Tag Archives: drugs

Healthcare reform process and policy measures to reduce socio-economic inequalities should be implemented in tandem for optimal economic progress of a nation.

Posted on by
Reply
Important research studies indicate that health of an individual is as much an integral function of the related socio-economic factors as it is influenced by the person’s life style and genomic configurations.It has now been well established that socio-economic disparities including the educational status lead to huge disparity in the space of healthcare.Healthcare preventive measures with focus just on disease related factors like, hygiene, sanitation, alcohol abuse, un-protected sex, smoking will not be able to achieve the desired outcome, unless the underlying socio-economic issues like, poverty, hunger, education, justice, values, parental care are not properly addressed.

It has been observed that reduction of social inequalities ultimately helps to effectively resolve many important healthcare issues. Otherwise, the minority population with adequate access to knowledge, social and monetary power will always have necessary resources available to address their concern towards healthcare, appropriately.

Regular flow of newer and path breaking medicines to cure and effectively treat many diseases, have not been able to eliminate either trivial or dreaded diseases, alike. Otherwise, despite having effective curative therapy for malaria, typhoid, cholera, diarrhoea/dysentery and venereal diseases, why will people still suffer from such illnesses? Similarly, despite having adequate preventive therapy, like vaccines for diphtheria, tuberculosis, polio, hepatitis and measles, our children still suffer from such diseases. All these continue to happen mainly because of socio-economic considerations.

Following are some research studies, which I am using just as examples to vindicate the point:

• HIV/AIDs initially struck people across the socio-economic divide. However, people from higher socio-economic strata responded more positively to the disease awareness campaign and at the same time more effective and expensive drugs started becoming available to treat the disease, which everybody suffering from the ailment cannot afford. As a result, HIV/AIDS are now more prevalent within the lower socio-economic strata of the society.

• Not so long ago, people across the socio-economic status used to consume tobacco in many form. However, when tobacco smoking and chewing were medically established as causative factors for lung and oral cancers, those coming predominantly from higher/middle echelon of the society started giving up smoking and chewing of tobacco, as they accepted the medical rationale with their power of knowledge. Unfortunately the same has not happened with the people of relatively lower socio-economic status. As a consequence of which, ‘Bidi’ smoking, ‘Gutka’/tobacco chewing have not come down significantly within people belonging to such class, leading to more number of them falling victim of lung and oral cancer.

Thus, in future, to meet the unmet needs when more and more sophisticated and high cost disease treatment options will be available, it will be those people with higher socio-economic background who will be benefitted more with their education, knowledge, social and monetary power. This widening socio-economic inequality will consequently increase the disparity in the healthcare scenario of the country.

Phelan and Link in their research study on this issue has, therefore, remarked:

“Breakthroughs in medical science can do a lot to improve public health, but history has shown that, more often than not, information about and access to important new interventions are enjoyed primarily by people at the upper end of the socioeconomic ladder. As a result, the wealthy and powerful get healthier, and the gap widens between them and people who are poor and less powerful.”

Conclusion:

Though healthcare reform measures are essential for the progress of any nation, without time bound simultaneous efforts to reduce the socio-economic inequalities, it will not be easy for any nation to achieve the desirable outcome.

By Tapan 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.

China has recently unfolded the blueprints of its new healthcare reform measures, when will India do so?

Posted on by
Reply
Early April, 2009, China, a country with 1.3 billion people, unfolded a plan for a new healthcare reform process for the next decade to provide safe, effective, convenient and affordable healthcare services to all its citizens. A budgetary allocation of U.S $124 billion has been made for the next three years towards this purpose.
China’s last healthcare reform was in 1997:

China in 1997 took its first reform measure to correct the earlier practice, when the medical services used to be considered just like any other commercial product, as it were. Very steep healthcare expenses made the medical services unaffordable and difficult to access to a vast majority of the Chinese population.

Out of pocket expenditure towards healthcare services also increased in China…but…:

The data from the Ministry of Health of China indicate that out of pocketl spending on healthcare services had doubled from 21.2 percent in 1980 to 45.2 percent in 2007. At the same time the government funding towards healthcare services came down from 36.2 percent in 1980 to 20.3 percent in the same period.

