The association warned that continuing input shortages could prevent firms from fulfilling government tenders due to the disparity between fixed tender prices and skyrocketing input costs, potentially resulting in permanent closure of units and large-scale job losses in the MSME sector.
FOPE highlighted that in just eight to nine days, the pharmaceutical formulation sector has been hit by a catastrophic surge in the prices of critical inputs, particularly APIs, which have risen by 20–60 per cent.
Speaking to TNIE, Vinod Kalani, Co-chairman of FOPE, said: “The government should convene a meeting with all stakeholder associations to understand the ground reality regarding all input materials for the pharmaceutical formulation and API industries, as well as the availability of medicines. A thoughtful, practical approach is needed at such crucial times.”
The letter, dated March 13, also pointed out concerns over irregular supplies of key solvents and chemical intermediates essential for pharmaceutical manufacturing. It noted that the prices of PVC compounds, bottles, films, Alu-Alu and foils have escalated sharply, making existing production contracts financially unviable.
“In addition, there are noticeable increases in the prices of certain paper-based packaging inputs widely used for cartons, labels and outer packaging of medicines. This broad-based price rise across multiple segments is placing further financial strain on formulation manufacturers,” it stated.
The association accused some entities of creating artificial scarcity to exploit formulation units, forcing many MSMEs to slow or halt operations.
Under the Drugs (Prices Control) Order, 2013, companies operate within tightly regulated price frameworks, limiting their ability to absorb sudden cost increases. As a result, several units are struggling to maintain production schedules and meet supply commitments.