Progress of the ‘Millennium Development Goals (MDGs)’ in India: a little to cheer, more to ponder

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The world has just five more years to achieve the ‘Millennium Development Goals (MDGs)’. To accelerate progress of this unique United Nation’s initiative the UN Secretary-General Ban Ki-moon has called on world leaders to attend a summit in New York on 20-22 September 2010. Under this back-drop let us deliberate on the progress made by India on this global project.

The ‘Millennium Development Goals (MDGs)’:

These are eight time-bound comprehensive developmental goals, both global and country-specific, adopted by the world leaders in the year 2000, with clearly defined benchmarks and targets to achieve by the year 2015, encompassing even the healthcare space. The key purpose of the MDGs is to address multi-dimensional issues and manifestations of extreme poverty prevailing in the world. The eight MDGs, which have been clearly divided into 18 quantifiable targets and evaluated by 48 indicators, are as follows.

1: Eradicate extreme poverty and hunger
2: Achieve universal primary education
3: Promote gender equality and empower women
4: Reduce child mortality
5: Improve maternal health
6: Combat HIV/AIDS, malaria and other diseases
7: Ensure environmental sustainability
8: Develop a Global Partnership for Development

What happens, if these goals are achieved?

MDGs provide a unique platform to the civil society across the nations to work in unison with common objectives to ensure equitable distribution of the outcome of human development in all countries of the world. If the MDGs are achieved by all the nations, it is believed, ‘world poverty will be cut by half, tens of millions of lives will be saved, and billions more people will have the opportunity to benefit from the global economy’.

UNDP score card and forecast:

The first India country-report on the MDGs for the year 2005 was released by the Government of India on February 13, 2006 in Delhi. Now with just five more years to go, let me take you through the following broad and major findings from an assessment report prepared by the United Nations Development Program (UNDP) in 2009 on the same:

1: Eradicate extreme poverty and hunger:

Set objective: India must reduce the number of people below the poverty line from around 37,5% in 1990 to around 18.75% in 2015.

Progress:

• Absolute number of poor has declined from 320 million (36% of population) in 1993-94 to 301 million (27.6% of total population) in 2004-05. At this rate, the country will still have 279 million people (22.1%) living below the poverty line in 2015.

• India is slow in eliminating the effects of malnutrition, going by the proportion of underweight children below three years of age. This proportion has declined only marginally from about 47 in 1998-99 to about 46 percent in 2005-06. At this rate, 40% of children will still remain underweight by 2015.

2: Achieve universal primary education:

Set objective: India should increase the primary school enrolment rate to 100% and wipe out the drop-outs by 2015 against 41.96% in 1991-92.

Progress: Going at the rate by which youth literacy increased between 1991 and 2001, from 61.9% to 76.4%, India is expected to have 100 percent youth literacy by the end of 2012.

3: Promote gender equality and empower women:

Set objective: India will promote female participation at all levels to reach a female: male proportion of equal levels by 2015.

Progress: Gender parity in primary and secondary education is likely to be achieved, though not in tertiary education. But the share of women in wage employment in the non-farm sector can at best be expected to reach a level of about 24% by 2015, far short of parity.

4: Reduce child mortality:

Set objective: India will reduce under- five mortality rate (U5MR) from 125 deaths per thousand live births in 1988-92 to 42 in 2015.

Progress: Prevalence of child mortality is down from 125 per thousand live births in 1990 to 74.6 per thousand live births in 2005-06. At this rate, the level is expected to reach 70 per thousand by 2015, short of the target of 42 per thousand live births by 2015.

5: Improve maternal health:

Set objective: India should reduce maternal mortality rate (MMR) from 437 deaths per 100,000 live births in 1991 to 109 by 2015.

Progress: The national MMR level has come down from 398 per 100,000 live births in 1997‐98 to 254 per 100,000 live births in 2004‐06, a 36% decline over a span of seven years as compared to a 25% decline in the preceding eight years from 1990‐1997. Given to achieve an MMR of 109 per 100,000 live births by 2015, India tends to fall short by about 26 points as it tends to reach MMR of about 135 per 100,000 live births in 2015.

6: Combat HIV/AIDS, malaria and other diseases:

Set objective: India has a low prevalence of HIV among pregnant women as compared to other developing countries, yet the prevalence rate has increased from 0.74 per thousand pregnant women in 2002 to 0.86 in 2003. The increasing trend needs to be reversed by 2015.

Progress:

• Spread of HIV/AIDS in the country shows a downward trend: from 2.73 million (0.45%) people living with HIV/AIDS in 2002, the number has declined to 2.31 million (0.34%) by 2007.

• With 1.9 million tuberculosis cases estimated in 2008, India has a fifth of the world’s total. But India made the most notable progress in providing treatment across the country. In 2008, over 1.5 million patients were enrolled for treatment.

7: Ensure environmental sustainability:

Set objectives:

• Integrate the principles of sustainable development into country policies and programs and reverse the loss of environmental resources.

• Halve, by 2015, the proportion of people without sustainable access to safe drinking water and basic sanitation

Progress:

• During the past decade, India’s forest cover has increased by 728 sq. km, access to water is up from 68.2% in 1992-93 to 84.4% in 2007-08 and in urban areas it is 95%.

• 2015 Target (83%) for proportion of households without access to safe drinking water sources has already been attained by 2007‐08 (84%).

• At the current rate of decline, India is likely to have the proportion of households without any sanitation reduced to about 46% by 2015 against the target of 38%.

8: Develop a Global Partnership for Development:

Set objective: Co-operation with the private sector and making available the benefits of new technologies.

Progress: Overall tele-density has remarkably increased from 0.67 per 100 population in 1991 to 36.98 per 100 population in March 2009.

Conclusion:

Though in some areas of MDGs like, achieving universal primary education, combating HIV, malaria and tuberculosis, ensuring environmental sustainability and developing a global partnership for development, India has something to cheer about. However, in other areas the progress made by the country, as on date, is far from satisfactory, as there are more key issues to ponder. The main reasons of inadequacy in these areas being low public spend of around 1.1% of GDP on health and 4.1% on education.

Moreover, the awareness, contribution and involvement of other stakeholders like Corporates, NGOs and the Civil Society at large in most of the states of India, if not all, in this commendable global initiative is dismal, to say the least.

If India wants to come out with flying colors by end 2015 in its efforts to effectively address multi-dimensional issues and manifestations of extreme poverty and hunger prevailing in the country, the Country assessment report prepared by the UNDP in 2009 on MDGs, should be taken as the ‘wake-up’ call to make good the lost time– as the saying goes ‘better late than never’.

