Democratization of Healthcare: An Evolving Trend Driven By Cutting-Edge Technology

We have stepped on to a fascinating era of yet another disruptive innovation in a newly carved out space of the healthcare domain.

Such initiatives are driven by path breaking ideas, which are being translated into reality with the application of cutting-edge technology. All these are aimed at providing a plethora of unique healthcare related solutions in the cyberspace to various stakeholders, especially to patients through inexpensive smartphones of various types.

Although the process has just begun, but is moving at a rapid pace. In virtually no time, as it were, it is showing a great potential of delivering more accurate and affordable healthcare solutions to a large number of the population globally, particularly in the developing nations.

‘Democratization of Healthcare’: 

The ‘patient empowerment’ of such kind, with technology enabled the power of personalized healthcare knowledge and information in an organized manner, has been termed as ‘The Democratization of Healthcare.’

The critical point to ponder, therefore, whether this fast developing state of art technological advancement has the potential of delivering a novel and much affordable process of disease treatment and management, in the real world. As it happens, the new paradigm would shift the focus of key stakeholders from doctors to patients, in a genuine sense, and almost irreversibly.

In this article, I shall deliberate on this wonderful emerging scenario.

A recent reiteration raises hope:

The following reiteration of one of the largest and most reputed tech giant of the world raises general hope that this process would soon come to fruition:

‘The democratization potential of healthcare interests most of us, as the injustice of fantastic healthcare available in some parts of the world, and others suffering needlessly.”

The above profound comment was made on a radio show – ‘Conversations on Health Care’, by none other than the Chief Operating Officer, Jeff Williams of Apple Inc. on January 4, 2016 and was reported accordingly by ‘appleinsider.com’ on January 06, 2016.

Jeff Williams also indicated in his talk, how smartphone technology can be harnessed for therapeutic purpose in disease treatment, as well. Citing an example, he said, detecting autism at an early age is a key to future treatment, as doctors can intervene – albeit to a limited degree – as long as the brain is still developing. 

He referred to a study that found not just the potential in app-based smartphone screening of children, but can even go much further by delivering therapy and treatment.

The rapid progress of technology in this direction is very real, as ‘Apple’ and other smartphone health app developers are stretching the commoditization of computer technology to serve health sciences. In not so distant future, with relatively inexpensive smartphones and supporting health apps – the doctors and researchers can deliver better standards of living in severely under-served areas like Africa, where there are only 55 trained specialists in autism, Williams said.

Triggers a key shift in focus: 

As I said before, unleashing the power of technology in healthcare solutions through smartphones will bring a fundamental shift in focus of all concerned, from medical doctors to ordinary patients. 

This transformation seems to be rather imminent now, as equipped with detailed knowledge of various types of individual health and disease related information through their smartphones, the patients would position themselves in the driver’s seat, demanding more for affordable treatment of diseases. 

Dr. Eric Topol, the author of the book titled, “The Patient Will See You Now”, thus very appropriately said, “MDs will no longer be considered ‘medical deities’, but rather professionals with whom patients will consult to get the proper treatment on the path of least resistance.” 

Consequently, the pharma players and other related service providers would require to ‘walk the talk’ by being ‘patient centric’ in the true sense, and definitely not by using this profound term, as one of the tools of their mostly self-serving, advocacy campaigns.

Empowering patients:

As Dr. Eric Topol said, smartphone applications that can monitor throughout the day, such as, heart rate and rhythm, blood pressure, take and interpret an electrocardiogram, capture X-rays and analyze ultrasound, have the potential to reduce patient visits to doctors, cut costs, speed up the pace of care and give more power to patients. He emphasized though, digital apps won’t replace physicians. The patients would still be seeing doctors, but the doctor-patient relationship will ultimately be radically altered.

As an illustration, it is worth mentioning here, that taking a significant step forward in this direction, the U.S. Food and Drug Administration (USFDA) has already approved ECG apps by for consumers, which have been validated in many clinical studies.

Examples of Smartphone Apps for patients:

Smartphone apps are now available for different user segments. In this section, I shall focus only on patient-centered apps capable of performing a wide array of functions, such as managing chronic disease, lifestyle management, smoking cessation and even self-diagnosis.