A series of healthcare reforms was effectively implemented since then like, new cooperative medical scheme for the farmers and medical insurance for urban employees, to address this situation.

The core principle of the new phase of healthcare reform in China:

The core principle of the new phase of reform is to provide basic health care as a “public service” to all its citizens. This is the pivotal core principle of the new wave healthcare reform process in China where more government funding and supervision will now play a critical role.

The new healthcare reform process in China will, therefore, ensure basic systems of public health, medical services, medical insurance and medicine supply to the entire population of China. Priority will be given for the development of grass-root level hospitals in smaller cities and rural China and the general population will be encouraged to use these facilities for better access to affordable healthcare services. However, public, non-profit hospitals will continue to be one of the important providers of medical services in the country.

Medical Insurance and access to affordable medicines:

Chinese government plans to set up diversified medical insurance systems. The coverage of the basic medical insurance is expected to exceed 90 percent of the population by 2011. At the same time the new healthcare reform measures will ensure better health care delivery systems of affordable essential medicines at all public hospitals.

Careful monitoring of the healthcare system by the Chinese Government:

Chinese government will monitor the effective management and supervision of the healthcare operations of not only the medical institutions, but also the planning of health services development, and the basic medical insurance system, with greater care.

It has been reported that though the public hospitals will receive more government funding and be allowed to charge higher fees for quality treatment, however, they will not be allowed to make profits through expensive medicines and treatment, which is a common practice in China at present.

Drug price regulation and supervision:

The new healthcare reform measures will include regulation of prices of medicines and medical services, together with strengthening of supervision of health insurance providers, pharmaceutical companies and retailers.

As the saying goes, ‘proof of the pudding is in its eating’, the success of the new healthcare reform measures in China will depend on how effectively these are implemented across the country.

Healthcare scenario in India:

Per capita public expenditure towards healthcare in India is much lower than China and well below other emerging countries like, Brazil, Russia, China, Korea, Turkey and Mexico.

Although spending on healthcare by the government gradually increased in the 80’s, overall spending as a percentage of GDP has remained quite the same or marginally decreased over last several years. However, during this period private sector healthcare spend was about 1.5 times of that of the government.

It appears, the government of India is gradually changing its role from the ‘healthcare provider’ to the ‘healthcare enabler’.

High ‘out of pocket’ expenditure towards healthcare in India:

According to a study conducted by the World Bank, per capita healthcare spending in India is around Rs. 32,000 per year and as follows:

- 75 per cent by private household (out of pocket) expenditure
- 15.2 per cent by the state governments
- 5.2 per cent by the central government
- 3.3 percent medical insurance
- 1.3 percent local government and foreign donation

Out of this expenditure, besides small proportion of non-service costs, 58.7 percent is spent towards primary healthcare and 38.8% on secondary and tertiary inpatient care.

Role of the government:

Unlike, recent focus on the specific key areas of healthcare in China, in India the national health policy falls short of specific and well defined measures.

Health being a state subject in India, poor coordination between the centre and the state governments and failure to align healthcare services with broader socio-economic developmental measures, throw a great challenge in bringing adequate reform measures in this critical area of the country.

Healthcare reform measures in India are governed by the five-year plans of the country. Although the National Health Policy, 1983 promised healthcare services to all by the year 2000, it fell far short of its promise.

Underutilization of funds:

It is indeed unfortunate that at the end of most of the financial years, almost as a routine, the government authorities surrender their unutilized or underutilized budgetary allocation towards healthcare. This stems mainly from inequitable budgetary allocation to the states and lack of good governance at the public sector healthcare delivery systems.

Health insurance in India:

As I indicated above, due to unusually high (75 per cent) ‘out of pocket expenses’ towards healthcare services in India, a large majority of its population do not have access to such quality, high cost private healthcare services, when public healthcare machineries fail to deliver.

In this situation an appropriate healthcare financing model, if carefully worked out under ‘public – private partnership initiatives’, is expected to address these pressing healthcare access and affordability issues effectively, especially when it comes to the private high cost and high quality healthcare providers.

Although the opportunity is very significant, due to absence of any robust model of health insurance, just above 3 percent of the Indian population is covered by the organised health insurance in India. Effective penetration of innovative health insurance scheme, looking at the needs of all strata of Indian society will be able to address the critical healthcare financing issue of the country. However, such schemes should be able to address both domestic and hospitalization costs of ailments, broadly in line with the health insurance model working in the USA.

