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Full Text | 'We Warned Govt of Syringe Shortage, It Didn't Pay Heed': Industry Leader

The chairman and managing director of Hindustan Syringes and Medical Devices, Rajiv Nath, recalled that manufacturers had sent repeated reminders to the government to draw up a plan, but there was no response.

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On October 7, The Wire published a video interview of Rajiv Nath, chairman and managing director of Hindustan Syringes and Medical Devices Limited. The interview covered how the Narendra Modi government’s negligence has put India in a situation where it does not have enough syringes to administer COVID-19 vaccines. This is after syringe manufacturers, like Rajiv Nath, have sent repeated reminders over the last year and a half to the government asking it to draw up a plan to ensure that there is no shortfall in the availability of syringes.

This negligence has not only put India in a difficult situation from the point of view of the COVID-19 vaccination programme but also cost syringe manufacturers in India their credibility in the international market. The Indian government has placed curbs on the export of the number of syringes to international buyers.

Below is the full transcript of the 28-minute interview. It has been edited slightly. Watch the interview here.

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Karan Thapar: Hello and welcome to a special interview of The Wire supported by Glenlivet Books. Now it is no secret that India is unlikely to have enough vaccines to fully vaccinate every adult before the end of the year and it is almost entirely because the government failed to place advance orders sufficiently early.

As a result, production wasn’t ramped up and as a result, we now face a shortfall of vaccines, or so at least, every expert has repeatedly said. Now what will come as a terrible surprise to you is, almost identically, the same thing seems to be happening with syringes. A Business Standard story today says, “India simply will not have enough syringes, for the COVID-19 vaccines we want to give, if every single adult is to be fully vaccinated by the end of the year.”

Once again it emerges, that the reason we will be short of syringes is because the government failed to plan in advance and failed to place sufficient orders. But, in this instance, you will also discover, that India’s syringe manufactures were constantly asking the government for details – which the government simply did not give. As a result, the government is now putting pressure on India’s syringe manufacturers to divert stock meant for exports to the domestic market.

Secondly, the government from Monday has also put a curb on exports which will of course affect the sizeable export market India has built up. Joining me to talk about the situation is the chairman and managing director of Hindustan Syringes and Medical Device Limited – India’s largest syringe manufacturer. He is also the forum coordinator of the Association of Indian Medical Device Industry – Rajiv Nath.

Mr. Nath, let me start with a very simple question. Today’s Business Standard says, “Because vaccine availability in India surpasses the production rate of auto-disable syringes and because buffer stock of syringes are inadequate, we have a shortage of syringes, particularly for COVID-19 vaccines”. Can you confirm that?

Rajiv Nath: Yes, that is true. Now vaccines being made in the country, from this month onwards or September onwards, are much more than the rate of production of auto-disable syringes used for vaccination.

Also read: ‘India Faces Syringe Shortage Because Govt Didn’t Place Advance Order’: Industry Leader

KT: In other words, just to take the example of the Serum Institute, they claim that they will be making 200 million doses of Covishield every month starting October. I believe your production of auto-disable syringes is 90 million a month and you are the biggest manufacture of them. So already, between 90 million and 200 million, there is a gap of 110 million. I believe this is compounded further by the fact that so far for next year, the government has only placed an order of 75 million. So, we have a mismatch at almost every level.

Nath: Very true. We have been seeking the government’s plan since last April and we have been sending reminders to the government every few months that there needs to be a supply chain plan, and there needs to be a stockpile as a buffer stock to be created. So that, it is a matter of time when the vaccines will be more than the syringes’ availability…because it is a specialised product to be made. And the delivery time for the moulds and the machine is nine months to one year. Now here you have a position where vaccines are like bullets and syringes are the guns, so until now we have been needing the vaccines but now we will be having the vaccines – the bullets available – but no guns to fire them.

KT: And the important thing is what you said, that since last year, you have been saying –

RN: Yes. My first attempt to reach out to the government was in April last year, just at the onset of COVID, when we knew that more than 50 companies from around the world were trying to make vaccines. So, it was a matter of time that someone would succeed and when someone would succeed we knew that the whole world will want that company to give the technology to other people, even the competition to make a product. So we knew that it is going to be a matter of time, because in every vaccine, you have got 10 dosages. So we have to make at least 10 times those vials, on a daily basis, to keep up.

