India Rejects 100% Pfizer Subsidiary

In the absence of a firm commitment to undertake manufacturing or R&D activities in India, the country's Foreign Investment Promotion Board has turned down an application from US drugmaker Pfizer to set up a 100%-owned subsidiary. A similar plan from Bristol-Myers Squibb has also been rejected.

The Pfizer request to set up a 100% subsidiary was one of a clutch of similar proposals made after the new Drug Price Control Order was announced in September 1994. The final decision has been taken apparently because the FIPB remained unconvinced about Pfizer's modified plans. The FIPB decision, according to the Marketletter's local correspondent, is an indication of the board being increasingly selective about the granting of permission to set up 100%-owned subsidiaries in India.