Ahmedabad: Pharmaceutical manufacturers in Gujarat are grappling with mounting cost pressures as prices of key raw materials have surged sharply over the past month, following supply disruptions triggered by the ongoing conflict in West Asia.Industry sources said prices of several petrochemical-based Active Pharmaceutical Ingredients (APIs) have risen steeply, in some cases by as much as 90%, severely squeezing margins for drug makers. The spike is particularly concerning for manufacturers of essential medicines, where selling prices are tightly regulated.Among the hardest hit inputs, metformin has recorded a price increase of nearly 90%, paracetamol by around 50%, and sodium acid citrate BP by 31% within a month. The surge has disrupted cost calculations across the sector, forcing companies to reassess production strategies.The pressure extends beyond APIs. Prices of excipients, solvents, intermediates, and even packaging materials have also climbed significantly, compounding the burden on manufacturers. Adding to the uncertainty, suppliers are reportedly unwilling to hold quotations for more than an hour due to extreme price volatility.“There is unprecedented uncertainty in the raw material market. API suppliers are not willing to commit to rates, and that has created enormous financial stress for manufacturers who need predictable input costs,” said Munjal Patel, director of Lincoln Pharmaceuticals Ltd.Supply constraints have further tightened availability of several APIs, with disruptions in gas supplies affecting production of petrochemical-linked materials. The situation has been exacerbated by a weakening rupee, which has made imported raw materials more expensive.Industry experts noted that manufacturers of scheduled drugs are facing the greatest strain, as they are unable to pass on rising costs due to price caps.Highlighting the logistics challenges, Viranchi Shah, former national president of the Indian Drug Manufacturers’ Association, said disruptions in vessel movement along India’s western coast are affecting exports and input supplies.“There is disruption due to availability of vessels sailing to and from the western shore of India, which poses a challenge for pharma exporters. Most players anticipate supply chain issues in petrochemical-based APIs, KSMs, and solvents. This has led to speculative increases in API rates, though we expect the situation to stabilise soon,” he said.
