The AI imperative: Propels Purpose-driven Leaders Revolutionizing Patient Care

The winds of change are blowing in healthcare! Artificial Intelligence (AI) is poised to revolutionize how we deliver quality care to everyone. As a recent ET Healthworld article (March 3, 2024) aptly stated: “AI and technology are going to be transformative. The only way we can provide quality healthcare for the masses of the country will be through technology.” This isn’t just a future possibility, it’s a necessity with the potential to bridge the gap and ensure everyone has access to the care they deserve.

Accordingly, the leadership game in the healthcare industry is also changing. Purpose-driven leaders are harnessing the power of AI and etching their ambitious goals into company DNA. Take a recent  PharmaTimes  article (March 26, 2024) where an AstraZeneca heavyweight declared, “‘we have a bold ambition to eliminate cancer as a cause of death.’” This isn’t just about treatments anymore; it’s about… very close to curing cancer for good. This exemplifies the ‘audacious purpose’ driving their oncology leadership – a vision light years beyond mere effectiveness and safety.

Forget business as usual, healthcare is embracing a revolution! For years, experts have been preaching the gospel of Purpose-Driven Leadership (PDL), especially in healthcare. Now, thanks to visionary leaders in international and national organizations, PDL is taking off at warp speed. This article dives deep into this exciting new frontier, exploring how purpose is reshaping the healthcare landscape.

What it means:

In pharma, leading with purpose used to mean putting patients first, driving ethical innovation, and building trust. Now,the AI era supercharges this mission. This isn’t just about purpose anymore – it goes much beyond. It’s about unlocking a healthier future through transparency, collaboration, and the power of AI. 

This area is now rapidly evolving:

The leadership purpose of the healthcare business has undergone a significant shift over the years, moving from a primarily profit-driven model to one that emphasizes a broader set of goals. Thus, I believe, purpose-driven leadership (PDL) isn’t a fad of the day – it’s a global health revolution. And India’s pharmaceutical industry is no exception! While mirroring the global trend, India’s PDL journey has some unique twists. Buckle up, because we’re about to fast-forward through decades of change and explore the nuances that set India apart. As I envisage, PDL has been evolving in India, broadly following the steps as indicated below:

Early Years (Pre-1970s):

  • Organizational Focus: Primarily generic drug production for domestic needs and exports.
  • Leadership Purpose: Meeting basic healthcare needs and establishing India as a “pharmacy of the world.”
  • Overall Impact: Made essential medicines affordable for many countries, but limited focus on R&D for innovative drugs.

From the beginning of the drug price control era (1970s-1990s):

  • Organizational Focus: Balancing generic production with increasing government support for R&D – mainly reverse engineering, with an eye on process-patent.
  • Leadership Purpose: Maintaining affordability of generics while fostering domestic innovation to fast replicate patented molecules of globally successful drugs.
  • Overall Impact: India became a major player in generics, but original drug discovery lagged.

Patent Regime Shift (With Patent Amendment Act 1999, 2002, 2005):

  • Organizational Focus: Expecting stricter intellectual property regime, increasing focus on branded drugs, especially by large domestic companies.
  • Leadership Purpose: Balancing affordability with profitability and encouraging domestic innovation for new drugs.
  • Overall Impact: Growth in Indian specialty and complex branded generics, including Biosimilar drugs, but concerns about rising drug prices for newer medications.

Current Era (2000s-Present):

  • Organizational Focus: Balancing affordability with patient well-being, access to medications, and establishing a cost-effective and balanced pathway for product and process innovation.
  • Leadership Purpose: Combining innovation with social responsibility and Patient-Centricity with an emphasis on affordability and public health initiatives.
  • Overall Impact: Increased focus on R&D for new drugs, affordability programs, and public health partnerships. However, challenges remain in balancing affordability with R&D investment.

Nevertheless, the winds of change have started blowing within the Indian pharmaceutical leadership, as well. Their purpose is no longer singular – it’s a multifaceted dance balancing affordability, essential for a vast population, with the need for ground-breaking innovation to meet the unmet need. This tightrope walk defines India’s pharmaceutical future, ensuring both accessible medications and advancements in healthcare.

Examples of PBL initiatives by international and Indian companies:

It is worth noting, while some companies might announce major partnerships or product launches related to AI in the drug industry, the underlying development processes often take place over several years. However, we can explore the purpose these leaders likely aim to achieve based on examples ferreted from the public domain:

International:

  • Pfizer & IBM Watson (Clinical Trial Matching Platform):

Purpose: Launched around 2016-2017, this initiative aimed to accelerate patient access to new treatments by streamlining clinical trial recruitment through AI-powered matching.

  • Sanofi & Google DeepMind (Protein Folding Simulations):

Purpose: Partnership, which most likely began around 2019-2020. This collaboration focuses on using AI to revolutionize drug discovery by allowing for highly accurate and efficient design of new medications.

Indian: 

  • Sun Pharma (AI-powered Chatbots):

Purpose: This initiative leverages AI to improve patient education and medication adherence, ultimately aiming to improve patient health outcomes.

  • Dr. Reddy’s Laboratories (AI for Drug Discovery):

Purpose: Their use of AI focuses on identifying promising new drug targets through advanced data analysis, aiming to accelerate drug development for unmet medical needs.

The way forward for Indian drug industry leaders:

Indian pharmaceutical leadership can leverage AI to:

  1. Innovate for patients: Develop targeted drugs and personalized treatments using AI-powered discovery and data analysis.
  2. Expand access: Optimize supply chains and fight counterfeits with AI for affordability and patient safety.
  3. Build trust: Use AI Chatbots for patient education and address concerns through social media analysis.
  4. Be ethical: Prioritize data privacy and transparent AI for responsible use. Comply with the Uniform Code of Pharmaceutical Marketing Practices (UCPMP)
  5. Collaborate for impact: Partner with AI experts and open-source initiatives to accelerate healthcare solutions for India.

This approach allows Indian pharmaceutical leadership to lead with purpose by putting patients first and leveraging AI for a healthier future.

The differences between the older and the AI Era:

The key differences between the old days and the AI era, in the steps Indian pharmaceutical leaders take towards leading with purpose, lie in the scale, speed, and precision achieved through AI:

Old Days:

  • Limited data: decision-making relied on smaller datasets, leading to fewer targeted solutions.
  • Manual processes: drug discovery, supply chain management, and patient education were labor-intensive and time-consuming.
  • Reactive approach: identifying patient needs and concerns often happens after the fact.

AI Era:

  • Massive data analysis: AI can analyze vast amounts of patient data, genomics, and healthcare information, leading to more precise drug targets, personalized treatments, and proactive solutions.
  • Automation and optimization: AI automates tasks and optimizes processes, accelerating drug discovery, supply chain management, and patient communication.
  • Predictive capabilities: AI can analyze data to predict patient needs and identify potential issues before they arise, allowing for a more proactive approach.

Essentially, AI empowers Indian pharmaceutical industry leaders to move beyond traditional methods and achieve their purpose goals with greater efficiency, precision, and impact.

Conclusion:

Now is the time to forget the old limitations! AI is a game-changer for the Indian pharmaceutical industry’s mission to improve healthcare for all fueled by PDL. Here’s how:

  • From blind guesses to laser focus: AI analyzes mountains of data to pinpoint precise drug targets and personalize treatments, leaving limited information in the dust.
  • Slowpoke to speed demon: AI automates tasks and streamlines processes, accelerating drug discovery and patient communication at warp speed.
  • Playing catch-up to leading the charge: AI predicts patient needs and flags potential problems before they arise, enabling a proactive approach that revolutionizes healthcare.

This isn’t just leading with purpose anymore; it’s unleashing the power of purpose-driven healthcare solutions that will delight patients with their outcomes. Thus, I reckon, with AI, propelled by its leadership’s inclination and drive, Indian pharmaceutical companies can deliver better healthcare solutions faster and with a much greater impact.

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.

Criticality of Bridging the Skill Gap in Today’s Indian Pharma Industry

To address the shortage of adequately skilled workers in the country, in 2023, the Government of India released a new version of the national skill development initiative called Pradhan Mantri Kaushal Vikas Yojana 4.0 (PMKVY 4.0). It is touted as a major upgrade over the previous versions of the scheme and aims to train 100 million people in different skills by 2024. This is expected to have a positive impact on the economy, creating new employment opportunities.

In this article, I shall deliberate on its current relevance in the Indian pharmaceutical industry. Let me start with some of the new features of this scheme and their relevance to the drug industry as I move on.

