Pharmaceutical, Indian Pharmaceutical Industry, Changing trends, Pharma industry

1. Changing trends
in
Indian Pharmaceutical
Industry
- Rishang Deoras

2. Indian Pharmaceutical Evolution
Phase II
Government
Control
Domestic Indian
market- key driver
Indian Patent Act –
1970
Drug prices capped
Local companies
begin to make an
impact
Phase III
Development
Phase
 Bulk drug &
formulation
manufacturing
Process
development
Production
infrastructure
creation
Export initiatives
Phase IV
Growth Phase
Bulk drug exports
to developing
Markets
TRIPS agreement
signed in 1995
Rapid expansion of
domestic market
International market
development
Research orientation
Phase V
Innovation &
Research
New IP law
Discovery Research
Gearing up
for changing
patent law
Step towards
NCE development
CRAM
1970 1980 1990 2000 2011
Phase I
Early Years
Market share
domination by
foreign
companies
Relative
absence of
organized
Indian
companies
Pre-1970’s

3. India’s Competitive Advantage
India
Economical
Skilled
Manpower
World Class
Manufacturi
-ng
Facilities
Quality at
Low Price
Vibrant
Domestic
Industry
Talent Pool
Source : Mckinsey study; Economic Times
Significant Cost Advantage
Highest number of USFDA approved plants
0.015
0.31
0.56
0
0.1
0.2
0.3
0.4
0.5
0.6
Indian Retail
Price
US Generic
Price
US Brand
Price
Price ($)
Promethazine
61 60
25
22
9
5 7
0
10
20
30
40
50
60
70
No. of USFDA
Approved Plants
 Indian Pharmaceutical industry Valued at $22 Billion
 3rd Largest in terms of Volume
13th in terms of Value
 Growth Rate : 14% Per Annum
 2nd most populous country in the World with current
population 1.22 Billion

4. TRIPS : The Paradigm Shift
EMR
• Exclusive
Marketing
Rights
Patents
• Product
• Processes
Others
• Compulsory
Licenses
• Uniformity
TRIPS
Innovation
Reverse
Engineer
ing
TRIPS
Strong IPR in Place to
Protect & Nurture Innovation
Synriam
Arterolane Maleate and
Piperaquine Phosphate

5. New Pricing Policy : A Step towards transforming India
Drug Policy (1994)
Based on market
share principle
Cost-Based Pricing
National
Pharmaceutical
Pricing Policy 2012
Based on NLEM
essentiality of drugs
Proposed to cover all
348 drugs
Market-Based Pricing
Based on Simple Avg
of all brands with
market share >1%
 NPPP likely to result in 10-15% price cuts
 Impact on industry to the extent of 3-5%
 Impact likely to be higher on companies
with premium pricing strategy, especially
MNCs & companies with relatively higher
product/therapeutic concentration
Impact :
Source : ICRA Report Oct’12 ; Economic Times
Boost ‘Affordability & Availabilty’
Imported Medicines which are part of
NLEM list for the 1st time under policy’s
purview. Eg : Prices of Insulin
Price control over drugs was first introduced in the country in the aftermath of Chinese
aggression by Drugs (Display of Prices) Order 1962 and the Drugs(Control of Prices) Order 1963.

6. MCI & CBDT break the enduring ‘Drs & Pharma Co’s Nexus’
Indian Medical Council Regulations 2009 :
 Regulations laid by Medical Council of India banning doctors
and their associations from accepting freebies
Recent Landmark Move by Finance Ministry :
 Pharma Co’s Freebies to docs taxable for both
 Freebies include money, travel facilities, hospitality, etc
Impact :
Ethical practices would increase
Medico Marketing is the future
Branding would be pivotal in Business generation

7. Thank You
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