By Tapan Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Creating an IPR friendly robust ‘Echo-System’ and ‘Improving Access to Affordable Medicines’ are not either/or situation in India

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Last year, though the growth of the Global Pharmaceutical Industry with a turnover of US$ 752 billion significantly slowed down to just 6.7% due to various contributing factors, the Indian Pharmaceutical Industry continued to maintain a robust of growth of 18% with a turnover of US$ 8.1 billion (IMS 2009).

Need to invest more in R&D:

On a longer term perspective, the domestic industry growth will be significantly driven by the newer products, which will be the outcome of painstaking innovative research and development initiatives. Keeping this point in mind, the fact that today India accounts less than one per cent of over US$130 billion of the worldwide spending on research and development for pharmaceuticals, despite its known strength in process chemistry and abundant talent pool, has started attracting attention of the government.

Robust IPR regime and addressing the needs of the poor both are equally important:

The Prime Minister of India, Dr Manmohan Singh in his address at the Fortune Global Forum in New Delhi in October, 2007 clearly enunciated, “We have affirmed our commitment to the protection of intellectual property rights. But, the global economy, the global community cannot afford the complete privatization of research, of knowledge generation, especially in fields like medicine. We need to evolve mechanisms that protect intellectual property and at the same time, address the needs of the poor”.

Thus encouragement, reward and protection of IPR and addressing the crying needs of the poor are definitely not an either/or situation. The country needs to address both with equal importance and focus.

‘Vision 2020’ of the Department of Pharmaceuticals:

It is encouraging to note that the Department of Pharmaceuticals (DoP) of the Government of India through its ‘Vision 2020’ initiatives is planning to create a new echo-system in the country to promote new drug discovery platforms. This is expected to catapult the country as one of the top five global pharmaceutical hubs, by 2020 attracting additional investments of around US$ 20 billion to the GDP of the country.

The Primary role of the Pharmaceutical Industry in India, like in many other countries of the world, is to make significant contribution to the healthcare objectives of the nation by meeting the unmet needs of the ailing patients, with innovative affordable medicines. This role can be fulfilled by developing newer medicines through painstaking, time-consuming, risky and expensive basic research initiatives. To help translate this vision into reality appropriate echo-system needs to be created in the country, urgently, for the Pharmaceutical Industry in India to commit themselves to its one of the prime functions of discovering and developing newer medicines not only for the patients in India but for all across the world.

Ongoing efforts in Research & Development (R&D) would require a robust national policy environment that would encourage, protect and reward innovation. Improving healthcare environment in partnership with the Government remains a priority for the Research based Pharmaceutical Companies in India.

Need to tighten the loose knots:

However, in the new paradigm, which has been designed to foster innovation in the country, there are still some loose knots to be tightened up to achieve the set objectives for the nation, in the longer term perspective.

Uncertainty over weak enforcement of patent in the country should be dispelled, with efficient administration of the new patent regime. Regulatory Data Protection should be introduced to spur R&D investment and global collaborative opportunities. This will, in turn, help improving the competitiveness of India vis-à-vis countries like China to attract appreciable investments towards R&D of pharmaceutical and bio-pharmaceutical products. It is believed that the capacity of our judiciary should be expanded and specialized courts that can enforce Pharmaceutical patents be provided with requisite technical expertise.

How to address the core issue of ‘availability of quality medicines at affordable prices’?

India needs to address the root cause of the ‘pricing issue’ affecting ‘access to quality medicines at affordable prices’ to a vast majority of its population, in a holistic way, rather than superficially with a piecemeal approach, as is being done since long.

The policy of ‘stringent price control of medicines’ of the government since 1970, has certainly enabled India to ensure availability of medicines at the lowest price in the world, lower than even the neighbouring countries like, Pakistan, Bangladesh and Sri Lanka. However, the core issue of ‘affordability of medicines’ has still remained elusive and will remain so, if we continue to tread this much beaten path, though not so successful in the perspective of the core issue, even today.

This is mainly because, around 40% of our population still costitutes of ‘Below the Poverty Line (BPL)’ families, who, very unfortunately, will not be able to afford any price of medicines. This is vindicated by the WHO report, quoted by even our government that 65% of Indian population has no access to modern medicines, as against 15% in China and 47% in Africa, despite medicines prices being the cheapest in India.

In such a situation, even if prices of all drugs featuring under the National List of Essential Medicines (NLEM), anti-cancer and other drugs are brought under stringent price control, the same ‘affordability of medicines’ issue will continue to linger.

Moreover, the recent announcement by the National Pharmaceutical Pricing Authority (NPPA), “as per the Secondary Stock Audit Report of ORG-IMS for the month of April 2010, which covers 60,000 packs, in the non-schedule category, the percentage of packs whose prices have increased on monthly basis during 2009-10, is only in the range of 0.0003 to 4.75%, while the remaining have shown stable to declining prices,” clearly vindicates that unusual price increase of medicines is also not a problem either, in India.

Considering all these points, as I have been suggesting since long, the government should, at least now, allocate adequate fund to cover all BPL families under “Rashtriya Bima Yojona’ and ensure its effective implementation by creating adequate healthcare infrastructure and measurable/transparent delivery systems. Similarly, the rest of the population of the country should be covered by encouraging opening-up and deep penetration of a variety of medical insurance products to suit all pockets together with appropriate tax incentives, as is currently being extended to the ‘Mediclaim’ policy holders.

In all developed countries and many emerging markets like China (where about 85% of the population are covered by different types of healthcare expenditure reimbursement schemes), the issue of ‘affordability of medicines’ has been addressed with such type of approach and other social security measures by their respective governments.

 

“Employers must take health cover for staff or lose tax gains”: Montek Singh Ahluwalia

It is indeed quite encouraging to note from the report of The Hindu Business Line dated September 9, 2010, as this critical issue is being regularly deliberated through this column, the Deputy Chairman of the Planning Commission, Mr Montek Singh Ahluwalia, has “mooted denial of tax deductibility on wage payment if the employer in the organised sector does not take steps to enrol the employee in a group health insurance scheme. Mr Ahluwalia said employers in the organised sector should be encouraged to make it compulsory for their employees to join a group health insurance scheme, in which the employer and the employee make contributions. As an incentive for this, the insurance premium that is paid can be exempt from tax as India will never be able to expand insurance for which people pay unless an element of incentive-cum-compulsion is introduced”. Mr. Ahuluwalia further commented, “If you leave it to people, only rich people will buy insurance, even middle class people will not buy insurance,” He insisted that “his proposal is feasible and the Government should give it a very serious consideration”.
High incidence of mortality and morbidity burden of India can only be addressed by improving ‘Access to Healthcare’:

Therefore, improving access to healthcare in general and medicines in particular should be on the top priority agenda of the policy makers in our country. High incidence of mortality and morbidity burden in a country like ours can only be addressed by improving Access to healthcare through a concerted partnership oriented strategy. Thus, Pharmaceutical Industry in India should be committed to actively support all efforts from all corners towards this direction to improve Access to Medicines to a vast majority of population in India. Although sporadic, efforts to this direction are being made through various laudable Corporate Social Responsibility (CSR) Initiatives by both local and global pharmaceutical companies within the country.