Some new features and details of the scheme:

As I see it, PMKVY 4.0 includes a number of new features and details over the previous versions, as follows:

  • A focus on high-demand skills: The scheme will focus on training people in high-demand skills, such as artificial intelligence, machine learning, and cloud computing.
  • A greater emphasis on apprenticeships: The scheme will encourage more apprenticeships, which will provide trainees with hands-on experience.
  • A focus on women and underrepresented groups: The scheme will make special efforts to train women and underrepresented groups.
  • A greater focus on quality: The scheme will have a stronger focus on quality assurance to ensure that trainees are getting the best possible training.

Similarly, the specific details of the scheme include:

  • The scheme will be implemented by the National Skill Development Corporation (NSDC).
  • The scheme will cover a wide range of skills, including IT, manufacturing, healthcare, and retail.
  • The training will be provided by a network of training providers, including government institutions, private training institutes, and industry partners.
  • The training will be free for all eligible candidates.
  • The scheme will also provide financial assistance to trainees to help them cover their living expenses during the training period.

Studies on the lack of a skilled workforce in the Indian pharma industry:

In tandem with the above, the lack of a skilled workforce in the Indian pharmaceutical industry has also emerged as a major concern in 2023. The industry is growing rapidly, creating a high demand for skilled workers.

Unfortunately, a huge shortage of adequately skilled workers keeps increasing. A contemporary study by the Indian Pharmaceutical Alliance found that the industry will need an additional 1 million skilled workers by 2025. Moreover, the National Skill Development Corporation (NSDC) has also identified the pharmaceutical industry as one of the top 10 industries facing a shortage of skilled workers. 

Factors contributing to this shortage:

Several factors have contributed to this shortage, including:

  • The rapid growth of the Indian pharmaceutical industry: The Indian pharmaceutical industry is growing at a rate of 10% per year. This rapid growth has created a demand for skilled workers that the industry is struggling to meet.
  • The increasing complexity of pharmaceutical manufacturing and marketing: Both are becoming increasingly complex, demanding employees with different skill sets. who have the knowledge and skills to operate complex equipment and follow strict procedures in the manufacturing process. Similarly, pharmaceutical marketing is also becoming increasingly complex due to the increasing number of regulations governing the industry, the growing importance of digital marketing, and the need to target a wider range of patients with varied demands and expectations. 
  • The lack of adequate training opportunities: There are not enough training opportunities available to meet the demand for skilled workers in the pharmaceutical industry. This is due to a number of factors, including the high cost of training and the lack of qualified trainers.
  • Mismatch between salary and expectations: There is often a mismatch between the salary offered and employee expectations. The average salary offered in pharmaceutical marketing is not as high as in other industries, such as technology. This makes it difficult to attract and retain skilled marketing professionals. 

The impact of the shortage of adequately skilled workers:

The shortage of skilled workers gives rise to negative consequences for the Indian pharmaceutical industry, such as:

  • Reduced productivity: The shortage of skilled workers is leading to reduced productivity in the pharmaceutical industry. This is because unskilled workers may lack the knowledge and skills to perform tasks efficiently.
  • Increased costs: The shortage of skilled workers is also leading to increased costs in the pharmaceutical industry. This is because companies have to pay higher salaries to attract and retain skilled workers. 
  • Quality problems: The shortage of skilled workers can also lead to quality problems in the pharmaceutical industry. This is because unskilled workers may not be able to follow GMP procedures correctly. Also, because unskilled marketing professionals may not be able to develop and implement effective marketing campaigns. 
  • Compliance issues: The shortage of skilled workers can also lead to compliance issues in the pharmaceutical industry. This is because unskilled workers may not be aware of the regulations that apply to the industry or the consequences of their violations on patients and society.

What the industry is doing today:

Some steps, though not considered enough by many, are being taken by the Indian pharmaceutical industry to address the shortage of skilled workers. Here are some specific recent examples:

  • Establishing training institutes: The industry is establishing training institutes to provide training to workers in the pharmaceutical industry. For example, the Indian Drug Manufacturers’ Association (IDMA) has established the IDMA Skill Development Institute in Hyderabad. The institute offers courses in pharmaceutical manufacturing, quality control, and regulatory compliance. 
  • Partnering with educational institutions: The industry is partnering with educational institutions to offer courses in pharmaceutical science and technology. For example, the Indian Pharmaceutical Alliance (IPA) has partnered with the National Institute of Pharmaceutical Education and Research (NIPER) to offer a diploma in pharmaceutical technology.
  • Promoting apprenticeships: The industry is promoting apprenticeships as a way to train workers in the pharmaceutical industry. For example, the Department of Pharmaceuticals (DoP) has launched the Apprenticeship Training Scheme for the Pharmaceutical Industry. Under the scheme, apprentices are paid a stipend and receive on-the-job training from experienced professionals.
  • Offering scholarships and grants: The industry is offering scholarships and grants to students studying pharmaceutical science and technology. For example, the IPA has launched the IPA Scholarship Scheme for Women in Pharmaceutical Sciences. The scheme provides scholarships to female students studying pharmaceutical sciences at the undergraduate and postgraduate levels.
  • Emphasizing on continuous learning: The industry is emphasizing on continuous learning for its employees. For example, several pharmaceutical companies offer their employees training programs and workshops on new technologies and regulations. 

Industry needs to work more closely with the government: 

The Indian pharmaceutical industry needs to work more closely with the government to address the shortage of skilled workers. The areas could possibly include:

  • Increasing the number of training institutes
  • Providing financial assistance to students studying pharmaceutical sciences
  • Relaxing the eligibility criteria for apprenticeships
  • Recognizing the skills of workers trained in other countries 

Where the government should take greater initiatives:

These areas may include the following:

  • Funding training programs
  • Partnering with educational institutions
  • Promoting apprenticeships

Conclusion: 

The shortage of skilled workers is a major challenge for the pharmaceutical industry. However, the industry is taking steps to address the challenge. There isn’t an iota of doubt in the contemporary pharma business environment that rebalancing the skill sets required, especially for employees in pharma sales and marketing, is more imperative today than ever before. Thus, it is important for the industry to continue to take steps to bridge the skill gap by addressing the shortage of its skilled workforce. This is essential today to maintain India’s position in the global market, at least as the reliable pharmacy of the world.

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.

 

 

Exploiting India’s Weakness For Monopolistic Commercial Gain?

Public access to healthcare in India is a complex issue with several challenges. While India has been making progress over the years in improving healthcare access and reducing the burden of disease, there are still significant disparities in healthcare access and outcomes across the country. The three primary barriers continue to remain:

  • Affordable access to quality healthcare: This arises out of the shortage of healthcare infrastructure and resources, more in rural areas. The shortage includes an inadequate number of doctors, nurses, and other healthcare professionals, as well as inadequate facilities and equipment.
  • Cost of healthcare: While India has a largely publicly funded healthcare system, the quality of care in public hospitals is often poor, and many people are forced to opt for private healthcare, which can be expensive.
  • Access to affordable drugs: Despite India being a major producer of generic drugs, many people in India still lack access to essential medicines. This is due in part to the high cost of branded medicines, which are often out of reach for many people, as well as a lack of availability of certain medicines in some areas.

Undoubtedly, this remains a weak area for the country, till date. Successive Indian governments have taken steps to address these challenges. However, public funding on healthcare as a percentage of GDP and implementation of policies to increase access to medicine, continue to remain below par. Much work needs to be done to ensure that all people have access to quality healthcare and essential medicines.

Amid this situation, especially on the international political front, drug MNCs are continuously blaming India for the fact that the Indian Patents Act is not robust enough to protect their drug patents on NMEs and technologies. For example, in its 2022 Special 301 Reportthe USTR designated seven countries on the Priority Watch List. These are Argentina, Chile, China, India, Indonesia, Russia, and Venezuela. To give some more examples from the available reports:

  • In February 2021, PhRMA, a trade group representing multinational pharmaceutical companies, raised concerns about India’s policies related to IP rights and access to medicines. PhRMA argued that India’s policies were undermining innovation and investment in the pharmaceutical industry, and that multinational pharmaceutical companies were facing difficulties in doing business in India. 
  • In March 2021, Pfizer’s CEO also expressed concerns about India’s policies related to IP rights and access to medicines. He said that Pfizer was facing challenges in obtaining patents for its products in India, and that the lack of adequate patent protection was discouraging investment in research and development.
  • In May 2021, Novartis’s CEO criticized India’s policies related to IP rights and access to medicines. HE stated that the lack of adequate patent protection in India was discouraging innovation and investment in the pharmaceutical industry, and that multinational pharmaceutical companies were facing difficulties in doing business in India. 

Against this backdrop, in today’s article I shall deliberate on this vexing issue – starting from some key grievances of drug MNCs in this regard. Thereafter we will look at the Indian industry response to drug MNCs’ concern about the robustness of the Indian Patents Acts. This could possibly help us to understand the key question – Is it then an attempt to exploit India’s weakness regarding inadequate overall access to medicines for monopolistic gain by the vested interest?