The Government of India at the same time will require bringing in some financial reform measures for the health insurance sector to enable the health insurance companies to increase penetration of affordable health insurance schemes across the length and the breadth of the country.

Conclusion:

It is an irony that on one side of the spectrum we see a healthcare revolution affecting over 33 percent population of the world. However, just on the other side of it where around 2.4 billion people (about 37 percent of the world population) reside in two most populous countries of the world – India and china, get incredibly lesser public healthcare support and are per forced to go for, more frequently, ‘pay from pocket’ pocket type expensive private healthcare options, which many cannot afford or just have no access to.

In both the countries, expensive ‘pay from pocket’ healthcare service facilities are increasing at a greater pace, whereas public healthcare services are not only inadequately funded, but are not properly managed either. Implementation level of various excellent though much hyped government sponsored healthcare schemes is indeed very poor.

Moreover, despite various similarities, there is a sharp difference between India and China at least in one area of the healthcare delivery system. The Chinese Government at least guarantees a basic level of publicly funded and managed healthcare services to all its citizens. Unfortunately, the situation is not the same in India, because of various reasons.

Over a period of time, along with significant growth in the respective economies of both the countries, with China being slightly ahead of India for many reasons, life expectancy in both India and China has also increased significantly, which consequently has lead to increase in the elderly population of these countries. The disease pattern also has undergone a shift in both the countries, mainly because of this reason, from infectious to non-infectious chronic illnesses like, hypertension, diabetes, arthritis etc. further increasing the overall burden of disease.

High economic growth in both the countries has also lead to inequitable distribution of wealth, making many poor even poorer and the rich richer, further complicating the basic healthcare issues involving a vast majority of poor population of India.

A recently published report indicates that increasing healthcare expenditure burden is hitting the poor population of both the countries very hard. The report further says that considering ‘below the poverty line’ (BPL) at U.S$ 1.08 per day, out of pocket healthcare expenditure has increased the poverty rate from 31.1 percent to 34.8 percent in India and from 13.7 percent to 16.7 percent in China.

To effectively address this serious situation, the Chinese Government has announced its blueprint for a new healthcare reform measures for the coming decade. How will the Government of India respond to this situation? It will indeed be interesting to watch.

By Tapan 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.

Tackling the menace of counterfeit medicines – vested interests or petty sentiments should not make the pressing public healthcare issue irrelevant.

Posted on by
Reply
There are following three clearly emerging views on the global issue of counterfeit drugs:1. The innovator companies feel that the generic pharmaceutical industry and the drug regulators are
not really very keen to effectively address and resolve this global public health issue.2. The generic companies and the drug regulators feel that the problem is not as acute as it is
projected to be and the innovator global pharmaceutical companies through their intense advocacy
campaign are trying to exploit the situation to fight against generic medicines and parallel imports.

3. Some other group, including a section of NGOs claim that an important public health sentiment is
being used by the R&D based global pharmaceutical companies to extend intellectual property rights
(IPR) to patients’ safety issue, allegedly for vested interest. These organizations have taken their arguments
to various international platforms like Anti-Counterfeiting Trade Agreement (ACTA) and
International Medical Products Anti-Counterfeiting Taskforce (IMPACT) of the World
Health Organization (WHO), for effective resolution of their grievances.

Addressing some of these concerns:

• IPR being extended to the definition of counterfeit medicines:

Even in India, ‘misbranding’ though an integral part of IPR, is considered as a public health issue and is an offence under Section 17 of the Drugs and Cosmetics Acts, 1940. Albany Law Journal of Science and Technology, 2006 has estimated a loss to the industry towards such counterfeit medicines of US$ 30 billion, which is about 6% of the turnover of the global pharmaceutical industry.

• Magnitude of problem with counterfeit medicines has been inflated:

In the industrialized and developed nations of the world with effective regulatory control, the problem perhaps, may not be as acute. A study done by IMPACT in 2006 indicates that in countries like, the USA, EU, Japan, Australia, Canada and New Zealand the problem is less than 1%.