I am quoting below just a few of these interesting apps, as reported in an article published by ‘The Online Journal of Public Health Informatics (OJPHI)’ on February 5, 2014:

A. For diabetic patients, over 80 apps on the Android platform alone, offer a variety of functions. These include self-monitoring blood glucose recording, medication or insulin logs, and prandial insulin dose calculators.

Yet another diabetes intervention app integrated communication between patients and a healthcare provider. Here, the patient would log fasting blood sugars, daily eating behaviors, medication compliance, physical activity and emotions into a mobile online diary. A remote therapist with access to these diaries would then formulate personalized feedback to the patient.

‘WellDoc’ is reportedly one such company that has already received approval of the US FDA for its mobile-enabled diabetes management program, and is being paid for by health insurers as they would for a pharmaceutical product.

B. For smoking cessation and alcohol addiction apps are also available. At least 47 iPhone apps for smoking cessation and another one called – ‘A-CHESS’ (Alcohol Comprehensive Health Enhancement Support System) helps preventing relapse in alcoholic dependency and harnesses mobile technology to improve treatment and motivation.

C. For asthma and allergic rhinitis patients, an app called ‘m.Carat’, developed at Faculdade de Medicina da Universidade do Porto, Portugal, , helps recording their exacerbations, triggers, symptoms, medications, lung function tests and visits to the doctor or the hospital. The users of this app can also receive disease education, medication information, task notifications, and synchronize records with an online database to better control their symptoms.

D. For psychiatric patients, available smartphone apps offer benefits of ambulatory monitoring, that randomly prompts the patient to self-report psychotic symptoms multiple times throughout the day.

E. For sickle cell disease another app allows patients access to an online diary for recording pain and other symptoms.

F. For patients with dementia, ‘iWander’ app assists the affected individuals with daily living, by providing audible prompts to direct the patient home, sending notifications and GPS coordinates to caretakers, or by calling local 911 (US emergency) services.

G. For HIV (human immunodeficiency virus) and STD around 55 unique smartphone apps are available. These are used for education, prevention, testing and to provide other resources.

Self-diagnosis without a medical visit:

The above article also states that patients may even use smartphone apps to attempt self-diagnosis without a medical visit. Patients with a camera-enabled smartphone can use apps to take photographs of skin lesions and send these to a remote server for computer analysis and/or review by a board certified dermatologist. However, such apps are still not without their pitfalls, which are being addressed by the scientists, expeditiously.

Nevertheless, informed debate has already started in search of an appropriate direction for self-diagnosis with the help of robust smartphone apps, without any in-person medical visits.

Need for Regulatory control and certification of health apps:

I hasten to add, all such smartphone health apps should not be allowed to come to the market without stringent regulatory control and a well thought out the certification process.

As in the United States, where the health apps are being assessed by the U.S. Food and Drug Administration (US FDA), in India too the Drug Controller General of India (DCGI) or any other appropriate and designated authority should approve and certify all such smartphone health apps, before the market launch.

‘Trust deficit’ poses a critical challenge to pharma industry:

Since the health apps opportunity is new, and still in its evolutionary stage, pharma industry, in general, does not seem to have fully accepted yet, that the process of ‘Democratization of Healthcare’ has already commenced. I reckon, the progress in this direction is unstoppable now. Nevertheless, many drug companies apparently continue to prefer sticking to the same proven path that had fetched enormous success for them in the past and, of course, also its associated business models.

Besides health apps, the democratization process of healthcare includes other technological platforms too, such as, social media and video communications, which have started to bring healthcare into patients’ homes. To be successful in a situation like this, gaining ‘patient trust’ has become more important today than ever before, for all concerned. 

Unfortunately, the drug companies, generally speaking, continue suffering from an increasing ‘trust deficit’ of the key stakeholders. This has been vindicated by a September 9, 2013 study of Makovsky Health, which found:

  • Pharma websites continued to rank low in terms of traffic, with just 9 percent of Americans visit them for health information.
  • WebMD is the most frequented online source for healthcare information (53 percent)
  • Almost a fourth of consumers (24 percent) use at least one or a combination of social media channels – including YouTube video channels, Facebook sites, blogs, and Twitter feeds with links to other resources – to seek healthcare information  

The writing on the wall:

Some major global pharma players apparently have clearly seen the writing on the wall, and started collaborating with the developers of various types of digital health apps.

