An interview with Amit Rajan on why pharma MNCs are beating Indian counterparts
The success of MNCs in
terms of their growth rate in the last 18 months. This has to be attributed to
the regulatory regime change that has happened in India, says Amit Rajan, MD, Prosfora Technologies. Excerpts from an interview with ET NOW.
Do you think it is a given that Indians
will consume more medicines and MNC companies which have a niche presence in
diabetes or vaccine or for that matter thyroid, will continue to grow at
inflation plus 5%?
Yes, look at the
success of MNCs in terms of their growth rate in the last 18 months. This has
to be attributed to the regulatory regime change that has happened in India and
unlike our own India Inc, which has a problem with the government, MNCs pharma
companies to thank the Indian Government.
Let me give you
three-four regulatory changes that have helped: A) There is solid patent
protection. There is respect for patent now and the courts are not listening.
After 2014, there is not a single compulsory licensing that has been
entertained by the courts of India. B) The ban on 300 or 400 fixed dose
combinations (FDCs) in India by DCGI. This has yielded space to multinationals
to bring in innovative molecules. Unfortunately the research by R&D team of
Indian pharma is busy with the ANDA business. There is no active research on
innovative products for the India market. The multinationals have a full
pipeline of R&D with new innovative molecules. C) The timeline for approval
of the new molecule in India. Once you file from overseas, it now takes three
to eight months, unlike 12 months to eternity that was seen two or three years
earlier.
So, a combination of these three regulatory decisions by the Government of India has actually led to multinationals performing well. Secondly, Indian pharma does not offer serious competition to MNCs in terms of vaccines and animal healthcare. These two are very big market with the government coming out with compulsory annual healthcare programme in India.
There is a huge market for vaccines which no Indian pharma has been able to capture. So multinationals are doing good and will certainly do good with increasing population etc. Look at Abbot. It has gone into a rural push now. With greater participation of multinational companies in Ayushman, their volumes are increasing.
There are two things which will challenge the drug
or the OTC market/prescription market in India one is drug price control,
second is the copycat nature of Indian pharma companies. How did MNC pharma
companies manage to protect some of the key drugs outside the ambit of drug
price control and how is it that Indian pharma companies have not been able to
copy them?
The answer lies
in the regulatory regime. Even if you have to launch a new drug which is
generic in nature, you will have to give a lot of clinical trial data and redoing
the whole clinical trial in India is a costly procedure. The multinationals
being the innovators of the molecules, already have the clinical trial data.
Two DCGI rules that
have changed in the last three months a) once you have a clinical trial data of
any regulated market, you will get an automatic approval and b) if you apply
for a new molecule in India and you do not hear from the government, in 30 days
you get an automatic approval. Multinationals are already geared up for this
kind of data presentation. Indian companies do not have clinical data on new
molecule or new combinations.
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