Key grievances of drug MNCs for poor access to medicines in India: 

One can recall that the Patent Act in India was amended in 2005 to comply with the World Trade Organization’s (WTO) Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement. The amendment made it more difficult for multinational pharmaceutical companies to obtain patents for their products in India for the ‘me too’ type of innovation, which has led to lower prices for medicines and increased access to affordable drugs for the Indian population.

However, drug MNCs generally argue that:

  • The lack of adequate patent protection in India discourages innovation and investment in research and development, which ultimately limits the availability of new drugs for patients in India.
  • They have also criticized the Indian government’s use of compulsory licensing, which allows the government to authorize a third party to produce a patented drug without the consent of the patent holder. They argue that this undermines their intellectual property rights and discourages investment in research and development, which ultimately limits access to new and innovative drugs for patients in India.

Counter argument by Indian companies:

Indian companies, on the contrary, defend their position and policies related to access to medicines and healthcare in India, and have responded to the accusations made by drug MNCs in the following ways:

  • Provides adequate patent protection: The Indian Patents Act provides adequate IP protection, in accordance with the TRIPS agreement. They have also pointed out that the patent laws in India allow for the grant of patents for genuine inventions, while preventing the grant of frivolous or secondary patents (the me-too types), which can result in excessive monopolies and high prices for medicine. 
  • Encourage innovation: Indian policies have not discouraged innovation in the pharmaceutical industry. They have pointed out that Indian companies invest heavily in research and development and have developed several innovative drugs that have been approved by regulatory authorities in India and around the world. 
  • Rare occurrence of Compulsory licensing: The use of compulsory licensing is a legitimate tool under international law and is aimed at promoting public health and ensuring that life-saving drugs are accessible and affordable to patients in India. They have also pointed out that the use of compulsory licensing is a rare occurrence in India and is only used in exceptional circumstances.

Overall, Indian drug companies have emphasized their commitment to improving access to medicines and healthcare in India, while ensuring that their policies are in line with international laws and regulations. They have also emphasized the need for collaboration and dialogue with multinational pharmaceutical companies to find mutually acceptable solutions that benefit patients in India and around the world.

Examples of innovative drugs developed by Indian drug companies:

It’s interesting to note that in the same IP scenario, Indian companies with limited resources, are developing innovative drugs that have been approved by regulatory authorities around the world. Here are a few examples, as reported at different times:

  • Lipaglyn: Developed by Zydus Cadila, Lipaglyn is the first-ever drug approved for the treatment of diabetic dyslipidemia. It has been approved in India and several other countries, including the European Union. 
  • Tafinlar: Developed by Dr. Reddy’s Laboratories, Tafinlar is a kinase inhibitor that has been approved by the US FDA for the treatment of advanced melanoma. 
  • Mycapssa: Developed by Sun Pharma, Mycapssa is a novel oral formulation of octreotide, a hormone therapy used to treat acromegaly. It has been approved by the US FDA. 
  • Saroglitazar: Developed by Zydus Cadila, Saroglitazar is a dual PPAR agonist that has been approved in India for the treatment of diabetic dyslipidemia and non-alcoholic fatty liver disease (NAFLD). 
  • Nexavar: This much discussed drug, originally developed by Bayer and by Natco Pharma, is a kinase inhibitor that has been approved by the US FDA for the treatment of liver and kidney cancers.

Conclusion:

The IP issues keep haunting India and are being captured in different Special 301 Reports of the USTR, even after The Indian Patents Act 2005 came into force – till 2022. Any change to this Act seems very unlikely now as this is an important piece of legislation that helps balance the interests of protecting intellectual property, promoting innovation and access to affordable medicines. Any dilution of this Act could have negative consequences for India and its citizens.

From this perspective, I reckon, any further pressure in this area may be construed as an attempt to exploit India’s weakness of inadequate access to medicines for monopolistic gain by vested interests. 

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.

With More Patients Preferring Telehealth Pharma Marketing Needs Retooling

Even after six months of COVID-19 pandemic, the omnipresent chaos, general unease and apprehensions about a yet unpredictable future continues in all countries, including India. In absence of vaccines and proven medicines to address the disease, wearing face mask, maintaining social distancing and frequent hand sanitizing, remain the primary measures for all to combat this unprecedented health crisis.

The rapid spread of the lethal Coronavirus has not only impacted lives and livelihoods, besides changing the health care ecosystem – with a silver lining, though. The pandemic has instilled a sense of urgency – an accelerated speed – in the entire value chain of the health care systems, including the pharma industry.

To contain the rapid spread of the disease – many physicians, Governments and even patients themselves, are being encouraged to leverage technological platforms, for various non-Covid related medical needs. Realizing that there no other working alternatives in this situation, even most skeptical doctors and patients are now resorting to video consultations.

Consequently, ‘Telemedicine’, in different forms, has started growing in leaps and bounce. Its spin-off benefits favor the patients – better care at lower costs, sans any further strain on the existing health care systems. Along with many others, the Bloomberg article of April 10, 2020 – ‘Coronavirus Should Finally Smash the Barriers to Telemedicine,’ also expects it to grow, not just during the pandemic, but much beyond.

Echoing the World Health Organization (W.H.O) on the need to promote telemedicine in this health crisis, Niti Aayog of India also acknowledged, ‘‘Telemedicine: A Blessing In Disguise In Time Of COVID-19.’ It further added, ‘With the arrival of the COVID-19 pandemic, telemedicine has finally gained momentum. Telemedicine providers reported an overnight increase in demand, acceptance among doctors, paramedics, and consumers.’

As patient-doctor interactions are now expanding – from personal visits to physicians to remote telehealth, is there a need for recomposing notes of the pharma marketing playbook - to excel in the new world order?  This article would focus on this specific area of leveraging ‘The Break in The Clouds’.

Telemedicine and its key primary driver: 

Telemedicine’– often called telehealth or e-medicine, in simple term, involves the remote delivery of health care services, when both doctors and patients are not physically present at the same place. It includes, patient examination, doctor consultations, diagnosis, treatment and remote monitoring, over the technology enabled modern communication infrastructure.

Although, telemedicine is not a new concept, it was not very popular for various reasons, till Covid pandemic offered no other viable alternatives to non-Covid patients. The article – ‘COVID-19: The rise and rise of telemedicine,’ published in the MobileHealthNews on May 27, 2020, also vindicates this point. It reconfirmed: ‘Telemedicine has experienced a huge surge in adoption over the past few months, during the coronavirus pandemic.’

Even Frost & Sullivan’s recent analysis, ‘Telehealth – A Technology-Based Weapon in the War Against the Coronavirus’ of May 13, 2020, found the demand for telehealth technology rising dramatically, as the COVID-19 pandemic continues to disrupt the delivery of healthcare worldwide. Thus, ongoing stringent requirements of wearing face masks and maintaining social distancing to contain the virus spread, will continue to drive the growth telemedicine as the preferred way of accessing healthcare.

Indian perspective of increased online access to health care:

Practo’s Insight Report of June 20, 2020, titled, ‘How India accessed health care in the last three months,’ has revealed some interesting India-specific data in this area. This study was based on transactions of 500 million Indians accessing health care online, during March 1, 2020 to May 31, 2020 period. It found, while COVID-19 continued to remain India’s topmost concern, ‘telemedicine has helped doctors – patients stay connected, as people practiced physical/social distancing.’ This resulted into a ‘500 percent increase in online doctor consultations,’ in that time frame. Other important findings of this report include:

  • 80 percent of all telemedicine users experienced it for the first time.
  • 44 percent of the teleconsultations were from non-metro cities.
  • In-person doctor visits dropped by 67 percent.
  • Indians consulted their doctors 2 times per month, using telemedicine.

The surge in teleconsultations in India, reportedly, follows the long-pending telemedicine guidelines which were finally issued by the Ministry of Health and Family Welfare, in collaboration with NITI Aayog and Board of Governors, Medical Council of India (MCI).

Could ‘Telehealth’ be a game changer even beyond Covid time?

Many experts in this area believe so. For example, the article – ‘Telehealth could be a game-changer in the fight against COVID-19. Here’s why,’ published the World Economic Forum on May 01, 2020, makes some important observations. It suggests: ‘Beyond the pandemic, governments, insurers and healthcare providers need to work together to ensure that the innovation sparked by this crisis endures and accelerates. Post-crisis, telehealth can still help alleviate the pressures posed by healthcare resource shortages, the growing elderly population and issues with healthcare accessibility.’

