Bengal Chemicals & Pharmaceutical Works is the first Indian pharmaceutical company which was established in 1930 in Calutta. The company exists even today as one of the government of India owned company.For almost fifty years most of the drugs in India were imported either in fully-formulated form or bulk form. The government of India started encouraging growth of drug manufacturing companies in India in 1960s and with the patent act in 1970 the Indian Drug Manufacturing Industry is what it is today. This patent act removed composition patents from food and drugs, and though it kept process patents, these were shortened to a period of five to seven years. The lack of patent protection made the Indian market undesirable to the multinational companies, and they started leaving the country.Indian pharma companies started taking their places. By using reverse-engineering technique they started establishing business both domestically and overseas.
From then to now there has been a paradigm shift in our pharmaceutical industry with changes underlining every aspect of it.In the process of change, many terms have become obsolete. 'Sheltered Market' is one of them. Today more than 7,500 pharmaceutical companies are competing for a share of market and the number is increasing every day. An overcrowded marketplace cluttered with products is forcing the pharma industry to take a closer look at the management practices and its effectiveness.
We have moved from an era of import-license and loan-license to co-marketing strategic alliances and collaborative research. In a market-driven scenario a plethora of products are fighting for a mind share of the high profiled customers. The technology is getting upgraded and updated so very often that the changes are shortening life cycles of the products like never before. We have zipped through from norfloxacin to lomefloxacin, from dexoprophoxyphene to nimusulide in just about eight to nine years. The demassified society described in 'The Third Wave' by Alvin Toffler is sure to stay here. The mass market is splintering into an ever changing and continually multiplying set of mini-markets that demand an expanding range of options and customizations.
A highly specialized branch, pharma marketing combines the basic marketing principles with more focused need-based approach to the pharma industry.Pharma marketing is a whole new way of looking at marketing strategies specific to the pharma industry. The healthcare industry as a whole contributes to the total well being through safe and effective medicines, using scientific diagnostic procedures and effective therapeutic agents.In this sense the healthcare business revolves around the patients who need the therapies, the physician prescribes them and the chemists dispense them.The awareness, dependability and credibility of a particular therapy therefore become crucial as it determines the physician's final choice while he writes the prescription for the patient. Unlike the 'customer' in the conventional marketing sense, the concept of 'customer' in pharma business is not monolithic segment.The customer group in India can be broadly classified into physicians, physician-cum dispensing chemists, retailers/traders/ chemists, diagnostic centers, rehabilitation centers, hospitals and ploy clinics and clinical and pathological laboratories besides others.
While the pharmaceutical industry is leaping ahead with lots of innovation and insurgency, there are few brands in the market which reign for decades; e.g.Bayer's Disprin Pfizer's Becosule, SmithKline's Crocin or Knoll's Brufen.These brands have stood the tests for decades. They have competed with various brands in the market.There are about 237 ibuprofen brands in the market, which compete with Brufen; still the brand has managed to become a household name.Disprin has been in the market for more than 100 years.Becosule is more than fifty years old brand. This brand is the largest selling pharmaceutical brands in India.It has made a turnover of 77.2 cr in the year 2000. This is an example of good and integrated marketing by Pfizer. India's antibiotic consumption is very high, which requires to be consumed with B complex vitamin.For ages, the physicians in India have got so used to prescribeBecosule along with any antibiotic prescription, that skilled professionals of Pfizer have used the doctor's convenience with Becosule to their lead always. Similarly, Crocin and Disprin have to fight almost 536 paracetamol preparations in the market to retain their positions.
Quantum leaps made in the field of proteomics, genomics and biotechnology are creating revolutionary therapeutics that require equally impressive drug delivery systems in order for patients to derive optimum benefits. This, coupled with patent expirations and subsequent competitive threats from lower priced generics, is compelling pharmaceutical companies to investigate these innovative drug delivery solutions. There is now a growing realization that innovative delivery of drugs would not only increase safety and efficacy levels but also improve the overall performance of the drug,
While drug delivery plays an important role in enriching drug performance, researchers are concentrating on using delivery as a means to reduce dosage frequency, preferably through non-invasive methods. Most blockbuster drugs are in the hands of select pharmaceutical companies. Numerous drug delivery companies have also become more proactive in participating in the drug development procedure. While drug delivery plays an important role in enriching drug performance, researchers are concentrating on using delivery as a means to reduce dosage frequency preferably through non-invasive methods. Multiple injections required per week or day could be replaced by once a month dosages or even longer intervals, which would stabilize blood levels of the medication, thereby enhancing treatment outcomes and patient compliance.In India, the new drug delivery system is playing a pivotal role.
As it expands its core business, the industry is being forced to adapt its business model to recent changes in the operating environment. The first and most significant change was the January 1, 2005 enactment of an amendment to India's patent law that reinstated product patents for the first time since 1972. The legislation took effect on the deadline set by the WTO's Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement, which mandated patent protection on both products and processes for a period of 20 years. Under this new law, India is forced to recognize not only new patents but also any patents filed after January 1st 2005. In the domestic market, this new patent legislation has resulted in fairly clear segmentation. The multinationals narrowed their focus onto high-end patients who make up only 12% of the market, taking advantage of their newly-bestowed patent protection. Meanwhile, Indian firms have chosen to take their existing product portfolios and target semi-urban and rural populations. The new patent regime has taken effect at a time when Indian companies have recently started to aggressively pursue global opportunities, so it is not clear whether the flurry of international activity surrounding the enactment date is a result of the change in legislation. Mergers, acquisitions and alliances have been taking place on an unprecedented scale, most notably with companies in the U.S. and Europe.
Multinational companies are beginning to turn to India for more outsourced activities. Having long been a preferred destination for contract manufacturing, leading international drug makers are also beginning to bring their R&D and clinical trials activities to India, capitalizing on the country's high levels of scientific expertise as well as low wages. The cost of clinical trials in India is about one-tenth of their levels in the US, and it is estimated that outsourced clinical trials could be worth $300 million to India by 2010.
India's rich "human capital," is its strongest asset. Various studies show that India's English-speaking scientific talent pool of more than 4 million is second only to the US. India's potential to further boost its role in global generics production, as well as an outsourcing location of choice for multinationals, presents an opportunity worth an estimated $48 billion in 2007.
India's vast market potential offers opportunities for the industry. Experts predict a boom in the availability of health insurance for the nation's more than one billion people and new government initiatives seek to enable the majority of the population to access life-saving drugs. A further huge boost to the local market is coming from the rise of India's new affluent consumers, who lead more Western-style lives and are demanding innovative drugs to treat the chronic illnesses that these changing lifestyles produce.The industry is surely shaping up steadily.
(The author is the director and professor of Marketing Management at Allana Institute of Management Studies)