Govt to upgrade two Pharma Cos

New Delhi: The Government has brought Karnataka Antibiotics & Pharmaceuticals (KAPL) and Rajasthan Drugs & Pharmaceuticals (RDPL) under its direct control to help the companies upgrade manufacturing facilities.

KAPL is a joint venture company promoted by Hindustan Antibiotics Ltd (HAL) and the Karnataka Government through the Karnataka State Industrial & Investment Development Corporation.

RDPL is a joint venture company promoted by Indian Drugs & Pharmaceuticals Ltd (IDPL) and Rajasthan Government through Rajasthan Industrial Development Investment Corporation (RIICO).

The Union Cabinet at a meeting held here has decided that the equity stake held by HAL and IDPL will be held directly by the Union Government.

The decision was taken because HAL and IDPL are sick companies, and therefore, unable to support the two pharma companies in upgrading their manufacturing facilities.

The equity shares held by State governments through their PSUs in KAPL and RDPL would continue to be held by them in the same proportion.

The equity of Union Government and respective State governments in KAPL would be 59:41 and in RDPL 51:49 as before.

KAPL proposes to upgrade its manufacturing facilities and also set up a new Cephalasporin plant at an estimated cost of Rs 22.45 crore.

RDPL proposes to modernise its existing manufacturing facilities at an estimated cost of Rs 8.75 crore. Both these companies are profit making.

“In order, therefore, to help KAPL and RDPL in their plans to upgrade their manufacturing facilities, both the companies have been brought under the direct control of the Union Government.

“The decision would also help KAPL and RDPL to develop and grow further and stay competitive as also to cater to the requirement of people and provide good quality medicines at reasonable rates,” said a press statement.