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UCPMP 2024: Game Changer or False Dawn?

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On March 12, 2024, the Department of Pharmaceuticals (DoP) of the Government of India notified the new Uniform Code for Pharmaceutical Marketing Practices (UCPMP) 2024.

Having gone through the details, many construe that aiming to finally clean up pharmaceutical marketing practices in India, as demanded by many stakeholders – including the Supreme Court of India, the new one released by the DoP in March 2024 still appears to be a ‘work in progress.’ One therefore, wonders whether UCPMP 2024 is a step forward or status quo in establishing desirable standards for pharma business ethics in India.

In this article, let me dwell on this issue, highlighting examples of some key points in this regard.

Some key points to take note of:

There are several key points to take note of some examples, which will include:

  • Unlike its predecessor, the 2024 UCPMP removes the word “voluntary” but doesn’t explicitly make the code mandatory. It requests industry associations to implement the code.
  • The code doesn’t explicitly prescribe penalties for pharmaceutical companies beyond removal from industry associations (if they are members).
  • Doctors who violate ethical codes can face license suspension and fines under the National Medical Commission (NMC) guidelines. However, the NMC’s stricter 2023 code revisions were put on hold due to industry pressure.

Thus, several issues, including the following, need to be answered, beyond any ambiguity whatsoever. That said, let me start with how the UCPMP 2024 brings both opportunities and challenges for Indian drug companies, and then we will try to fathom whether the new code as it presents today will prove to be a game changer to improve the quality of ethical standards, especially, in Indian pharmaceutical marketing. 

UCPMP 2024 – some key challenges for drug companies:

A.  Marketing Revamp:  The new UCPMP demands a complete overhaul of marketing practices and strategies. Companies need to find new, compliant ways to educate doctors about their products, likely focusing on:

  • Scientific Data and Value Proposition: Stronger clinical trial data and highlighting a drug’s actual benefits will be crucial.
  • Transparency and Credibility: Building trust with doctors through clear, accurate information and high-quality educational materials is essential.

B.  Salesforce Transformation: Medical representatives, previously reliant on personal connections, now need expertise in:

  • Scientific Communication: Effectively engaging doctors with the science behind the drug.
  • Product Knowledge: Deep understanding of the drugs they are promoting.
  • Potential Sales Slump: Stricter marketing might lead to a decline in sales, particularly for established brands that rely heavily on promotion. Companies need to adapt their sales strategies to address this.

Effectively navigating these challenges requires significant investments in:

  • R&D: Stronger focus on research and development to create innovative drugs with a clear value proposition.
  • Data-Driven Marketing: Utilizing data science to understand doctor needs and target marketing efforts effectively.
  • Salesforce Training: Upskilling representatives in scientific communication and product knowledge.

By adapting their approach, Indian drug companies can leverage UCPMP as an opportunity to move towards a model focused on the quality and scientific merit of their products.

UCPMP 2024 – some key opportunities for drug companies:

The UCPMP 2024, while presenting challenges, also offers some key opportunities for Indian drug companies to thrive:

  • Level Playing Field: The ban on gifts and incentives removes an unfair advantage for larger companies. This allows smaller or generic drug companies to compete based on the merits and affordability of their products.
  • Focus on Innovation: With less emphasis on promotion, companies may be incentivized to invest more in R&D, leading to the development of new, innovative drugs with stronger scientific backing.
  • Building Brand Trust: Transparency and accurate information mandated by UCPMP can help companies build trust with doctors and patients alike. This strong reputation can be a valuable asset in the long run.
  • Data-Driven Marketing: The shift towards data-driven marketing allows for targeted communication based on doctor needs and preferences. This can be more cost-effective and lead to better engagement with healthcare professionals.
  • Focus on Patient Education: UCPMP encourages companies to provide clear information directly to patients. This can empower patients to make informed decisions about their healthcare and potentially increase the demand for effective medication.

By capitalizing on these opportunities, Indian drug companies can:

  • Differentiate themselves: By focusing on innovation and patient-centricity, they can carve out a niche in the market.
  • Building long-term value: Investing in R&D and building trust with doctors can lead to sustainable growth and brand loyalty.
  • Becoming more competitive globally: A focus on innovation and scientific merit can help Indian companies compete effectively in the international pharmaceutical market.

Interestingly, the UCPMP presents a chance for Indian drug companies to move away from an outdated marketing model and embrace a more ethical and sustainable approach. By focusing on innovation, data-driven marketing, and building trust, they can seize this opportunity to become leaders in the global pharmaceutical industry.

Is UCPMP 2024 a game changer or a false dawn?

Having said all this, the question still remains whether UCPMP 2024 is a game changer or a false dawn. I reckon, while aiming to curb unethical practices in the pharmaceutical industry, questions linger about its effectiveness. Let’s delve into both sides of the argument:

A Game Changer:

  • Stronger Stance: The removal of “voluntary” from the code suggests a stricter approach compared to its predecessor.
  • Focus on Transparency: Provisions like mandatory expenditure disclosure for conferences organized by pharma companies could increase transparency.
  • Addressing Travel & Hospitality: Discouraging pharma-funded travel and hospitality for doctors might reduce undue influence.
  • Potential for Improved Ethics: A well-enforced UCPMP could lead to a more ethical environment where marketing focuses on the merits of drugs rather than lavish incentives.

False Dawn:

  • Missing Teeth: The lack of clear penalties beyond industry association removal for pharma companies raises concerns about enforcement.
  • Rollback of NMC Code: The NMC’s stricter code for doctors with potential financial penalties was rolled back due to industry pressure. This weakens the overall impact.
  • Ambiguity on Non-Member Companies: The code’s effectiveness might be limited if pharmaceutical companies outside industry associations are not held accountable.
  • Uncertain Implementation: The success of UCPMP hinges on robust implementation and a clear mechanism to address violations.

Conclusion:

From the above perspective, the true impact of UCPMP 2024 remains to be seen. While it has positive intentions, its effectiveness depends on stricter enforcement mechanisms, penalizing violations, and ensuring all companies are held accountable. Only time will tell if UCPMP 2024 ushers in a new era of ethical practices or remains a symbolic but unenforced reform.

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.

Collaboration For Sustainable Excellence – The Name of The Game in The New Normal

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The union minister of health and family welfare of India recently invited Japanese companies to collaborate with Indian companies on research and innovation in emerging therapies, like precision medicine, cell and gene therapy, biological products, and on the utilization of digital tools and technologies. This was reported on May 16, 2023.

Underscoring this objective, the minister articulated, “such collaboration on research and innovation would help enhance the domestic availability and affordability of these innovative therapeutic options.”

The area of research and drug innovation in emerging therapies and on the utilization of digital tools and technologies has emerged as one of the top focus areas of the country in the new normal. Currently, the Indian pharmaceutical industry is primarily focused on manufacturing generic medicines, exporting bulk drugs, and supplying active pharmaceutical ingredients.

Thus, this goal can be quickly achieved through global collaborations – at a time when India plays a pivotal role in improving health outcomes worldwide by serving as a dependable supplier of affordable and high-quality generic drugs. The country is currently providing approximately 60 per cent of the global vaccine supply, and 20-22 per cent of generic exports. Importantly, ‘In the battle against the Covid-19 pandemic, India has supplied essential drugs to around 185 countries,” he underscored.

Interestingly, after the Covid-19 pandemic, there has been a significant shift in the approach of both Indian and multinational drug companies towards business collaboration. This article will focus on this area with recent Indian examples, culled from available reports. However, before delving into this space, let me also point out that drug MNCs operating in India are also changing focus on their India operations, as reported in recent times.

Drug MNCs operating in India are also changing business focus: 

This was brought to the fore by several recent reports. For example, in February 2022, The Economic Times reported: 

  • In February, Novartis India passed on the sales and distribution rights of three of its established brands to Dr Reddy’s Labs and terminated the employment of 400 staffers.  
  • In October, US drugmaker Eli Lilly sold the marketing rights of its anti-diabetes drugs to Cipla and laid off 120 employees in India. 
  • Around the same time, Danish pharma company Lundbeck decided to exit India as part of its global strategy. 

However, their key goal remains - delivering new patient-perceived value – not just incremental, but in quantum measure for business growth.