Similar study, on the other hand, indicated that in the developing nations like parts of Asia, Latin America and Africa more than 30% of the medicines are counterfeits. It has also been reported that in South East Asia, estimated prevalence of counterfeit artesunate for malaria is 33-53%.

• Apprehension from some section of the generic pharmaceutical industry:

Apprehensions from some section of the generic pharmaceutical industry that attempts are being made by the interested groups within the industry to bring generic drugs under the purview of counterfeit medicines, is indeed unfounded. As from no developed countries around the world, there has been any threat to non-patent infringing legal generic medicines. And why there should be any such threat at all, when the world is witnessing the global pharmaceutical companies scaling up their generic business operations?

On the contrary generic pharmaceutical business, in almost all developed markets across the world, is growing at a much faster pace than the patented products of the innovator companies and this trend is expected to continue at least in short to medium term.

An unexplained similarity:

From the above details one will be tempted to draw a conclusion that in all those countries where access to modern medicines is poor, incidences of counterfeit medicines are higher. IMPACT has reported counterfeit versions of all types of medicines ranging from anti-malarial, anti-hypertensives, anti-tubercular, anti-retroviral to cardiovascular and other life saving and life style drugs, from these countries.

Various types of counterfeit medicines:

WHO has indicated following types of counterfeit medicines:

• Without active ingredients: 32%

• Wrong ingredients: 21.4%

• Incorrect quantities of active ingredients: 20.2%

• Right quantities of active ingredients but in fake packaging: 15.6%

• High levels of impurities and contaminants: 8.5%

• “Substituted ingredients of anything from paracetamol to boric acid, talcum powder, rat poison or
road paint”

• Medicines purchased online from illegal internet sites: 50%

Factors influencing flourishing trade of counterfeit medicines:

WHO IMPACT has reported following key factors:

• Low manufacturing costs, thus higher profit margin

• Albany Law Journal reports that high pricing ratio of counterfeit medicines compared to a branded
product attracts counterfeiters

• In countries like India the risk of detection of fake medicines is quite low where the penalties for such
heinous crime even today is very lenient, as the amended anti-counterfeit law, for some strange
reasons, has not been made operational, as yet.

Global sales forecast for counterfeit medicines:

The sales of counterfeit medicines across the world as estimated by the ‘Centre for Medicine in Public Interest’ will be around US$75 billion by the end of 2010. This is an increase of over 90% as compared to 2005.

Incidence of detection of counterfeit medicines:

A report from the WHO’s Executive Board in its 124th session indicated that the detection of counterfeit medicines in 2007 had increased to more than 1,500. This reflects an increase of around 20% over 2006 and ten times more compared to year 2000.

Volume of counterfeit seizures, the world over:

WHO indicated that in 2005-06 the volume of counterfeit drug seizures included 2.7 million articles and the main countries where these articles originated from, were reported as follows:

• India: 31%
• UAE: 31%
• China: 20%

Conclusion:

We have, therefore, enough data to establish that counterfeit drugs are posing a growing menace to the humanity. All stakeholders should join hands to address this public health issue, leaving aside petty commercial interests, be it generic pharmaceutical companies or research based pharmaceutical companies, across the world and India is no exception. Otherwise, thugs and criminals who are running to their banks, more often than ever before, with sacks full of money from this illicit trade, at the cost of the innocent patients, will keep going almost scot free, forever.

By Tapan 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.

Ensuring ‘health outcomes’ based drugs prescriptions will be more beneficial for the patients in India than just ‘price control’ of drugs

Posted on by
Reply
Currently the global pharmaceutical market is undergoing a metamorphosis. The concept of ‘evidence-based medicine’ is gaining ground in the developed markets of the world, making the pharmaceutical companies generate requisite ‘health outcomes’ data using similar or equivalent products. Cost of incremental value that a product will deliver is of key significance. Some independent organizations like, the National Institute for Health and Clinical Excellence (NICE)in the UK have taken a leading role in this matter.Global pharmaceutical companies using more ‘health outcomes’ data to set pricing strategies:In early 2009, reported agreements between Sanofi-Aventis, Procter & Gamble and Health Alliance as well as Merck and Cigna vindicate this point. These agreements signify a major shift in the global pharmaceutical industry’s approach to gathering and using ‘health outcomes’ data

In the Sanofi-Aventis/Procter & Gamble-Health Alliance agreement, the concerned companies agreed to reimburse health insurance companies expenses incurred for patients suffering from non-spinal bone fracture while undergoing treatment with their drug Actonel.