Quoting from the May 02, 2014 edition of ‘MobileHealthNews”, I am citing below, just as an illustration, the initiatives taken in this space by some of the drug majors: 

Pfizer (2014) had backed startup Akili in the development of a mobile game to help diagnose patients with Alzheimer’s. The game could also be used in the treatment or detection of ADHD and autism, among other conditions.

Johnson & Johnson’s subsidiary, Janssen Healthcare Innovations (2013), launched the new version of its free Care4Today medication reminder app and platform – Care4Today Mobile Health Manager 2.0. It has also overhauled Care4Today medication adherence app.

Sanofi US (2013) and the Prostate Cancer Foundation announced the creation of Prost8Care, an SMS system to help prostate cancer patients and their families understand treatment processes.

AstraZeneca (2013) announced a pilot with Exco InTouch to help patients suffering from Chronic Obstructive Pulmonary Disease (COPD), with mobile and online tools. 

Sanofi’s (2012) iBGStar device became the first US FDA cleared iPhone-enabled blood glucose meter.

GlaxoSmithKline (2012) offered a free asthma management app called MyAsthma, for iPhone and Android users. The app’s core offering is an Asthma Control Test (ACT), which is a simple 30-second test providing users with an index score of how well they are managing their asthma overall.

The potential in India:

In India, ‘Democratization of Healthcare’ is believed to be more broad based, with a third of all Indian mobile users expected to own a smartphone by 2017.

This is vindicated by the Press Release of Telecom Regulator TRAI, India, pharma, drug, playersy Authority of India (TRAI) of December 30, 2015. It states, the Wireless Tele-density in India is 79.39 as on October 31, 2015. The shares of urban and rural wireless subscribers were 57.61 percent and 42.39 percent, respectively, during the same period.

Conclusion:

The process of ‘Democratization of Healthcare’ is gaining momentum with the digital health app developers flooring the gas pedal. Even the global tech giant – Apple, has expressed its support and vow of taking rapid strides in this direction.

As this fascinating process unfolds, the final disease treatment decision, from various medical options available, is expected shift from doctors to patients, and may be their closest relatives. In tandem, patients would learn to take ownership of their physical and mental health conditions for disease prevention of various types, besides general fitness.

The patients, empowered with relevant digital information and knowledge, on their health status, including the pace of disease progression, would play a pivotal role not just in reducing disease burden, but also in making overall cost of individual healthcare more affordable. Additionally, access to healthcare, especially in the developing world like India and in its hinterland, will be improved significantly.

Digital apps are not just limited to patients’ use, these are being developed with equal speed for doctors, diagnostic centers, and clinical trials, just to name a few. All these would substantially reduce healthcare costs and add speed to various disease treatments.

In this golden pathway, there are some thorns too, mostly in the form of important regulatory issues, which need to be sorted out, expeditiously. Increasing ‘Trust Deficit’ of stakeholders on the drug companies is yet another hurdle, especially when the primary focus of all would shift from doctors to patients. However, it appears, the pharma players will eventually have no other choice, but to willy-nilly mold themselves accordingly, primarily for survival and thereafter progress.   

As I see it today, the fast evolving trend of ‘Democratization of Healthcare’, driven by cutting-edge technology, is virtually unstoppable now. The only question is how soon will it happen?                                                                          

By: Tapan J. 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.

Pharma And Healthcare: Mounting ‘Trust Deficit’ In Post Halcyon Days

Although a radical transformation in the field of medicine and path breaking advances of medical sciences are in progress, the healthcare system as whole, including the pharma industry, as voiced by many, is fast losing its human touch and values. This is mainly because a large number of patients feel that they are being financially exploited in the entire medical treatment chain, as their ailments become primary means of making money…more money by many others .

A new and interesting book, authored by a practicing cardiologist, titled “Doctored: The Disillusionment of an American Physician”, which has just been released in August 2014, also unfolds with self-example a dysfunctional healthcare system and stark realities of practicing medicine even in the ‘Mecca’ of medicine – the United states.

