regular treatment with medicines called Factor 8 or Factor 9--have to rely on imported products because of shortage of the drugs.

"They should have been consulted before the waiver was removed," Menghaney said, adding there is now only little bit of production of these drugs domestically which is insufficient to meeet the needs of haemophilic patients.

However, experts believe the move seems to be in line with the government's objective to rationalise the duty exemptions.

According to Indian Pharmaceutical Alliance Secretary General D G Shah, the recommendation to prune the lists was aimed mainly at taking stock of the current status of the industry and to rationalise the exemptions.

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