OPPI: India Budget was a missed opportunity

India's pharmaceutical sector, which considered it was virtually ignored in the 2006-2007 Union budget, may consider it has more reason to feel aggrieved with the latest budget, which industry leaders claim has once again failed to address the main issues for drugmakers.

While tax exemption for R&D has been extended for five years to 2012, Ranjit Shahani, president of the Organization of Pharmaceutical Producers of India, and managing director of Novartis India, said in a statement: "the exemption should have been extended to 2017, since the pharmaceutical discovery process is risky and lengthy and takes anywhere between 12 and 15 years."

However, Mr Shahani noted among the positive features of the budget are: the exemption from the 12.5% service tax for global clinical trials, which will mainly benefit clinical research organizations. In a later interview, Mr Shahani said "the fringe benefit tax for physician samples, which were not a benefit to employees, has been correctly withdrawn after two years." The import of R&D equipment for laboratories was previously taxed at 5% for public sector facilities and 7.5% for private ones, but is now set at a uniform 5%.