The need for increased collaboration and shared resources:

Against the above backdrop, it appears to me that the pandemic has highlighted the need for accelerated cooperation and sharing resources to address global healthcare challenges, effectively. As a result of which, both Indian and MNC drug companies are recognizing the benefits of working together, and are actively seeking collaboration opportunities in the following areas. 
  • Access to Emerging Markets: Indian pharma companies have a strong presence in emerging markets due to their cost-effective generic drug manufacturing capabilities. Multinational companies recognize the potential of these markets and are looking to collaborate with Indian firms to gain access to these regions. By partnering with Indian companies, MNCs can tap into local expertise, distribution networks, and regulatory knowledge. 

- Example: In 2022, Cadila Healthcare entered into a collaboration with Novartis to develop and commercialize multiple oral solids and injectable generics for global markets, including emerging markets.

  • Research and Development: Collaboration in research and development (R&D) activities has become crucial for drug companies. MNCs bring advanced research capabilities, cutting-edge technologies, and substantial financial resources, while Indian companies offer a skilled workforce and a cost-effective environment for R&D. By joining forces, they can pool their strengths and accelerate the discovery and development of new drugs and therapies.

- Example: In 2021, Bharat Biotech collaborated with the Washington University School of Medicine in St. Louis and the International AIDS Vaccine Initiative (IAVI) to develop a novel vaccine candidate for HIV. This collaboration aims to combine the strengths of all three organizations to advance HIV vaccine research.

  • Manufacturing and Supply Chain: The pandemic exposed vulnerabilities in global supply chains, particularly in the pharmaceutical sector. Collaborations between Indian and MNC drug companies can help diversify manufacturing locations and strengthen supply chain resilience. Indian companies’ expertise in large-scale generic drug production can complement the specialized manufacturing capabilities of multinational firms.

- Example: In 2021, Hetero entered into a partnership with the Russian Direct Investment Fund (RDIF) to manufacture the Sputnik V Covid-19 vaccine in India. This collaboration aimed to increase the production capacity of the vaccine to meet global demand.

  • Regulatory Compliance: Regulatory compliance is a critical aspect of the pharmaceutical industry. Indian companies have been working closely with regulatory authorities to meet global standards and gain approvals for their products. Collaborating with Indian companies enables MNCs to leverage their understanding of regulatory processes, navigate local regulations efficiently, and ensure compliance with diverse international requirements.

- Example, in 2022, Biocon Biologics partnered with Adagio Therapeutics, a US-based biotechnology company, to develop and commercialize an antibody treatment for COVID-19. This collaboration involves regulatory support from both companies to navigate global regulatory processes.

  • Market Expansion: Collaborations provide an opportunity for both Indian and multinational companies to expand their market presence. Indian companies can benefit from the MNCs’ established marketing networks, while MNCs can leverage the Indian companies’ extensive distribution channels and market knowledge. Joint ventures and partnerships facilitate market entry, improve market penetration, and help companies capture a larger share of the global pharmaceutical market. 

- Example: In 2022, Torrent Pharmaceuticals collaborated with Swedish multinational company Handicare Group AB to distribute and market Handicare’s range of mobility solutions in India. This collaboration enables Torrent Pharmaceuticals to diversify its product portfolio and expand into the healthcare mobility market. 

  • Technology and Innovation Sharing: Collaborations foster knowledge exchange between Indian and multinational drug companies. MNCs can share their technological advancements and research findings, while Indian companies can contribute their insights and expertise in managing large-scale production. Such knowledge-sharing initiatives can drive innovation, improve manufacturing processes, and enhance overall operational efficiency. 

- Example: In 2022, Glenmark Pharmaceuticals entered into a collaboration with the Canadian multinational company SaNOtize Research and Development Corp. to develop a nitric oxide nasal spray for the treatment of COVID-19. This collaboration combines Glenmark’s expertise in drug development with SaNOtize’s innovative nitric oxide platform.

  • Intellectual Property and Licensing: Collaboration often involves the exchange of intellectual property (IP) rights and licensing agreements. Indian companies possess a vast pool of generic drug formulations and manufacturing capabilities. MNCs can license their patented drugs or technology to Indian partners for production and distribution in specific markets. These licensing arrangements benefit both parties by expanding the product portfolio and maximizing revenue potential. 

- Example: In 2021, Glenmark Pharmaceuticals signed a licensing agreement with Canadian biopharmaceutical company Xenon Pharmaceuticals to develop and commercialize a potential treatment for epilepsy. This collaboration involves the licensing of Xenon Pharmaceuticals’ proprietary technology for the development of a novel therapeutic product.

Conclusion:

Overall, as the recent trends indicate, the post-pandemic era has accelerated initiatives of strategic collaboration between Indian and multinational drug companies. By leveraging each other’s strengths and with shared value and resources, these collaborations aim to drive innovation, address global healthcare challenges, and deliver affordable and accessible healthcare solutions to patients worldwide. And thereby, will help deliver a unique patient experience.

Additionally, the examples, as available from published sources, highlight an increasing number of such recent collaborations, besides operational re-focusing by several MNC drug majors in India.  

These strategic steps clearly emphasize their joint efforts to drive innovation, expand their market presence, and address critical healthcare needs. From this angle, I believe, for sustainable business excellence and for staying relevant to customers in the new digital world, one of the top focus areas for Indian pharma players deserves to be strategic collaboration initiatives.

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.

Big Pharma Fails Avoiding Drug Price ‘Control’? Even In The US? Why?

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It ultimately happened – even in the United States, as the US President signed a bill on August 16, 2022 that aims to reduce healthcare costs, alongside fighting climate change, besides raising taxes on the rich. This new law was enacted, despite powerful lobbying and the vehement opposition of big pharma associations and that too in their home turf.

According to the Fierce Pharma report of the same day, since the current US President moved into the White House in 2020, the drug industry left no stone unturned battling to preserve pricing status-quo. It further added, the ‘pharmaceutical industry, including, PhRMA, its allies, and the nation’s largest pharmaceutical firms’ have spent more than $205 million in multi-media ads opposing ‘Medicare price negotiations’ and lobbying against efforts to lower drug prices for consumers.’

No wonder, when the bill was just introduced to the US lawmakers, big pharma’s disappointment on the bill was palpable. This gets well-captured in what the AbbVie CEO pointed out at that time. He said, ‘the legislation would force manufacturers to accept the government’s proposed price or face a harsh tax on their revenues from a given product.’ He also said: “So, it’s not a negotiation,” as stated in the bill. He further opined in his conference call: “We should just call it what it is. It’s price controls,’ which is what the lawmakers are ‘basically putting in place, if the language stays the same,’ the AbbVie chief added.

Capturing this new development in the United States, at least, in the recent past - Fierce Pharma in its August 08, 2022, issue commented: “The seemingly unstoppable pharma lobbying force has lost its charm. With the passage of a new bill, the U.S. Senate is opening the door to major drug pricing reform, leaving the drug industry licking its wounds.”

In the Eldorado of the global drug industry, this is indeed an unprecedented initiative to significantly reduce costs of many important drugs and reduce patients’ out of pocket expenses. Consequently, it has created so much of hullabaloo, across the world, for various reasons. In this article, I shall track this emerging scenario along with the message that it sends across the globe, and its possible impact on new drug innovation to meet unmet needs of patients. In India, one such area could be revisiting the price negotiation proposal for patented drugs, a government initiative that failed to take off earlier.

Would lowering prices stifle new drug innovation?

The apprehension, I reckon, that big pharma will continue to play with - price control will stifle new product innovation – adversely impacting patient interest. Notably, to many industry experts, this argument doesn’t just lack robustness, seems more a conjecture rather than the outcome of any peer- reviewed research study findings. On ewthe contrary, several highly credible and independent studies prove otherwise. Thus, let me put hereunder:

  • One – what big pharma directly and through their powerful industry associations or some financially sponsored studies are saying
  • And – what the top experts concluded from their independent analysis in this regard, as published in the globally acclaimed journals.

I leave it to my readers to evaluate the credibility of each to form their views.

