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Focus On Core Competencies – Regardless of Generic Or Innovative Drug Business

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On February 11, 2021, by two different Press Releases, two global pharma majors – GSK and Novartis simultaneously made interesting announcements. Both were related to three generic cephalosporin antibiotics.

GSK revealed, ‘it has reached an agreement with Sandoz – a division of Novartis, to sell its Cephalosporin antibiotics business. Sandoz will pay GSK USD 350 million at closing, plus additional milestone payments up to USD 150 million, subject to the terms of the transaction.’

While articulating the purpose of hiving of its generic cephalosporin brands, the company reasoned: GSK is now dividing itself into two companies – one with core competencies focused on OTC products, and the other – prescription drugs and vaccines. The company emphasized: ‘The transaction aligns with GSK’s strategy to prioritize and simplify its portfolio and invest in the company’s innovative R&D pipeline and new product launches.’ Other brands in GSK’s antibiotics portfolio, are not impacted by this divestment. In other words, this would possibly mean that the generic drug business doesn’t fall within the core competencies of GSK, any longer.

Whereas, Novartis disclosed, the company’s Sandoz division, ‘has signed an agreement to acquire GSK’s cephalosporin antibiotics business, reinforcing its leading global position in antibiotics.’ Its noteworthy that Sandoz’s core competencies lie in the generic drug business.

While explaining the purpose of this acquisition, Novartis explained, cephalosporins being the largest antibiotic segment by global sales, acquiring these 3 leading brands - Zinnat, Zinacef and Fortum,“will further position Sandoz as a global leader in antibiotics – truly essential medicines that are the backbone of modern healthcare systems.”

The above transactions bring to the fore the criticality of focusing on core competencies for business excellence, regardless of innovative drug business and in multiple situations, such as:

  • Bringing organizational focus back on core competencies when these tend to get diluted.
  • Increasing the focus on core competencies as opportunities arise.

In this article, I shall revisit this critical management concept in the current perspective.

A brief recap:

The concept of core competencies of a business organization was introduced by two global pioneers in business management – C.K. Prahalad and Gary Hamel with the article – ‘The Core Competence of the Corporation.’ This was published in the May-June 1990 edition of the Harvard Business Review.

The relevance of focusing on ‘core competencies’:

The quality and quantum of commercial dividend in consistently focusing on ‘core competencies’ in any space, spanning across individual professionals to business organizations, have been profound. This calls for defining these in detail and collectively, at the top rungs of organizational leadership. Then, cultivate, and leverage the core competencies to differentiate an organization from its competition, creating a company’s long-term competitive and sustainable advantage in the marketplace – for business excellence.

What constitutes core competencies to gain strategic strength?

Core competencies – whether for individuals or for businesses, comprise primarily of resources, such as, special skills, capabilities and rewarding experience in those activities as strategic advantages of a business. Garnering financial resources would usually follow, thereafter. Thus, core competencies are always considered as a strategic strength, everywhere. That said, core competencies require continuous monitoring to always be in-sync with changing market dynamics. Otherwise, the strategies are likely to fail.

Broad examples – from pharma perspective:

Broadly speaking, discovering, developing and successfully marketing new drugs, identifying repurposed drugs for new clinical trials, and churning out novel vaccines quickly, may be considered as core competencies for innovative drug makers. They have demonstrated this skill even during Covid-19 pandemic. Similarly, immaculate skills in reverse engineering of existing drug molecules and high efficiency in process research to gain price-competitiveness, may be construed as core competencies of generic drug companies.

Examples of shifting focus on core competencies:

Although, it is desirable that pharma players stick on core competencies for sustainable long-term performance excellence, regardless of being in primarily innovative or generic drug business, we have witnessed this focus shifting on several occasions for both. However, expected success did not generally follow those companies with such tweaking in the strategic business models.

