Globalisation seems to be driving the Indian pharma industry towards better environmental, health and safety (EHS) performances. In order to elevate their global image, several Indian companies are complying with EHS standards to widen their horizons and attract international players.
EHS auditing is becoming a global practice as organisations around the world develop audit standards. Big players across diverse industrial sectors especially from US and European countries are opting for EHS compliance as one of the key mandate in the process of manufacturing outsourcing.
Most pharma companies like Ranbaxy Laboratories, Alembic, Dr Reddy's Laboratories, Cadila Pharmaceuticals, Zydus Cadila, Arch Pharmalabs and USV, among others have ensured a proper EHS management system and other environmental initiatives to attract additional business opportunities in the global arena.
"The Indian pharma world has evolved around industrial development zones set up by various state governments. In earlier years, most of the units could take benefit of the then prevalent lax environmental laws.
But now US and European customers are looking beyond our local compliance levels and want companies to adhere to their standards, which are quite exacting and taxing from an investment perspective.
This has led to a big challenge for the Indian pharma industry, particularly small scale units, which either have investment concerns or limitations of growth beyond their allotted unit areas in these industrial zones. These developments are bound to result in various units getting disqualified for supplies leading to elimination and consolidation in the pharma world.
With quality and cost efficiency as a given, it is only EHS compliance that will stand out for a vendor," says Ajit Kamath, chairman and managing director of Arch Pharmalabs, which has a standalone turnover of Rs 750 crore.
Kamath adds that at a macro level, both China and India have long been viewed as countries with suspect EHS compliance. Companies with orientation of exports to the Western world are faced with no choice but to adhere to EHS. Besides customer audits, many Indian companies have been proactively seeking out ISO14000 and ISO18000 standards to signal EHS compliance.
To be in sync with the green policy of the western world, Indian companies seem to be proactive in adopting a number of green initiatives, including a proper EHS management system.
For Alembic, EHS functions as a major focus are along with other green initiatives like water conservation, replacement of furnace oil by solid fuel bio-mass and stopping the use of ozone depleting chemicals. "Alembic is a 101 year old company and we put a lot of focus in EHS.
At present we are working with a number of multinational pharmaceutical companies and this is an important pre-requisite for them in considering Alembic as a partner for their global outsourcing.
A good EHS system such as the one we have at Alembic also helps us in terms of an accident free zone, awareness about the safety and periodically training our team and a pollution free environment.
Besides, EHS has become a critical area for the leading Indian pharmaceutical companies as more people are investing in it due to the numerous benefits such as safety and health of employees as well as a commitment to the environment. This also results in the enhancement of productivity," says Pranav Amin, director and chief business development officer at Alembic Limited.
According to Amin, an environment-friendly policy could result in additional business opportunities which would affect the top line and bottom-line as an environmentally friendly policy is well respected by pharmaceutical companies all over the world.
The EHS guidelines were created by the International Finance Corporation in 1998. The objective of EHS is to safeguard life, property and the environment.