Pharmaceutical Industry also needs to behave as a responsible corporate citizen:

Another area of focus should be on good corporate governance. This encompasses adherence to high ethical standards in clinical trials, regulatory and legal compliance, working to prevent corrupt activities, high ethical standard in promotion of medicines and addressing all other issues that support good healthcare policies of the Government. In addition, the Pharmaceutical Industry should take active measures to involve all concerned to fight the growing menace of counterfeit and spurious medicines which significantly harm the patients all over the country.

Conclusion:

It is obvious that the Pharmaceutical Industry alone will have a limited role to address the key healthcare issues of our nation. All stakeholders like the government, corporate and the civil society in general must contribute according to their respective capabilities, obligations and enlightened societal interests to effectively address these pressing issues.

However, it is worth reiterating that the Pharmaceutical Industry in India should continue to act responsibly and demonstrate commitment to work closely in collaboration with all stakeholders to make newer innovative medicines both preventive and therapeutic available and accessible adequately at an affordable price to the ailing population of the nation. Thus, in my view, for the progress of the nation, creating a robust IPR friendly ‘Echo System’ and ‘Improving Access to Quality Medicine at an Affordable Price’, are certainly not an either/or situation for the astute policy makers in India, as is being made out to be at some quarters.

By Tapan Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Prescribing medicines by generic names…a good intent… but is it a practical proposition in India?

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Parliamentary Standing Committee for Health and Family Welfare in their recommendation to the ‘Rajya Sabha’ of the Indian Parliament on August 4, 2010, recommended prescription of medicines by their generic names.

This recommendation appears to be based on the premises that the cost of ‘Brand Building’ exercise of the generic drugs in India, including varying degree of presumably ‘high sales and marketing expenditure’ incurred by the formulators towards such efforts, can be easily eliminated to make medicines available to the common man at much cheaper prices.

This recommendation, on the face of it, makes immense sense. However, the moot question remains, “Is it a practical proposition to implement in India?”

In the following paragraphs, let me try to deliberate on this important issue.

Generics and Branded Generics:

As we know generic name is the actual chemical name of a drug. The brand name is selected by the producer of a formulation and is built on various differential value parameters for its proper position in the minds of health professionals as well as the patients. Thus, brand name offers a specific identity to the generic drug.

The prevailing situation in India:

In India, over 50% medicines prescribed by the physicians are for Fixed Dose Combinations (FDCs), spanning across almost all therapeutic categories. Thus, it could be difficult for them to prescribe such medicines in the generic name and could equally be difficult for the chemist to dispense such prescriptions.

Moreover, in case of any mistake of dispensing the wrong drug by the chemist inadvertently, the patients could face serious consequences. It is well known, the concentration of ingredients in the fixed dose combination of any two medicines, many a times, differs from manufacturer to manufacturer. There are over 50,000 odd formulations in the Indian pharmaceutical market and it would be almost impossible for any doctor to keep track of exact concentrations of each of these drugs and prescribe in their right strengths.

Current prescription practice:

Currently doctors use brand names to differentiate one such formulation from the others. Different brands of even single ingredient medicines may have inherent differences in their formulations like, in the drug delivery systems (controlled/sustained release), kind of coatings allowing dissolution in different parts of alimentary canal, dispersible or non-dispersible tablets, chewable or non-chewable tablets etc. Since doctors are best aware of their patients’ conditions, they may wish to prescribe a specific type of formulation based on specific conditions of the patients, which may not be possible by prescribing only in generic names.

Other Patients related issues:

Patients also could face other difficulties due to generic prescribing. As is known, different brands of FDCs may have different proportions of same active ingredients. If chemists do not know or have the exact combination prescribed by the doctor in their shops, thye would possibly substitute with a different combination of same drugs, which could well be less effective or even harmful to the patients.

Conclusion:

Prescriptions by generic names instead of brand names could likely to lead to substitution of the medicines at the chemists’ outlets because of the reasons, as mentioned above.

Thus, the major concern with generic prescriptions is that a chemist will then make the choice of the manufacturer while dispensing a medicine. There could only be one criterion for the choice of such medicines by a chemist i.e. to select what gives them highest margin of profit. In such a case, the ultimate decision making authority for the prescription medicines shifts from the physicians to the chemists, which could make the situation far worse for the patients. For the interest of the patients, it is, therefore, extremely important that the government, regulators, physicians, chemists and even the patients’ groups are aware of such risks.

Considering all these risk factors, in my view, if the prescriptions of medicines are made mandatory by their respective generic names in India, it could compromise with patients’ safety, very significantly.

By Tapan Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Create, Deliver and Realize maximum value from a new product launch with an innovative Supply Chain Management system

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Like in many other industries, effective supply-chain management (SCM) in the pharmaceutical industry involves a systematic process, spanning from procurement of raw, packaging and other related materials, converting those materials into finished goods stock keeping units (SKUs), inventory management of both raw and packaging material, as well as finished goods and finally the distribution of these SKUs to wholesalers/ stockists/ distributors, C&F Agents.Now a days, with intense cost containment pressure all around, effective SCM is gaining a critical importance in the overall business process of the pharmaceutical companies. Besides all these, SCM also plays a very important role in maintaining regulatory compliance and help preserving product quality and safety standards.Key deliverables of a good SCM system:

The key deliverables of a good SCM system are to ensure availability to the customers:

Of RIGHT Product
At RIGHT Time
In RIGHT Quantity
At RIGHT Place
At RIGHT Price and
Of RIGHT Quality

However, in this article, I shall not dwell on these well known and basic parameters. Instead I shall deliberate on three other very important aspects of the supply chain management for your consideration:

1. What will a great SCM system mean?
2. What is the emerging role of SCM system in launching a new product
3. Innovation and measuring SCM effectiveness

1. What will a great SCM system mean?

In my opinion this will cover three important points:

- The SCM system should have an excellent feel of demand fluctuations and its robust measurement system.
- The cost of running an efficient SCM system should be kept at its minimum.
- The SCM structure should always be without any organizational flab.