Nevertheless, some drug companies did get tempted to deviate from their core competencies. For example, innovative drug players tried to expand into low-risk generic medicines, which, in the long run, did not deliver expected results for many companies. However, this deviation wasn’t without any compelling reasons.

There were some valid reasons, though:

As is much known, traditionally, global R&D companies prefer to focus only on the business of innovative prescription medicines. Low margin generic business wasn’t their cup of tea. Subsequently, this trend shifted. Especially in those cases, where the pipeline of high potential new drug molecules did not meet the concerned company’s expectations. To stick to the knitting, some companies with deep pockets, explored another model of Mergers and Acquisitions (M&A) of innovative patented products and companies with rich new drug pipelines. Interestingly, in this M&A business model, low risk, low cost and high-volume turnover of generic business also started attracting several R&D based companies, alongside.

Which is why, an increasing number of R&D based companies started planning to expand their business in less risky generic drug business. This appeared to be a quick fix to tide over the crisis, as the generic drug business model won’t require going through lengthy R&D processes. Besides, compliance with ever increasing stringent regulatory approval protocols, particularly in the developed markets of the world.

Examples of why focus on core competencies matter, even in new normal: 

There are several examples of large companies to illustrate this point – both from the old and the new normal. Just to give a flavor of the relevance of focusing on core competencies of organizations, I shall draw upon three interesting examples. Each of these, highlight different organizational visions and perspectives at different times, particularly the relevance of focus on core-competencies for a corporation. These are as follows:

  • The first one is Daiichi Sankyo of Japan’s acquisition of India’s generic drug major of that time – Ranbaxy, in June 2008. The parent company claims: “We provide innovative products and services in more than 20 countries around the world. With more than 100 years of scientific expertise, our company draws upon a rich legacy of innovation and a robust pipeline of promising new medicines to help patients.” It is much known today, what happened to this acquisition, thereafter, for various reasons, including faulty pre-acquisition due diligence. However, later on, the domestic pharma leader – Sun Pharma, acquired Ranbaxy. Nonetheless, at least from Daiichi Sankyo’s narrative, its areas of core competencies, appear closer to any R&D-based drug company.
  • The second example is US-based Abbott Laboratories acquisition of domestic formulations business of Primal Heath care in India in May 2010. Like Daiichi Sankyo, this acquisition was also a part of Abbott’s strategy to enter into ‘generic drug business’ -dominated emerging markets. Abbott, at that time, apparently decided to expand its strategic focus beyond its core competencies in business, primarily of patented products. However, by the end of 2012, the company separated into two leading healthcare companies. Abbott became a diversified medical products company. The other one – a totally separate company was formed, with the name – AbbVie, as a new researched-based global biopharmaceutical organization. AbbVie now operates in India, as well – with erstwhile Abbott’s innovative brands. In this case, by an innovative restructuring of the parent organization, Abbott brought back its sharp focus on core competencies of both the companies with both doing well in India.
  • The third example is a recent move of reverting to the original focus of core competencies, when moving beyond these did not yield results. In that sense, this example is different from the second one. On November 16, 2020, Pfizer also announced the creation of ‘the new Pfizer’, as it reverted to its original core competencies of “developing breakthrough treatments and delivering innovative, life-changing medicines to patients around the world.” On that day, Pfizer completed transaction to spin off its Upjohn generic drug business and combined it with Mylan to create a new entity – Viatris Inc. Earlier, the company had sold its veterinary business, a baby formula unit and its consumer products division as part of a deal with GSK – for similar reasons. Earlier, the company’s moving beyond its core competencies to pluck low hanging fruits of generic drug business, did not yield dividend, as Pfizer’s profit in the generic drug sector, reportedly, had gone South.

Conclusion:

According to Pharma Intelligence, several large players, such as, Novartis, Sanofi, AstraZeneca are now focusing on core competencies, as they start recovering from their unsettling patent cliff and other headwinds. Meanwhile, one may expect to witness more of Spin-offs, Carving-out, Splitting-off or further strengthening of core-competencies of organizations – for a sustainable long-term business excellence in the years ahead.