KT: You are making a very important point. You are saying from last year – April 2020 – you have been saying to the government, ‘Think about how many syringes you will need’ and you got no clear response. Is that correct?

RN: Yes, we also reached out to WHO, UNICEF and other international bodies and they responded to us in June, July last year and they started stockpiling from August last year. The Indian government took time till October to respond to us and only in December last year, they placed their first order with us.

KT: In other words, the WHO and UNICEF got back in June last year, and the Indian government first got in touch in October last year and didn’t place an order till December last year, and clearly this is something they could have done many months ago.

Let me put it like this, it is no rocket science to work out roughly how many syringes you need. For a start, you know it is a double dose vaccine so you know that if you are going to give it to 984 million people, you need virtually 2 billion doses. You can, on that basis, work out how many syringes you need because you know for every vial, you will perhaps need 8-9 syringes because it is for 8-9 people. This advance planning not only could have been done, it should have been done, but it wasn’t.

I am only repeating this because it comes as such a shock that it is exactly what happened when we were talking about ordering enough vaccine doses and it has again happened when it’s the question of having enough syringes.

RN: Yes. We have been pre-warning the government directly through letters and also via media last year because we could sense that what we are learning about the numbers from vaccine makers was only through newspapers and magazines. There was never a meeting which took place till date between vaccine makers and syringe makers. The government should have carried out a coordination exercise for India and for the world as to which are the vaccines coming forward, what are the kind of syringes required for each vaccine. Because each vaccine has a different science of drug delivery. So it has to be fine-tuned.

For example, last year November we came to know that Pfizer vaccine requires a 0.3 able syringe with a special design, and in six weeks’ time, we modified, our processes and our molds to make a product which would complete that need.

KT: But you are saying something particularly shocking. Earlier in the answer you said, you found out from newspaper articles, how many vaccine doses were being ordered and on that basis, you extrapolated for yourself how many syringes would be needed. This information should have come directly from the government in a very clear direct form but it didn’t. You had to work it out from what you read in newspapers and through your own extrapolation.

RN: True. We sought this dialogue because in business to order something is a huge risk. Especially if you know you are going to add catastrophe and next day the demand will not be there.

KT: And you are saying something else too, that you wanted a meeting, a tripartite meeting between vaccine manufacturers and syringe manufactures and the government so you could talk to each other and find out what sort of syringes is needed. As you said Pfizer needed a special syringe…you only found out in November. Fortunately, Pfizer doesn’t get done in India but that doesn’t affect the Indian market. But you wanted a meeting with Indian vaccine manufacturers and the government to work out what were Indian requirements in terms of the quality of the syringe, the quantity of the syringe and the dates of supply and the government did not arrange these meetings. You are really saying the government did not arrange these meetings?

RN: Yes our company believes in sharing the Prime Minister’s vision of being ‘Atmanirbhar’ (self-reliant), we make our own components if we have enough time period to plan in advance. It need not be formal orders also, but at least tell us clear indications as to what are the country’s requirement. We can plan to order equipment for doing that – whether to make a needle, or a cannula or a special type of syringe. All that requires nine months’ period or one year period for ordering the equipment and planning.

KT: And the government never got in touch and told you what they need and that is the most amazing thing of all because it is not something the government would have to go and search to find out. On the very second day if had began talking to vaccine manufacturers, they would have known what the syringe requirement would be and yet it failed to communicate, they even failed to heed your requests for tripartite meetings.

In fact, before this interview you told me that on September 14, roughly three weeks ago, you wrote to the health secretary asking him to let you know what will be the syringe requirements for different phases all the way to March 2023. Three weeks have gone by and I gather you have had no reply from the health secretary. Is that right?

RN: Yes. We only have orders of about 75 million syringes to be supplied in 2022 beginning and we are unclear as to what we have to supply to the Indian government the whole of 2022…whether by March or by December next year or by March 2023. We are not clear about. Until we are clear we cannot plan allocation.