I repeat, to be effective, a good SCM System must always be demand driven. Customer demand must be ascertained and quantified first and only then company specific supply chain requirements to be worked out and not the other way.

Various research studies confirm that there are certain common qualities for the demand-driven companies, namely:

- Reaction time to gauge and respond to the customer needs and demand is very quick
- A robust IT infrastructure is in place to facilitate delivery of the key Supply Chain
deliverables

SCM helps in value creation, value delivery and the value realization process:

As we know that value creation is the first step for a demand driven organization, followed by value delivery and value realization.

Pfizer Inc ranked high towards these efforts with Lipitor. If by any chance Lipitor gets out of stock, doctors usually do not switch over to other statins; the patient may possibly come back to the Pharmacy next day and hope he/she will get Lipitor. Such type of value creation for the product had made Lipitor over US$14 billion brand today despite the presence of other newer statins in the market and a very efficient SCM system of Pfizer Inc.

In an ideal scenario there should be an overlap between product management, demand management and the SCM systems.

Need for interaction between SCM and Product Development/Management Teams:

In my view, some sort of close interaction between the Supply Chain with Product Development and Management teams is very important for any innovative company to succeed in the market place. This I reckon will be unavoidable in not so distant future. Currently there could be some such link, as mentioned above, existing in some organization, but certainly not what it ought to be.

A robust IT system is a major requirement:

A robust IT system is a major requirement for such interaction process between Product Management, Demand Management and the SCM. Those companies, which will be unwilling to invest in a robust and rapidly scalable IT infrastructure that provides process integrity, transaction reliability, data visibility and intelligence for decision making may find it difficult to implement such an important business process.

2. The role of SCM System in launching a New Product:

In the twenty first century, as we all are aware that quality of innovation determines the sharpness of the competitive edge of any company in the marketplace. This aspect of competitiveness will be increasingly more and more important. Unfortunately, despite having this cutting edge many highly innovative companies have been experiencing great problems while launching their innovative new products in the market.

As we have seen from the recent media reports, two examples indeed stand out:

- Delays in the launch of Airbus 380 wiped off five billion euros of the value of its parent
company.
- Another important example was the enormous problem that Sony faced to make adequate
number of Play Station 3 consoles for the holiday season.

These illustrations indicate that conceptualizing, developing and finally launching new products is becoming increasingly more and more difficult. It is now widely believed that the key issue is inadequate understanding of the critical role that the supply chain plays in the innovative process of an organization.

SCM – a key success factor for a new product launch:

In most of the companies, the world over, the marketing team decides on the product launch decisions. Fortunately now we have started understanding though gradually but surely that the success of a new product launch very heavily dependent on effective co-ordination on all aspects of the supply chain from design to sourcing to manufacturing to distribution.

Therefore, in order to succeed with a new product launch, concerned company will need to ensure that Product development, Sales and Marketing, operations planning and supply chain work very closely together as a coherent team. Such co-ordination between these functions is now an absolute imperative. Close co-ordination even within the various activities of SCM systems play a critical role on the quality and nature of an innovative product or services and thereafter for an effective logistic support to the finished new products.

3. Innovation and measuring SCM effectiveness:

Quality of innovative ideas implemented in various levels of the SCM process along with the operational excellence will determine the ultimate effectiveness of a SCM system of a company.

Operational excellence is usually measured through the effectiveness of various parameters set for the same like. These parameters may include order fill rate, cost of the SCM process followed and the speed that it adds right from the material procurement process to the delivery of required SKU’s right up to the retail chemists.

Similarly effectiveness of innovative steps taken in the SCM process is measured by many on parameters like, the return on new product development and the speed of launch.

Conclusion:

To make a new product launch successful, companies will increasingly require to work out not only an effective process for launch, but will also need to ensure that marketing, finance, operations and SCM with innovative steps built into it, work very closely together to help create, deliver and realize both tangible and intangible value of a new product, most effectively, to contribute significantly to the stakeholders’ value.

By Tapan Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion

Hype on “Superbug” – national pride – rational mind

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Since around last fortnight Indian media of all types and forms, have been fiercely competing with each other to attract the ‘eye balls’ of the viewer/readers through ‘alarming’ news items starting from the situation in the J&K to the ‘rampant corruption’ involving the Commonwealth Games, with of course their usual (over)dose of sensationalism.

In a situation like this to prove ‘enough is JUST NOT enough’, as it were, on August 11, 2010, the well-known medical journal of repute “The Lancet” published a routine article, which further added to the ‘media sensationalism’ in India. The report highlighted that a new ALL antibiotics-resistant “Superbug” originating from Pakistan, appears to have taken its first life. This happened when a patient who was brought to a hospital in Belgium and died in June this year after having met with a car accident in Pakistan, where the diseased was infected by this ‘Superbug”.

This article in ‘The Lancet’ written by a team of international researchers including an Indian, elaborated that a new variety of enzyme named after India’s national capital New Delhi, called, “New Delhi Metallo beta lactamase” in short “NDM 1” turns any bacteria into a deadly “Superbug”, making it resistant to ALL types of antibiotics, leaving virtually no cure in sight.

It was also reported that this deadly “Superbug” has already reached the United Kingdom through patients who acquired it from the hospitals in India. The article reported that the deadly “Superbug” originated from the hospitals of Pakistan and India has the potential to precipitate serious health issues across the world.

“The New Delhi Superbug” was discovered even earlier:

This report generated a sharp reaction in India and from some of its authors regarding its authenticity. Some experts even termed this study as the ‘Western plot to undermine medical tourism in India’.

A leading daily of India reported, “Indian medical journal first documented Superbug”. It stated that that the first ever formal documentation of this ‘Superbug’ was made last year at the P.D. Hinduja National Hospital and Medical Research Centre located in Mumbai. This finding was published in the ‘Journal of the Association of Physicians in India (JAPI’) in March 2010. The reason for the emergence of the ‘Superbug’ was attributed to the ‘worrisome outcome of the indiscriminate use of antibiotics’.

“Unfair to blame the country for the ‘New Delhi’ superbug”:

Reacting to this article, Indian health authorities opined, “It is unfortunate that this new bug, which is an environmental thing, has been attached to a particular country.” The reasons being, “Several superbugs are surviving in nature and they have been reported from countries like Greece, Israel, the U.S., Britain, Brazil and there is no public health threat and no need to unnecessarily sensationalize it”. Some experts, however, feel, “such drug resistant bacteria is a matter of chance, is a global phenomenon and is preventable by sound infection prevention strategies which are followed in any good hospital.”