In the Merck/Cigna agreement, Cigna will have the flexibility to price two diabetes drugs based on ‘health outcomes’ data.

‘Outcomes-based’ pricing strategies are expected to become the order of the day, in not too distant future, all over the world.

The ground realities in India:

Medicines constitute a significant cost component of modern healthcare systems, across the world. In India, overall healthcare system is fundamentally different from many other countries, even China. In most of those countries around 80% of expenses towards healthcare including medicines are reimbursed either by the Governments or through health insurance or similar mechanisms. However, in India situation is just the reverse, about 80% of overall healthcare costs including medicines are private or out of pocket expenses incurred by the individuals/families.

Since 1970, the Government of India (GoI) has been adopting various regulatory measures like cost based price control and price monitoring to make medicines affordable to the common man. For those products, which are patented in India, it has now been reported that GoI is mulling the approach of price negotiation with the respective companies.

However, we should keep in mind that making drugs just affordable in India, where about 65% of population does not have access to modern medicines, is indeed not a core determinant of either healthcare value or proven health outcomes or both.

Cost-effective ‘health outcomes’ based doctors’ prescriptions are more important:

Spending on medicines can be considered as an investment made by the patients to improve their health. To maximize benefits from such spending will require avoidance of products, which will not be effective and the use of lowest cost option with comparable ‘health outcomes’.

For this reason many countries have started engaging the regulatory authorities to come out with head to head clinical comparison of similar or equivalent drugs keeping ultimate ‘health outcomes’ of patients in mind. A day may come in India when the regulatory authorities will also concentrate on ‘outcomes-based’ pricing. However, in Indian context these appear to be very early days.

Till then…

1. Get Standard Treatment Guidelines (STG) prepared for the diseases more prevalent in India, based on, among other data, ‘health outcomes’ studies.

2. Put the STG in place for all government establishments and private hospitals to start with.

3. Gradually extend STG in private medical practices.

4. Make implementation of STG a regulatory requirement.

Thus we need to discuss first what these STGs are.

Standard Treatment Guidelines (STG):

STG is usually defined as a systematically developed statement designed to assist practitioners and patients in making decisions about appropriate cost-effective treatment for specific disease areas.

For each disease area, the treatment should include “the name, dosage form, strength, average dose (paediatric and adult), number of doses per day, and number of days of treatment.” STG also includes specific referral criteria from a lower to a higher level of the diagnostic and treatment requirements.

For a developing country like India formulation of STGs will ensure cost-effective healthcare benefits to a vast majority of population.

In India STGs have already been developed for some diseases by the experts in those areas. These are based on review of current published scientific evidence towards acceptable way forward in diagnosis, management and prevention of various disease conditions

STGs, therefore will provide:

- Standardized guidance to practitioners.
- Cost-effective ‘health outcomes’ based services.

GoI should encourage the medical professionals/institutions to lay more emphasis and refer to such ‘heath-outcomes’ based evidences while prescribing medicines. This will ensure more cost effective ‘health outcomes’ for their patients.

Conclusions:

Such an approach for drug usage will help both the doctors and the patients, significantly, to contain the cost of treatment in general and the cost of medicines in particular. Encouraging and implementing ‘health outcomes’ based medicines prescription in India will require, above all, a change in the mindset of all concerned. The use of an expensive drug with no significant improvement in ‘health outcomes’ should be avoided by the prescribers, initially through self regulation and if required through an appropriate regulation.

By Tapan 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.

Global API manufacturers are poised to penetrate the Indian market in a bigger way – will the API ‘marketing warfare’ be even more intense, in future?

Posted on by
Reply
India currently plays a relatively dominant role in the Global Active Pharmaceutical Ingredient (API) Market with China being ahead of India. While this is the current scenario, many experts in this field contemplates that important players from the regulated markets will soon start making significant inroads in India.Current API Market situation in India:In 2007 the API output value in India was around US $4.1 billion registering a 5 year CAGR of around 19% and ranking fourth in the world API output. According to the Tata Strategic Management Group, Indian API export value is expected to increase to US $12.75 billion in 2012.