The article, published in the Invest in India website of the Government of India, on April 10, 2020, emphasized the relevance and benefits of ‘Telemedicine’ in India – even after Covid Time. Conceding, in-person health care delivery in the country is challenging, given the large geographical distances and limited resources, it enumerated all-time relevance and the key advantages of ‘Telemedicine,’ as hereunder:

  • Saves cost, effort and other related inconveniences, especially of rural patients, as they need not travel long distances for obtaining consultation and treatment, also limiting burden on the secondary hospitals.
  • Ensures higher likelihood of maintenance of records and documentation, minimizing the possibility of missing out advice from the doctor and other health care staff.
  • Provides safety to patients and health workers’, especially where there is a risk of contagious infections.
  • The doctor has an exact document of the advice provided via tele-consultation. Written documentation increases the legal protection of both the parties.
  • Enables the availability of vital parameters of the patient available to the physician with the help of medical devices such as blood pressure, blood glucose, managing.
  • Provides equal access to quality care to all, minimizing inequity and barriers to access.

The official guidelines for telemedicine practices in the country are aimed at allowing registered medical practitioners to providing remote consultation. Under this backdrop, Telemedicine is expected to remain in a growth trajectory, even in India. Accordingly, there arises a need for recomposing notes of the pharma marketing playbook - to excel in the new world order. 

Increasing telehealth preference prompts marketing strategy retooling:

As I wrote on July 10, 2020, pharma leaders need to leverage the art of turning challenges into opportunities, now – especially when telehealth is at the threshold of playing a pivotal role in the health care delivery systems. In this scenario, traditional pharma brand-demand generation strategies are unlikely to deliver expected business results, anymore. Pharma players would need to work out fresh and effective marketing models, in-sync with patients changing health care related needs. Conceiving, strategizing, and delivering changing patient-value based content, effectively, using modern omnichannel platforms, would be the new ballgame.

‘Telehealth is more than a channel for delivering care’:

As the ZS Insights article – ‘While telehealth continues to evolve, pharma needs to keep an eye on the future,’ published on August 03, 2020 reiterated: ‘Telehealth is more than a channel for delivering care, it reflects a fundamental shift in how brands reach patients and physicians.’ Following are some key points worth noting:

  • Until now, in-person delivery of care has anchored brand marketing in the sales territory-based geographic perspective. Whereas, telehealth platforms are free of sales territory-based geographic distinction.
  • Physicians now provide telehealth services to patients in two ways, having different implications for pharma players:
  1. Vertically integrated virtual practices, such as, PractoLybrate and others in India.
  2. Brick-and-mortar offices, where physicians provide telehealth visits through     FaceTime, WhatsApp, Zoom and other teleconference platforms.

It is envisaged, alongside patients avoiding the risk of contracting Covid, tangible benefits of lower treatment cost and escaping long waiting time to meet the doctors physically, will encourage people switching to Telemedicine, for an indefinite period.

Collaborative, not standalone pharma marketing may not work better:

In the era of telehealth or Telemedicine, the common ground where patients, doctors and drug companies can meet, would be the telemedicine platforms. These may well be some popular telemedicine apps for e-consultation, such as, Meddo, Practo, mFine and others in India. Besides, there lies an opportunity for pharma companies also to develop custom-made ones, for installation by doctors.

These platforms can be effectively leveraged with collaborative approaches – for content delivery to physicians, patients and other stakeholders, at the appropriate time and places. There are various innovative ways to prepare a grand strategy for this purpose – ‘tailor-made’ for each company. And astute pharma marketers should play the role of ‘master tailors.’

Conclusion:

Meanwhile, as on October 11, 2020 morning, India recorded a staggering figure of 7,051,413 of Coronavirus cases with 108,371 deaths. The daily number of new cases appeared to have slowed down during the last week.

Nonetheless, the unprecedented and savage onslaught of the new Coronavirus has unsettled the pharma industry, as it disrupted the old normal of the world. At the same time, many people have also demonstrated high resilience, grit and innovative mind to keep moving, in a relatively orderly manner – amid an omnipresent chaos, as it were. In the health care space, the need for responding to non-Covid related health emergencies, pushed people to experiment with not much used before – telehealth or  Telemedicine.

It worked and continues receiving support from all concerned. Its other major benefits also surfaced – as a breath of fresh air. It’s unlikely that people will let it go, in the foreseeable future, which has a great implication to pharma industry. With more patients and doctors increasingly preferringTelemedicine, in various ways, pharma marketing needs retooling its strategy kit – by expanding into collaborative approaches with Telemedicine providers.

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.

 

Would ‘Complex Generics’ Attract More ‘Authorized Generics’?

Despite increasing numbers of alleged scams involving generic drugs, both in the United States and also in India, even involving many large generic drug manufacturers, the traditional generic drug market, keeps growing globally. Although, the current growth is in mid-single digit, the market can’t be ignored, either.

That apart, enormous pricing pressure, squeezing bottom line and cutthroat competition, are prompting many companies, including Big Pharma, to craft different strategies to excel in this market. One such involves a shift in business focus from relatively low priced traditional generic drugs to comparatively higher priced complex or specialty generic medicines with a few competitors.

In this emerging situation, a lurking apprehension does surface for many. If the margin is good and the prices of these complex or specialty generics, are much higher than traditional ones, won’t it prompt more ‘Authorized Generics’ coming into the market? Won’t that jeopardize the interest of other generic drug makers? In this article, I shall explore this area, along with its possible consequences. Before doing that, it will be worthwhile to give an overview of the generic market, before recapitulating what are ‘Authorized’ and ‘Complex’ generics.

How lucrative is the generic drugs market now?

According to the latest report by IMARC Group, the global generic drug market size reached US$ 340 Billion in 2018 and is expected to be at US$ 475 Billion by 2024, growing at a CAGR of 5.3 percent during 2019-2024 period.

The key market growth drivers remain, increasing number of product patent expiration, higher prevalence of chronic diseases and different government initiatives to encourage faster generic launch, including the United States. The pace of increase is faster in the emerging markets, like India. However, unlike India, non-branded generic drugs, rather than branded generics, are dominating most the markets.

Although, Central Nervous System (CNS), cardiovascular, dermatology, oncology and respiratory are among the dominant segments in the market, CNS and Cardiovascular segments are the two largest ones in this market. North America holds the largest market share, with more than 88 percent of total prescriptions being written for generic drugs in the U.S., as the report highlights. Despite this scenario, to mitigate huge pricing pressure, cutthroat competition and low margin, many drug players are preparing to move into specialty or complex generics.

The size and growth of complex or specialty generics market: 

The April 2019 report by Research and Markets- “Specialty Generics Market: Global Industry Trends, Share, Size, Growth, Opportunity and Forecast 2019-2024″ states, the global specialty generics market reached a value of US$ 44.8 Billion in 2018. By 2014, its value is expected to reach US$ 88.9 Billion with a much higher CAGR of 11.9 percent, in 2019-2024 period.

Which drugs would belong to this market?

According to the ‘White Paper’ titled, ‘Complex Generics: Maximizing FDA Approval Prospects’ of Parexel, the following are some examples of complex generics; the list continues to grow as more products are being added in this category every day:

  • Complex Active Pharmaceutical Ingredients (APIs), examples being Enoxaparin, Low Molecular Weight Heparin, Glatiramoids, Iron Carbohydrate Complexes etc.
  • Complex Formulations, examples being Liposomes, abuse-deterrent generics, parenteral microspheres.
  • Complex Route of Delivery, such as topical ointments and locally acting GI drugs.
  • Complex Drug-Device Combinations, such as DPI, MDI, nasal sprays, and transdermal systems.

These types of complex and high-cost generics, besides some off-patent biologic products and even Biosimilar drugs, are often used to treat complex and life-threatening diseases, such as, cancer, Hepatitis C, and many others. Complex generics are expected to eventually own a significant percentage of the total generic drugs market, as a number of big-ticket specialty drug molecules will go off patent in the ensuing years.

The major advantages of complex generics:

Some of the major advantages of the complex generics market over traditional generics are as follows:

  • Complex manufacturing requirements with higher capital costs – thus, higher price, better margin, fewer players, lesser competition.
  • Increasing prevalence of life-threatening diseases, besides, cost containment measures from the government and healthcare providers, are pushing the demand of these drugs.

Indian companies are also entering the fray: 

As the share of specialty medicines in global spending in 2017 increased to 32 percent from 19 percent in 2007, Indian drug players also could sniff the opportunity in this space. Just as Sun Pharma, reportedly shifted its focus from once lucrative traditional generics medicines to specialty drugs, amid continued price erosion in its biggest market – the US, many others are also joining the fray.  The Indian players who are, reportedly, investing in complex generics include, Aurobindo Pharma, Dr. Reddy’s Labs, Cipla, Lupin, Glenmark and Cadila.

