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Amit Rajan on why pharma MNCs are beating Indian counterparts

Patent protection, ban on fixed dose combinations among factors helping pharma MNCs

ET Now|
Dec 03, 2019, 02.03 PM IST
Amit Rajan, Prosfora Tech-1200
The success of MNCs in terms of their growth rate in the last 18 months. This has to be attributed to the regulatory regime change that has happened in India, says Amit Rajan, MD, Prosfora Technologies. Excerpts from an interview with ETNOW.

Do you think it is a given that Indians will consume more medicines and MNC companies which have a niche presence in diabetes or vaccine or for that matter thyroid, will continue to grow at inflation plus 5%?
Yes, look at the success of MNCs in terms of their growth rate in the last 18 months. This has to be attributed to the regulatory regime change that has happened in India and unlike our own India Inc, which has a problem with the government, MNCs pharma companies have to thank the Indian Government.

Let me give you three-four regulatory changes that have helped: A) There is solid patent protection. There is respect for patent now and the courts are not listening. After 2014, there is not a single compulsory licensing that has been entertained by the courts of India. B) The ban on 300 or 400 fixed dose combinations (FDCs) in India by DCGI. This has yielded space to multinationals to bring in innovative molecules. Unfortunately the research by R&D team of Indian pharma is busy with the ANDA business. There is no active research on innovative products for the India market. The multinationals have a full pipeline of R&D with new innovative molecules. C) The timeline for approval of the new molecule in India. Once you file from overseas, it now takes three to eight months, unlike 12 months to eternity that was seen two or three years earlier.

So, a combination of these three regulatory decisions by the Government of India has actually led to multinationals performing well. Secondly, Indian pharma does not offer serious competition to MNCs in terms of vaccines and animal healthcare. These two are very big market with the government coming out with compulsory annual healthcare programme in India.

There is a huge market for vaccines which no Indian pharma has been able to capture. So multinationals are doing good and will certainly do good with increasing population etc. Look at Abbot. It has gone into a rural push now. With greater participation of multinational companies in Ayushman, their volumes are increasing.

There are two things which will challenge the drug or the OTC market/prescription market in India one is drug price control, second is the copy cat nature of Indian pharma companies. How did MNC pharma companies manage to protect some of the key drugs outside the ambit of drug price control and how is it that Indian pharma companies have not been able to copy them?
The answer lies in the regulatory regime. Even if you have to launch a new drug which is generic in nature, you will have to give a lot of clinical trial data and redoing the whole clinical trial in India is a costly procedure. The multinationals being the innovators of the molecules, already have the clinical trial data.

Two DCGI rules that have changed in the last three months a) once you have a clinical trial data of any regulated market, you will get an automatic approval and b) if you apply for a new molecule in India and you do not hear from the government, in 30 days you get an automatic approval. Multinationals are already geared up for this kind of data presentation. Indian companies do not have clinical data on new molecule or new combinations.

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