Spin-off and acquisition of Cephalosporin generic business by GSK and Sandoz Division of Novartis, respectively, is a part of the same ball game. Thus, maintaining or reverting focus on core competencies – regardless of generic or innovative drug business, I reckon, are the new imperatives of commercial success, even in the new normal.

By: Tapan J. Ray      

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

 

Antimicrobial Resistance: A Recent Perspective

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On January 23, 2018, at the World Economic Forum in Davos, Switzerland – the first independent analysis of pharmaceutical industry efforts to tackle antibiotic drug resistance, was published by the Netherlands based Access to Medicine Foundation.

The issue of Antimicrobial Resistance (AMR) was brought under focus by the World Economic Forum (WEF) not for the first time at Davos in 2018. Its 2013 Annual Report on global risks, also underscored the gargantuan health hazard that AMR poses to mankind. It said, we live in a bacterial world where we will never be able to stay ahead of the mutation curve. A test of our resilience is how far the curve, we allow ourselves to fall behind. It’s indeed a profound statement!

In that sense, the AMF analysis is important. More so, when the global population is virtually at the threshold of facing a situation very similar to pre-antibiotic era, where even a common infection used to pose threat to a life. And now, a fast-developing AMR to many effective antibiotics or even super-antibiotics, are making them almost redundant in many serious conditions. Consequently, around 700,000 people die every year only due to antimicrobial resistance, the world over.

The World Health Organization (WHO) also reiterated its grave concern in this area by a news release on September 20, 2017. It cautioned, “Antimicrobial resistance is a global health emergency that will seriously jeopardize progress in modern medicine.” Against that backdrop, in this article, I shall dwell on some latest developments in this area, both globally and also in India.

Dire need for newer antibiotics – but dry R&D pipeline:

At the very outset, let me flag another critical area that is intimately related to this concern. An article titled, “Where Are the Antibiotics?”, published by the AARP Foundation adds more to this growing concern. It writes, in an era when many breakthrough innovative drugs are curing some of our most deadly afflictions, the quest for meeting the unmet medical needs, seems to have shifted away from development of critically needed breakthrough antibiotics to effectively address AMR, for various reasons.

The author further highlighted that between the time penicillin was discovered in 1928, and the 1970s – 270 antibiotics were approved – a robust arsenal of powerful drugs that kept almost all bacterial infections at bay. However, since then, research into new antibiotics has declined dramatically. Today, just five of the top 50 big drug companies are reportedly developing innovative antibiotics – the article reiterates.  Nevertheless, some recent developments in this area can’t be ignored, either, which I shall touch upon in this discussion.

Global initiatives for a multi-pronged concerted action:

It is understandable that there are no magic bullets to address the fast-growing menace of AMR. It calls for a multi-pronged strategy with well-orchestrated concerted efforts for its effective implementation with military precision. Following are the three primary constituents who should lead from the front in the battle against AMR, as I reckon:

  • The world leaders
  • Each country, individually
  • Pharmaceutical industry, both global and local

The medical profession, including hospitals, nursing homes, the retail chemists and individual patients, also play a significant role to alleviate this problem, especially in India and other developing countries. But, I shall keep that as a subject for a separate discussion, altogether. Let me now touch-upon the first three constituents, one by one, as follows:

1. The world leaders’ initiative:

Realizing that failure to act on AMR will result in a global health and financial crisis, the world leaders met to address this growing menace. Accordingly, on September 21, 2016, the United Nations General Assembly (UNGA) passed a declaration aimed at slowing the spread of antibiotic-resistant superbugs. At this meeting in New York City, the top UN leaders successfully urged all governments to sign a political declaration to tackle the problem of AMR, both globally and in their respective countries. The joint declaration requires each country to develop a 2-year plan to protect the potency of antibiotics for both livestock and humans. The progress of the initiative for each country at the end of those 2 years will be evaluated. However, in this article, I shall focus only on the agreed human-specific actions, which include the following:

  • Antibiotics should be prescribed only when they are absolutely necessary
  • A massive education campaign about antibiotic resistance.
  • Greater monitoring of superbugs to understand the scope and magnitude of the problem.
  • Safeguarding current antibiotic stockpile.