The author eloquently highlights the malaise and cronyism affecting a sizeable number within the medical profession, being hand in gloves with a large constituents of the pharma industry. Medical practice seems to have now become just as any other ‘make-money’ endeavor; not quite different from what the pharma business has metamorphosed into, over a period of time.

A heartless game played by shrewd minds:

In a situation like this, a heartless game is being played by shrewd business savvy minds, at the cost of patients, making healthcare frightfully expensive to many.

As the above new book narrates, many pharmaceutical companies are coming to the fore to exploit the situation for commercial gain. In the book the author confesses, to make extra cash, he too accepts speaking fees from a pharmaceutical company that makes a cardiac drug he prescribes. He candidly admits enjoying the paid speeches on that specific pharma company’s drugs to influence other doctors, usually arranged at exotic places over fancy dinners. The author does not fail in his part to admit that the drug he touts on behalf of the pharma company turns out to be no better than other cheaper alternatives.

In this beautifully written memoir, the author Dr. Sundeep Jauhar tries to bring to light many complex problems of the healthcare system and alleged involvement of global pharma companies to drive the medical treatment costs up at a galloping pace. All these are being driven by various malpractices in pursuit of making quick bucks.

There are some compelling health policy, public spending on health and infrastructure related issues too, specifically for India, which are not the subject of my today’s discussion.

In this article, I shall neither dwell on the above book any further, but briefly deliberate on how all these, much too often repeated instances, are giving rise to mounting ‘Trust Deficit’ of the stakeholders, involving both the pharma industry and the medical profession at large and yet, quite intriguingly, they seem to remain unbothered.

The Halcyon days and after:

When we take a glimpse into the recent history of pharma and healthcare industry, it would be quite possible to convince ourselves that the overall situation, focus and mindset of the drug industry honchos and members of the medical profession were quite different, even a few decades ago. Those were the ‘Halcyon Days’.

At that time, pharmaceutical industry used to be one of the most admired industries of the world and people used to place the doctors almost in the pedestal of God.

Unlike today, when the drugs meant for the treatment of even widely prevalent dreaded diseases, such as, Cancer, Hepatitis C and HIV are not spared from maximum stretch pricing, the grand vision of the Global Chief Executives, in general, used to extend much beyond of just making profits. So were the doctors christened by the Hippocratic Oath. Yes, I repeat, those were the ‘Halcyon Days’.

Just to cite an example, in 1952, George Wilhelm Herman Emanuel Merck, the then President of Merck & Co was quoted on the front cover of the ‘Time Magazine’, epitomizing his following vision for the company:

Medicine is for people, not for the profits”.

Having articulated this vision with so much of passion and clarity, Merck did not just walk the talk, in tandem, he steered an up swing in the company’s valuation over 50 times, proving beyond an iota of doubt that it is possible to give shape to his vision, if there is a will.

Today, in post ‘Halcyon Days’, for many of those who follow the history and development of the knowledge driven pharma and healthcare industry, this grand vision is no more than a sweet memory. Though the bedrock of pharma industry is innovation, is it inclusive? Is it benefitting the majority of the global population? No one believes now that “Medicine is for people, not for the profits”.

Thus, it was no surprise to many, when in 2012 while vocalizing its anguish on specific pharma mega malpractices ‘The Guardian’ came out with a lashing headline that reads as follows:

Pharma Overtakes Arms Industry To Top The League Of Misbehavior.’

Ignoring the reality:

Many people believe that all these are happening, as the global pharma industry refuses to come out of its nearly absurd arrogance created by spectacular business successes, over a very long period of time, with a large number of blockbuster drugs and the massive wealth thus created.

It appears, the pharma industry, by and large, cannot fathom just yet that its business model of 1950 to perhaps 1990, has lost much of relevance at the turn of the new millennium with changing aspirations and values of people, governments and the civil society at large.