Drug industry arguments supported by recent studies:

The findings of a study conducted recently, with the financial support of the Pharmaceutical Research and Manufacturers of America (PhRMA), the Biotechnology Innovation Organization (BIO), Amgen, Pfizer, Alexion, AbbVie, Genentech, and Bristol Myers Squibb, were released by PhRMA on November 23, 2021. The study was conducted by Vital Transformation. The key findings of this study highlighted: ‘Every 10% drop in the price of medicines in price-controlled EU markets was associated with a:

  • 14% decrease in total VC funding (10% early stage and 17% late stage)
  • 7% decrease in biotech patents
  • 9% decrease in biotech start-up funding relative to the US
  • An 8% increase in the delay of access to medicines.

It concluded: ‘Drug pricing controls implemented in the US would likely have an even greater impact on Biopharma KPIs given its global leadership in investment and innovation.’

Independent expert studies, published in highly reputed journals:

Around the same time as the above report, an independent study published in the Harvard Business Review (HBR) on October 01, 2021, found exactly the opposite. It categorically stated: ‘The U.S. can lower drug prices without sacrificing innovation.’

The paper summed up: ‘With Congress considering legislation to allow Medicare to use its bargaining power to negotiate lower drug prices, large pharmaceutical companies are once again waging a campaign that contends that doing so would seriously harm the development of breakthrough drugs. This is not true. Smaller companies now account for the lion’s share of such breakthroughs. The key to supporting drug innovation is to increase NIH funding of the efforts that give rise to these new companies, cut the costs, and accelerate the speed of clinical trials, and reform patent law.’

Drug pricing in the Indian context:

Prices of, especially, new drugs and the overall cost of healthcare are two major concerns – more in the developing countries like India. Responding to this need drug price control for pre-defined essential medicines are already in place in the country. More recent studies further vindicate the relevance of such regulation from the perspective of affordability of drugs for the poorer section of the society, and where out of pocket expenses are very high.

Let me quote one such paper, published on June 04, 2022, which received no outside financial support from this study, where the researchers concluded: ‘With induced demand and an inadequate competitive environment, the pharmaceutical industry fails to reduce prices. Supply-chain trade margins are very high. Hence, government intervention through price control of essential and life-saving drugs is a necessity in India.’

In this context, another question that is being raised – are there other alternatives to expand access to high-priced life-saving drugs at an affordable cost to all those who need those most? The most common alternative that floats, encourage more competition for those drugs as soon as they go off patent. Let me examine what’s big pharma players are doing in that area.

Does Big Pharma encourage increasing competition to reduce drug prices?

Another way to reduce the price of an expensive product is encouraging competition to enable market forces bring down the price. An interesting article on breaking the rule of drug pricing by pharma companies was published in the Forbes magazine on June 29, 2022. I also wrote on June 10, 2013: ‘To scale-up access to health care, especially for the marginalized population of any country, greater access to affordable generic drugs will always remain fundamental, besides improving healthcare infrastructure and its delivery mechanism.’

Thus, there should be a robust mechanism, across the world, to facilitate quick entry of cheaper generic equivalents immediately after patent expiry of the original molecule. Increasing attempts of blocking entry of generics surreptitiously by vested interests, leaves no other alternative, but price control. This is imperative, ‘as without the availability of newer generics, unmet medical needs of the most vulnerable section of the society cannot be met effectively by any country, as I wrote there.

Attempts to game the system to minimize competition continue unabated:

Even after my article, this red flag is being raised for quite some time. It will be evident from another Harvard Business Review article titled, ‘How Pharma Companies Game the System to Keep Drugs Expensive,’ published in the on April 06, 2017. Acknowledging: ‘Drug development is risky and expensive, thanks to the long testing and approval process,’ the author concluded from their study – ‘But, increasingly, makers of branded drugs are using a variety of tactics to extend their exclusive rights,’ enabling them to maintain high drug prices for much longer time.

More recently, the above Forbes article of June 10, 2022 also highlighted, ‘even the most generous patent protections come to an end and companies must face the potential for generic competition. That’s when major drug manufacturers shift tactics from influencing policy to crushing the competition.’ There are several legal and semi-legal approaches that big pharma players adapt to game the system and maintain pricing monopoly. Let’s recap it with just three of these examples:

- ‘Patent Thicket: Delaying entry of lower price off-patent molecule through a Patent Thicket. This involves creation of ‘a dense web of overlapping intellectual property rights that a generic pharma company must hack its way through in order to actually commercialize new technology of a drug molecule,’ even after the original patent expires. For example, AbbVie’s Humira, the world’s best-selling drug for a long time. I also discussed this issue in my blog over three years ago – on April 22, 2019.

- ‘Pay-for-delay deals’:  I discussed this issue in this blog on June 19, 2013. Moreover, the above Forbes article of June 29, 2022, also underscored this tactic. It explained that this is a deal in which drug companies agree not to compete for a set amount of time to maintain high prices of their brand-name drugs. The article, published in Bloomberg Law on February 20, 2020, captures it nicely.

- Authorized generics: As many would know, law permits six months of exclusivity to the first generic version of an off-patent new molecule coming into the market. Interestingly, just before patent expiry of an innovative drug, several drug makers roll out their own generics to stifle competition. Although, they keep different names for the generic versions, but pricing remains almost similar. Such a practice obliviously delays the entry of cheaper generics, at least by six months.

In this scenario, the new drug prices continue racing north. Something was to be surely done – for patients’ sake, as many believe, at least, where it all started – the US.

New drug prices are highest in 2022:

As reported by Reuters on August 16, 2022:

  • Eight of 13 drugs launched in 2022 priced over $200,000 per year
  • Median annual price for new U.S. drugs this year is $257,000
  • Some drugmakers disclose less information on pricing

Despite this, as reported on August 15, 2022: ‘The main U.S. drug lobby has said it will push back against the legislation, which includes policies that drug makers have opposed for decades.’

Conclusion:

The significance of the above development in the US healthcare scenario, was aptly summed-up by the US House Speaker, as she said: “If you are sitting at your kitchen table and wonder how you’re going to pay the bills – your health care bills, your prescription drug bills – this bill is for you.” For the first time in the US – the champion of champions of free-drug pricing market, will negotiate the drug price with their manufacturers to become patient -centric.

The reverberations of this difficult decision, especially on new drug prices, are expected to prompt the need for price negotiation or price control, primarily for expanding access to new drugs for a larger number of patients. This deserves to be a focus area for the Government, including India. Moreover, the August 18, 2022, media report also suggests that the top court of India may now encourage the Government to investigate, report and take remedial action on drug industry malpractices.

Finally, it’s worth noting that over a decade ago, international media widely reported -  ‘India considering price controls for patented drugs.’ Its objective was to address the aggressive new drug pricing trend in the country. Accordingly, the price negotiation proposal for patented drugs was notified by the Department of Pharmaceuticals (DoP) in 2007. The constituted Committee submitted a report, as well, on February 21, 2013. But it did not take off as on date. Many apprehend, this is due to intensive and ongoing lobbying by big pharma, just as what happened in the US. Nevertheless, the question that surfaces – will the above new drug law in the largest pharma market in the world encourage the DoP to revisit price negotiation for patented drugs - to make modern drugs affordable to a larger patient population in India – now?

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.

Time For Pharma To Leverage ‘The Break In The Clouds’

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A ‘break in the clouds’ is now clearly visible in the dark and overcast sky – witnessing a global havoc caused by the Coronavirus pandemic in the healthcare space – with its severe socioeconomic consequences. The name of the game to combat this gargantuan crisis in a heavily restricted environment with success, is adding ‘error-free speed’ in all aspects of the planned countermeasures.

This isn’t a very easy task, either. And certainly, is possible with well-integrated digital interventions. From this perspective, one can construe this situation as ‘break in the clouds’ that can be leveraged by pharma companies for digital transformation of their respective business operations.

It may also be interpreted as a blessing in disguise, because such transformation will empower the companies to take appropriate effective measures with speed. When effectively leveraged, such strategic steps will help pharma players in two ways. One, to contain the virus spread while ensuring access to care through business operations. And the second, will help propel the organization to move ahead, even within such a crisis. However, the ‘Digitalization’ process is multifaceted, having, at least two fundamental prerequisites. In this article, I shall focus on this strategic space.

