The draft Pharmaceutical Policy, released recently by the Department of Pharmaceuticals (DoP), covers several aspects affecting the industry. However, the most important part is pricing. While this draft policy released by the government provides an insight to government’s intentions, one will have to wait and watch for the final policy and how the policy will be implemented, said Bhavik Narsana, Partner, Khaitan & Co.
Providing a roadmap ahead for Indian generic drugs, Narsana said that there are several factors which have, in the past, affected, and which will, in future, affect this segment of the industry, both exports as well as the domestic business. These include global regulatory authorities giving more importance to quality of drugs. For instance, the US FDA action on Indian manufacturers, R&D expenditure and development of new drugs including biologicals, protection of intellectual property rights, expiry of large number of patents and pricing of drugs, particularly branded versions.
India has an unpredictable drug pricing regime and this has had, and will have, a severe impact on doing business in India, Narsana told Pharmabiz in an email.
While the government’s intentions of providing affordable drugs to the Indian population cannot be questioned, the drug authorities need to find a better way to achieve their objective. In the interest of all stakeholders a clear roadmap for the industry is required to enable the industry to plan their business appropriately, he added.
Whilst the quality of drugs exported is generally good, the government needs to enforce better quality of drugs for the domestic market as well. The bio-availability and bio-equivalence studies is proposed to be made mandatory for all drugs to be approved whether by central or state government. This will ensure minimum quality of drugs, however, it will also mean higher costs for pharmaceutical companies. Some companies will be able to survive this new requirement, however, the smaller companies may not be able to bear the additional costs, he noted.
In the area of active pharmaceutical ingredients (APIs), the government is looking to encourage manufacturing in India which is a step in the right direction. The success of this will largely depend on the actual implementation of the proposal and also the costs involved in manufacturing the APIs in India as opposed to importing the same from China, said Narsana.
On the marketing front, the government has expressed its intention to crack down on the nexus between the pharmaceutical companies and the doctors. Recently the Indian government expressed its intention to make it mandatory for doctors to prescribe generic name of the drugs. Further, the government also proposes to make the marketing regulations mandatory for Indian pharmaceuticals companies. Indian companies will need to gear up for this eventuality and be prepared with alternate marketing strategies, he said.