Sales incentives worth ₹165.74 crore released to four pharma companies under PLI scheme
The Hindu
Against the expected investment of ₹17,425 crore in the pharmaceutical sector over the six-year scheme period, the scheme has garnered an investment of ₹16,199 crore in the first year of implementation
Four pharmaceutical companies have received the first tranche of incentives of up to ₹165.74 crore under the Product Linked Incentive (PLI) scheme of the Department for Pharmaceuticals. The scheme was floated to boost indigenous production of active pharmaceutical ingredients which are the key raw materials in manufacturing drugs.
The firms are Dr. Reddy’s Laboratories Limited, Biocon Limited, Strides Pharma Science Limited and Premier Medical Corporation Private Limited.
“The Department has received an incentive claim of about ₹544 crore from 15 applicants. Based on the evaluation, ₹221 crore of claims of incentives from four applicants were found to be eligible and 75% of this amount i.e., ₹165.74 crore has been released. Remaining incentives are under examination,” the Department of Pharmaceuticals said in a press statement.
The incentives on incremental sales to selected participants under these categories are at a varying rate over the years ranging from 10% to 3% (tapering in the last two years of the scheme).
The goverment launched the PLI scheme for pharmaceuticals in 2021 with a financial outlay of ₹15,000 crore over a period of six years. So far, 55 applicants have been selected under the scheme, including 20 Micro, Small & Medium Enterprises (MSMEs). The financial year of 2022-2023 being the first year of production for the PLI Scheme, the Department of Pharmceuticals has earmarked ₹690 crore as the budget outlay.
Against the expected investment of ₹17,425 crore in the pharmaceutical sector over the six-year scheme period, the scheme has garnered an investment of ₹16,199 crore by the 55 applicants in the first year of implementation.
As of January 31 2023, cumulative sales of about ₹36,000 crore has been reported by the selected 55 applicants.