Alternative ways to provide health care is fast gaining ground:

The product and service delivery models of pharma companies are generally built around the concept of physical presence of patients while consulting a doctor or other health care providers. However, Coronavirus pandemic has triggered some significant changes in this area. Let me illustrate this point with some contemporary references.

As the recent L.E.K paper – ‘COVID-19 and the Acceleration of Digital Health in APAC’ emphasized – ‘by sheer necessity, governments and regulators have also reduced the barriers to participation and uptake for remote engagement of consumers, enabling access to care despite social distancing measures,’ during the pandemic. Moreover, a technical guidance paper, published by the World Health Organization (W.H.O) on April 1, 2020 on strengthening health systems against COVID-19, also recognizes ‘telemedicine’ as an alternative model for delivery of care to ensure the continuous running of essential health care.

COVID-19 will take health system digitalization to a new level:

The above L.E.K paper also pointed out – in the days and months ahead, COVID-19 will accelerate the ‘digitalization’ of health systems to a new level. Especially when, healthcare stakeholders adopt a more urgent, no-holds-barred strategy to stem the rising tide of infections. L.E.K article predicted, the new ways of working and behaviors, forged and refined in the heat of battle against COVID-19, will not be easily put “back in the box.” Consequently, this increasingly digitalized reality will force a paradigm shift in the healthcare ecosystem, the paper concluded.

‘A virtually perfect solution’ to neutralize Covid-19 impact: 

Another paper - ‘Virtually Perfect? Telemedicine for Covid-19,’ published in the NEJM on April 30, 2020 wrote, disasters and pandemics pose unique challenges to health care delivery. It underscored, ‘Though telehealth will not solve them all, it’s well suited for scenarios in which infrastructure remains intact and clinicians are available to see patients.’ It also indicated, telemedicine may be a virtually perfect solution, particularly where such infrastructure is available.

‘Governments must reimagine healthcare delivery’:

That ‘Telemedicine can be a COVID-19 game-changer’ - both now, and in a post-pandemic world, was also articulated by another article, published by the World Economic Forum on May 13, 2020. It suggested: ‘Governments must reimagine healthcare delivery in the face of COVID-19.’

This is mainly because, hospitals and several other places where the COVID-19 battle is raging – have become risky places for both patients and healthcare workers. Although, several measures are being taken to limit transmission from such places, those are still ‘insufficient to stop overstretching of healthcare systems that were already overwhelmed before COVID-19,’ the article observed.

The good news is, in sync with the recommendation of the World Health Organization (W.H.O) for the use of telemedicine as an alternative model to boost clinical performance and optimize service delivery, India has also recognized its telemedicine facility. The Government finds it as ‘a blessing in disguise in time of Covid-19’ and has urged - ‘it’s already high time to recognize telemedicine as a mandatory technology for responding to the current pandemic.’

Health consumers started utilizing digital platforms during lockdown:

hanger, As I wrote in my article of April 27, 2020, being literally locked down at home, a good number of healthcare consumers in India, are utilizing innovative digital platforms, mostly for common illnesses or follow-up consultations, such as:

  • For medical consultation on digital platforms, e.g., Skype, Facetime etc.
  • Getting diagnostic tests done at home by requesting through digital apps,
  • Sending test reports to doctors digitally,
  • Getting doctor’s prescription through digital mode,
  • Ordering medicines through e-pharmacy apps by uploading prescriptions,
  • Getting medicines delivered at home after e-payment,
  • Repeating the same process whenever required.

I also mentioned there, the use of telemedicine in several different, unconventional formats, is also gaining momentum, signaling its greater potential in the years ahead. It seems a reality today, as strict compliance with ‘social distancing’ guidelines is one of the basic requirements of health safety for all.

Does pharma have any other prudent choice now to be effective?

Traditionally, health care industry almost in all countries, is structured on the model of in-person interactions between patients and their clinicians. As the article – ‘Covid-19 and Health Care’s Digital Revolution,’ published in the NEJM on June 04, 2020 wrote, ‘clinical workflows and economic incentives have largely been developed to support and reinforce a face-to-face model of care, resulting in the congregation of patients in emergency departments and waiting areas during this crisis.’

Realizing that this model of care contributes to the spread of the virus to uninfected individuals who are seeking evaluation, many health care consumers are now postponing the needed care or looking for a digital solution for common ailments, to begin with.

In this environment to be effective – pharma players don’t seem to have any other choice but to transform their business operations and scaling up operating systems with the power of digital technologies, as the article indicated. Although, some digital technologies, including telemedicine, have existed for decades, they have had poor penetration into the market for different considerations. But, it’s a transformed situation today, exhibiting a groundswell for the same.

Groundswell for digital transformation in pharma?

COVID-19 pandemic is creating a groundswell for an early digital transformation in the health care space where pharma industry plays a very critical role. If one observes carefully, it is not difficult to fathom the change in behavior and practices of health care consumers. Thus, it calls for commensurate changes in the operating models of the drug players, to keep the kettle boiling, at the very least.

Consequently, the need for integrated digital interventions, quite akin to ‘Zoom’ – replacing many long in-person meetings. Changes of such nature and significance won’t just come and go. These are here to stay to add speed, convenience and cost-effectiveness in business operations, even if Coronavirus disappears, eventually.

The shape and talent need of future organizations will be prompted by such changes, facilitated by digital technologies and Artificial Intelligence (AI). However, digital transformation isn’t just a ‘switch-on’ operation of drug companies, as and when they would wish. Moving towards this direction will call for an unbiased assessment of, at least two prerequisites, for each player.

Two important prerequisites:

As both personal lives and also the work lives of almost all professionals and entrepreneurs, along with the customer behavior, have metamorphosed significantly, commensurate changes need to be implemented in all these areas, urgently. One area where a quantum change has taken place almost unknowingly – mainly driven by the human instinct of survival in a crisis, is the use of various state-of-the-art digital platforms. These include, the way businesses and professionals interact with each other for productive engagements.

Many studies have unraveled this process, such as the one – ‘Seizing the moment in digital’, published in the eye for pharma on May 28, 2020. It underscores two critical prerequisites for any digital transformation of businesses. These are to assess – first, how compatible will this transformation be with the existing organization culture and the same of its top leadership.

If any barrier surfaces, the organization would need to ask, whether its business is ready for a commensurate cultural transformation to make it work productively. The second one is, the capability – it may not be just the technical capability – internal or outsourced to go digital, but more importantly, the capability to run the transformed business to fetch desired results.

Conclusion:

The world is still in the midst of a global crisis, triggered by the Coronavirus pandemic. It is quite far from even plateauing in India. As on July 5, 2020 morning, crossing half a million mark, the recorded Coronavirus cases in the country have reached 673,904 with 19,279 deaths. And its climb continues.

Thus, amid a virtually unfathomable Covid-19 crisis, it will be foolhardy to predict what will happen next. However, as one joins the dots of some significant development, a perceptible trend emerges through the break in the clouds. This is unlikely to vanish anytime soon, and is very likely to be a new normal. Many articles from various thought leaders, such as one of McKinsey Digital - ‘The COVID-19 recovery will be digital’, published on May 14, 2020, vindicated a ground swell for the same. Yet another interesting article of May 11, 2020, termed the Covid-19 pandemic as a black swan event – ‘pushing towards a digital future.’

That said, digital transformation for a drug player will call for an unbiased assessment of two critical prerequisites – culture and capability, to deliver a meaningful outcome. Be that as it may, all indicators confirm that this is undoubtedly a critical time for pharma to leverage the ‘break in the clouds’ in pursuit of excellence – in the new normal.

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.

Continues ‘The Cat And Mouse Game’ In Pharma Business?

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Many are already aware of the critical factors that make generic drugs so important for patients – virtually for all. These don’t just facilitate greater access to health care – offering affordable alternatives to high-priced off-patent innovative drugs. This is as relevant in the largest pharma market in the world – the United States (US), just as in India. Let me illustrate this point with two examples – one from the US and the other from India.

According to US-FDA, ‘9 out of 10 prescriptions filled, are for generic drugs’ in the United states, as off-patent branded generic drugs cost more than their generic equivalents. The US drug regulator explains, ‘Increasing the availability of generic drugs helps to create competition in the marketplace, which then helps to make treatment more affordable and increases access to healthcare for more patients.’

