India is often called the pharmacy of the world, supplying medicines globally. However, most of its raw materials come from China. Recently, China has significantly reduced the prices of chemicals used in drug manufacturing. This has sparked speculation that medicine prices in India could decrease soon.
Sharp Drop in API Prices
Active Pharmaceutical Ingredients (APIs) and intermediates from China have seen massive price cuts. Industry experts suggest that lower API costs will reduce manufacturing expenses, potentially bringing down prices for generic drugs. Sources reveal that over the past few months, API prices in China have dropped by 35–40%, and this trend may continue.
Some notable price declines include:
- Paracetamol API: From ₹900/kg during the pandemic to ₹250/kg
- Amoxicillin: From ₹3,200/kg to ₹1,800/kg
- Clavulanate: From ₹21,000/kg to ₹14,500/kg
Why the Prices Fell
Post-pandemic, China heavily expanded its pharmaceutical factories, resulting in an oversupply of raw materials. This surplus has pushed prices down, and further reductions are expected. Mehul Shah, an expert monitoring China’s pharma market, notes that patients worldwide, including in India, are likely to benefit from these lower prices.
India’s Dependence on China
India relies heavily on China for pharma raw materials, sourcing about 70% of its requirements from the country. Analysts point out that Chinese companies have slashed prices globally, even below production cost, causing challenges for Indian raw material manufacturers.
The price cuts could benefit Indian consumers if manufacturers pass on the savings, potentially making essential medicines more affordable across the country.
Disclaimer: Market and industry data are based on current trends and expert observations. Actual medicine pricing may vary based on regulatory approvals and domestic market conditions.
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