SPIC Pharma unit shuts down
20 July 2011
The 17-year-old SPIC Pharma unit, located at the SIPCOT Industrial Estate here, that has been a market leader in the penicillin products in India till recently, has been unceremoniously closed down, and all its 160 employees and officials have been retrenched.
On Monday morning, the employees who turned up for work were greeted, to their shock, by the locked gates and the closure notice affixed on it. This move has also robbed the livelihood of about 300 contract workers. The notice declares that since there has been no production in the Penicillin-G unit, a pharmaceutical division of the Southern Petrochemical Industries Corporation Ltd, for the past several months and there will be no further production, the Board has approved retrenchment of workers and officials.
The notice further states that the Asset Reconstruction of India Ltd (ARCIL) has taken possession of the assets of the unit under Section 13 (4) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002.
The ARCIL has conveyed to the company its proposal to sell the assets of the unit.
At a time when India was depending upon the imported supply of Penicillin-G the SPIC Pharma had set up the unit in Cuddalore in 1994 at an investment of Rs 220 crore and commenced commercial production in 1995.
Soon it rose to the level of holding 60 per cent market share in penicillin products in the country.
It had set up a highly advanced microbiology laboratory and state-of-the art equipment. Being environmentally conscious, it had also set up an anaerobic digester in its effluent treatment plant.
However, G.Ramanan, general manager of the company, told The Hindu that the company that was even exporting its products to countries such as the US and Canada was too overwhelmed by the unhealthy competition from China.
According to P.Karuppian, CITU district president, the retrenchment was illegal because the mandatory clauses such as serving a 90-day notice to the employees were not complied with.
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