However, unlike the US, there prevails a unique perception difference even within generic drugs – between branded and unbranded generics. The Indian Survey, undertaken to review and analyze various facts on branded and equivalent unbranded generic medicines, found a huge difference in prices between them in the country. Interestingly, as the researchers also noted, although, more consumers want an economical alternative to high priced branded generics, most physicians do not prefer unbranded generic medicines.

There is another important point worth noting regarding India made generic drugs. Although, Indian pharma sector caters to around 40 percent of generic demand in the US, as IBEF reports, many Americans nurture serious apprehensions on the quality of generic drugs manufactured even by India’s top drug companies. 

This is quite similar to apprehension that exists in India between the quality branded and unbranded generic medicines in India. The only difference is – the above perception in India is not based on impartial and credible scientific studies, whereas it is not so in America. The New York Times report, published on May 11, 2019 vindicates this point. It questioned: “Americans Need Generic Drugs. But Can They Trust Them? The fake quality-control data, bird infestations and toxic impurities at the overseas plants that could be making your medication.” Incidentally, there aren’t any such large-scale accusations regarding dubious quality of drugs manufactured by Big Pharma. 

On the other hand, big pharma players have long been accused of drug price gouging or price-fixing of life-saving drugs, primarily to maximize earnings by ‘extending’ product patent-life. Curiously, in recent times, even the generic drug players are being accused of following a similar practice. Thus, in this article, I shall explore how generic drug players are also trying to hoodwink measures to bring down the drug price, either through price control or through the encouragement of intense competition – playing a ‘cat and mouse game’, as it were, whenever an opportunity comes. If it continues and probably it will, what is the way ahead? Let me begin by recapitulating a historic pace-setting move in the global generic market by an Indian drug player.

A historic pace-setting move by an Indian generic drug player:

Being a major exporter of generic drugs in many developed, developing and even poor countries around the world, India is often termed as ‘the pharmacy of the world.’ That apart, a historical move in this space, by a top domestic player – Cipla, earned global accolades, at the turn of this new millennium. In 2001, Cipla slashed the price of its triple-therapy drug ”cocktails” for HIV-AIDS – being sold by MNCs, ranging from USD 10,000/ USD 15,000 a year to USD 350 a year per patient to a doctors’ group working in Africa.With the generic industry’s focus on a deeper bottom line, the scenario has changed now. Finding ways and means for the price increase, evading both competitive pressure and also drug price control, as in India, has turned into a ‘cat and mouse game’, as it were.

Generic drug pricing – ‘a cat and mouse game?’

Pricing pressure, especially for generic drugs, from patients, payers, politicians and governments, is gradually becoming more intense. More the pressure greater is the effort of affected players to come out of it, in any way –akin to a ‘cat and mouse game’, as it were. Although, it has recently started in the USA, the same exists in India, since 1970, when the first drug price control was introduced in the country. Intriguingly, in the midst of this toughest ever drug price control, phenomenal rise of almost all top Indian companies, including the top ranked company in the Indian pharma market commenced – from scratch. Nonetheless, to get a feel of how is this game being played out, let me start with the Indian scenario.

How this game is played in India to evade price control:

Instead of taking a deep dive into the history of drug price control in India, let me give a bird’s eye view of a few mechanisms, out of many, used to evade price control, since it commenced. The idea is to give just a feel of how this ‘cat and mouse game’ game pans out, with a few of such examples in a sequential order, since 1970, as much as possible, by:

  • Including price decontrolled molecule in the FDC formulations.
  • Replacing a price-controlled molecule by a similar decontrolled one, keeping the brand name unchanged, when the number of controlled molecules came down.
  • Making a major shift towards selling more of higher-priced decontrolled molecules, jettisoning low priced controlled molecules.
  • Resorting to vigorous campaigns, when the government started encouraging prescription of low-priced generic molecules, to ensure further shift to branded FDC prescriptions, alongside image enhancement of branded generics over equivalent unbranded ones. Its outcome is visible in the above Indian Survey on the image of branded and unbranded generics.

Has Indian pharma industry succeeded in this game?

It appears so and gets reflected in the CAGR of the industry. According to IBEF, “The country’s pharmaceutical industry is expected to expand at a CAGR of 22.4 per cent over 2015–20 to reach US$ 55 billion.” I underscore, this is value growth.

Thus, the point, I reckon, that the government should ponder: How both can happen, at the same time – price control is bringing down drug prices, extending real benefits to patients on the ground, and at the same time the industry is recording an impressive growth rate in value terms?  Whatever it means, let’s now try to explore, how such ‘cat and mouse game’ is being played to increase generic drug prices in the United States.

How similar game is played in the US to increase generic drug price:

On May 10, 2019, international media reported that ‘44 US states announced a lawsuit alleging an anti-competitive conspiracy to artificially inflate prices for more than 100 drugs, some by more than 1,000 percent.’ This lawsuit is based on an investigation involving a number of generic drug companies. The process, which took five-years to complete, accused twenty generic drug players. Teva Pharmaceuticals USA, whose parent company is based in Israel was, reportedly, named as the ringleader of the price-fixing. The company raised prices of around 112 generic formulations.

Other companies, reportedly, named in the complaint, include Pfizer, Novartis subsidiary Sandoz, Mylan, and seven Indian drug companies, including Lupin, Aurobindo, Dr. Reddy’s, Wockhardt, Taro Pharmaceutical Industries (a subsidiary of Sun Pharma) and Glenmark. Some of the 15 senior company executives who were individually named in the lawsuit for their involvementin this alleged “multibillion-dollar fraud ”belong to Teva, Sandoz and Mylan.

The ‘cat and mouse game’ in this case is slightly different. Instead of government price control, the US drug regulator encouraged intense generic competition to bring down the price. When the priced did not come down as expected, the State of Connecticut, reportedly, began investigating select generic drug price increases in July 2014. Subsequently, other states also joined the investigation, and uncovered the reason for prices not coming down.

According to the complaint, between July 2013 and January 2015, Teva significantly raised prices on approximately 112 different generic drugs. Of those 112 different drugs, Teva had colluded with its competitors on at least 86 of them. The complaint noted: “Teva had understandings with its highest quality competitors to lead and follow each other’s price increases, and did so with great frequency and success, resulting in many billions of dollars of harm to the national economy over a period of several years.” In this way, the impact of intense competition on drug prices, was made ineffective.

Not the first time, it was detected:

The 2019 anti-trust lawsuit against the generic drug makers may be ‘the biggest price-fixing scheme in the US history’, but not the first lawsuit of this kind in America. A similar lawsuit for illegal price-fixing against six generic companies, was filed by the states in 2016, as well, which is still being litigated. The 2019 case is a sweeping version of the same and is the result of a much wider investigation. It indicates, instead of taking corrective measures, the ‘cat and mouse game’ still continues. However, almost all the companies have vehemently denied this allegation.

Is this game existential in nature of the business?

One may well argue that such ‘cat and mouse game’ with the government is existential in nature, for the generic drug business. When price control or intense market competition brings down the price to such a level, it becomes a matter of survival of most businesses. There doesn’t seem to remain enough financial interest for them to remain in the market. If and when it happens, causing shortage of cheaper generic drugs, patients’ health interest gets very adversely affected. It also prompts the manufacturers to find a way out for the survival of the business. This is understandable. But it needs to be established, supported by scientific studies.

An off the cuff solution:

A general and off the cuff solution to the above issue would naturally be, there should be a right balance between affordability of most consumers and the business interest of the drug makers. This broad pointer is also right and understandable. But again, no one knows the expected upper limit of the generic drug profit margin for their manufacturers – where hardly any breakthrough and cost-intensive R&D is involved. Equally challenging is to know – below what margin, generic players, by and large, loose interest in this business?

What do some available facts indicate?

According to the year-end report of the Pharmaceutical Export Promotion Council (Pharmexcil) the total pharma exports from India has been pegged at USD 19.14 billion for 2018-19. This represents a growth of 10.72 per cent over USD 17.28 billion in thelast year. It further reported, “The top 25 export destinations contribute 76.52 per cent of the formulation exports amounting to USD 10.38 billion. Among these, the US continues to be the largest export destination with over 38.62 per cent of the total generic exports to that country at USD 5.24 billion.” Does it mean business as usual, despite ‘price-fixing’ law suits in the US, since 2016?