It has been reported that the ‘National Center for Disease Control of India’ is working on guidelines for appropriately recording these types of nosocomial (hospital acquired) infections.

“Superbug” Hype and Medical Tourism:
Many people of both India and Pakistan have felt since then that in absence of an effective response by the health authorities, especially, in India the fast evolving Medical Tourism initiatives, providing medical services ranging from complicated cardiovascular, orthopedic and cerebrovascular surgery to other life-threatening illnesses, may get adversely impacted.

The root cause and the ‘blame game’:

Experts have opined that overuse and imprudent or irrational use of antibiotics without any surveillance protocol are the root cause for emergence of such ‘Superbugs”, though some Indian parliamentarians have termed this article as the propaganda by some vested interests. It has been alleged that the study was funded by the Wellcome Trust and Wyeth, the two global pharmaceutical companies who produce antibiotics to treat such conditions, together with the European Union.

In this context it is worth mentioning that ‘The Lancet’ article in its disclosures says:

“Kartikeyan K Kumarasamy has received a travel grant from Wyeth… David M Livermore has received conference support from numerous pharmaceutical companies, and also holds shares in AstraZeneca, Merck, Pfizer, Dechra, and GlaxoSmithKline, and, as Enduring Attorney, manages further holdings in GlaxoSmithKline and Eco Animal Health. All other authors declare that they have no conflicts of interest.”

Such a situation has not been reported for the first time:

This type of situation has indeed some precedents. When ‘MRSA’ was reported for the first time, it caused similar scare. However, this time many experts feel that it is too early to conclude whether or not ‘NDM-1’ will eventually prove to be more dangerous than ‘MRSA’.

Several such “Superbugs”, as stated earlier, have already been reported from countries like Greece, Israel, USA, UK, and Brazil. However, as I know, in the battle against infectious diseases involving both the scientists and the bacteria, the later had always to succumb, in the long run.

‘NDM-1′, as well, perhaps will be no exception. All concerned MUST continue to make it happen, not by mere wishful thinking but by establishing a strong procedural mechanism to keep a careful vigil on the reasons for emergence of drug resistant bacterial strains in the country.

The World Health Organization (WHO) perspective:

On Saturday, August 21, 2010 the WHO commented, “while multi-drug resistant bacteria are not new and will continue to appear, this development requires monitoring and further study to understand the extent and modes of transmission, and to define the most effective measures for control”.
Conclusion:

The hype created and motives attributed by the media and the politicians over one such routine scientific papers published in a medical journal of international repute, in my view are unwarranted. There are built in systems within the scientific discourse for raising questions and even challenge any findings. Remarks made by one of the authors of the article to the media, perhaps added more fuel to the fire. Politicians seem to have joined the bandwagon to politicize even a benign medical issue captured in the said article. In an era where news items mean “sensationalism” and ‘politicization’ of most such news items is the order of the day, the civil society should be helped to understand the core issues behind all such raging debates.

Besides the reasons, as discussed earlier, attributed to repeated emergence of such “Superbugs”, one more issue I could foresee in today’s environment compared to the same in the past. This issue possibly lies in the shift in focus of pharmaceutical R&D from discovery of novel drugs for infectious diseases to discovery of drugs for non-infectious chronic illnesses like, metabolic disorders (diabetes), hypertension, cardiovascular diseases, psychiatric disorders, cancer, vaccines etc. This shift in the R&D focus has obviously been prompted by the tilt in the prevalence of the disease pattern towards the same direction.

Perhaps for this reason, one notices hardly any significant and novel molecules in the research pipelines of either global or local pharmaceutical companies to treat such antibiotic-resistant infections. It is understandebly not an ‘either/or’ situation. However, as we all know, in life-threatening conditions both types of drugs have their respective places to save precious lives. Let us ponder over it.

By Tapan Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Making quality medicines available at an affordable price – Are we ‘missing woods for the trees’?

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On August 4, 2010 the Parliamentary standing committee for Health and Family Welfare in its 45th report, recommended the following to the ‘Rajya Sabha’ of the Parliament of India for ‘Making quality medicines available at an affordable price’ to the common man:

1. Blanket caps on the profit margins of all medicines across the board, as these are the ‘only items’ where the purchasing decision is taken by a doctor – a third party and not by the patients who will actually pay for such medicines. In such a situation, a possible’ unholy nexus’ between the prescribing doctors and the pharmaceutical companies could put the patients at a disadvantage and in a helpless situation.

2. This blanket cap on profit for ALL drugs will discourage pharmaceutical companies to shift the balance of their product portfolio from schedule (price control) to non-schedule (outside price control) formulations.

3. This action will make the administration of the ‘Price Control’ mechanism by the Government much simpler by eliminating the current practice of price monitoring and the government preference of substitution of generic drugs for the branded pharmaceuticals

4. MRP of ALL medicines should be determined by the NPPA based on an open and transparent process and considering interests of all stake holders, as is currently being followed in other areas like, electricity tariff, bus, auto rickshaw and taxi fares, insurance premiums and various interest rates.

5. The Department of Health and Family Welfare and the Department of Pharmaceuticals should work out a system through the Inter-Ministerial Coordination Committee to put a blanket cap on profit margins of ALL drugs across the board, immediately.

6. Despite amendment of the MCI guidelines for the doctors in December 2009, banning the acceptance of all kinds of gifts, trips to foreign destinations and availing various types of hospitality by them from the pharmaceutical companies, nothing much has changed on the ground related to such ’unethical practices’. Since MCI has no jurisdiction over the pharmaceutical companies, the government should formulate similar punitive steps through the DCGI, CBDT etc. against the erring pharmaceutical companies.

7. The Committee indicated that it desires to be kept apprised of the action taken in this regard by the Government.

The key factors influencing affordability of medicines:

All the above steps will remain as good intent by the policy makers, if the issue of access to medicines is not addressed simultaneously. As we know that affordability will have no meaning, if one does not have even access to medicines.

In my view, there are five key factors, which could ensure smooth access to medicines to the common man across the country; affordable price being just one of these factors:

1. A robust healthcare infrastructure
2. Affordable healthcare costs including pharmaceuticals
3. Rational selection and usage of drugs by all concerned
4. Availability of healthcare financing system like, health insurance
5. Efficient logistics and supply chain support throughout the country

High out of pocket expenditure could push a section of population below the poverty line:

In India ‘out of pocket expenditure’ as a percentage of total healthcare expenses is around 80%, being one of the highest in the world.