India comes first, my country comes first, so naturally we will give to India first but when India does not come forward and clarify, then we need to offer that to our international buyers. International buyers make commitments to us for one year time period or two year time period, and then tomorrow we go back and do not honour those commitments that puts the country in a bad position and our company in a bad position too.

KT: I want very much to talk about the bad name the government is forcing your industry to get into. But that I would like to pick up on something you said. Not only have you got no reply till today, October 7, to a letter you wrote to the health secretary on September 14 and all you wanted to know was what is the likely requirements of syringes all the way to March 2023.

Now, you only had three weeks gone by and got not reply. But, in that answer you said the only order the government had placed for auto-disable syringes for next year i.e. 2022 is 75 million. That is all they have placed until now when it is already October 7. Next year starts, roughly in two and half months time. I mean the government must now that we need multiple times more than 75 million and yet, that is all they have ordered.

RN: That becomes our challenge because typically tenders come out with a notice period of hardly two weeks to bid and then we need to deliver the quantities in four to six months’ time, in the delivery period required by the government and whether me or any other company in India who makes syringes needs to plan for components because at least my company is self-dependent, we make our own needles. Most of the competitions buy needles and cannula from outside vendors, importing them from China and other countries and you need many months to arrange those components. So, the country may have huge surplus capacity but like if country has the capacity to make 500 million syringes at once and more than half that capacity will be lying idle. So it is not that we cannot deliver, but we cannot deliver with such a short notice period.

KT: Absolutely, and what the government is required to do is share its thinking with you and please hold us in advance so that you have got the components and you can book the system in place to use idle capacity. But you can’t crank up idle capacity like you kick a ball on the football field. It’s not as simple and easy and straightforward as that. It takes time, it takes preparation and that is what the government hasn’t given you and putting it in layman’s term. Am I right?

RN: Very true. It is not only the investment is required for carton machinery. For example, my company had to outlay Rs 150 crore but you also have to outlay money for the working capital for raw material, for components, and there is a risk factor that the capacity will not be used.

KT: Tell me this, at the moment they have only ordered 75 million auto-disable syringes, and clearly without any doubt, they need multiple times that number. So what happens, if in two weeks, three weeks, four weeks, six weeks you get an urgent call from the government saying. ‘Mr. Nath, actually we need 750 million’. What happens then?

RN: So, the earlier we get to know the better it is, because of other buyers like UNICEF, buyers in South America. They do children vaccination programmes, COVID vaccination programmes and they are having long-term agreements with us. They want a clear indication from us, as to what will be offered to them by us like 300 million or 600 million next year or 2023 and we cannot go back and say, “I don’t know.”

KT: But forgive me, isn’t that what you are having to already do. The government is putting pressure on you to deliver syringes and your forced into taking away stock that was put away for export purposes or UNICEF purposes, or WHO purposes and give it to the government instead. I believe already UNICEF has got upset because you have told them we cannot give you the quantity we committed ourselves to do. Is that correct?

RN: Yes, very correct and when we realised that the shortages are coming forward, the previous month we had moved 100 million syringes from UNICEF allocated agreements and offered it to the Government of India, to tide over the immediate crisis which was looming. But, that of course destroys our credibility and we were rapped on our knuckles. figuratively speaking by the clients, because then we don’t become a dependable supplier to them.

KT: Absolutely. In other words, when you say you were rapped on your knuckles, you are saying the UNICEF was not at all happy to hear that. They were displeased?

RN: Very much so. It takes years of effort to make customers like that.

KT: That is the second point I want to come to. It takes years to build up export markets, it takes trust to develop them. Now as of Monday, four days ago, curbs have been put on how much you can export. I gather your industry as a whole, used to export 120 million syringes a month, last year. In the first few months of this year, that had increased to 130 million. But now you have been told by the government, that you can only export 40 million in October and November, and only 90 million in December and January. Is there a danger here, that you could end up losing some export markets as a result?