Similar impression one would probably get from the Indian scenario, as well. Notably, despite price control, which is continuing since last five decades, the growth rate of the Indian pharma market, which is dominated by branded generics, remains very impressive.According to the January 2019 report of IBEF: “The country’s pharmaceutical industry is expected to expand at a CAGR of 22.4 per cent over 2015–20 to reach USD 55 billion.” So also the same game, probably!

Conclusion:

It appears, there is certainly a huge reputation or image crisis for the generic drug industry, as such, due to such alleged delinquencies. However, from the business perspective, the manufacturers are still having enough leeway to move on with similar measures, supported by fresh thinking. At the same time, it seems unlikely to have any form of drug price control in the United States, at least, in the foreseeable future. Nevertheless, price pressure due to cut-throat competition could even be more intensive, as it gets reflected even in the US-FDA statements.

Nearer home, the Indian generic drug business has been hit with a double whammy – allegations for dubious drug quality standards, on the one hand, and price manipulation on the other, besides dented reputation and image – widening trust gap with patients and governments.

Moreover, unlike the best export market even for generic drugs – the United States, India has been following some patchy policy measures for health care, as a whole. The drug price control system is one such. Till a holistic policy on health care is put in place for all, backed by an effective monitoring system, The Indian price control system may remain like a ‘maze’, as it were, with several ways to hoodwink it.

Hence, the ‘cat and mouse game’, albeit in a different format, is likely to continue, until one gets caught, or till all concerned puts their act together – putting patients at the center of the core business strategy.

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.

The Game is Changing: Ensure Better Treatment Outcomes: Leverage Technology

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Today, several pharma players, mostly ‘encouraged’ by many non-pharma tech companies, are trying to gain, at least, a toehold in the digital health care space. It is visible even within the generic drug industry. Such initiatives, as they gain a critical mass, will remold the process of doing – almost everything in the pharma business, catapulting the concerned drug companies to a much higher growth trajectory, as many believe.

This is quite evident from an interview of Fierce Pharma with the senior management of Sandoz – the generic drug arm of Novartis, that was published on May 14, 2019. The honchos said: “We’re looking across the whole value chain to make sure we’re embracing digital and technology wherever we can. So that means from the way that we innovate, to the way that we sell and the way that we operate and do day-to-day business.” The process covers “a whole range of activities from how you use AI and automation, all the way through to prescription digital therapies.”

I discussed about leveraging technology in the pharma space to address many burning issues – both for patients and the pharma industry. One such article, “Focus on Patient Compliance To Boost Sales…And More…”, was published in this blog on May 20, 2019. It establishes that even world-class sales and marketing programs can, at best, ensure higher prescription generations, but can’t prevent over 50 percent revenue loss from those prescriptions, due to patient non-compliance.

Interestingly, the issue of ‘nonadherence to treatment’ is being debated, since several decades. Various conventional measures were suggested and also taken. But the problem still persists in a huge scale, with probably an increasing trend. Thus, fresh measures, preferably by leveraging modern technology, are of high relevance in this area.

In this article, I shall illustrate the above point, with one of the most exciting areas in the digital space – the digital therapeutics. This is a reality today and marching ahead at a much faster pace than many would have anticipated.

Unfolding another disruptive innovation in healthcare:

One of the articles that I wrote on this subject is ‘Unfolding A Disruptive Innovation in Healthcare,’ which highlights a different facet of the same subject. Thus, let me begin today’s discussion with a recapitulation of some important aspects of a drug, particularly the following ones:

  • A large number of patients don’t find many drugs accessible and affordable during the entire course of treatment.
  • Drugs have to be administered orally, systemically or through any other route
  • Alongside effective disease prevention or treatment, many drugs may bother patients with long and short-term side-effects, including serious ones.
  • Treatment outcomes can’t often be easily measured by patients.

These are, of course, known to many, but several questions come up in this area, which also deserve serious answers, such as:

  • Are drugs indispensable for the treatment of all types of disease?
  • Can a holistic disease treatment be made more accessible and affordable with radically different measures?
  • Can the same effectiveness of a drug, if not more, be achieved with no side-effects with a non-drug therapy?
  • Can outcomes be significantly improved following this process, as compared to drugs?

In search of answers to these questions – arrive digital therapeutics:

In search of answers to the above questions, a number of tech savvy whiz kids. dared to chart an uncharted frontier by asking themselves: Is it possible to treat a disease with a software – having no side-effects, but providing better cost effectiveness and treatment outcomes to patients?

Today, with the signs of healthy growth of the seed – sown with the above thoughts, ushers in – yet another game changing pathway for disease treatment. The quest for success of these pathfinders can benefit both – the drug innovators and also the generic players, in equal measure, besides patients. Digital therapeutics is an upshot of this pursuit.

Its ‘purpose’ outlines – why it’s one of the most exciting areas in digital space: 

The Digital Therapeutics Alliance well captures the purpose of digital therapeutics, as, “Improving healthcare quality, outcomes, and value through optimizing the use and integration of digital therapeutics.”

What do digital therapeutics actually do?

There are several, but quite similar descriptions of digital therapeutics. For example, Deloitte described digital therapeutics as software products used in the treatment of medical conditions, enabling patients to take greater control over their care and are focused on delivering clinical outcomes. It also highlights, ‘digital therapeutics are poised to shift medicine’s emphasis from physically dosed treatment regimens to end-to-end disease management based on behavioral change.’

Digital therapeutics offers all positives of a drug and more:

In indications where digital therapy is approved and available, the new approach offers all positive attributes of an equivalent drug, with no side-effect. There isn’t any need of its physical administration to patients, either. Deloitte elucidated this point very aptly: “As software and health care converge to create digital therapeutics, this new breed of life sciences technology is helping to transform patient care and deliver better clinical outcomes.” More importantly, all this can be made available for better compliance and at a cheaper cost in many cases.

For example, according to the article published in the MIT Technology Review on April 07, 2017, carrying the title ‘Can Digital Therapeutics Be as Good as Drugs?’: “Some digital therapeutics are already much cheaper than average drug. At Big Health, people are charged $ 400 a year, or about $ 33 a month to use the insomnia software. The sleeping pill Ambien, by contrast, costs $ 73 for six tablets of shut-eye.”

Two basic types of digital therapeutics:

The Digital Therapeutics Alliance also underscores: “Digital therapeutics rely on high quality software to deliver evidence-based interventions to patients to prevent, manage, or treat disease.” It further elaborates: “They are used independently or in concert with medications, devices, or other therapies to optimize patient care and health outcomes.” In line with this description, the above MIT Technology Review article, as well, classifies digital therapy into two basic categories:

  • For medication replacement
  • For medication augmentation

It also says that the digital therapy for sleep (sleep.io), belongs to the first category, making sleeping pill most often unnecessary and with outcomes better than those of tablets. Whereas, the second category includes various disease specific software apps that improve patient compliance with better self-monitoring, just as co-prescription of drugs.

Nonetheless, the same MIT article gave a nice example of ‘medication augmentation’ with digital therapy. The paper mentioned, Propeller Health – a digital company, has inked a deal with GlaxoSmithKline for a ‘digitally guided therapy’ platform. The technology combines GSK’s asthma medications with Propeller Health made sensors that patients attach with their inhalers to monitor when these are used. Patients who get feedback from the app, end up using medication less often, the study reported.

The first USFDA approved digital therapy:

Let me give one example each of the launch of ‘medication replacement’ and ‘medication augmentation’ digital therapy, although there were other similar announcements.

  • On November 20, 2018, by a media release, Sandoz (Novartis) and Pear Therapeutics announced the commercial availability of reSET – a substance use disorder treatment that was the first software-only digital therapeutic cleared by the US-FDA, for medical prescriptions.
  • Closely followed by the above, on December 21, 2019, Teva Pharmaceutical announced US-FDA approval for its ProAir Digihaler for treatment and prevention of bronchospasm. Scheduled for launch in 2019, it is the first and only digital inhaler with built-in sensors that connects and transmit inhaler usage data to a companion mobile application, providing insights on inhaler use to asthma and COPD patients – for prevention and better treatment of the disease.

Many other projects on digital therapeutics are fast progressing.

