Alembic challenges finmin over Penicillin-G imports

AHMEDABAD: Drug-maker Alembic Ltd has approached Gujarat High Court challenging the finance ministry’s decision of non-imposition of anti-dumping duty on Penicillin-G (Pen-G).

The ministry recently turned down a government body’s recommendation to impose anti-dumping duty on imported Pen-G. The first hearing is scheduled this week.

The Vadodara-based company is among the few who make Pen-G in the country and has been fighting to protect its turf. This is the second time it has filed a petition challenging finance ministry’s decision.
Kunal Nanavati of Nanavati Associates representing Alembic declined to comment. An email sent to Alembic remained unanswered.

Pen-G prices plunged in last one decade following cheaper imports from China. With business becoming unviable, Indian manufacturers like Max-GB, HAL, JK Pharma and TGBL closed down the production. Alembic too had closed down the Pen-G facility, but it restarted later.

Earlier this year, the finance ministry had rejected recommendations by Directorate General of Anti-Dumping & Allied Duties, the nodal investigating agency of the commerce ministry, to impose duty of $2.5 per billion on units of Pen-G imported from China and Mexico.

It’s proposal for imposing duty of around $9.28 per kg on Pen-G intermediates (6-APA) from China too was rejected. The recommendation was based on an investigation done after Indian suppliers complained that Chinese and Mexican firms were shipping Pen-G at a low price to kill local competition from Indian manufacturers.

Earlier, Alembic filed a case against the finance ministry to know the ministry’s stand on imposition of anti-dumping duty. As per the law, the ministry needed to make its stand clear on the recommendations submitted by the commerce ministry on the issue of Pen-G anti-dumping duty.

The finance ministry then disapproved of a duty on Pen-G fearing prices of popular antibiotics would become costlier by as much as 25%.

Now in its second litigation, Alembic has challenged the decision of finance ministry. It claimed the unrestricted imports would harm the interest of the local players.

The litigation was filed two weeks ago and notices have been issued to the finance ministry, ministry of chemicals and fertilizers, ministry of commerce, Commissioner of Excise and Custom, Vadodara and Gujarat Food & Drug Administration (FDA). The notice has been also been sent to Hindustan Antibiotics Ltd (HAL) and SPIC Pharma to inform them about the litigation and to seek their support.