Currently in India about 400 different types of APIs are manufactured in around 3000 plants, Ranbaxy Laboratories, Lupin, Shasun Chemicals, Orchid Chemicals, Aurobindo Pharma, Sun Pharmaceuticals Ipca Laboratories and USV being the top API manufacturers of the country. Indian domestic companies source almost 50 percent of their API requirements from China, because of lower cost in that country.

In terms of global ranking, India is now the third largest API producers of the world just after China and Italy and by 2011 is expected to be the second largest producer after China. However, in Drug Master File (DMF) filings India is currently ahead of China.

In addition, India scores over China in ‘documentation’ and ‘Environment, Health and Safety (EHS)’ compliance. All these have contributed to India having around 100 US FDA approved world class manufacturing facilities, which is considered the largest outside the USA.

Indian API manufacturers are facing a cut throat competition from their Chinese counterparts mainly because of lower costs in China. Considerably higher economies of scale and various types of support that the Chinese API manufacturers receive from their Government are the main reasons for such cost differential.

Growing competiton from the regulated markets:

We now observe a new trend within the API space in India. Many of the global innovators and generic companies are keen to enter into the API space of India.

It is known that API manufacturers from the regulated markets are already selling their products in India. However, at present, the numbers of Indian registrations for API applied by some of the large global companies, as reported by ‘Thomson Reuters Newport Horizon Premium’, are quite significant, which are as follows:

1. Novartis, Switzerland:20
2. Pfizer, USA:16
3. Sanofi-Aventis, France: 26
4. Teva, Israel: 45
5. Schering-Plough, USA:39
6. BASF: 37
7. DSM: 26
8. E.ON AG: 16
9. Kyowa Hakko: 23

All these companies who are entering into the API business space in India, I am sure, have worked out a grand design to compete not only with the the low cost domestic API manufacturers, but also with the cheaper imports, particularly from China.

What will then be the competitive edge of these companies in India?

It appears that each of these companies has weighed very carefully the existing strategic opportunities in the API sectors of India, both in terms up technology and also in terms of domestic demand.

Strategic gap in API manufacturing technology:

India, undeniably, is one of the key global hubs in the API space, with competitive edge mainly in ‘non-fermentation technology’ product areas. This leaves a wide and perceptible technological gap in the areas of products requiring ‘fermentation technology‘.

Significant demand from domestic formulations manufacturing :

India is much ahead of China in pharmaceutical formulations manufacturing, especially in the area of exports to the regulated markets like, the USA and EU. Over 25 domestic Indian companies are currently catering to exports demand of the U.S market. However, it is interesting to note that the global manufacturers like Sandoz, Eisai, Watson, Mylan have already set up their formulations manufacturing facilities in India and some more are expected to follow suit over a period of time. Hence, fast growing domestic demand for APIs, especially for exports, will drive the business plan of the global API players for India.

Is the cost advantage in India sustainable?

Indian API manufacturers although currently have a cost advantage compared to their counterparts in the regulated market, this advantage is not sustainable over a period of time because of various reasons. The key reason being sharp increase in cost related to more stringent environmental and regulatory compliance, besides spiralling manpower and other overhead costs.

Indian regulatory requirements for the global API players:

To sell their APIs into India, global companies are now required to obtain the following regulatory approvals from the Indian authorities:

1. Foreign manufacturing sites for the concerned products
2. APIs which will be imported in the country

The Drug Controller General of India (DCGI) has stipulated a fee of U.S$1,500 to register the manufacturing premises and U.S$1,000 to register each individual API. Since January 2003, around 1,200 registration certificates have been issued in India. Large number of Indian registrations is attributed by many to the strategic technology gap in India, as stated above, demand of high-quality API for finished formulations required by the regulated markets like the U.S and EU, and relatively cheaper product registration process.

As we see above Teva has gone for maximum number of Indian registrations, so far and most probably selling the APIs to their contract formulations manufacturers in India. Similarly, Schering-Plough and Sanofi-Aventis, if not Pfizer are perhaps catering to the API demand of their respective formulations manufacturing plants in the country.