More specifically, with the contribution of specialty medicines to overall pharmaceutical spend in the US, Germany, France, Italy, UK, and Spain – almost doubling over the last 10 years, this trend is likely to gather momentum, as the above report indicated. Accordingly, commensurate strategic actions aimed at this segment by many companies, both global and local, are clearly now visible.

Some strategic initiatives:

In preparation of a major shift in the strategic focus on complex generics, key examples of some of the important initiatives of different companies will include the following:

  • Big generic players wanted to be bigger in the global market through M&A, such as Teva acquired Allergan’s generic business, Mylan bought Abbott Laboratories’ generics businessAbbott Laboratories’ non-U.S. developed markets specialty and branded generics business. Similarly, Endo International acquired Par Pharmaceuticals. In India the mega deal of Sun Pharma acquiring Ranbaxy in 2015. In the same year, Lupin acquired New Jersey-based generic drugs firm GAVIS to boost its presence in the US.
  • Novartis sold its 300 ‘troubled’ U.S. generics to India’s Aurobindo for US$ 1B, as the entire generics industry faced unrelenting pricing pressure in the U.S.’ Whereas, Novartis’ wants to focus higher-margin assets like Biosimilars and complex generics.
  • Pfizer is set to combine its off-patent drug unit Upjohn with Mylan, to create a new business with its own off-patent branded and generic drug lines. The merger will bring together Pfizer medications such as Lipitor and Viagra with Mylan’s EpiPen, used to halt life-threatening allergic reactions.
  • Owing to margin pressure and other reasons, some of the Indian drug players also decided to enter into higher margin complex generics space, pursuing both organic and inorganic routes. There are several such examples, such as: In January 2017, Zydus Cadila announced acquisition of Sentynl Therapeutics Inc., a US based specialty pharma company specialized in marketing of products in the pain management segment. And in October 2017, Lupin acquired US-based Symbiomix Therapeutics LLC to expand Lupin’s US women’s health specialty business in the highly complementary gynecological infection sector.

Any flip side of complex generics business for the Indian players? 

Although, driven by mainly higher profit margins and tough entry barriers, many generic players with the requisite wherewithal, find complex generics business more attractive to focus on, there’s a flip side to it, as well. This is, post patent expiry, innovator companies may be encouraged to introduce more ‘Authorized Generics’, creating a tough competitive environment for other generic players to compete with them. This brings us to the question of what are ‘Authorized Generics?’

Authorized Generics:

According to the USFDA, the term ‘Authorized generic’ is used to describe an approved brand name drug that is marketed without any brand name on its label. It is exactly the same product as the branded one, and may also be marketed by another company with the innovator company’s permission. Generally, an ‘Authorized Generic’ is launched at a lower price than the brand name drug.

Moreover, ‘Authorized Generics’, despite being the generic version of patented molecule, are mostly marketed by the patent holders themselves, both pre and post patent expiry. While a separate NDA is not required for marketing an ‘Authorized Generic’, USFDA requires that the NDA holder notify the FDA, if it markets an ‘Authorized Generic. The NDA holder may market both the ‘Authorized Generic’ and the brand-name product at the same time. Interestingly, the USFDA has approved around 1215 ‘Authorized Generics’ as of September 30, 2019.

Advantages of ‘Authorized Generics’ over ‘Traditional Generics’:

The key advantage of ‘Authorized Generics’ over traditional generic drugs is, while traditional generic drugs can be marketed only after patent expiry of the innovator drug, ‘Authorized Generics’ can be marketed even before patent expiry. In other words, innovator companies or their authorized collaborators can make lower priced ‘Authorized Generic’ versions available on their behalf, under their own new drug application (NDA). ‘Authorized Generics’ may be made available to patients even before patent expiry to out-maneuver the conventional generic drug makers, in advance, on price, quality and doctors’ confidence in the original drug.

According to several reports, over the past years, ‘many innovator drugs companies have been launching Authorized Generics, simultaneously with the first Abbreviated New Drug Applications (ANDA) filer’s launch of its generic drug product.’ However, the question remains how do the stakeholders perceive the ‘Authorized Generics’?

Perception of ‘Authorized Generics’:

Studies are available analyzing the impact of ‘Authorized Generics’ on the pharma market and also on the stakeholders. In this article, I shall refer to a comprehensive research study, titled ‘Authorized Generics: Effect on Pharmaceutical Market,’ published in the International Journal of Novel Trends in Pharmaceutical Sciences (IJNPTS), on February 29, 2012, which came out with the some notable findings.

Generally, there isn’t any doubt, either on the fact that ‘Authorized Generics’ provide the identical experience that the patient receives from the brand drug but at a lower price. Nor is there any question over greater confidence of doctors while prescribing these drugs. However, the researchers wrapped up the discussion by stating: It is difficult to conclude that the ‘Authorized Generics’ practice should be continued or banned. Though Indian pharmaceutical companies are dealing with generic drugs – 42 percent of the respondents were in favor of ‘Authorized Generics’ practice, whereas 58 percent opposed it. Thus, the overall perception of ‘Authorized Generics’, appears to be a mixed bag.

Conclusion:

There are free flowing arguments both in favor and against the ‘Authorized Generics.’ The article titled, ‘Drugmakers Master Rolling Out Their Own Generics to Stifle Competition,’ published in the Kaiser Health News (KHN) on August 05, 2019, captures it well.

It quoted the spokeswoman for the Pharmaceutical Research and Manufacturers of America, or PhRMA, a powerful pharma lobby group saying, an Authorized Generic drug “reduces prices and results in significant cost savings.” Whereas the critics say, “Authorized Generics hurt long-term competition and often perversely increase costs, even in the short term.”

The detractors further expressed, ‘Authorized Generics’ don’t just steal sales from existing generic rivals, they erode incentives to make generic drugs. A professor at the University of California, Hastings College of the Law, who studies pharma was also quoted in this article saying, this practice can “stave off generic competition and make sure that generics can’t get much of a foothold when they do get to market.” Adding further he said: “That’s the game. And drug companies have become masters at this.”

As the Kaiser Health News highlighted, Eli Lilly announced launch of the ‘Authorized Generic’ version of Humalog insulin in March 2019 for US$137 a vial, at half the price of its brand name version costing US$237. This was reasoned by the company as a considerate move to address the need of those patients who can’t afford the price of the brand – Humalog. Curiously, even some analysts believe that ‘Authorized Generics’ may help explain why relatively few true generics are reaching the market despite a surge in approvals, especially in the United States.

Against the above backdrop, the drug policy makers need to ponder, would ‘complex generics’ of different companies face greater challenges from ‘Authorized Generics,’ playing a spoilsport for the rest in this ball game?

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.

 

 

Adopt A Hybrid Business Model For Better Sales – Not A Large Field Force

For aggressive business expansion or to attain greater market access, creating a large sales force has been the thumb rule in the pharma industry, since long. To meet the challenge of changing market dynamics, going for a thorough re-engineering of even a rattling sales and marketing machine, is still considered a risky proposition.

Many studies have captured the common reasons of such hesitations. For example, the McKinsey article titled, ‘Cutting sales costs, not revenues,’ finds that field force being a major growth engine for sales, since long, the thought of overhauling it fills senior executives with dread. Thus, to keep sales flowing, companies will make piecemeal ongoing repairs as long as they can – ‘no matter how patched up or spluttering that engine may be.’

Nevertheless, some compelling business reasons have now prompted several pharma players to accept the ground reality – fast-evolving over the last one and half decades. Many of them have realized that in today’s changing market dynamics, a leaner and smarter sales force (or field force or medical rep, or MR) will fetch the desired results than ‘flabby’ and larger ones.

In this article, I shall not discuss the obvious reasons of downsizing, such as to record profit under trying circumstances, or when per rep productivity keeps declining consistently, or during a change in the promoted product-mix, or a decision to reduce focus on volume intensive-low margin generic brands. But, what I shall discuss is, the reasons for an urgent need of creating a hybrid sales and marketing model, during this changing paradigm.  

It begins with accepting a change in the business environment: 

If the objective of sales force size reduction remains limited to cost-cutting for short-term improvement of the bottom-line, it could be grossly counterproductive, possibly with many unforeseen consequences. Field staff will continue to remain one of the key growth drivers in pharma and biotech business, but not the sole mechanism to increase brand prescriptions. Finding a well-integrated alternative model would begin with acceptance of a significant change in pharma business environment.

Undoubtedly, a perceptible change is noticeable today in pharma stakeholders’ mindset. This change is being further fueled by rapid increases in their usage of various digital platforms and networks. For example, many patients are trying to be reasonably informed of even various disease treatment options and the cost of each, much before they visit a doctor’s clinic or a hospital. The nature and quality of their interaction with health care providers, including doctors, are also changing. Patient-experience during a treatment process, and the value offerings that come with a pharma brand, will have increasing relevance to business performance – more than even before. Anything going against the patient-interest will possibly be shared with all, mostly in social media, which has a potential to precipitate serious consequences.

