Considering the enormous problems that the healthcare  system  in   India faces, can the Indian pharmaceutical  industry take up the challenge and be a partner in the planning  and implementation  of a  viable  and  effective healthcare system in the country? That   means    extending  it’s role to being a provider  of healthcare rather than just a supplier of drugs. In what way can the industry participate  in  the Healthcare  Mission spelt  out in  the New National Health Policy (2015)?

National Health Policy 2015
The Government of India has published a Draft National Healthcare Policy 2015, thirteen years after the last policy statement of 2002. The policy acknowledges the fact that  the prevailing policy has failed  to realise the wide gaps which exist  in the country with regard to providing adequate healthcare  to the population .in spite of availability of adequate interventions,  since “ the power of existing interventions is not matched by the power of health systems to deliver them to those in greatest need, in a comprehensive way and on an adequate scale”. Among the available interventions, the development , manufacture and distribution of needed medicines is an important component.

During the early days after independence, India had  laid emphasis on the setting up of healthcare systems and providers in the public sector with limited participation from the private sector. In the wake of the failure of public sector pharmaceutical companies to meet the needs  and the hospitals not meeting service standards, in recent years there has been a shift to the private sector whether in the area of hospitals, medical institutions, pharmaceutical manufacturers , insurance agencies etc. The primary health centres and rural health missions meant to extend medical services to the rural areas showed mixed outcomes in terms of their effectiveness.

Profile of health issues
The profile of healthcare needs in India also have changed over time due to a variety of factors including increase in life expectancy  and consequently increase in ageing population, emergence of new diseases, shift in prevalence and incidence of non communicable diseases such as diseases of the cardiovascular and  central nervous systems, diabetes, cancer , respiratory , musculoskeletal and gastrointestinal disorders etc. The current issues in India have gone far beyond those spelt out in the Millenium Development Goals as well as in the report of the National Commission on Macroeconomics and Health . While Policy Documents of 2002 as well as the current Draft (2015) spells out all the issues as well as methodology to address them, the major factor responsible for the non-performance of the system has been the poor implementation of the  various programmes initiated under the earlier policies. Two other important factors have been the dual responsibility for healthcare programme implementation by the centre and the states as mandated under the Indian Constitution as well as the very low spending on healthcare. At 1.5 per cent of GDP,  spending  on healthcare is one of the lowest in the World, lower than even most of the neighbouring  countries. The number of Medical and para medical professionals and the number of beds per thousand population are also among the  lowest,  higher than only Bhutan and Sub Saharan Africa , but lower than in Bangla Desh, Sri Lanka and Pakistan. Health Insurance Schemes are in their infancy with less than 10 per cent of the population covered. With little state support, over 70 per cent of healthcare  expenditure is  borne by the patients, out of pocket, and having to meet the high costs of  healthcare is one of the factors responsible for over 30 per cent of the population living below the poverty line..

New government initiatives
While healthcare is the joint responsibility of the Central Government and State Governments, policies which impact  the welfare of the population related to healthcare are designed and dictated by the Central Government.. Already in 2011 India  brought out a National List of Essential Medicines (NLEM) consisting of 348 drugs in the basket. Since 1962, India had statutory price control on medicines   under various stipulated formulae  depending on the essentiality of medicines . The number of drugs which came under statutory price control was progressively reduced to a low of 74 under the   Drug Price Control Order. (DPCO) 1995. However the trend was reversed under the DPCO 2013 which brought into the fold price control on all the 348 drugs included in the National List Of Essential Medicines.  A new formula for fixing the maximum selling price was also evolved which is being progressively implemented. .

With a new Government in the  Centre since June 2014 , in keeping with the assurances given during the election process , a number of initiatives related to healthcare are  being proposed by the Ministry of Health and Family Welfare. They include making all essential drugs available free of cost to patients in public sector hospitals, universal insurance for all citizens through insurance schemes, both from the public and private sectors, development of Indian systems of Medicine and its integration with other systems of medicines  and revamping the  Indian Medical Council. On the question of Foreign Direct Investments (FDI) a policy decision was earlier made to allow 100 per cent foreign investments in this sector , but later on it was revised to allow 100 per cent FDI only for greenfield projects and not for brownfield projects. Very recently the Government brought in a notification allowing 100 per cent FDI in the medical devices field.

Being a signatory to the GATT Agreement and a founder member of the World Trade Organisation, India has enacted a TRIPS compliant Intellectual property protection system which is fully compliant with the TRIPS agreement. Recent actions by the Indian Patent Office and by the Supreme court included refusal of a patent for an anti-cancer drug  Glivec of Novartis and the issue of Compulsory Licence to an Indian company for the manufacture and marketing of the Bayer’s anti-cancer drug Nexavar has raised concerns among the research based pharmaceutical companies of the U.S. and Europe. Even though pricing and costs of treatment are not issues dealt with under TRIPS, India  and many other developing countries consider affordability as  important criteria while granting licenses under the patent system. Such a stand has also the support of Para 6 of the DOHA Declaration at the WTO Inter Ministerial Conference in November 2011, which mandates that wherever there is a conflict between public health interest and patentee’s rights , the former will prevail. That the New Patent Act and its working are fair and equitable is evident from the fact that of the 4614 of patents granted by the  Indian Patent Office  during the period 2005 (when the New Indian Patent Act came into force) till 2014,  77per cent  (3575) were granted to foreign applicants  and in spite of provisions under Compulsory Licenses and in spite of several compulsions , only  one Compulsory  License has so far  been issued to an Indian Company

On the regulatory side The Central Drug Control administration which administers the Drugs and Cosmetics Act  meant to ensure  globally acceptable regulatory standards for manufacture, quality control, pre-clinical and clinical experimentation, marketing practices, post marketing surveillance etc is continuously upgrading its services . Universal guidelines for Good Laboratory practices (GLP), Good Manufacturing practices (GMP) and Good Clinical Practices (GCP) are being implemented , so much so that India has the largest number of FDA approved pharmaceutical plants outside the U.S.; so too one third of  ANDAs approved by U.S.FDA  for the marketing of generic drugs emanate from Indian companies.