Whatever may be the reasons, these global players are now exporting APIs at a much larger scale to India and in that process have started curving out a niche for themselves in the Indian API market. Impressive growth of the domestic pharmaceutical formulations manufacturing market fueled by increasing domestic consumption and exports to the regulated markets, coupled with gradual improvement in the regulatory environment of the country, is expected to drive the growth of API business of the global players.

However, the moot question is how significant will this competition be?

By Tapan 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.

With significant competitive edge should Global Biotech Companies consider entry into high potential ‘Biosimilar drugs’ business?

Posted on by
Reply
‘Biosimilar drugs’ – rapid future growth potential:
In most of the developed countries of the world, besides regulatory issues, ‘Biosimilar drugs’are considered a threat to the fast growing global biotech industry. However, many believe that innovative biotech companies can have a head start with all wherewithals at their disposal, compared to generic pharmaceutical companies, to convert this seemingly significant threat into a bright emerging opportunity and derive the best possible mileage out of such changing environment.

Sandoz (Novartis) – first to launch a ‘Biosimilar drug’ in the USA:

In mid 2006, US FDA approved its first ‘Biosimilar drug’; Omnitrope of Sandoz (Novartis) following a court directive in the U.S. Omnitrope is a copycat version of Pfizer’s human growth hormone, Genotropin. Interestingly, Sandoz (Novartis) had taken the U.S FDA to court as the regulatory approval of Omnitrope was kept pending by them, in absence of a defined regulatory pathway for ‘Biosimilar drugs’ in USA.

The CEO of Sandoz had then commented, “The FDA’s approval is a breakthrough in our goal of making high-quality and cost-effective follow-on biotechnology medicines like Omnitrope available for healthcare providers and patients worldwide.” Despite this event, no one at that time expected the U.S FDA to start commencing approval of other ‘Biosimilar drugs’ within the country.

‘Biosimilar drugs’ – emerging global interest:

Thereafter, many developments are fast taking place in the space of ‘Biosimilar drugs’, the world over. To fetch maximum benefits out of this emerging opportunity, India is also taking steps to tighten its regulatory reform process for ‘Biosimilar drugs’ to allay general fear and apprehensions regarding safety of such drugs, in absence of adequate clinical data for the specific protein substance.

Merck’s entry in ‘Biosimilar drugs’ business is through an acquisition:

In the west Merck announced its entry into the ‘Biosimilar drugs’ business on February 12, 2009, while announcing its acquisition of Insmed’s portfolio of ‘Biosimilar drugs’ for U.S$130 million in cash. Rich pipeline of follow-on biologics of Insmed is expected to help Merck to hasten its entry into global ‘Biosimilar drugs’ markets.

Current status of ‘Biosimilar drugs’ in the USA:

The new administration of President Barak Obama has expressed its strong intent to pave the way for regulatory guidelines for ‘Biosimilar drugs’ in the USA. To facilitate this process, the new draft legislation titled, “Promoting Innovation and Access to Life Saving Medicine Act” has already been introduced by the legislators of the country. This legislation, when will come into force would help define guidelines for approval of ‘Biosimilar drugs’ in the USA with just a five year exclusivity period to the innovative products, against a demand of 14 years by the global biotechnology industry.

Lucrative Global market potential for ‘Biosimilar drugs’:

It is estimated that only in the top two largest pharmaceutical markets of the world, USA and EU, sales of ‘Biosimilar drugs’ will record a turnover of U.S$ 16 billion in next two years and around U.S$ 60 billion by year 2010, when about 60 biotech products will go off-patent.

Opportunity for the Indian biotech companies:

Such a lucrative business opportunity in the west will obviously attract many Indian players, like, Biocon, Dr. Reddy’s Labs, Ranbaxy, Wockhardt etc, who have already acquired expertise in the development of ‘Biosimilar drugs’ in India like, erythropoietin, insulin, monoclonal antibodies, interferon-alfa. Domestic Indian biotech players are not only marketing these products in India but also exporting them to other non/less-regulated markets of the world.

Indian Companies are fast preparing to take a sizable share of the global pie of ‘Biosimilar drugs’ market:

Ranbaxy in collaboration with Zenotech Laboratories is engaged in global development of Granulocyte Colony-Stimulating Factor (GCSF) formulations. Wockhards is expected to enter into the Global ‘Biosimilar drugs’ market by 2010. Dr. Reddy’s Laboratories and Biocon are also preparing themselves for global development and marketing of insulin products, GCSF and streptokinase formulations.