Key reasons of distrust:

If we make a list from the global and local reports, the following are some of the key examples:

  • Media reports on pharmaceutical companies directly paying to doctors for writing prescriptions of high priced drugs to patients.
  • A growing belief that the pharma industry spends disproportionately more on sales & marketing than on R&D, which eventually increases the drug prices.
  • Unabated reports in the media of various pharma malpractices from across the world, including hefty fines amounting to billions of dollars, paid by many global pharma players.
  • A widespread belief that for commercial gain, the industry often hides negative clinical trial results, which go against patients’ health interest.

A recent survey:

According to a recent ‘Healthcheck Survey’ of the drug business by ‘Eye for Pharma’:

  • 42 percent of the respondents indicated that image of pharma is not getting any better among average people.
  • More than one-third said they are not sure or remained neutral on the subject.
  • 19 percent within the group are optimistic about improving image of pharma.

Though, it was reported that almost half of the respondents believe the industry knows what to do to gain standing and only 24 percent think pharma is clueless about how to regain its reputation, the commentators on the survey results are skeptical that companies are willing to do what it takes. This is predominantly because the pharma players do not know what would be the immediate financial impact, if the corrective measures were taken.

2014 developments in India:

In August 2014, a premier television news channel of India – NDTV exposed some blatant violations of medical guidelines involving both the doctors and the pharmaceutical companies in the country. The crew of NDTV carried out a sting operation (video), pretending to be medical representatives of a Delhi based new pharma company. The video clipping showed three doctors resorting to malpractices for which the pharma companies pay them heavily, though illegally.

This particular sting operation by NDTV could arrest the attention of the new Union Minister of Health Dr. Harsh Vardhan, whose reaction on tweeter was:

“One more sting operation on doctors exposing greed and readiness to shed professional ethics. I again appeal to brother doctors – show spine!”

Based on this public expose, the Medical Council of India (MCI), which is supposed to serve as the watchdog for doctors and overall medical practices, was compelled to conduct an enquiry on professional misconduct against those three doctors through its Ethics Committee. MCI has the power to cancel licenses of the erring medical practitioners.

Soon thereafter, one of the three Delhi doctors, who were caught on camera taking bribes in exchange of prescribing drugs, was reportedly arrested and the other two doctors were summoned by MCI for further investigation.

Just before this incident an article published in the well-reputed British Medical Journal (BMJ) on 08 May 2014 highlighted, “Corruption ruins the doctor-patient relationship in India”. The author David Berger wrote, “Kickbacks and bribes oil every part of the country’s healthcare machinery and if India’s authorities cannot make improvements, international agencies should act.”

I deliberated a part of this issue in one of my earlier blog posts titled “Kickbacks And Bribes Oil Every Part of India’s Healthcare Machinery”.

Interestingly, a couple of months earlier to this BMJ report, the Competition Commission of India (CCI) issued notices for various illegal practices in the pharma industry. These notices were served, among others, to pharma industry associations, chemists associations, including individual chemists & druggists, stockists, wholesalers and even to some local and global pharma majors.

In February 2014, the CCI reportedly issued a warning of severe penalties and prosecution to various bodies in the pharmaceutical industry indulging in anti-competitive practices even after giving undertakings of stopping the illegal practices, for which they were summoned for deposition before the commission earlier.

The CCI has now called upon the public through a public notice to approach it for curbing the malpractices that amount to anti-competitive in nature, adversely impacting interests of the consumer.

I reckon, all these actions are fine, but the bottom-line is, pharma and healthcare malpractices still continue unabated at the cost of patients, despite all these. Unable to garner adequate resources to pay for the high cost of treatment, which is fuelled by virtually out of control systemic malfunctioning, the families of a large number of patients are reportedly embracing abject poverty each year.

Pharma and healthcare continue to remain unbothered:

It is also not surprising that despite global uproar and all these socio-commercial issues, including pressure on drug prices, pharma and healthcare continue to march on the growth path, without any dent in their business performance particularly on this count.

Just to give an example, Moody Investor Services have highlighted just last week that India’s pharmaceutical market is set to experience continuing double-digit growth, faster than most other markets of the industry.

Lack of significant financial impact on the overall business performance on account of the alleged misconducts, barring USFDA imports bans, further reduces the possibility of a sense urgency for a speedy image makeover of the industry by doing the right things, in an organized manner.

