New Delhi: The Foreign Investment Promotion Board (FIPB) on Friday cleared seven Foreign Direct Investments (FDI) proposals for investment in Indian pharmaceutical companies, ending the policy of uncertainty over Investments in the sector.
It deferred three proposals as there were ownership issues. The Department of Industrial Policy and Promotion (DIPP), the nodal body for framing FDI policy, wants to review the policy to ensure there are enough safeguards to ensure domestic healthcare concerns.
In all, the FIPB, which is headed by Department of Economic Affairs Secretary Arvind Mayaram, discussed 30 Foreign Direct Investment (FDI) proposals. The three proposals deferred will be taken up after the DIPP clarifies the policy.
The proposals which were discussed in the meeting on Friday include that of Singapore's GlaxoSmithKline Pte Ltd, US' Mylan Inc, Mauritius-based Castleton Investment Ltd, Mumbai-based Ferring Therapeutics and Hyderabadbased Verdant Life Sciences.
At present, 100% FDI in pharma sector is allowed through automatic approval route in the new projects but the foreign investment in the existing pharma companies requires FIPB approval.
This distinction was made last year following concerns that largescale acquisition of Indian pharma companies by MNCs could compromise public health as the foreign companies may stop manufacturing cheaper drugs.
The government had also decided to build in conditions to ensure that Indian company did not stop producing essential drugs after being acquired by a foreign company. The Department of Industrial Policy and Promotion is likely to clarify these conditions soon after which proposals that envisage change of control could be taken up.
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