A study by the World Bank conducted in May 2001 titled, “India – Raising the Sights: Better Health Systems for India’s Poor” indicates that out-of-pocket medical costs alone may push 2.2% of the population below the poverty line in one year.

‘Missing woods for the trees’?

Affordability is indeed a relative yardstick. What is affordable to an average middle class population may not be affordable to the rest of the population even above the poverty line. Similarly, below the poverty line population may not be able to afford perhaps any cost towards medicines. In a situation like this, putting a blanket profit cap on all medicines will not be just enough. There is a crying need to put in place an appropriate healthcare financing model by the policy makers, covering all sections of the society. Are we then ‘missing woods for the trees’?

Create a robust healthcare provider group through Public Private Partnership (PPP) initiatives to offer quality healthcare at an affordable price:

To resolve the issue of affordability of healthcare in general including medicines, the policy makers should take immediate steps to put in place the ‘Healthcare Financing’ initiatives through a robust PPP model in the country. A highly competitive ‘Health Insurance’ sector, created through PPP, could emerge as a powerful and key healthcare provider in the country. The power that such stakeholders will then assume in deciding for their respective clientele, types of doctors, hospitals, diagnostic labs and even what types of medicines that will be dispensed to them to offer quality healthcare at an affordable price, could indeed be a game changer having an immense influence in bringing the cost of overall healthcare for the common man, including medicines, very significantly.

The ‘Health Insurance’ companies can then decide through the Third Party Administrators (TPA), based on public interest, what types of fees should be charged by the following to offer quality healthcare services at an affordable price to their clientele, if these groups would like to avail the huge business potential for a long period of time:

1. Doctors
2. Hospitals
3. Diagnostic laboratories
4. Other related service providers

For making centralized purchase of medicines, these insurance companies or payors may enter into a hard negotiation with the pharmaceutical companies directly to bring down the price of medicines for the use of their respective clientele.

A recent incident:

To illustrate the above point let me quote an important and related news item, which was published in almost all the leading national daily newspaper, just in the last month.

In July 2010, it was reported that about 18 health insurance companies, who were providing cashless services to the policy holders at over 3,000 hospitals across India, found out that only 350 of them constituting around 11% of the total, were consuming more than 80% of the total claims.

It was also reported that the patients were overcharged by these hospitals for each hospitalization irrespective of the treatment provided and were left with them very little funds for their next treatment. This prompted the said insurance companies to bring some order out of the chaos, as it were.

As a result, at least 150 hospitals only from Delhi and the National Capital region were taken out of their designated list for the cashless facility, keeping the facility available at around 100 hospitals where none belonged to any corporate chain. Similar action was taken against hospitals in other cities, as well.

Thereafter, these insurance companies also decided to convey to the invidual policy holders the fresh list of hospitals for cashless facilities, working out new treatment packages depending on the quality of available healthcare infrastructure of each hospital and a lower or a higher rate was worked out for implementation, accordingly.

This illustration will vindicate how powerful and assertive the health insurance companies could be with the effective use of the TPAs for the sake of public health interest, if they wish to and at the same time to protect their respective bottom lines, creating a win-win situation for all.

Conclusion:

It is indeed an irony that despite being the 4th largest producer of pharmaceuticals and catering to the needs of 20 per cent of the global requirements for the generic medicines, India is still unable to ensure access to modern medicines to around 650 million population of the country (The World Medicine Report, WHO 2004). Like in many other emerging economies of the world, in India too, access to modern medicines along with their affordability, is the key macro healthcare issue of the nation.

In a situation like this, as stated above, when the payors or health insurance companies will start exerting immense performance pressure to all concerned to provide quality healthcare at an affordable price, even the alleged ‘unholy nexus’ between the pharmaceutical companies and the medical profession, perhaps will not have any practical relevance.

It is worth pondering, whether the Government is now sending confusing signals to the civil society at large by propagating ‘non-regulated pricing’ for Petroleum Products and ‘regulated pricing’ for pharmaceutical products?

By Tapan Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

Patients’ Safety, regulatory approval of Biosimilar Drugs in India and WHO Biosimilar guidelines

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Biopharmaceutical drugs are broadly defined as:

”Those medicines produced using a living system or genetically modified organism. These drugs are different from traditional chemical medicines in many ways. Size of the molecule is one of the most obvious distinctions: the molecules of a biopharmaceutical medicine are much larger, have far more complex spatial structures and are much more diverse (“heterogeneous”) than the chemical molecules which make up classical drugs.”

The Biosimilar drugs:

Biosimilar drugs are follow-on versions of original biopharmaceutical medicines. Biosimilar medicines are intended to have the same mechanism of action for the same diseases as the original biopharmaceutical drugs.

The term “bio generic” will be misleading for off patent biopharmaceutical products, as no two biopharmaceutical products could possibly be exactly identical. This is mainly because of the following reason:

“Whereas generics of chemistry based medicines are identical in the molecular structure and therefore copies of the original product, based on a strict definition of “sameness”, a corresponding definition cannot be established for biosimilar medicines because of their nature and the complexity of their manufacturing process. Here post-translational modifications are dependent of the host cell and the process.”

Thus the common terminologies used to describe such products when the original products go off-patent are follow-on biologics and biosimilars.

Manufacturing Conditions of biosimilars ultimately define the final product:

Unlike chemical drugs, the manufacturing conditions and the process followed to produce biopharmaceutical drugs largely define the final product and its quality. Any alteration to the manufacturing process may result in a completely different product. Additionally proteins are relatively unstable. Thus additional measures in their storage, formulation and delivery are very critical.

Key concerns with the existing regulatory approval process for Biosimilar drugs:

• Small changes in the manufacturing process of biosimilar drugs could significantly affect the safety and efficacy of the molecule.

• Due to the very nature of a biologic it is virtually impossible for two different manufacturers to manufacture two identical biopharmaceutical drugs. Identical host expression systems, processes and equivalent technologies need to be demonstrated in extensive comparability trials. Thus, as stated above, a ‘bio generic’ cannot exist.

• As against the situation applicable for generics of chemical molecules which can be replicated, biosimilar drugs cannot be replicated. At the most such biopharmaceuticals can be at the most “similar” but not “identical” to the original reference products. To ensure desired efficacy and safety of biosimilar products, these products should only be approved after charting out a formal and well validated regulatory pathway for the biosimilar drugs in India.

• Currently biosimilar drugs are given marketing approval by the regulator without such guidelines for large molecule biological and following just the bioequivalence model as specified in the Schedule Y of the Drugs and Cosmetics Act (D&CA) of India for small molecule chemical entities only, as the current Drugs and cosmetics Acts of India, very unfortunately, do not differentiate between large and small molecular drugs. This could, in turn, endanger patients’ safety with serious medical consequences.