RN: Sure. As a country, we must be exporting to more than 150 countries worldwide. My own company exports to 120 countries worldwide. On today’s date, I have put 35 million syringes lying in ready stock which was supposed to go out in September, but could not go because of shortage of containers. Our monthly exports from HMD alone are 50 million pieces a month on an average and 40 million embargo is two short a quantity. We don’t understand this 40 million because covers non-COVID syringes. So what is not required for COVID, why ban the export of that?

KT: This is a very important point you are making, in fact, there are two points. One the total amount of export permitted by the industry as a whole is 40 million. Your company alone, which is the biggest manufacturer in India, used to do 500 million a month. So is 40 million is permitted for the industry as a whole, there is no way that you can make even half of your total commitment because, I suppose, that 40 million has to be shared with other manufacturers.

And the second thing. The government has put a curb in a pretty unthinking way, syringes which are not needed for COVID vaccine are also barred or restricted from export, they don’t affect COVID vaccination. Yet, even there export is affected.

Nath: Very true. Not only are we going to be dishonouring our commitments to the buyers of the COVID or the children vaccine syringes worldwide, but also we will be dishonouring distributors in countries like the USA, Europe, Middle East, South America. It’s a different matter that we knew these shortages may come forward. On a voluntary basis, my company and many manufacturers have been withdrawing offering syringes for the export market, because we know India comes first. So, we have enquiries coming in, repeat orders coming in from Japan and Brazil and we sacrificed that business because yes we know India comes first. So it feels quite unfair that here we think for India first, and try to play a balancing game with our international counter commitments and the country but we lose out on both.

A syringe and a vial labelled “COVID-19 vaccine” are seen in front of the Indian flag. Photo: Reuters/Dado Ruvic

KT: Absolutely! So two things have happened, because the government failed to place advance orders, because it failed to think long-term and work out what it needed. Something that didn’t require rocket science which was done pretty easily and simply but because it failed:

a) we have a shortage of syringes domestically, and
b) more importantly from your personal point of view, you are forced to let down traditional countries to whom you exported, because now you are diverting what was intended for them to make up the shortfall at home.

So you are losing out on two counts. You are losing out in terms of export markets but you are still getting the blame from the government for not producing enough for the domestic market. And therefore all of this is because the government failed to think in advance, failed to order in advance. Is that correct.

RN: Very true. All this was avoidable by better supply chain management, by having a better dialogue between the vaccine makers, the syringe makers and the government, and having timelines for the country to gear up, its production for everything including the components. Last year, we told the government that you have taken out a PLI scheme for medical devices. Please include drug delivery, including syringes and other COVID critical medical devices also in the PLI scheme. Things like oxygen concentrators and masks, they should be in PLI scheme.

KT: But did they include other COVID syringes and other devices in the PLI scheme or did they fail to do so?

RN: Nothing, they have only been targeting the PLI scheme for higher equipment which is currently not a priority. Things like MRI, CT scan are prestigious but it may be required in peacetime but currently, for last one and half year we have been fighting a war with COVID. To fight a war with COVID, we need to gear up our medical supplies for concentrators, oxygen therapy equipment, ventilators, masks, PPEs, syringes. Basic stuff. We are falling short of basic stuff and right now in the market there is a spike in demand due to dengue for syringes and healthcare requirement over there. So, as a company do I think for patients in the hospital first or shall I think for vaccination. I would think for patient in the hospital first, and vaccination second.

KT: You are making an astounding point in this answer earlier. The PLI scheme of which the government is so proud and keeps talking about it and boasting about it…You said to them, ‘Extend it to cover, syringes and other COVID required equipment’ and they haven’t done that. I find it astonishing. You are absolutely sure they haven’t done it? I am asking that again.

RN: No they have not done that. We have also asked them, don’t keep the bar so high that it cannot be made eligible for MSME. We wanted the midsize small companies in India to avail the benefits. We said you don’t have to make into a very lucrative scheme but at least give recognition. The people who came forward to put factories in the crisis time, for PPEs kits, for masks and for ventilators. At least recognise their efforts and reward them. It may not cover their losses because now they have got surplus capacities and nobody is buying from them.