The leaders suggested that people should be encouraged to help prevent the crisis from turning into a death sentence for millions, with the steps, such as:

  • Get available vaccines to prevent illness
  • Stop asking doctors for antibiotics when they have the cold or flu, as antibiotics treat neither
  • To urge their political leaders to commit to action in combating antibiotic resistance.

2. Country-specific initiatives:

In September 2016, just a year after the UNGA high-level meeting on AMR, an update by the United Nations Foundation reported that 151 countries out of 195 WHO member states have responded. The overall response includes the following, among others:

  • 85 percent of countries are developing or have developed National Action Plans (NAC).
  • 52 percent of countries have a fully developed plan with ‘One Health’ approach that seeks to unify human and veterinary medicine, agriculture, and food providers against the progression of AMR by reducing agricultural antimicrobial use.
  • 52 percent of Low and Middle-Income Countries (LMICs) have national-level measures in place on ‘Infection Prevention and Control (IPC)’ measures in human healthcare.

3. Pharmaceutical industry initiatives: 

I shall cite only the latest commendable developments in this area, as I see it. On Jan. 21, 2016 a document titled the ‘Declaration on Combating Antimicrobial Resistance’, was launched, again, as part of the World Economic Forum at Davos, Switzerland.

For the first time, 85 pharmaceutical, biotechnology, generic-drug, and diagnostic companies agreed on a common set of principles for global action to support antibiotic conservation and the development of new drugs, diagnostics, and vaccines. The document, outlining several critical measures the government and industry must take to increase antibiotic effectiveness worldwide, was also drafted and signed by nine industry associations spanning 18 countries.

Global progress assessment of AMR initiatives in 2018:

This brings me back to where I started from, while analyzing what happened in this regard a year after the above declaration was signed. On January 23, 2018, at the World Economic Forum in Davos, Switzerland – the first independent analysis of pharmaceutical industry efforts to tackle drug resistance, was revealed by the AMF. It found companies are developing new drugs, as well as dismantling the incentives that encourage sales staff to oversell antibiotics, setting limits on the concentration of antibiotics in factory wastewater released into the environment, and tracking the spread of superbugs.

In the AMR Benchmark, GSK and Johnson & Johnson lead among the largest research-based pharmaceutical companies. A separate ranking of manufacturers of generic antibiotics features Mylan, Cipla, and Fresenius Kabi Global, in the leading positions. While Mylan leads the generic medicine manufacturers, Entasis, reportedly, leads the biotechnology group. 

Twenty-eight antibiotics are in late stages of development:

The other key findings of the 2018 study include mention of 28 antibiotics that are in later stages of development, targeting pathogens deemed critical AMR priorities by the WHO, and/or US Centers for Disease Control and Prevention. However, only two of these 28 candidates are supported by plans to ensure they can be both made accessible and used wisely if they reach the market. Be that as it may, the benchmark finds room for all companies to improve in this space, the report indicated.

Some major initiatives in India:

The good news is, ‘The National Policy for Containment of Antibacterial Resistance’, with similar objectives, was put in place in India by the Directorate General of Health Services, Ministry of Health & Family Welfare, way back in 2011. Further, on March 20, 2015, to strengthen the surveillance of antimicrobial resistance (AMR) in the country, Indian Council of Medical Research (ICMR) had set up a National Antimicrobial Resistance Research and Surveillance Network (AMRRSN) to enable compilation of national data of AMR at different levels of health care.