Conclusion:

Stressing a key importance of digital therapeutics in chronic disease conditions, McKinsey article of February 2018, titled ‘Digital therapeutics: Preparing for takeoff’, also underlines: ‘Digital therapeutics tend to target conditions that are poorly addressed by the healthcare system today, such as chronic diseases or neurological disorders.’

It also, further, emphasized that digital therapeutics can often deliver treatment more cheaply than traditional therapy, by demonstrating their value in clinical terms. It illustrated the point with US-FDA’s approval for a mobile application that helps treat alcohol, marijuana, and cocaine addiction, well-supported by clinical trial data. The results showed 40 percent of patients using the app abstained for a three-month period, compared with 17.6 percent of those who used standard therapy alone.

I now come back to where I started from. The pharma ball game is changing, and that too at a faster pace.Ensuring and demonstrating better treatment outcomes for patients – both for patented drugs and the generic ones, will increasingly be the cutting-edge to gain market share and grow the business. Thus, leveraging technology to its fullest is no longer just an option for pharma companies. The evolution of digital therapeutics as a game changer, vindicates the point.

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.

Blockchain: A Game Changer For Safe Medicines

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‘Your medicine box may have fake drugs’ was the March 18, 2018 headline of a popular pan Indian news daily. Just the year before, the 2017 report of the World Health Organization (WHO), also flagged that around 10.5 percent of all medicines in low-and middle-income countries, including India are substandard or fake. Even prior to this, another news headline of February 15, 2016 highlighted: ‘1 In 7 Indian Drugs Revealed As Substandard.’ These reports paint a scary situation for consumers of medicine in India, especially when the same incidence is just around one percent in the high-income countries of the world. Nevertheless, getting into a protracted discussion to prove the veracity of this issue, may not yield much, either. Some may even term these as efforts to ‘sensationalizing’ the situation.

That said, the good news is, the Government Think Tank Niti Aayog and also the Drug Technical Advisory Board (DTAB) of India,are reportedly contemplating to combat this menace with cutting-edge technology. In this article, I shall dwell on this threat, starting with its profound impact, not just on human health, but also on the economic and the socioeconomic space of India.

Why is it so important?

The most obvious fallout of this hazard is of course borne by the consuming patient.  The other two critical impact areas has also been well captured by the World Health Organization (WHO) in its 2017 study, titled ‘A study on the public health and socioeconomic impact of substandard and falsified medical products’. I am summarizing those 3 key impact areas hereunder:

A. Health impact: 

  • Adverse effects (for example, toxicity or lack of efficacy) from incorrect active ingredients
  • Failure to cure or prevent future disease, increasing mortality, morbidity and the prevalence of disease
  • Progression of antimicrobial resistance and drug-resistant infections, loss of confidence in health care professionals, health programs and health systems

B. Economic impact:

  • Increased out-of-pocket and health system spending on health care
  • Economic loss for patients, their families, health systems and manufacturers (and other actors in the supply chain) of quality medical products
  • Waste of human effort and financial outlay across the health system, further straining resources, staff and infrastructure
  • Increased burden for health care professionals, national medicine regulatory authorities, law enforcement and criminal justice systems.

C. Socioeconomic impact:

  • Lost income due to prolonged illness or death
  • Lost productivity costs to patients and households when seeking additional medical care, the effects of which are felt by businesses and the wider economy
  • Lack of social mobility and increased poverty

What the Government contemplates in India? 

According to the April 09, 2018 news report, “Indian policy think tank Niti Aayog is working to put the entire inventory of drugs made and consumed in the country on blockchain with an intent to crack down on counterfeit and spurious drugs, according to two government sources. The government wants to complete a proof of concept (PoC) solution by the year-end and begin implementation in 2019.”

On May 16, 2018, DTAB reportedly deliberated and approved a Track and Trace mechanism to address this issue. The proposal is a stand-alone measure to combat fake or counterfeit drugs covering 300 pharma products. However, it does not intend to cover the entire drug supply chain integrity with Blockchain technology, in a comprehensive manner.

According to the above report, this particular approach involves asking the pharma manufacturers to print a unique 14-digit alphanumeric code on the package of the drug. While buying any medicine, the individual can inquire via a text message, whether the drug bearing that code is genuine or not.

I wrote an article in this Blog on the use Blockchain by pharma players, on January 22, 2018. You may wish to refer that to know more about it in context of the pharma industry.

Recent Blockchain initiatives by global pharma majors:

Some global pharma layers have already covered some ground with Blockchain, especially in this area.On September 21, 2017, an article titled ‘Big Pharma Turns to Blockchain to Track Meds’, published in Fortune, presented some interesting facts. It indicated: to stop a flow of fake, spurious or counterfeit medicines entering the supply chain and reaching patientshow the pharma industry appears to be on the verge of resolving this long-time problem with the intervention of one of the most modern technology – Blockchain.

A group of companies, including Genentech and Pfizer has announced the MediLedger Project for creating blockchain tools to manage pharmaceutical supply chains. The group, has completed a successful pilot program to track medicines, where all concerned – from drug manufacturers to wholesalers to hospitals and retailers will be recording drug deliveries on a blockchain. This would ensure that, at each step of the distribution process, a network of computers will vouch for the ‘provenance and authenticity’ of a drug shipment—making it virtually impossible for counterfeiters to introduce fake drugs – the article highlighted.

Quoting domain experts, the authors underscored the key difference between current practices in this area and managing supply chain through Blockchain technology. At present, most companies use various software to manage the supply chain. However, these usually consist of a mishmash of different databases. ‘The introduction of a Blockchain system, in which each participant controls a node on the network, and transactions require a consensus, is thus a significant leap forward’ – the experts noted.

On scaling up, if this project achieves the intended goals, it would possibly be a game changer for the pharma companies in addressing the counterfeit or fake drug menace, effectively.

How will Blockchain combat fake or counterfeit drugs?

In India, there are basically four constituents in the pharma supply chain: source of procurement of various ingredients – manufacturers – C&F Agents – wholesalers – retailers, besides hospitals and dispensaries. To avoid counterfeit or fake/spurious drugs in a comprehensive way, it is critical for these constituents to see and share relevant data based on a modern and tamper-proof technology platform. Unfortunately, the current practices mostly fail to address this serious threat in a holistic way.

Experts envisage Blockchain delivering a superior value in this area, as it has the potential to cover end-to-end supply chain network of a pharma business. A November 14, 2017 article appeared in a Harvard Business School publication of Technology and Operations Management (TOM) explains its rationale very well. The paper is titled “Can blockchain help solve the problem of counterfeit drugs?”

In the context of a supply chain it says, blockchain can be used to track the flow of goods and services between businesses and even across borders. At each step of the distribution process, a network of computers can unmistakably indicate the provenance and authenticity of a shipment, making it harder or counterfeiters to introduce fake drugs. The key advantage of this technological process is that

it is virtually impossible for malicious actors to alter the event logs. Another advantage is speed: should a shipment be disrupted or go missing, the data stored on the common ledger would provide a rapid way for all parties trace it, and determine who handled the shipment last, the author elaborates.

Common anti-counterfeit-measures:

In many countries, including India, drug regulators are focusing on putting in place various anti-counterfeit measures, such as, ‘track and trace’ and ‘mass serialization.’ In some nations these mandatory in nature. At present, the most common process, globally, is to have machine-readable codes carrying a serial number featuring on each and every pack of medicines. Many anti-counterfeit solution providers call these in various different names, to position themselves on a marketing high ground. Other such measures include, forensic markers, cloud-based supply chain data repositories are also being talked about.

So far so good, but the current reality continues to remain scary for patients, probably more in India. Each year ‘tens of thousands dying from $30 billion fake drug trade,’ – reported Reuters just recently – on November 28, 2017. As reported by IntelligentHQ on November 3, 2016, ‘studies have shown that the pharmaceutical industry still struggles on two main counts: interoperability between all the participants, from the manufacturer to the dispenser and data management, to better integrate the serialization systems. Being able to avoid drug counterfeiting is just one of the reasons for which it is so critical to successfully track products down the supply chain.’

Conclusion:

Ensuring safety and security of the pharma supply chain – from sourcing to manufacturing to logistics to retail chemist and ultimately to the final consumer, is now possible with the application of Blockchain. In fact, this process has already been developed, and tried in many continents of the world, including Africa (video).

