The Indian pharmaceutical industry is growing at a rate of 8-9 per cent per year and this has led most of the domestic pharma players to explore newer avenues of drug research, discovery and development, promising higher capital investments in the near future. Also, many multinational companies (MNCs) have entered India to market drugs and conduct clinical trails and research. All these have given an impetus to the country's pharma research, manufacturing and outsourcing to India, apart from turning India into a land of opportunities in the pharma space.
Besides, a recent study by Confederation of Indian Industry (CII) predicts that India could become a global pharma hub by exporting domestically produced generic products and presenting itself as an offshoring destination for clinical and preclinical research and other support services.
In addition, the domestic pharma market itself presents a tremendous business potential to its players. For instance, consumer spending on healthcare went up to 7 per cent of gross domestic product (GDP) in 2007 from 4 per cent of GDP in 1995. Further, the consumer spending on healthcare is expected to go up to 13 per cent of GDP by 2015, turning India into a $20 billion pharma market, according to a recent McKinsey report.
This implies that pharma companies will have a huge research and development (R&D), sales and marketing network spread across geographies, which would in turn pave way for exponential increase in their telecommunication costs. Therefore, pharma companies need to embrace a technology that can offer dynamic lines of communication between the global markets and its manufacturing and research centres in India. Ultimately, Indian's growth as a global player hinges on its ability to overcome challenges. Given the present scenario, integrating and facilitating cost-effective communication is a major challenge.
Indian contract research & clinical trial scene
Going by the current growth trend, India is poised to emerge as a key contract research hub. According to a study by Ernst & Young, the total clinical research market in India is expected to touch $1.5-2 billion by 2010. Also, A. T. Kearney, a global management consulting firm, has listed India second (just after China) as a preferred location for conducting clinical trials.
With pharma majors facing increased pressure on profit margins, spiralling R&D costs and increasing overheads, outsourcing of clinical research processes to third parties in developing countries seems a viable option. By contracting such works to India, they save anywhere between 40 to 60 per cent in new drug development.
In this context, networking and communications technology is considered as the best means to carry out different aspects of contract research and clinical trial business. The application of this technology has the potential to improve certain things, including:
■ Time to market: Achieved through significant reductions in patient recruitment intervals and more efficient data management.
■ Cost containment: Achieved through the reduced re-work required for a single trial and internal savings on systems development.
■ Improved productivity: Achieved by re-use of standard networks, study sites and processes across multiple trials that will release key staff quicker.
■ Faster and better informed decisions: Achieved by implementing web-based "real time" data access for rapid decision making and project management reporting.
Technology harnessing
Some of the specific challenges that plague the Indian pharma industry are:
■ The "silo effect" in large pharmaceutical companies that prevent clinicians from sharing pertinent data.
■ Lack of standardised data definitions, necessitating duplicate testing and trials.
■ Weak process and systems integration that slows time to market.
System thinking based communication platforms could help pharma companies to overcome these obstacles by developing an electronic clinical development system based on internet platform initiatives. There are certain advantages to this communication system. They are:
Secure extranets for research partners: In an ideal networked pharmaceutical business model, the company stores the intellectual capital, which is critical to its competitive advantage, in-house. The remaining information is outsourced through strategic alliances with peers and vendors. These alliances could be short term or long term and geographically independent. Converging web-based collaboration tools and secure communications, companies can be in seamless contact.
R&D supply chain management: Supply chain management, not only in terms of logistics but also in terms of large volumes of data, allows sharing of critical systems, while protecting intellectual property. An example would be mapping a gene bank data or gathering genotype data from external sources.
E-learning & shared work space: Converging communication technology allows for enhancing collaborative efforts for on-demand e-learning and informal knowledge sharing. During clinical trials establishing the protocols and the study design account for the most of the work. Internet-based automated application builders can help clinicians design procedures, capture data and establish workflow rules confirming to good clinical practices.
Clinical portals: Pharmaceutical companies can widen their intellectual footprint beyond partners with online multimedia environments, which would help them accelerate the speed of clinical trial data transactions and exchange with regulatory agencies and non-secure partners.
R&D command centres: Command centres that are hosted or built in-house, can handle multiple data and information feeds from extranets, intranets and portals. This allows for rapid response to unexpected regulatory or clinical problems and also quick redeployment of intellectual property to new projects.
Factors affecting IT adoption
In the early days of the Indian pharmaceutical industry, there was a stiff price war amongst companies as they focused on reverse engineering of complex molecules at lower costs and manufactured "me-too" products with same therapeutic properties. Now, Indian pharma companies are strengthening their R&D capabilities to focus on new drug regimes and newer molecules. This renewed focus on R&D reiterates the need for robust and secure networks for large data transactions.
Small and medium sized domestic pharma companies are yet to understand the long-term benefits of adopting cutting-edge technology due to constraints such as budgets and limited infrastructure. Although the SME pharma market is very large and has tremendous potential, it is yet to be tapped to its full potential.
Though many of the Indian SME pharma companies are not into drug research and testing, they still need technology to improve efficiency in quality assurance and control. Also, technology is a must for them for adherence to regulatory requirements for operation and testing, improving batch tracking and expiry date tracking, optimising credit and logistics control, consolidating sales promotions, discounts and purchase-sales inventory analysis and optimally tracking consignment sales.
Internet economy
The internet economy is rapidly changing the face of the pharmaceutical industry by delivering new web-enabled solutions to solve many business and primary care issues. Automating administrative processes such as billing, purchasing etc lead to increased sales, marketing and R&D productivity, thereby reducing operating costs across the organisation.
Emerging sciences such as genomics and proteomics increase the number of drug targets from hundreds to tens of thousands, while internet applications will help to optimise large volumes of complex data and identify drug candidates. The question is no longer when the internet or technology will impact the pharma business, but how the industry will adopt the technology to get the most out of the new global business environment. Today's new pharma companies need scalable networking solutions that will grow with the company, provide productivity for a mobile workforce and meet pertinent security regulations.
(The author is vice president -Enterprise, Cisco India & SAARC)