Again, in February 2017, the Indian Council of Medical Research (ICMR)  has put a new ‘Treatment Guidelines for Antimicrobial Use in Common Syndromes’, to achieve the same objectives. Despite this, as many medical experts opine, a large number of General Practitioners (GP), including hospitals, nursing homes continued over-prescribing antibiotics. Alarmingly, considered as the last line of defense antibiotics by many doctors – Colistin and Carbapenem resistant infections have also been reported from several Indian hospitals. All this adds further fuel to the AMR fire.

Another matter of huge worry in India:

The February 04, 2018 article titled, ‘Threats to global antimicrobial resistance control Centrally approved and unapproved antibiotic formulations sold in India,’ published in the British Journal of Clinical Pharmacology, highlight serious hurdles for controlling antimicrobial resistance in India, which has had parliamentary investigations into the failures of the country’s drug regulatory system. The study was conducted by researchers from Queen Mary University in London, Newcastle University and Lakshya Society for Public Health Education and Research in Pune. Some of the key findings of the study are as follows:

  • Extensive use unapproved of fixed dose combination (FDC) antibiotics is contributing to the rising rate of AMR in India, which is already one of the highest in the world.
  • Out of the 118 of FDC antibiotics being sold in India, only 43 (36 percent) were approved by the CDSCO. These 118 antibiotic formulations are being sold in 3307 brand names and manufactured by 476 entities. Of these, 464 were Indian manufactures, and 12 were MNCs.

The authors recommend work on understanding why unapproved formulations are being prescribed by medical professionals.

Conclusion:

As the above AARP Foundation article highlights, like all living beings, bacteria constantly evolve to survive. While encountering a new antibiotic, they quickly find ways to evade it, and continue to live or exist. Some have even developed cell wall like virtually impregnable shields, as it were, keeping antibiotics out. Others pump antibiotics out when they get in. Several deadly bacteria have even devised ways to deactivate antibiotics.

The comments made in the article titled, ‘The Future of Antibiotics and Resistance,’ published by The New England Journal of Medicine (NEJM) on January 24, 2013, is also worth noting. It says, the converging crises of increasing resistance and collapse of antibiotic research and development are the predictable results of policies and processes we have used to deal with infections for 75 years. If we want a long-term solution, the answer is not incremental tweaking of these policies and processes. Novel approaches, based on a reconceptualization of the nature of resistance, disease, and prevention, are needed.

The bottom line still remains, AMR is a humongous threat to the global population, not just in India. While its awareness is gradually increasing, much more painstaking work remains to be done by all, both individually and collectively, to contain this global health menace. It’s our responsibility to protect the well-being of our future generations.

By: Tapan J. Ray  

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.

Is The Core Purpose of Pharma Business Much Beyond Profit Making?

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Dr. Margaret Chan, the Director General of the World Health Organization (WHO), at a briefing to discuss the Ebola outbreak in West Africa at the UN Foundation in Washington on September 3, 2014 said:

“Big Pharma’s greed for profits, not lack of funding, delaying Ebola treatment development.”

Highlighting that the disease has already taken lives of 4,951 people in West Africa, Dr. Chan castigated the pharmaceutical industry for failing to develop an effective treatment for the deadly virus Ebola since 1976. “Though the Ebola crisis has become the most severe acute public health emergency seen in modern times, a profit-driven industry does not invest in products for markets that cannot pay”, Dr. Chan added.

That said, the Big Pharma has now initiated some efforts in this area, as the disease currently poses a significant threat to non-African countries, including America.

The sentiment reverberates:

Echoing similar sentiment, an article published in the BBC News on November 7, 2014 reiterated:

“Big pharma companies are in the business to make money, so will generally develop those drugs that offer the greatest potential for profit. This means a number of important drugs are neglected – the current Ebola crisis being a case in point.”