Also read: What We Need To Do To Ensure India’s COVID Vaccine Shortage Doesn’t Get Worse

KT: Mr Nath, I am interrupting. The government calls these people, “warriors” That is the rhetoric the Prime Minister uses. He goes abroad and makes speeches in the UN about how we ramped up PPE production from nothing to a fantastic amount and yet, when you are saying to them, “Help them by putting them on the PLI scheme.” All you get is silence.

RN: Yes. We have asked the government that the manufacturing capacity which has now been created. Let us make it globally competitive, help the manufactures to become world-class, give them incentive them so they can make quality product for the world market and make sure they don’t become bankrupt because now the common man finds that there is surplus capacity in the country, custom duties have been reduced so you have imports coming in, there is unhealthy competition. Factories are dying out –

KT: The audience listening to you will have formed two opinions and I to put them to you to ask if you agree. First, the government boasts about the PIL scheme, the government boasts about how PPE production went up and yet when you said to them, as an industry bring them under PIL and help them particularly the small people. It refused to do so, it was silent. Audience will say to themselves isn’t this hypocrisy? Would you agree?

RN: I think I failed in my persuasive ability to convince them.

KT: Okay, you are being a diplomat. Let me put another question to you. The situation we face with syringes is entirely because the government failed to plan and think and order in advance. Something they could have done, should have done, but didn’t do. Exactly the same thing has happened with vaccine orders, Which is why we had such a shortfall, it’s getting better now, but we had a terrible shortfall right through the months of summer. Both with regard to ordering vaccines and now with regard to ordering syringes. The audience will say, this is laparwahi (negligence), this is irresponsibility. Would you agree?

RN: Very much so. From our end, we have been proactive in forewarning the government repeatedly. Outside India, we are being listened to and we feel sorry that within India we are not being listened to.

KT: This is astonishing! Outside India, I take it you mean UNICEF, WHO and everyone else. They listen to you, they order in advance, they make sure they have given proper commitments so that you produce. Inside India, you are giving them forewarnings and they are not listening to you.

RN: Yes, we have had international conferences between WHO, Gates Foundation and other multilateral organisations  and UNICEF so that the global supply chain and the global demand and supply can be managed to avoid shortages not only for India but also for the world. Because nobody is safe until everybody is safe, so we have to make syringes not only for India. The whole world needs to be vaccinated. Tomorrow there might be a new strain of the disease that will come back to bite us.

KT: I am going to end this interview by repeating what you said. When I said to you, this whole situation — how the government managed COVID vaccine orders, how it managed syringe orders suggest to the audience that this is laparwahi, this is irresponsibility. And I asked if you would agree, your answer was, “Very much so.” So you are saying the government has been irresponsible.

RN: It could have managed in a much better manner surely. This crisis could not have been created, it could have been prevented.

KT: It could have been prevented, it could have been managed in a better way. Will you also use the word ‘irresponsible’? You said, “Very much so.” But when I repeated it a second time, you didn’t use the word irresponsible. I know you are smiling. I know it is not easy who you have to deal with — the government — to use that language. Bu there is the Indian audience which would like clarity from you. Would you use the word, ‘irresponsible’ rather than, “Very much so”?

RN: One cannot fight with one’s customers. One has to carry the customer along with you. One can educate the customer. That’s it.

KT: In this case, the customer being the government does not get educated despite your best efforts. That you will agree to, won’t you?

RN: True.

KT: Mr. Nath, I thank you for having told me this story and I thank you in particular for giving us the details. Lastly I just want to repeat that when I ask you, whether you would accept that the audience are left with the impression that this is laparwahi, this is irresponsibility, your preferred answer was, “Very much so.” You agree it is irresponsibility, even if, understandably, you do not want to use that precise word yourself.

RN: True.

KT: Thank you very much for this interview. Take care, stay safe and I hope you are not made to suffer for your honesty and for sharing the truth with the Indian people.

RN: On our part, we will keep on making endeavours, to build the supply chain gaps. Right now, we are building another factory to make another 20 lakh pieces per day and putting another factory to increase capacity from four billion needles per day to six billion needles per day.

KT: I wish you the best of luck. Take care. Stay safe.

Watch the full interview here