Although, Central Drugs Standard Control Organization (CDSCO) and the Drugs Controller General of India (DCGI) are responsible for approvals of the new drug applications, health being a state subject, respective state regulatory authorities are responsible for granting manufacturing license to the pharmaceutical manufacturers.

Pharmaceutical manufacturers setting up facilities in the states, where regulatory oversight and incidences of weaker enforcement are common, will be able to market their products, including biosimilars, across the country. It is alleged that there are hardly any regulatory control over the mistakes or offences committed by the State Drug authorities who permit manufacture of drugs even unapproved by the DCGI. The existing issue of mushrooming of various irrational Fixed Dose Combinations (FDC) products in India will vindicate this point.

The Government’s response to this public health concern:

Express Pharma in its June 30, 2009 edition reported Dr M K Bhan, Secretary, Government of India, DBT, saying, “The first question is do we have written guidelines available to people? Currently, we have a large committee of about 30 people in the Review Committee on Genetic Manipulation (RCGM) which frequently discusses the current FDA and EMEA guidelines and makes sure that it is updated as per the guidelines in case by case approvals.”

He acknowledged, to make sure that the product is identical or original is harder for biological than for chemical entities and said, “So the next question is, what is the degree of difficulty you create to be sure that some of the products in the in vitro laboratories and the strength of the biomolecule, are to be characterized in details, and the other side is how expensive should the chemical evaluation be? At this moment, RCGM is seeing the issues and is in touch with both the FDA and the EMEA, and they are taking case by case decisions while trying to standardize the minimum information that is required to show how companies have characterized their products.”

“If we ask a big established company on this issue they will tell us to be strict, whereas a smaller company will suggest otherwise. What we are trying to do is being very scientific and come to a conclusion,” reported Express Pharma quoting Dr. Bhan.

The current practice:

Much water has flown down the bridge since the above interview was published. Nothing much has changed on ground regarding this critical issue, thus far. The industry sources allege that even today regulatory approval of biosimilar drugs (large molecules) are granted based on Phase III clinical trials, as specified in the schedule Y of the Drugs and Cosmetics Acts for the small molecules (chemicals) and that too conducted mostly on just 40 to 45 patients. At times the number of patients studied is even lesser. Immunogenicity study, which is so important for biosimilar drugs is, more often than not, overlooked. This could seriously compromise patients’ safety with such category of drugs.

Conclusion:

It is, indeed, quite surprising that in our country there is still no separate transparent and published guidelines for regulatory approval of Biosimilar drugs even when the World Health Organization (WHO) has come out with the same and India had actively participated in that exercise.
The question, therefore, comes to my mind whether the Biosimilar drugs manufactured in India would conform to international quality and safety standards, like in the U.K or what has been recently announced in the USA? If not, who will address the safety concerns of the patients administering these life saving medicines?

Such a concern gets vindicated by widely reported serious quality problems, detected by the drugs regulatory authorities, at some large and well known Biosimilar drug’s manufacturing units in India, in not too distant past and also from the condition of some vaccine manufacturing units in our country. The recent example of WHO cancelling the pre-qualification of ‘Shan 5’ (Shanta Biotech) vaccines for quality related problems, perhaps may help opening the eyes of our regulators, on the related patients’ safety issues arising out of regulatory laxity.

This issue assumes even greater importance considering the very recent development of the Department of Biotechnology (DBT) unfolding an interesting scheme to encourage development of biosimialr dugs in India by offering financial support to the domestic pharmaceutical and biopharmaceutical industry.

The proposed new regulatory pathway for the marketing approval of Biosimilar drugs in India will immensely help paving the way for the Biopharmaceuticals drugs manufacturers in India to adequately prepare themselves to grab a significant share of the fast emerging Biosimilar drugs markets, particularly, in Europe and the USA, in the years to come.

The Ministry of Health and the Department of Biotechnology of the Government of India should, therefore, urgently and jointly consider amending the Drugs & Cosmetics Acts of India accordingly and establish robust regulatory guidelines for marketing approval of biosimilar drugs in the country, acknowledging the widespread concern for patients’ safety.

By Tapan Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

The traditional ‘Business Models’ of R&D focused Global Pharmaceutical majors are undergoing a metamorphosis

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Mounting pressure on the P&L account, as the products go off patent:

Patented new products are the prime growth driver of the research based pharmaceutical companies of the world. Since last few years, because of various reasons, the number of launch of such products has been greatly reduced. To add fuel to the fire, 2010-12 will witness patent expiries of many blockbuster drugs, depleting the growth potential of the most of the research based pharmaceutical companies.

The existing model of growth engine needs a relook:

The blockbuster model of growth engine of the innovator companies effectively relies on a limited number of ‘winning horses’ to achieve the business goal and meeting the Wall Street expectations. In 2007, depleting pipeline of the blockbuster drugs hit a new low in the developed markets of the world. It is estimated that around U.S. $ 140 billion of annual turnover from blockbuster drugs will get almost shaves off due to patent expiry by the year 2016. IMS reports that in 2010 more than U.S. $ 30 billion will be adversely impacted because of patent expiry. Another set of blockbuster drugs with similar value turnover will go off patent the year after i.e. 2011. It will not be out of context to mention, that last year around U.S. $ 27 billion worth of patented drugs had gone off-patent.

Decline in R&D productivity is not related to investments:

The decline in R&D productivity has not been due to lack of investments. It has been reported that between 1993-2004, R&D expenditure by the pharmaceutical industry rose from U.S.$ 16 billion to around U.S.$ 40 billion. However, during the same period the number of applications for New Chemical Entities (NCEs) filed annually to the U.S. FDA grew by just 7%.

Total global expenditure for pharmaceutical R&D was reported to have reached U.S. $ 70 billion in 2007 and is expected to be around U.S. 90 billion in year 2010. 75% of this expenditure was incurred by the U.S alone. It is interesting to note that only 22 NMEs received marketing approval by the US FDA during this period against 53 in 1996, when R&D expenditure was almost less than half of what was incurred in 2007 towards R&D.

Be that as it may, the pressure on the P&L (Profit and Loss) accounts of these companies is indeed mounting.

The silver linings:

However, there seem to be following two silver linings in the present scenario, as reported by IMS:

1. Number of Phase I and Phase II drugs in the pipeline is increasing.

2. R&D applications for clinical trials in the U.S. rose by 11.6% to a record high of 662 last year.

Significant growth of generic pharmaceuticals is expected in near future, far surpassing the patented products growth:

Patent expiry of so many blockbusters during this period will fuel the growth of generic pharmaceutical business, especially in the large developed markets of the world. The market exclusivity for 180 days being given to the first applicant with a paragraph 4 certification in the U.S. is, indeed, a very strong incentive, especially for the generic companies of India.

