One key ask of the industry was to include R&D expenses, product registration-related costs, which have been considered in this scheme. This is expected to benefit participants.
Selection criteria
There are different selection criteria for Group A, B and C. As compared to PLI 1.0, it is interesting to note that the same has been delinked from the investment proposed to be made for the said scheme – only exception being MSME (excluding in vitro medical devices) where there is a criterion of total investment committed under the scheme. Otherwise the selection criteria will be based on legacy data of gross manufacturing investment in India, number of ANDA/NDA as on 1 April 2021, R&D expenditure as detailed in the operational guidelines.
Selected participants in the scheme will be eligible for incentives on incremental sales of pharmaceutical goods based on yearly threshold criteria of minimum cumulative investment and minimum percentage growth in sales as prescribed in the scheme.
Way forward
As the application window for PLI 2.0 is scheduled to close on 31 July 2021, it is advisable to evaluate whether such expansion/entry into new product segments could stand the test of business feasibility and the likely benefits that could accrue to the company.
Given the enhanced budgetary outlay and increased product coverage under PLI 2.0, this may be an exciting opportunity for the pharma Industry to be part of the Atmanirbhar Bharat vision of the government.
1. Source: File No. 31026/60/2020-Policy dated 1 June 2021
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Summary
The scheme provides the pharma industry with a unique opportunity to participate in the government’s visions of self-reliant India and become competitive in the global market.