As this trend keeps going north, pharma market dynamics would change, commensurately, making pharma’s key business success factors significantly different with medical reps no longer being the sole prescription generators. A new hybrid – digitally empowered sales and marketing model is, therefore, the need of the hour. In this new ball game, as a growth driver, the role and size of the field staff will be quite different, where the senior management warrants a new vision for pharma business.

The situation warrants a new vision for pharma business:

In this changing situation, to generate more prescriptions from doctors by deploying a large field force, could prove akin to swimming against a strong tide. Whereas for achieving business success at this time, pharma players would require creating a well-oiled augmented value delivery system for enhanced customer experience, primarily for patients during their entire treatment process.

While creating this sleek and effective system, it would be necessary to cut unproductive or less productive flab in the frontline, with great precision. However, this process must be dovetailed with implementation of other communication and customer engagement platforms, mostly digital, to achieve the set objectives.

The new strategy being augmented value delivery to customers, the process would entail, besides innovative and modern tools, a different genre of field staff members, possessing some critical skill-sets. The goal of need-based field force downsizing complemented by new synchronous measures for operational synergy, must not only be clear to senior management, but also be explained to all concerned.

What would ‘augmented value delivery’ to customers lead to?

Another McKinsey article titled, ‘The few, the proud, the super-productive - how a smart field force can better drive sales,’ articulated: ‘Indeed, our perspective on the past five years is that leaders that used field reductions to actually rethink the commercial model – rather than taking a “blunt instrument” approach to cuts – are reaping rewards.’

As the current pharma sales and marketing models are undergoing a metamorphosis, globally – this transition phase throws several tough challenges – from defining new roles and capabilities for field staff to creative use of various interactive communication platforms.  As the McKinsey article underscores: ‘new capabilities need to be added even as we continue to use the tried and true current model, albeit with less success.  It further adds: ‘The inconvenient truth: we will have to sweat the current model and build the capabilities for the future in parallel. Those hoping for a ‘flip the switch’ transition, are likely to be disappointed.” With his, I reckon, will emerge a robust ‘augmented value delivery system’ for the business leading to:

  • Higher profitable sales through satisfied customers
  • Increase in sales per employee ratio
  • Containing/reducing sales and marketing spend as a percentage of total revenue.

Several initiatives to translate this concept into reality is now palpable, globally. A few examples may suffice to drive home this point.

Downsizing field force complemented by new measures for synergy pays:

Here also there are several research studies to bring home this point. One such is the paper titled, ‘Big pharma proves that oncology pays as workforces shrink,’ published in ’Vantage’ of Evaluate on July 23, 2018. The researchers touched upon this area while discussing the workforce productivity for Bristol-Myers Squibb (BMS). It found that a substantial shrinking of its workforce, alongside some other important measures, has given BMS a big boost in sales, with a dramatic impact on its overall performance. As the study indicated, even investors will find this fact hard to ignore. Let me hasten to add that ‘downsizing workforce’ mainly involved sales and R&D staff in this analysis.

The article further highlighted, during the period of 2007 to 20017, the management teams of some other pharma majors, as well, such as GlaxoSmithKline), AstraZeneca and Eli Lilly, either reduced their workforce significantly or kept flat. According to this study the changes in the workforce of these 4 companies are as follows:

Workforce Bristol-Myers Squibb GlaxoSmithKline AstraZeneca Eli Lilly
2007 42,000 103,483 67,400 40,600
2017 23,700 98,462 61,100 40,655

However, even in the year 10, all the four companies - Bristol-Myers SquibbGlaxoSmithKlineAstraZeneca and Eli Lilly posted not just sales growth, bit all-round performance improvement, as may be seen by clicking on each.

Having deliberated on the impact of downsizing field force, let me now focus on powerful complementary measures for augmented value delivery to customers.

Today’s reality for pharma business in India can’t be wished away:

The EYstudy titled, ‘Reinventing pharma sales and marketing through digital in India,’ captures the current situation quite well. I am quoting below just a few of those:

  • Today’s tech-savvy physicians are relying far less on reps and more on digital devices for healthcare information. Only 11 percent of healthcare professionals in India prefer in-person visits from a company representative, according to a 2016 study by Health Link Dimensions. Likewise, many patients arming themselves with medical knowledge available online, gradually relying less on only physicians’ decision-making. Thus, the rules of engagement need to be redefined.
  • With a shift in focus toward more complex or specialty medicines, pharma companies continue to add new layers of MRs to increase geographic coverage. The increasing number of MRs and the number of brands under each of them have drastically reduced the time and quality of sales pitches – from being scientific to mere brand name reminders.
  • Physicians’ place at the center of the pharma ecosystem as almost the sole-decision makers, is very likely to become a thing of the past with the emergence of a broad array of customers with a new mindset.
  • New tech-based entrants providing information platforms, analytics, e-consultation services and access to medicine online are challenging pharma’s value creation story.

Enhancing customer experience needs a hybrid business model:

The new market dynamics, demands cutting-edge brand-value augmentation measures, enhancing customer-experience with some tangible benefits. These telltale signs can only be ignored at one’s own peril. Let me also illustrate this point with the findings from another research study.

According to 2015 Oncology Customer Experience Tracker of ZS, “Oncology companies can add USD 50 – USD 75 million in incremental sales for every USD 1 billion in current sales by delivering a better customer experience.”

This vindicates that creating a better customer experience should be the key goal of pharma’s augmented value delivery system – going much beyond the traditional communication of key product features and its clinical benefits. This new concept is fast emerging as the fulcrum – not just for creating a strong brand pull, but also enhancing the public image of the organization. And can be achieved with a right blend of:

  • ‘Must do’ mindset of top management,
  • Expertise in well-targeted – multi-channel content making,
  • Expertise on data-science and analytics to churn out the right information from a large pool of data,
  • Wherewithal for effectively using the right digital platforms, either directly to customers or through a leaner and digitally-skilled sales force having a ‘can do’ attitude, as the situation will demand.

Some companies are testing the water:

Conventional ways to improve Sales Force Effectiveness (SFE), especially with soft skills, besides, of course product knowledge, is not new to the pharma players. What they need to do is change the primary focus of increasing sales through delivering mostly the key intrinsic value of the brand, to increase profitable sales by delivering augmented brand value, leading to enhanced customer satisfaction.

This is a major shift from the traditional paradigm and would surely entail application of digital technology and data science. As I wrote before, many companies have started adopting this approach – mostly with one baby step at a time, right or wrong.

Observation and findings of an India specific study: 

Noting that ‘Indian pharma’s journey to a digital world has just begun,’ the same EYstudy, as quoted above, reported the following findings, among a few others:

  • Lack of a clear digital strategy/value proposition and change management are the two key barriers to embracing digital.
  • Whatever was being done manually earlier is now being done digitally. But we are not adding additional value. On the other hand, companies globally are now cautiously moving toward being digital practitioners.
  • Indian pharma majors will need to grow into integrated health care providers – offering both products and services, forging patient-centric partnerships and demonstrating value to a broad array of customer groups.

The good news is, some of the key observations of the study also include the following:

  • Some are using digital technology to capture untapped and unstructured data, to make their sales and marketing decision making process more agile and robust.
  • Powerful apps with dynamic, meaningful content and the right value proposition are gaining popularity.
  • Several players, while staying within the realms of regulatory boundaries, are enabling patients to actively manage their care. 

Conclusion:

As we look around, many drug companies, especially in India, continue to remain focused on the age-old transactional sales and marketing models, delivering the intrinsic brand values, irrespective of the changing pharma market dynamics, especially disregarding what today’s customers in the knowledge economy look for. Traditional training and incentivizing a large, and often flabby, sales force on product and rupee value territory-sales against the target, are the general ways to achieve these. The focus on achieving the internal sales targets, regardless of the processes being contentious or not.

Modern time warrants a different conversation altogether – creation of a unique customer experience – with augmented value delivery systems. Achieving this goal would entail astute applications of modern technology, complementing the reach and impact of the right-sized field staff efforts, and leading to improvement in ‘sales per employee ratio.’

Thus, I reckon, higher sales or the need for an expanded market access, may not necessarily entail a larger field force, but a new breed of leaner and especially skilled MR to deliver the needs of the changing healthcare landscape.

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.

Will ‘Patent Thicket’ Delay Biosimilar Drug Entry in India?