The reason behind this inertia is also understandable, as expenditure on healthcare is not discretionary for the patients. To save lives of the near and dear ones, almost everybody, irrespective of financial status, try to garner resources to the maximum possible, whatever it costs.

Urgent remedial measures necessary:

Effective remedial measures to allay public distrust in all the above areas, in tandem with working out well-networked and inclusive innovation models, I reckon, would prove to be more meaningful today. This would facilitate not just in increasing the market access, but also for cost-effective innovation of new products leveraging the complex science of evolving biology. Let me reiterate, all these should be woven around the center piece of patients’ interest, without an exception.

I hasten to add here that some green shoots in this area have already started becoming visible, as some global industry constituents, though small in number, are articulating their new vision and the uncharted path that they intend to follow. Keeping a tab on the speed of spread of these green shoots would be important.

It is really a matter of conjecture now, whether the visible green shoots, as seen today would perish or not over a period of time. Nonetheless, that possibility is always there, if the concerned companies decide afresh that the efforts required for a long haul are not sustainable due to intense short-term performance pressure. Hence, it is not worth the financial risk taking.

In that scenario, they would continue with their existing business model of achieving the financial goals by selling the high priced medicines to the privileged few of the rich countries and to affluent people living in the other parts of the world, depriving millions of patients who desperately need those drugs, but are unable to afford.

Conclusion: 

Alleged malpractices in pharma and healthcare business operations, might not have hit any of the constituents really hard in financial terms just yet. However, the humongous ‘Trust Deficit’ of stakeholders, including the government, is gradually compelling them to face tougher resistance in operating the key business levers. Such resistance is increasingly coming in drug pricing, clinical trial requirements and related disclosure, marketing practices and even in the arena of Intellectual Property Rights (IPR).

On the part of the government, it is important to realize that self-regulations of various business and marketing practices have miserably failed in India for the pharmaceutical industry, just as it has failed in many other parts of the world, self-serving hypes often created by the global pharma associations in this regard notwithstanding. Besides the China saga and other reported scandals, billions of dollars of fines levied to the global pharma players, since last so many years, for a large number of malpractices would vindicate this point. It is worth noting that even these hefty fines are pittance, as compared to mind-boggling profits that these companies make on patented drugs with the adopted means. Hence, many of them would possibly feel that this risk is worth taking.  Similarly, lackadaisical implementation of MCI guidelines for the medical profession brings shame to the country, as evidenced by the article in the BMJ.

As self-regulation by the industry has proved to be nothing more than an utopia, it is about time for the new government to come out with strict, yet transparent and fair regulation, ensuring its effective implementation, to kill all these malpractices, once and for all, writing an apt epitaph to draw the final curtain to this chronicle.

That said, conscious efforts towards a mindset-changing approach for inclusive progress and growth by majority of pharma players and a sizeable number within the medical profession, would surely help reducing the ‘Trust Deficit’ of the stakeholders.

This much desirable transformation, if materializes, would enable both the pharma and healthcare industry to retrieve, at least, a part of the past glory. The constituents of the industry undoubtedly deserve it, just for the very nature of business they are engaged in.

By: Tapan J. 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.

 

‘India Taskforce’ takes the first step in an arduous task to bridge the trust deficit.

To prepare a comprehensive long term strategy to unleash the growth potential of the Pharmaceutical Industry of India considering all its current issues, the Ministry of Health and Family Welfare announced constitution of a taskforce on March 15, 2011 involving all the stakeholders, as mentioned below. As per reports, the first meeting of the committee was held on June 6, 2011 to deliberate on the mandated goals.

Within 3 months the taskforce, under the chairmanship of V.M. Katoch, Secretary, Department of Health Research and Director-General, Indian Council of Medical Research (ICMR), is expected to work out and submit a short, medium and long term strategic path and goals to the Government, highlighting the key and specific policy measures required to achieve these objectives.

The taskforce will have members drawn from:

  1. National Pharmaceutical Pricing Authority,
  2. Department of Industry Policy and Promotion,
  3. Indian Drug Manufacturers Association, Mumbai,
  4. Indian Pharmaceutical Alliance, Mumbai,
  5. Organization of Pharmaceutical Producers of India, Mumbai,
  6. Federation of Pharmaceutical Entrepreneurs, Gurgaon,
  7. Confederation of Indian Pharmaceutical Industry,
  8. Bulk Drug Manufacturers’ Association, Hyderabad,
  9. SME Pharma Industry Confederation, New Delhi
  10. Drug Controller General of India as the Member Secretary.