The profit oriented approach isn’t restricted just to the diseases of Africa:

The above article also points out that, besides diseases of the developing world, the Big Pharma has been slow to develop newer and multi-drug resistant antibiotics, as well.

This is mainly because, it is lot more difficult for the pharma companies to make huge quantum of profit from discovery of newer antibiotics for acute infections having limited use for around 7 to 10 days, as compared to the medicines for chronic illnesses that people will have to necessarily take every day, for life.

It appears today that the ongoing public opinion and pressure are possibly not adequate enough to trigger even a slightest change in the fetish for profit-making incentives of the Big Pharma companies.

Despite high profitability, the fetish for even more profit continues:

The pharma industry that basically exists to help saving lives of patients of all types, status and color in various ways, now seems to focus mostly on generation of more and more profit than ever before.

- The following table would vindicate the point of profitability of the industry:

Highest and Lowest Profit Margins of 5 key Industrial Sectors, 2013                        (Profit Margin in %)

No.

Sectors

Highest

Lowest

1.

Pharmaceuticals

42

10

2.

Banks

29

5

3.

Carmakers

10

3

4.

Oil & Gas

24

2

5.

Media

18

6

NB: Highest and lowest margins achieved by individual company                             (Source: Forbes, BBC News)

To generate mind boggling profits, many of the Big Pharma constituents have reportedly resorted to various types of gross misconduct and malpractices too, the Chinese saga being the tip of the iceberg.

- The following are some recent examples to help fathom the enormity of the problem:

  • In September 2014, GlaxoSmithKline was reportedly fined US $490m by China for bribery.
  • In March 2014, the antitrust regulator of Italy reportedly fined two Swiss drug majors, Novartis and Roche 182.5 million euros (U$ 251 million) for allegedly blocking distribution of Roche’s Avastin cancer drug in favor of a more expensive drug Lucentis that the two companies market jointly for an eye disorder.
  • Just before this, in the same month of March 2014, it was reported that a German court had fined 28 million euro (US$ 39 million) to the French pharma major Sanofi and convicted two of its former employees on bribery charges.
  • In November 2013, Teva Pharmaceutical reportedly said that an internal investigation turned up suspect practices in countries ranging from Latin America to Russia.
  • In May 2013, Sanofi was reportedly fined US$ 52.8 Million by the French competition regulator for trying to limit sales of generic versions of the company’s Plavix.
  • In August 2012, Pfizer Inc. was reportedly fined US$ 60.2 million by the US Securities and Exchange Commission to settle a federal investigation on alleged bribing of overseas doctors and other health officials to prescribe medicines.
  • In April 2012, a judge in Arkansas, US, reportedly fined Johnson & Johnson and a subsidiary more than US$1.2 billion after a jury found that the companies had minimized or concealed the dangers associated with an antipsychotic drug.

Many more of such instances are regularly being reported by the international media, unabated.

More profit through high drug pricing – The key argument in favor:

The Big Pharma argues that high drug pricing is absolutely necessary to generate a kind of profit, that is essential to fund heavy investments for drug innovation to meet the unmet needs of patients. Moreover, only 3 out of 10 drugs launched are profitable, on an average.

This argument really goes over the top. It does not hold much water either, as the Big Pharma reportedly spends more on the process of drug marketing than on innovation (R&D) of new drugs.

The following table would paint a different picture altogether, marketing expenditure being far more than the R&D costs: 

R&D and Marketing Spend of World’s largest Pharmaceutical Companies

Company Total Revenue (US$ Bn.) R&D Spend  (US$ Bn.) Marketing Spend (US$ Bn.) Profit (US$ Bn.) Profit Margin (%)
J & J (US) 71.3 8.2 17.5 13.8 19
Novartis (Swiss) 58.8 9.9 14.6 9.2 16
Pfizer (US) 51.6 6.6 11.4 22.0 43
Roche (Swiss) 50.3 9.3 9.0 12.0 24
Sanofi (France) 44.4 6.3 9.1 8.5 11
Merck (US) 44.0 7.5 9.5 4.4 10
GSK (UK) 41.4 5.3 9.9 8.5 21
AstraZeneca(UK) 25.7 4.3 7.3 2.6 10
Eli Lilly (US) 23.1 5.5 5.7 4.7 20
AbbVie (US) 18.8 2.9 4.3 4.1 22