Do pharma and biotech investors encourage companies indulging in ‘patent thicket?’ This question recently grabbed media headlines. On April 02, 2019, one such report brought out: AbbVie investors are calling for the Chair-CEO power split, flagging the CEO’s USD 4 million bonus payout, fueled by the company’s Humira ‘patent thicket’ strategy related aggressive price hikes. It prolonged the brand’s market monopoly, blocking entries of its cheaper biosimilar equivalents.

I have discussed some related issues in this blog, previously. As the issue is gaining relevance also in the Indian context, this article will deliberate the ill-effects of ‘patent thicket’ on patient health-interest. The sole beneficiaries for the creation of this self-serving labyrinth are the manufacturers of high-priced patented drugs, as reported above. Before I proceed further, let me recapitulate what exactly is a ‘patent thicket.’

‘Patent Thicket’:

The dictionary definition of patent thicket is: ‘A group of patents in a field of technology which collectively impede a party from commercializing its own patents or products in that field.’In the current context, it means a dense web of overlapping patent rights that restrict a generic or a biosimilar drug maker from commercializing its cheaper equivalents post expiry of the original patent.

This scenario has been well-captured by the above media report, which states: “AbbVie leadership has also been accused of creating a ‘patent thicket’ in its battle to stave off biosimilar competitors to Humira.” Boehringer Ingelheim is among the few still fighting AbbVie’s ‘patent thicket’ hoping to launch its Humira biosimilar - Cyltezo, even after receiving US-FDA approval on August 29, 2017. ‘Top biosimilar makers, including Novartis’ Sandoz unit and Mylan, have settled their own Humira patent fights with deals that put off launches until 2023,’ the report indicated.

In its favor: AbbVie says, Cyltezo infringes about 70 patents the company currently holds for Humira. Whereas, ‘Boehringer’s lawyers say AbbVie’s copious patents overlapped in an attempt to exclude competitors from the market.’ Notably, in March this year, New York’s UFCW Local 1500 Welfare Fund, reportedly, also accused AbbVie of using overlapping patents to exclude biosimilars.

‘Patent thicket’ – a way of ‘evergreening’ beyond 20 years patent term:

Much concern is being raised about various ploys of especially by the drug MNC and their lobby groups – directly or under a façade, to delay entry of cheaper generic drugs for greater patient access. Mostly the following two ways are followed for patent ‘evergreening’ beyond the term of 20 years:

  • ‘Incremental innovation’ of the existing patented drugs through molecular manipulation, with its clinical performance and safety profile remaining similar to the original one. As the cost benefits of such drugs are not shared with patients, cannibalizing the sales of the older molecular version with the newer one highlighting its newness, the sales revenue can be protected. With this approach, coupled with marketing muscle power with deep-pocket the impact of generic entry of the older version can almost be made redundant. For example: Omeprazole was first marketed in 1989 by AstraZeneca, under the brand name Losec (later changed to Prilosec at the behest of the US-FDA). When Prilosec’s US patent expired in April 2001, AstraZeneca introduced esomeprazole (Nexium) as a patented replacement drug. Both are nearly identical in their clinical efficacy and safety.
  • ‘Patent thicket’ is yet another tool for ‘evergreening’, delaying launch of similar drugs, or resorting to ‘pay for delay’ sort of deals. As another recent report reiterates, AbbVie’s ‘patent thicket’ for Humira, has deterred other potential challengers, such as Amgen, Samsung Bioepis and most recently Mylan, each of which struck settlements with AbbVie to delay their biosimilar challenges in the United States.

Goes against patients’ health interest:

On May 09, 2018, the Biosimilars Council reported, just as generic medicines saved Americans USD 1.67 trillion in the last decade, biosimilars are poised to do the same – ‘if they aren’t thwarted by delaying tactics instituted by some pharmaceutical companies.’ Echoing similar concern, the outgoing US-FDA Commissioner Scott Gottlieb also, reportedly said, ‘some drugmakers are using unacceptable tactics such as litigation and rebate schemes to stall the entry of cheaper copies.’

‘Of the nine biosimilars the FDA has approved to date, only three have made it into the hands of patients – an alarmingly small number. Patients can’t access the six others due to barriers thrown in their way by pharmaceutical companies that want to protect their monopolies and keep prices high,’ highlights the Biosimilars Council report. Net sufferer of this self-serving ‘patent thicket’ strategy of pharma and biotech players to extend product patents beyond 20 years, are those patients who need these drugs the most – to save their lives.

Despite law, patent ‘evergreening’ still not uncommon in India:

With section (3d) on the Indian Patents Act 2005 in place, the country is expected to protect itself from patent ‘evergreening’ through ‘incremental innovation.’ This section articulates:“For the purposes of this clause, salts, esters, ethers, polymorphs, metabolites, pure form, particle size, isomers, mixtures of isomers, complexes, combinations and other derivatives of known substance shall be considered to be the same substance, unless they differ significantly in properties with regard to efficacy.”

On this ground, Indian Patent Office (IPO) rejected Novartis’ drug Glivec (imatinib mesylate) patent application, which was ultimately upheld by the Supreme Court in 2013. Nevertheless, a study report of April 30, 2018 emphasized: ‘Though the law with regard to anti-evergreening, upheld and clarified by Indian courts, remains on the books, its application by the IPO has been far from satisfactory.’

The esteemed author of the report, after analyzing about 2,300 drug patents, granted between 2009 and 2016 concluded that evergreening practices may be rampant in India. The report pointed out, ‘the IPO could be operating with an error rate as high as 72 percent for secondary patents, despite provisions to keep them in check.’

Are these IPO’s mistakes, or due to external pressure?

As the paper, published in the January 2016 edition of the Journal of Intellectual Property Rights (JIPR) said,‘The multi-national pharma companies (MNCs) and the US-India Business Council (USIBC) have suggested in their report for elimination of Section 3 (d) so that drug patents can be granted in India for incremental improvement and modification. As per US 301 report, India is listed among countries with inadequate IP regime.’ Keeping all these aspects into consideration, the article expressed some key concerns pertaining to the impact of Section 3 (d) with special emphasis on its interpretation. Does it mean any possibility of wilting under such extraneous and high impact pressure?

A fresh pressure from drug MNC on the DCGI:

Since long drug MNCs have been attempting to delay the entry of even those generics, which are fully compliant with the Indian Patent Law 2005. One such effort was their demand for ‘patent linkage’ with the marketing approval of new generic drugs. However, it could not pass through legal scrutiny – first by the Delhi High Court in the Bayer Cipla case in 2010, and then by the Supreme Court – on the same case. The Court, reportedly, ‘noted the Indian patent system was distinct from the drug regulatory system with no linkage between them and so Bayer can’t prevent DCGI from granting marketing approval to generic versions of patented drugs.’

According to another recent media report of April 04, 2019, in a fresh endeavor ‘to delay launch of low priced generic medicine, multinational drug makers have asked the government to create a registry providing information about all drug applications pending manufacturing and marketing approval. The proposal, which is still pending with the Department of Pharmaceuticals (DoP), if accepted, could involve the generic players into expensive and time-consuming litigations, delaying early market entry of the cheaper generic or biosimilar equivalents.

To date, the health ministry has opposed the proposal, as it will be “unfair to local drug manufacturers to disclose their product strategy” and also has “the potential to substantially increase health care costs for the public.” The government further argued, “such information about product applications filed for approval are not disclosed anywhere in the world.”

India encourages new drug innovation, but not at any cost:

Despite shrill and disparaging comments of MNC lobbyists and the strong vested interests, that India’s Patent Law 2005, doesn’t encourage innovation, many independent international experts do praise the same for the following reasons:

  • Does encourage new drug innovation
  • Does extend product exclusivity for twenty years
  • Strikes a right balance with patients’ health interest
  • Indian judicial system deals with patient infringements and disputes, just as any other developed countries
  • Even 14 years after the enactment of patent laws, just one compulsory license has been granted, which is much less than other countries, including the United States.

What India doesn’t legally allow is, unfettered profit making through ‘evergreening of drug patents’ – at the cost of millions of patients-lives. Nonetheless, powered by deep pockets, the pharma and biotech players are unlikely to cease from this practice, anytime soon. Only patient-awareness, and stringent counter-legal measures can contain this unfair game of drug monopoly practices – in the name of ‘encouraging innovation’.

Conclusion:

The article titled, ‘Over patented, overpriced: How Excessive Pharmaceutical Patenting is Extending Monopolies and Driving up Drug Prices’ revealed:“Top grossing drugs have on average 125 patent applications, which are filed with a strategic intent to extend the commercial monopolies far beyond the intended twenty years of protection.” It also quoted American President Donald Trump as saying, “Our patent system will reward innovation, but it will not be used as a shield to protect unfair monopolies.”