The focus areas:

The report has been mandated to cover the following critical areas:

  1. Evolving a short, medium and long-term policy and strategy to make India a hub for drug discovery, research and development.
  2. Evolving strategies to further the interests of Indian pharma industry in the light of issues related to intellectual property rights and recommend strategies to capitalize the opportunity of $60 to $80 billion drugs going off-patent over the next five years.
  3. Evolve policy measures to assure national drugs security by promoting indigenous production of bulk drugs, preventing takeover of Indian pharma industry by multi-national corporations, drug pricing, promotion of generic drugs
  4. Recommend measures to assure adequate availability of quality generic drugs at affordable prices.
  5. Recommend measures to tackle the problem of spurious drugs and use of anti-counterfeit technologies.

Estimates and Perspectives:

  • The pharma industry is growing at around 1.5-1.6 times the Gross Domestic Product growth of India
  • Currently, India ranks third in the world of volume of manufacturing pharmaceutical products
  • The Indian pharmaceutical industry is expected to grow at a rate of around 15 % till 2015
  • The retail pharmaceutical market in India is expected to cross US$ 20 billion by 2015
  • According to a study by FICCI-Ernst & Young India will open a probable US$ 8 billion market for MNCs selling patented drugs in India by 2015
  • The number of pharmaceutical retailers is estimated to grow from 5,50,000,  to 7,50,000 by 2015
  • At least 2,00,000 more pharma graduates would be required by the Indian pharmaceutical industry by 2015
  • The Indian drug and pharmaceuticals sector attracted Foreign Direct Investments to the tune of US$ 1.43 billion from April 2000 to December 2008 (Ministry of Commerce and Industry), which is expected to increase significantly along with the policy reform measures and increased Government investment (3%-4%) as a percentage of GDP towards healthcare, by 2015
  • The Minister of Commerce estimates that US$ 6.31 billion will be invested in the domestic pharmaceutical sector
  • Due to low cost of R&D, the Indian pharmaceutical off-shoring industry is expected to be a US$ 2.5 billion opportunity by 2012

Key growth drivers: Local and Global:

Local: • Rapidly growing middle class population of the country with increasing disposable income. • High quality and cost effective domestic generic drug manufacturers are achieving increasing penetration in local, developed and emerging markets. • Rising per capita income of the population and inefficiency of the public healthcare system will encourage private healthcare systems of various types and scales to flourish. • High probability of emergence of a robust healthcare financing/insurance model for all strata of society. • Fast growing Medical Tourism. • Evolving combo-business model of global pharmaceutical companies with both patented and generic drugs is boosting local outsourcing and collaboration opportunities. Global: Global pharmaceutical industry is going through a rapid process of transformation. The moot question to answer now is how the drug discovery process can meet the unmet needs of the patients and yet remain cost effective.

Cost containment pressure due to various factors is further accelerating this process. CRAMS business, an important outcome of this transformation process, will be the key growth driver for many Indian domestic pharmaceutical players in times to come. Bridging the ‘Trust Deficit’ is one of the key Challenges:

Like all other industries, Pharmaceutical Industry in India has its own sets of challenges and opportunities under which it operates. Some of the challenges the industry faces are:

  • Unfortunate “Trust Deficit” between the Government and the Industry to improve access to affordable modern medicines.
  • Regulatory red tape and lack of initiative towards international harmonization.
  • Inadequate infrastructure and abysmal public delivery system.
  • Lack of adequate number of qualified healthcare professionals.
  • Inadequate innovation friendly ecosystem to encourage R&D and other non-product related innovation in the pharmaceutical value chain.
  • Myopic Drug Policies have failed to deliver.
  • Addressing needs of over 350 million BPL families who cannot afford to buy any healthcare products and services.
  • ‘80% out of pocket expenditure’ of the common man towards healthcare.
  • Inadequate Public Private Partnership (PPP) initiatives in most of the critical areas of healthcare.