Thus, in my view, for an effective anti-counterfeiting system to work or even a substandard drug ingredient going into any original final product that ultimately will be consumed by patients, the most important requirement is to ensureend-to-end supply chain visibility and integrity.Any stand-alone anti-counterfeit measure can’t possibly provide such holistic solution.

Just to emphasize on this point – what happens, if anything goes wrong during sourcing of ingredients, or during the manufacturing of the original drug? The drug in question, although could be substandard, can’t be termed counterfeit. Hence, any standalone anti-counterfeit mechanism will obviously indicate ‘all is well’ for the patients to consume this original medicine – before the product is ultimately recalled, if and when the defect is detected by other means.

From this perspective, the application of Blockchain technology covering end-to-end supply chain network has the wherewithal of being a game changer – offering safe medicines to patients.

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.

‘Made-to-Measure’ Marketing for ‘Made-to-Measure’ Medicines

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We have entered into a new era of innovation in medical science where ‘one size fits all’ type of treatment is making a sizeable space for a new ‘made-to-measure’ variety of the same. Such medicines are being developed particularly for life-threatening and rare diseases, where individual genetic differences in patients play a key role in the choice of therapy.

The marketers of such drugs, at the same time, will need to make sure that the right sets of messages are delivered to the right person, in the right way and at the right time, for brand success. This isn’t a piece of cake, as it will be akin to finding out a needle from a haystack. It would call for craftily ferreting out from an enormous database, both the patients’ and the prescribers detail profile virtually in each stage of the treatment process.

Such information would form the bedrock for effective brand value creation and its delivery, to achieve best possible business results and also patient outcomes. Thus, ‘made-to-measure’ marketing would be a whole new ball game for many pharma marketers – a  completely different situation that, very often, they know little about.

In this article, I shall dwell on this subject. Let me begin with a brief description of the emerging ‘made-to-measure’ variety of treatments.

‘Made-to-measure’ treatment:

There are many serious and life-threatening disease conditions where ‘One Size Fits All’ sort of treatment approach doesn’t work too well. One such dreaded disease is cancer. Conventionally, following standard treatment guidelines, doctors generally opt for similar treatment for patients suffering from the same type and stage of cancer. Interestingly, it has been conclusively established over a period of time that this approach often yields different outcomes to different patients.

With the progress of genetic science, the researchers have unraveled this mystery from the genetic difference of patients. This understanding heralded the dawn of a new era of targeted or ‘made-to-measure’ drug therapies. These are called “personalized medicine” or “precision medicine”. According to the National Research Council, “personalized medicine” is an older term with a meaning similar to “precision medicine.”

Personalized medicines:

According to the American Society of Clinical Oncology (ASCO), understanding a patient’s genetic makeup and ascertaining how certain gene changes during cancerous tumor growth, doctors can now choose more effective treatment options for each patient. In other words, based on genetic test results, oncologists can now opt for a customize treatment, based on each patient’s specific needs. Such drugs can block or turn off the signals that tell malignant cells to grow and divide, keep cells from living longer than normal, or kill the cancer cells altogether.

Moreover, by performing genetic tests both on the cancer and normal cells, doctors can also:

  • Find out the chances of a person developing cancer and selecting the screening strategies to lower the risk
  • Match patients with treatments that are likely to be more effective and cause fewer side effects
  • Predict the risk of recurrence, which means the return of cancer

The new era began in 1998:

The era of ‘personalized medicine’ for cancer, in all practical purposes, commenced in 1998, when the US-FDA approved the targeted therapy, Herceptin (trastuzumab). Breast cancer patients having high levels of a biomarker, known as “HER-2,” are more likely to be susceptible to this drug.

Since then, the development of targeted therapies has grown rapidly. As reported by the American Journal of Managed Care (AJMC), published on January 31, 2018, one in every 4 drugs approved by the US-FDA over the past 4 years was a personalized medicine, and the agency approved a record-breaking 16 personalized therapy in 2017. The same year, US-FDA also approved the first biosimilar of a personalized medicine - trastuzumab-dkst (Ogivri) for HER-2-positive breast cancer patients. This biosimilar was developed with Herceptin as its reference.

The February 2018 report of Research and Markets titled, ‘Personalized Medicine – Scientific and Commercial Aspects’ says, the aim of ‘personalized medicine’ is to match the right drug to the right patient and, in some cases, even to design the appropriate treatment for a patient according to his/her genotype. I deliberated on genotype-based treatment in my article titled, ‘A Disruptive Innovation to Fight and Cure Intractable Diseases’, published in this blog on October 30, 2017.

At this point, let me hasten to add that the development of personalized medicine raises some ethical issues, as well. Currently, this debate is mostly limited to the area of genetic testing.

Personalized dosage:

An article published on March 23, 2015 in the ‘FDA Voice’ of the US-FDA states, since the 1990s, the agency is also working on personalized drug dosing. This is because individuals differ in how they eliminate a drug. Some eliminate it much more slowly than most other people, and thus are susceptible to overdosing, while others eliminate it much faster, and may not get the desired therapeutic effect. There are biomarkers to identify people who may have these unusual results. Personalized drug dosing makes sure that drug efficacy for such patients are not compromised, or they are not at high risk of any severe side effects.

Marketing ‘personalized medicine’ a whole new ball game:

All this vindicates that ‘personalized medicine’ is not just a flash in the pan. With each passing year, it’s moving ahead at a brisk pace. In this emerging scenario, what happens to marketing of these drugs? Will the marketing of ‘personalized medicine’ remain just the same as the conventional one, or it warrants radically different cerebral inputs?

The opportunities for personalization in pharma marketing are immense. ‘Personalized medicines’ offer a greater scope in leveraging its potential that is yet to be fathomed, meaningfully. Broadly, this will mean targeting customers or potential consumers even at the individual level, to add greater differential value.

This, in turn, will involve making the marketing content, the message format and choosing the effective value delivery platforms, virtually ‘made-to-measure’ for the target audience. Marketing interaction of this ilk, has proven to offer a cutting-edge experience to the target groups with greater outcomes, in tandem, yielding superior financial results to the concerned pharma players.

Recent reports:

On December 18, 2017, Cambridge BioMarketing – one of the world’s leading rare disease agency highlighted, as personalized medicine continues to take hold, it will be more important than ever for healthcare companies to incorporate the ‘hyperpersonalized’ experience in marketing and communications. Patients’ voice has already started becoming more important than ever before, in various facets of pharma business. In 2018, one may expect to witness more pharma companies tapping the experts who can help explain the life-changing benefits of a treatment for the patient, effectively – the report predicted.

Moving forward, patients embarking on new treatments will be better empowered to take charge of their well-being. Physicians and nurses will also be better connected to their patients, along with other care providers, with the support of enhanced digital connections and mobile apps. Interestingly, one can find it happening in several developed countries, especially, in areas like rare diseases, where ‘personalized medicines’ will be used more – underscored this agency.

On January 22, 2018, quoting the same Cambridge BioMarketing, FiercePharma also reported, more ‘personalized medicines’ also mean more ‘personalized marketing’ – and the ‘hyperpersonalization’ trend goes to extremes. Crunching data gathered from multiple sources, such drug marketers need to identify small groups that could be receptive to specific messaging. Advanced data and analytics, would facilitate the marketers to whittle down their targets and tailor messages to consumer audiences, sometimes as small as one person – the report asserted.

Conclusion:

As the February 2018 report of ‘Research and Markets’ highlights, increase in efficacy and safety of treatment by individualizing it, has benefitted in financial terms too. Available information indicates that ‘personalized medicine’ will ultimately be cost-effective in healthcare systems. This would also eliminate the need for various assumptions in the process of diagnosing a disease.

Thus, conventional pharma marketing based on the mostly segmentation strategy used for blockbuster molecules may not work for a ‘personalized medicine’. Instead, ‘personalized marketing, focused on smaller and exclusive markets – identified based on robust research and analytical data, will be the name of the new game for business excellence in this specialized area.

Thus, I reckon, as we move ahead, ‘made-to-measure’ marketing will no doubt be one of the key success requirements to make ‘made-to-measure’ medicines’ – a money spinner.

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.