Probably there is not much love left in western European
and North American capitals towards Indian Pharmaceutical companies. Reasons
are plenty. Most of those countries have their own mammoth pharmaceutical
companies, whose interests are not aligned with the rise of Indian generic
manufactures and Indian Patent regime- which according to their accusations are
not strict enough.
Western Pharma majors are facing three major challenges
from India. Firstly, India's patent regime. Indian government, court and
regulators won’t hesitate in taking out the fantastic weapon called - compulsory
licensing in cases of life saving drugs. Companies may not get patent in India,
if their application running (or alleged to be running) on top of a horse
called ever greening.
Secondly, Indian manufactures can make generic medicines
which costs much less than that of foreign companies. This will make the competition
in Indian market in favour of domestic generic companies. Thirdly, in foreign
countries, like countries in Africa, Europe, Americas etc, Indian companies are
creating much bigger footprints (with affordable medicines). This essentially
(if not now, then in future) eating the margins (in generics) of many western Parma
behemoths. In a world where money is in short supply, affordability (of drugs)
is the name of the game. Western pharma companies, to an extent correctly,
complain that they are the ones who invest in costly research, long drawn
clinical trials etc.
It is to be noted here that, a huge amount of research output
is coming from big universities as well, which again is publically funded.
Ranbaxy Case
However, recent settlement in Ranbaxy case is indeed a
setback for India generic majors. According to NYT, "Ranbaxy pleaded
guilty on Monday to federal drug safety violations and will pay $500 million in
fines to resolve claims that it sold subpar drugs and made false statements to
the Food and Drug Administration about its manufacturing practices at two
factories in India"
"The company acknowledged that it failed to conduct
proper safety and quality tests of several drugs manufactured at the Indian
plants, including generic versions of many common medicines, like gabapentin,
which treats epilepsy and nerve pain, and the antibiotic ciprofloxacin."
It is to be noted here that, "F.D.A. said it did not
receive any reports of patients being harmed by the drugs made at the plants in
question" - NYT.
Ranbaxy is not the only company facing problems related
to quality, some western companies are also on the radar.
Indian Pharmaceutical Sector
Parma is big sector, we already have considerable market
share here. According to Ministry of Commerce, GOI, India is,
1. 4th in the world in terms of production volumes;
2. 12th in terms of export value of bulk actives and
dosage forms;
3. Largest exporter of formulations in terms of volume
with 14% market share.
Major export destinations are USA followed by UK. In
terms of Exports we registered a growth of 22.78% in 2011-12 and 10.55% in
2012-13.
What Ranbaxy case point out is Indian companies need to
be more careful in manufacturing medicines. Medicines are something which
directly affects the heath of consumer; any lapse on this front not pardonable.
Moreover, these incidents will create a bad impression about Indian generic majors
among foreign countries, even though it is not factually correct to label medicines
manufactured in India as substandard, dangerous for health etc.
In future, government, Indian regulators, manufactures
have to be more careful. We should take this penalty as a challenge and put a
stricter regulatory framework in place, stricter quality control regime,
implement best practices, more inspectors etc. At a moment, when we are asking
Chinese, Europeans to widely open their market for Indian pharma, there should
not be any lapse from our end.
Sajeev.
PS: At least in one case - generic Lipitor - FDA traced
the problem back to one of the Ranbaxy manufacturing plant in India. Why Indian
regulators didn't find this out earlier?
References
1.
http://www.nytimes.com/2013/05/14/business/global/ranbaxy-in-500-million-settlement-of-generic-drug-case.html
2.
http://profit.ndtv.com/news/corporates/article-another-bitter-pill-for-ranbaxy-this-time-from-eu-323004
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