Coming back to ‘patent thicket’ and the same classic case, another report of March 20, 2019 indicated, a new class action lawsuit filed by New York’s largest grocery union has accused AbbVie of violating antitrust and consumer protection laws, which AbbVie has defended by saying that its patent strategy for Humira has protected the investments that are necessary to “advance healthcare.”

Pharma and biotech companies’ maintaining patent monopolies far beyond twenty years has significant consequences on India’s healthcare system. Only patent lawyers and experts can possibly answer whether or not the Indian Patent Law 2005 can effectively deal with the practice of ‘evergreening’ with patent thicket. Intriguingly, taking a cue from recent developments, it seems many pharma and biotech investors too, deem ‘patent thicket’ rather distracting for longer-term undiluted focus on new product development, and sustainable investors’ return.

That apart, the question also comes, whether just as ‘antitrust and consumer protection laws’ in the US, the Competition Law of India will be able to do contain such unfair practices? Otherwise, with MNC lobbyists’ renewed activities in this area, ‘patent thicket’, especially for expensive biologic drugs, will delay market-entry of their cheaper biosimilar versions in India, as well, just as what is happening in the developed nations.

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.

Data: The New ‘Magic Wand’ For Pharma Business Excellence?

Pharma companies focus more on defending their current practices, rather than doing things differently. A September 24, 2014 article by Bain & Company, titled ‘New Paths to Value Creation in Pharma’, made this observation.

This happens regardless of the credence that leaders who change too early, risk losing attractive cash flows from established business models, and those that move too late risk being disrupted by emerging competitors. However, analyzing the recent history, the authors observed that pharma leaders have more often erred on the side of holding on to old models for too long, leaving room for more aggressive players to disrupt them.

Analysis of the 10 companies in the above study also found: “With their sustained success, these companies refute the widely held assumption that serendipitous innovation is the key to success in pharma.” However, on the ground all 10 of these large global drug companies have prospered despite industry-wide trends such as declining R&D productivity and the demise of the primary care blockbuster model. The authors explained: “This is because they operate in a high-margin environment.”

Starting with this scenario, I shall submit in this article, why the importance of well targeted data-based decision-making process, across the pharma functional areas, is now more than ever before.

Rewriting notes in the business playbook, taking cue from new data:

Having charted in the high margin ambience, Big Pharma exhibit reluctance in recomposing notes in the business playbook, based on a new set of real-life data. This is essential for sustainable success in a fast-changing business, political and social environment. They keep maintaining a strong belief in what they have been believing, regardless of what a large volume of credible data overwhelmingly indicates. Ongoing near unanimity in their collective decision to further intensify expensive advocacy initiatives in the same direction, continues. Other pharma players follow the same course.

This vicious circle continues sans any positive outcome, neither for pharma, nor for the patients. Already dented reputation of the industry gets more dented. In my various articles in this blog, I deliberated on various areas that merit radical overhaul in the pharma business, including patient-centricity and transforming the business through digitalization.

Use of data and analytics leaves room for a huge improvement in pharma: 

Let me express upfront, I am not trying to say, in any way, that pharma companies, in general, are not making investments for customized data generation or in analytics for use in new drug discovery and development, aiming improved process productivity. But, in many other functional areas, such as drug marketing, stakeholder engagement or even in strategic corporate communication for greater effectiveness, usage of scalable data and modern analytics leave much room for improvement.

Quality of data-use – ‘the proof of the pudding is in the eating’: 

As the saying goes, the proof of the pudding is in the eating, let me give a couple of examples on the quality of data-use and their outcomes in the areas under discussion.

Sizeable data clearly establishes the wish of most stakeholders, including patients for transparency in drug pricing, alongside improved access to affordable medicines. However, Big Pharma and their associates trying to swim against the tide keep advocating how the expensive process of drug innovation merits high drug prices. Understandably, negative public perception towards the industry further intensifies. Assuming that data analytics are extensively put to use while developing such communication, can anyone possibly cite such efforts as examples of productive use data?

Similarly, if any pharma company, for example, Sanofi besides many others, claims that it aims at ‘promoting and sustaining ethics and integrity in all our activities’ and has developed a comprehensive body of policies and standards, to provide guidance on a range of challenges specific to pharma industry like anti-bribery. However, in practice, we hear and read, even very recently that ‘Sanofi to pay more than $25 million to resolve corruption charges’ and which is not a solitary instance, either. The question, therefore, surfaces, how can data play any role in the fight against corruption by uncovering, preventing and deterring corruption.

‘How data is changing the fight against corruption:’

There are many published research papers, which established that effective use of data can prevent such corruption, and surely in cases of alleged repeat or multiple offenders in the pharma industry. One such paper titled, ‘How data is changing the fight against corruption,’ published in the OECD Forum Network on February 13, 2018, also reconfirms this point. It says:Data – both big and open – is indeed changing the anti-corruption landscape, by uncovering, preventing and deterring corruption.

Is pharma leveraging the data power for holistic business success?

I am not sure, but available evidences suggest most of them are not – at least, aiming for holistic business success. This is because, in the pharma industry, including Big Pharma, as I wrotein the past, alleged corrupt practices are widespread and continue unabated. This is quite evident from the national and international business magazines and media reports, coming rather frequently. The Transparency International Report titled “Corruption in the pharmaceutical sector – Transparency International 2016”, discusses the raging issue across the various functions of many drug companies.

Besides pharma and biotech R&D, there are many other critical areas, where leveraging data power with expert application of analytics, pharma players can reap rich harvest in terms of sustainable long-term business growth. However, for that there are some prerequisites, like – an open mind, unbiased approach, a mindset to accept reality as they are, and then neutralize the unfavorable ones with cerebral power. Trying to rationalize what is not working makes the situation worse, more complex, creating stronger headwinds.

Many sources of data capturing, still limited usage:

There are many sources of abundant data availability of various kinds, for pharma players. However, targeted data gathering of scale and appropriate analysis of the same, still remain rather limited in pharma. For example, while marketing their brands, numerous drug players in India don’t venture going beyond limited sources for data capturing for broad analysis. Such data may usually include, syndicated retail and prescription audits, besides internal sales and marketing details together with associated expenses or productivity related statistics. Data mining for dip-stick analysis is done seldom, according to industry sources.

Additionally, there are copious others who operate predominantly on ‘gut feeling’ and hearsay, sans any customer related meaningful and real-time data. When we create hype on patient-centricity, and alongside witness the general outcomes of such approaches, it requires no rocket science to fathom how much intelligent data input has gone behind such strategies.

The present system itself generates an enormous amount of real-time data in various areas, though most are not effectively utilized for weighty payoff, especially in pharma. The ongoing process of data generation also includes, drug innovation initiatives, manufacturing, supply-chain, distributor–wholesaler-retailer activities, digital apps and different websites, besides scores of other sources. But, the information, as stated above, apparently, is hardly analyzed through analytics to obtain targeted strategic inputs. Leave aside, intelligent application of the same to scale newer heights of all-round business success.

Data generation for swimming against the tide of public perception:  

Although, it’s not yielding positive results, I understand, pharma keeps spending a lot, both at the company level or through their trade bodies, to rationalize what they want the stakeholders to believe. For example,’ drug price control limits access to drugs’. Various reports to this effect are made public and used for the aggressive advocacy campaigns, though hardly taken seriously by those who matter.

Any price control, I reckon, may not be supported in ordinary circumstances. However, drug price control has definitely helped India to improve access to drugs without impeding any reasonable growth of the industry. That 5 or 10-year CAGR of the drug industry comes in double digit, despite continuation of drug price control regime for the last 48 years, offers a testimony to this fact. It’s a different issue, though, that Indian public health care system remains in shamble, even in the present regime. The lackadaisical attitude of all governments on public health related areas, is held responsible for this failure.

Conclusion:

The bottom-line is, expensive data generation effort, when gets primarily driven by self-serving motives, becomes increasingly counterproductive, as cited above. More informed stakeholders of date, including patients, probably other than the stock markets, want to see pharma players more in sync with the ground realities, and are acting accordingly. Thus, for sustainable business success, saner senses should prevail to generate adequate amounts of credible and targeted data, analyze them properly through analytics and use these with cerebral power to create a win-win situation in the pharma business.

In my view, any comprehensive ‘Decision Support System’ of an organization should go beyond the generation of mammoth internal business-related data. It should be integrated with the same kind of targeted external data of scale, with the use of modern analytics. This needs to happen – both at the macro level – as an organization, and also at the micro level – with its various functions. The corporate illusion of always ‘operating in a high-margin environment’ in pharma, will not guarantee sustainable business success, any longer.

From this perspective, using well-integrated internal and external data as the bedrock of all strategic decisions in pharma, I reckon, would soon prove to be a ‘magic wand,’ as it were, for pharma business excellence.

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.