India’s leadership in supply of generic drugs
The Indian Patents Act 1970 which disallowed protection of products in the pharmaceutical field provided a great opportunity for India to be strong in the development of novel process technologies and entry into the global generic drugs space. Today India is one of the largest exporters of bulk drugs and formulations  to over 150 countries including the highly regulated markets of U.S.A and Western Europe.. Consequently India became the third largest producer (in volume terms) of bulk drugs and formulations. Even then India accounts for only 1.4 per cent of the global market in value, and 10 per cent in volume terms. The World’s most regulated  market , the U.S acquires 40 per cent of  all their generic bulk drugs and formulations from India.     

Projected trajectory of growth
India’s growth in the pharmaceutical sector even during the recent recession period has been impressive at 14 per cent and if the momentum is maintained, Mckinsey predicts a market of U.S.$ 55 billion by 2020. With a more aggressive strategy and at a CAGR of > 17 % the market will reach U.S.$ 75 billion by 2020. Exports from India stood at U.S.$ 10 billion in 2013 marginally exceeding the domestic market. Import remains at less than 20 per cent of exports, even though India’s dependence on China for some critical fine chemicals , intermediates and bulk drugs to meet her  requirements for bulk drugs and formulations for the domestic and international markets is a cause for worry.

Having gained strength in the production of APIS for the global generic markets, India also entered the field of Contract Research and Manufacturing services (CRAMS) and clinical research. While in the former space major inroads were made , on the clinical research front, there has been  a  set back during the last two years due to some unfortunate developments related to several misconceptions, alleging uncontrolled use of Indian patients  in human trials on new drugs.. The top 15 Indian companies in the wake of the new Product Patent era (post-Indian Patents Act 2005) ventured into New Drug Discovery Research investing five  to 10 per cent of their turnover. However, whether it is due to sub optimal investments or due to lack of overall multidisciplinary skills the track record of the last 10 years has been dismal. So far no new molecular entity discovered in Indian laboratories have reached the global markets.

The “Make In India” campaign
The new slogan being promoted by the new Government primarily is  an invitation for global companies to make India a major hub for manufacturing of goods for global markets based on the premise that India offers the best possible location , infrastructure and skills for the production of quality products at the lowest costs. This slogan should have two components namely “make for India” as well as “make for the World”. The first component is important for the pharmaceutical sector since, in spite of India’s ability to manufacture even the most sophisticated drugs, specially of synthetic small molecules, their production for meeting the domestic needs of the formulation sector is relatively low. This is due to two factors , one reliance on China for import  of drug intermediates and bulk drugs and second,  the low penetration of drugs into the Indian rural markets, where the bulk of the Indian population resides. The annual per capita consumption of drugs in India at $ 10 is one of the lowest in the world even after considering  the low prices of drugs in India compared to the rest of the world.

How can pharma industry participate in new healthcare mission ?
Success of a new national healthcare system in the country depends on a number of factors , such as improvement in public health, better living and environmental conditions, better nutrition, higher incomes and availability of appropriate healthcare interventions. While the pharmaceutical industry can do little  to influence most of them, it can contribute towards building a robust healthcare system in the country by1) Supplying   Essential Drugs (NLEM 2011) of the right quality  as promised by the New Government to all  public sector hospitals at prices fixed by the NPPA 2) Participating  in all National Health Programmes including the Immunisation  programmes of UIP and EPI (vaccines for all diseases included under these programmes) 3)  Developing and   providing  the drugs needed for control/ eradication of communicable diseases ( TB, malaria, filariasis, Leishmaniasis).  4) Developing and supplying diagnostics, vaccines and drugs for newly emerging  high incidence diseases  such as Dengue ,Chikungunea, Japanese Encephalitis, Avain Flu, Ebola etc capable of reaching epidemic proportions 5) Developing and  and implementing  logistic approaches for making drugs readily available to currently underserved rural and backward communities 6) Developing  and managing campaigns to create better awareness of preventive measures to maintain  health and wellness 7) developing and implementing a  strategic plan to address issues related to the growing demand for drugs for non-communicable diseases  such as  cardiovascular and central nervous systems diseases, diabetes, cancer , chronic musculoskeletal diseases etc,  and 8) Carrying  out research  for development of diagnostics, vaccines and drugs for diseases endemic to India and other developing countries, which are neglected areas for research based global pharma companies.

If all these efforts could be initiated through public private partnerships between the Government and the pharmaceutical industry,  it can lead to an efficient model of healthcare for the benefit of the population. After all, the industry apart from its contribution to the national economy and providing reward to its shareholders also need to fulfill its obligations to the society it operates in and caters to.  Meeting its corporate social responsibility is not only good ethics , but also good business.