Nepal Drugs likely to come into operation in 6 months

KATHMANDU, April 14: If everything goes according to plan the state-owned Nepal Drugs Limited, which has remained closed for almost three years, will again start churning out medicines within the next six months.



The financially-troubled pharmaceutical company has already accepted Rs 50 million provided by the Ministry of Finance to facilitate the process of bringing the firm back into operation. [break]



Earlier, the company had refused to take the allocated fund citing it was too little to upgrade and maintain some of the machineries and production facilities. But it had decided to move away from its stance after reviewing its business plan.



As per the new plan, of the amount released by the finance ministry, Rs 20 million will go for covering administrative and salary expenses. “The remaining Rs 30 million would be used in retrofitting the company´s machinery and production units,” Nabin Kumar Jha, general manager of Nepal Drugs, told Republica.



To expedite the refurbishing process, the company is planning to issue a public notice at the end of April or early May calling on interested parties to participate in the bidding of upgrading and maintaining machineries and production facilities.



“This process could take more than five months,” Jha said.



But once it is complete the company will be able to produce Jeevan Jal, an oral rehydration solution, and 10 different types of tablets, names of which have not been finalized yet.



“However, we need at least Rs 10 million extra to purchase raw material,” Jha said, expressing hope that finance ministry would not “act stingy” in releasing additional fund as revenue created from sales of products will be sufficient to cover administrative and salary expenses of at least four months per year.



Nepal Drugs was shut down after the Department of Drugs Administration refused to renew its operating license citing its production standard did not comply with minimum manufacturing standard set by the drugs regulator.



Since then the government has been providing a sum of around Rs 4.2 million per month to cover salary expenses of 279 staff at the company. The government has been trying to reduce this liability by introducing voluntary retirement scheme but the company has demanded Rs 579.1 million to lay off staff, which the finance ministry has said is an “exorbitant amount”.

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