The past month has seen the Pharma sector in India undergo tumultuous times following compulsory licensing of Bayer’s anti-cancer drug sorafenib to NATCO and patent refusal to Novartis case pending in the Supreme Court. These cases hold a telling whether price limits would be imposed on over 60% of the drugs in India. Considering that over 50% of India’s 1.2 billion strong population doesn’t have medical insurance, is this good sign? Or would this send wrong signals to the Pharma companies looking at India as a high potential market causing them t
o divest?
Indian generics industry has oft fought price wars against expensive imported drugs often manufacturing them at a tenth of the price or less. A few years back Cipla had priced its anti-retroviral drug at $350 per patient/per year when other players in the market had HIV drugs at $15000. Cipla’s expertise in reverse innovation is once more at the fore with the slashing of cancer drug prices by a whooping 75%. This is even cheaper than NATCO’s sorafenib by Rs. 2000.
But whether cost-effectiveness translates to garnering a big chunk in the growing oncology field depends on the how effectively these drugs move to the mass market. The government has failed to improve the healthcare infrastructure in the rural areas where the majority of our population resides. Doctors often influence the choice of treatment and a lot would depend on the type of relationship an individual Pharma companies have with doctors. There is a also a compounded problem of global Pharma companies like Eli Lilly, Novartis and Glaxosmithkline selling drugs without complete data on safety. Contrary to reports, both companies have denied this.
Perhaps the best bet is to have custom made drugs for Indian population. This would provide early access to medicines when clinical trials show them to be safe and effective. Being the cheapest country to run clinical trials at $2607 for a breakthrough medicine according to KPMG’s competitive report providing a guide to location costs around the world, we might be perfectly poised to do just that.
Related Links:
Price limits set by Government — http://articles.economictimes.indiatimes.com/2012 – 05-17/news/31749224_1_new-drug-pricing-policy-price-control-essential-medicines
For the inadequate drug testing controversy involving Eli Lilly, GlaxoSmithKline and Novartis, see –
KPMG’s Guide to International Business Location Costs — Competitive Alternative Reports can be downloaded here — http://www.competitivealternatives.com/download/default.aspx