Urgent need to bridge the ‘Trust Deficit’ and improve public perception of the Industry:

Like many other countries of the world, in India too there is a negative public perception about the pharmaceutical industry. Recent reports on ‘clinical trials related patient’s compensation’ or the government intervention on allegedly gross ‘unethical’ marketing practices by the pharmaceutical companies, further strengthen such belief.  Unfortunately, despite meteoric success of the generic pharmaceutical industry of India in the global arena, public perception of the industry still remains as one, which is being driven by profiteering motive at the cost of the precious lives of ailing common population of the country. This is indeed acting as a strong retarding force. As a result the regulators are also compelled to introduce more of growth stifling measures at a fairly regular pace.

A new ‘Harris Poll’ conducted in the US between November 8 and 15, 2010 reports as follows:

Top industries that largest numbers of people believe should be more regulated

Industry % of respondents
Oil

47

Pharmaceuticals

46

Health Insurance

42

Tobacco

38

Banks

34

Managed Care

34

That an overwhelming 46% respondent in the US feels that the Pharmaceutical Industry should be regulated, only reflects a poor public perception of the industry in the USA.

Industries trusted by the fewest people

Industry % of respondents
Tobacco

2

Oil

4

Telecommunication

7

Managed Care

7

Life Insurance Companies

10

Pharmaceuticals

11

(Source: Harris Poll 2010) 

It is indeed an irony that a miniscule 11% respondents trust pharmaceutical industry in the USA.

Thus in the prevailing scenario globally, the Indian Pharmaceutical Industry should take more demonstrable self-regulatory measures to improve its public perception and make its growth more inclusive, in the best possible way that it can. Without active support of the government, media and other stakeholders, through conscious efforts to improve its image, all the efforts of the taskforce may ultimately get converted into a zero sum game.

Job Creation by the industry is of critical importance: Pharmaceutical sector in India has created employment for approximately 3 million people from 23,000 plus units. Accelerated growth in job creation, will not only open up more opportunities to pharmaceutical professionals, but will also fuel growth opportunities in allied business segments like Laboratory, Scientific instruments, Medical Devices and Pharma machinery manufacturing sectors.

Despite all these, it is worth noting that a major challenge still remains in getting employable workforce with the required skill sets. This issue will grow by manifold, as we move on, if adequate vocational training institutes are not put in place on time to generate employable workforce for the industry.

Government Initiatives, thus far, are still less than adequate: The government of India has started working out some policy and fiscal initiatives, though grossly inadequate, for the growth of the pharmaceutical business in India. Some of the measures adopted by the Government are follows:

  • Pharmaceutical units are eligible for weighted tax reduction at 175% for the research and development expenditure obtained.
  • Two new schemes namely, New Millennium Indian Technology Leadership Initiative and the Drugs and Pharmaceuticals Research Program have been launched by the Government.
  • The Government is contemplating the creation of SRV or special purpose vehicles with an insurance cover to be used for funding new drug research
  • The Department of Pharmaceuticals is mulling the creation of drug research facilities which can be used by private companies for research work on rent

Pharmaceutical Export going North: In recent years, despite economic slowdown in the global economy, pharmaceutical exports in India have registered a commendable growth. Export has emerged as an important growth driver for the domestic pharmaceutical industry with over 50 % of their total revenue coming from the overseas markets. For the financial year 2008-09 the export of drugs is estimated to be around US $8.25 billion as per the Pharmaceutical Export Council of India (Pharmexil). A survey undertaken by FICCI reported 16% growth in India’s pharmaceutical export during 2009-2010.

This trend needs to be encouraged and be given further boost.

Conclusion:

The newly formed taskforce will hopefully be able to address all these issues in an integrated way to guide this life-line industry to a much higher growth trajectory  to compete effectively not only in the global generic space, but also with the global innovator companies, sooner than later.

So the ball game for the taskforce is to recommend strategy and policy measures to improve access to modern medicines by reducing ‘out of pocket’ expenses significantly through public/private health insurance initiatives, protect public health interest and foster a climate for innovation, simultaneously, and certainly not one at the cost of the other.

By: Tapan J 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.