India has enough HCQ capacity to serve demand, clinical trial outcome is crucial

While the government’s partial relaxation of the export ban on hydroxychloroquine (HCQ) has renewed concerns of a possible shortage of the drug in the domestic market, industry executives and healthcare experts Moneycontrol spoke to said India has enough capacities to meet the domestic and global demand.

India earns about $40-$50 million by the export of HCQ medicine annually. The decades-old drug, which costs about Rs 5-6 per 200 mg pill, is used to treat malaria, and autoimmune diseases like rheumatoid arthritis and lupus. Malaria is influenced by seasonal factors.

“During normal times India consumes about 3 million tablets and exports around 30 million tablets,” said Sudarshan Jain, Secretary-General of Indian Pharmaceutical Alliance (IPA) that represents large domestic drug companies.

The drug came into the spotlight following an anecdotal study by French researchers on COVID-19 patients. The study reported HCQ to be effective in killing SARS-COV-2. The drug found a major backer in US President Donald Trump, who began pushing it aggressively, even calling it ‘miracle cure’.

There are now 1.6 million COVID-19 cases globally; India reported about 6,725 cases.

Shortage fears

Despite limited clinical evidence, HCQ is now used by many countries for treating COVID-19 patients and also as prophylactic medication to prevent the spread of infection, especially in high-risk categories like healthcare workers and people who are tending to confirmed cases of COVID-19. Indian Council of Medical Research (ICMR) too had recommended the drug but with a doctor’s prescription.

The US government announced that it stockpiled 29 million doses of the drug. Similarly, India ordered 100 million HCQ tablets. And other countries and traders also started stocking up on the medication, doubling the price of its active pharmaceutical ingredient (API). API prices, which ranged between Rs 75,000 and Rs 80,000 per kg, are now trading at Rs 1,50,000 and above.

Fearing shortages and price escalation in the domestic market the government imposed a blanket ban on the export of HCQs on April 4. This caused an uproar, with countries expressing concern over the ban. Trump threatened “retaliation” if India refused to supply these essential medicines.

Three days later, the government allowed certain exceptions to the ban like allowing exports to neighbouring countries and nations that badly need the medicines in the wake of COVID-19 crisis. To be sure HCQ will continue to be a prohibited item. The government is yet to issue any fresh notification amending the export ban notification issued on April 4.

The government said HCQ will be kept in a licensed category and its demand position would be continuously monitored.

Demand-supply position

Cadila Healthcare and IPCA Laboratories are the two major producers of HCQ in India making both the formulation and active pharmaceutical ingredient. Among them, they have the capacity to produce up to 50 metric tonne of API that translates into 250 million tablets. The rest can produce another 100 million tablets.

“We are currently manufacturing 30 metric tonnes per month which is about 150 million tablets. If need be, we can further increase this to 40 to 50 metric tonnes in the coming months,” Cadila Healthcare Managing Director Sharvil Patel told Moneycontrol.

IPCA too indicated that it is ready to meet whatever demand that’s coming from the government and exports.

There are other producers like Laurus Labs, Mangalam Drugs, Wallace Pharmaceuticals, Unichem Remedies and Vijayasri Organics. These companies put together can produce another 20-30 metric tonne of HCQ.

Analysts say the market size has ballooned to $150-$190 million.

Jain backs allowing exports for the time being. “We have excess capacities, there is no point in keeping them idle,” he said.

Meanwhile, French drugmaker Sanofi jumped into action by offering to donate 100 million doses of HCQ across 50 countries.

The company said it has already increased production capacity by 50 percent and is on track to further increase production over the coming months.

“While the benefit from HCQS appears difficult to quantify, it could have an outsized one-time contribution spread over several months for key suppliers,” said Yes Securities in its report.

Clinical trials outcome key trigger

But experts say the demand could further soar if the ongoing clinical trials find the drug effective.

“The drug use will be expanded to the general population as prophylactic, or if the trial fails to demonstrate the effectiveness of the drug, the hype just fizzles out in a matter of days,” an executive from one of the above-mentioned companies said on condition on anonymity.

The World Health Organisation announced an international clinical trial called “Solidarity” to investigate the use of several medicines, including hydroxychloroquine, in the management of COVID-19.

In addition, several independent trials are being conducted in parallel in different countries to find answers to many questions on the use of this medicine in COVID-19 as fast as possible.

Sanofi is also launching two clinical studies on hydroxychloroquine.

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