Healthcare reform of March/April 2010 in the USA is expected to give a further boost to this trend.

Pressure on traditional Marketing strategies:
The marketing expenditure for pharmaceutical of the global pharmaceutical companies as reported by Scrip is U.S. $ 57.5 billion. However, an industry association reported that research based pharmaceutical companies in the U.S. spent $ 29.4 billion on R&D and $ 27.7 billion on promotional activities.

New Product Differentiation could be a big issue:

Products in R&D pipeline could face problems of ‘differentiation’ in terms of value offering to the patients, once they are launched. This issue is expected to surface especially with products in the oncology disease area. IMS Health reports that about 55 oncology projects are now in Phase III and 8 in the pre-registration stage. Thus about 50 new oncology products are expected to hit the market by end 2010. Many experts anticipate that there may not be significant brand differentiation between the brands of the ‘same basket’, leading to cut-throat competition and further pressure on expenditure towards marketing of brands.

The changing business strategy of global pharmaceutical companies during this trying time:

In this trying time, the global pharmaceutical companies are resorting to an interesting strategy, combing both old and the new ones. I shall touch upon the following seven strategies:

1. Mergers and Acquisitions (M&A):
Mega M&A strategies are still being actively followed by some large Pharmaceutical companies mainly to enrich R&D pipeline and achieve both revenue and cost synergies.
However, some of these large global companies have started realizing that ‘powerhouses’ created through past mega mergers and acquisitions have now become too large to manage effectively for various reasons. Mismatch between two different organization cultures also throws a great challenge to obtain desired output, many a times. Moreover, the merged R&D set up could become too large to manage, impacting the R&D productivity very adversely.

2. Extension of the Product Life Cycle and Effective Product Life Cycle Management:
Many global pharmaceutical companies are now engaged in ‘product life cycle management’ of their existing products by extending the ‘product life cycle’, effectively. In that process they are trying to maximize the brand value of these products in the international markets. For example, AstraZeneca has developed once daily treatment with their anti-psychotic drug Seroquel XR. This extended-release formulation of the same drug will help patients avoid 5 to 7-day titration required with the immediate-release version.
Towards similar initiative, Pfizer has also recently set up a dedicated “Established Product Business Unit” within worldwide pharmaceutical operations, to hasten business growth in the international markets.

3. OTC Switch:
Prescription to ‘Over the Counter’ (OTC) switch is another business strategy that many innovator companies are now imbibing, at a much larger scale.

This strategy is helping many global pharmaceutical companies, especially in the Europe and the U.S to expand the indication of the drugs and thereby widening the patients base.

Recent prescription to OTC switches will include products like, Losec (AstraZeneca), Xenical (Roche), Zocor (Merck), etc.

4. Emerging of Preventive Therapy, like Vaccines:
Many large global companies, like GSK, Sanofi Aventis and Merck are getting attracted by the emerging opportunities in the fast developing vaccines market. This trend has been triggered primarily by heightened awareness and greater focus on preventive medicines almost all over the world. It is estimated that in 2011, the vaccines market will grow from U.S.$ 13 billion to U.S.$ 30 billion registering a growth of 18% each year during this period. PricewaterhouseCoopers (PwC) estimates vaccine market to be U.S. $ 42 billion by year 2015 based on data of 245 pure vaccines and 11 combination vaccines currently under clinical development. It is interesting to note that 90 of these are therapeutic vaccines for cancer.

5. Entry into highly contentious market of Biosimilar drugs:
The Generic Pharmaceutical Association (GPhA) has estimated that it is possible to save US$ 10 billion – 108 billion over a period of 10 years with biosimilars in the top 12 categories of biological drugs. Some of these biological are already off patent and for others the patents will expire shortly.
Only a few biosimilar drugs have reached the global markets as on date because of their regulatory restrictions in most of the developed markets of the world. Even those biosimilar drugs, which have since been launched in Europe like, human growth hormone (HGH) Somatropin and Epoetin alfa for anemia, are yet to make a mark in the market place.

IMS Health reports that Omnitrope (somatropin) of Sandoz, the first biosimilar drug launched in the developed world, has registered less than 1% of the U.S. $ 831 million HGH market in Europe. Moreover, the launch of 3 more biosimilar versions of epoetin alfa in 2007, made almost negligible impact in the market. Such a low acceptance of biosimilars in the western world, so far, could well be due to lingering safety concern of the medical profession with such types of drugs.

Currently, Japan and USA are working on formal guidelines for biosimilar drugs, whereas Health Canada has already issued draft regulatory guidelines for their approval in Canada.

In April 2010, Reliance Life Science has already announced its intent to enter into the Biosimilar market of the EU in not too distant future.

6. Entry into Generic Markets:

Some large global pharmaceutical companies have already made a firm commitment to the generics market. Novartis paved the way for other innovator companies to follow this uncharted frontier, as a global business strategy. Last year the generic business of Novartis (under Sandoz) recorded 19% of their overall net sales, with turnover from generics registering U.S$ 7.2 billion growing at 20%.

Keen business interest of Sanofi Aventis to acquire Zentiva, the generic pharmaceutical company of Czechoslovakia; it’s very recent acquisition of the generic pharmaceutical company Laboratorios Kendrick of Mexico and Shantha Biotech in India and acquisition of Ranbaxy Laboratories of India by Daiichi Sankyo, will vindicate this point.

Pfizer has also maintained its generics presence with Greenstone in the U.S. and is using the company to launch generic versions of its own off patent products such as Diflucan (fluconazole) and Neurontin (gabapentin).

7. Collaboration with the Indian Companies:

Another emerging trend is the collaboration of MNCs with the Indian pharmaceutical companies to market generics in the global market, like, Pfizer with Aurobindo and Claris, GSK with Dr. Reddy’s Laboratories (DRL), Astra Zeneca with Torrent. I guess that similar trend will continue, in future, as well.

Conclusion:
Another ‘new pharmaceutical sales and marketing model’ is gradually emerging in the global markets. This model emphasizes partnership by bundling medicines with services. The key success factor, in this model, will depend on which company will offer better value with an integrated mix of medicines with services. PwC indicates that in this ‘new pharmaceutical marketing model’, besides required medicines, the expertise of a company to effectively deliver some key services like, patient monitoring and disease management could well be the cutting edge for future success.

By Tapan Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.