(Source: GlobalData, BBC News)

Thus, it is difficult to fathom why are numbers of drugs, such as, Sovaldi and others costing as much as US $ 84,000 and above for a treatment course, when the cost of manufacturing is no more than an insignificant fraction of that treatment cost?

Considering all these and looking at the published profit and loss accounts of various pharma companies, it appears that, the line between ‘making reasonable profit’ and ‘profiteering’ is getting increasingly blurred in the pharma world.

Why is the marketing cost so high?

Since about the last decade and half, despite reasonably high expenditure on R&D there does not seem to have been many reports on breakthrough innovations. According to an expert of the World Health Organization (WHO), “of the 20 or 30 new drugs brought to the market each year, typically 3 are genuinely new, with the rest offering only marginal benefits.”

In a situation like this, when the challenge mostly is of generating targeted revenues with the new products of ‘me-too values’ rather than with those having intrinsic ‘unmet values’, marketing costs to generate doctors’ prescription would obviously escalate disproportionately. Even the process followed to generate these prescriptions, often cross the red line of regulatory, ethics and compliance standards, as have been cited above.

The following questions come up consequently:

- Are these exorbitant avoidable marketing expenditures adding any tangible or intangible values to the ultimate consumers – the patients?

- If not, why burden the patients with these unnecessary costs?

India is no different against similar parameters:

Back home in India, the deep anguish of the stakeholders over similar issues is now being increasingly reverberated with every passing day, as it were. It has also drawn the attention of the patients’ groups, NGOs, media, Government and even the Parliament.

The quality of the pharmaceutical sales and marketing process in India has touched a new low and continues to go south, causing suffering to a large number of patients. Well documented unethical drug promotion is increasingly becoming an emerging threat to the society.

Even today, the Ministry of Health and the Department of Pharmaceuticals of the Government of India provide few checks and balances on unethical drug promotion in India and prefer to keep the eyes meant for vigilance, closely shut.

Despite deplorable inaction of the government on the subject and frequent reporting by Indian media, the national debate on this issue is yet to attain a critical mass. A related Public Interest Litigation (PIL) is now pending before the Supreme Court for hearing, hopefully in the near future. Its judicial verdict is expected to usher in a breath of fresh air around a rather stifling environment for healthcare in India.

I deliberated on a similar issue in one of my earlier blog posts of September 1, 2014, titled, “Pharma And Healthcare: Mounting Trust deficit In Post Halcyon Days”

Conclusion:

While it is well-acknowledged that pharma industry has contributed immensely for the development of a large number of life saving new drugs to save precious lives all over the globe, none can also deny that for such efforts the companies concerned have not been hugely profited either…and, as we have been witnessing, not necessarily through legitimate means, always.

That said, in the backdrop of all the above examples, the core issue that emerges today as raised by many, including the World Health Organization (WHO), is the growing inherent conflict between predominantly the profit driven business goals of the pharma players and the public health interest of a nation.

Considering a number of recent serious public outbursts of the global thought leaders and also from the international media on the ‘profit dominating goals’ of the pharma industry, in general, the following questions need to be addressed with all seriousness:

- Is there a need to define afresh the core purpose of pharmaceutical business for all?

- Does the core purpose go much beyond profit making?

- If so, how would the industry plan to engage the stakeholders for its credible public demonstration?

Meanwhile, taking a serious note of it and learning from the past examples, India should initiate experts’ debate on the subject soon, to effectively resolve the conflict of two different mindsets, not resting on the same page in many ways.

By: Tapan J. Ray

Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.