Government of India funding for development of ‘Biosimilar drugs’ in India:

It has been reported that the Department of Biotechnology (DBT) of the Government of India has a proposal for funding of U.S$ 68 million through public private partnership (PPP) initiatives, where soft loans at the rate of interest of just 2% will be made available to the Indian biotech companies for development of ‘Biosimilar drugs’. Currently DBT spends around U.S$200 million annually towards biotechnology related initiatives.

Advantage India:

Experience in conforming to stringent U.S FDA manufacturing standards, having largest number of U.S FDA approved plant outside USA; India has acquired a great advantage in manufacturing similar high technology products in India. Significant improvement in conformance to Good Clinical Practices (GCP) standards in India offers additional advantages.

Two available choices for the innovator companies:

With increasing global cost-containment pressures within the healthcare space, emergence of a lucrative global ‘Biosimilar drugs’ market with appropriate defined regulatory pathway in place is inevitable now.

Major global research based companies will now have two clear choices in the fast evolving situation. The first choice is the conventional one of competing with the ‘Biosimilar drugs’ in all important markets of the world. However, the second choice of jumping into the fray of ‘Biosimilar drugs’ business keeping focus on R&D undiluted, appears to be more prudent to me and perhaps will also make a better business sense. Only future will tell us, which of these two business senses will prevail, in the long run for the global biotech companies.

By Tapan 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.

Growing menace of counterfeit drugs in India: why is the domestic pharmaceutical industry still so apprehensive with the new Amendments of the ACT?

Posted on by
Reply
The growing menace of Counterfeit drugs has remained a serious threat to the healthcare space of India.
Do we have any credible data to assess the magnitude of this menace in India?

No we do not have, as yet. At this stage, the magnitude of the problem is anybody’s guess. Earlier a study sponsored by the World Health Organization (WHO) and conducted by SEARPharm reported that only 0.3% drugs were spurious and 3% of drugs were counterfeits.

Government of India has initiated the largest study in the world to quantify the problem:

To scientifically assess the magnitude of the problem in terms of real size of counterfeit drugs market in India , the Drugs Controller General of India (DCGI) India’s, for the first time ever, has initiated one of the largest studies in the world, as reported by the Times of India May 14, 2008.

The study has already identified 61 popular drug brands from nine therapeutic categories for testing 24000 samples. These include drugs prescribed for tuberculosis, malaria, allergic disorders, diabetes cardiovascular conditions, vitamins etc. This study is expected to cost 50 million rupees or about U.S$1.0 million and is expected to be published, soon.

Making provisions for stricter penalties through amendment of the Drugs and Cosmetics Act, 1940:

To bring into effect stricter penalties for those involved in counterfeit drugs, the process of amendment of the Drugs and Cosmetics Act, 1940 was proposed by the Ministry of Health in October, 2007. These amendments are expected to make the drug-related offences, cognisable and non-bailable.

The latest amendment to the Drugs and Cosmetics Act, 1940 became a law in 2008. The punishment for selling or distributing spurious drugs, which are likely to cause death and grievous hurt to the patients, is now imprisonment for a term not less than 10 years and fine not less than Rs 10 lakh or three times the value of drugs confiscated, whichever is more.

The Minister of Health of India announced in November 2008, that with this amendment the Government of India will “go all out to do away with spurious drugs.”

India working closely with WHO Anti-counterfeiting Taskforce:

India being a part of ‘International Medical Products Anti-Counterfeiting Taskforce’ (IMPACT), established under WHO in 2006, decided to work together to combat the growing menace of counterfeit medicines.

The Drugs Controller General of India (DCGI) was reported to have several discussions with the convenor of the IMPACT to effectively address the issue of such serious threats to the patients at large. Many people believe that China and India are the main source of counterfeit drugs in the world.

Apprehensions of the Indian Pharmaceutical Industry with new Amendments in the Law:

Indian Pharmaceutical Industry although welcomed the stricter punitive provisions in the law, expressed its apprehensions due to lack of clear demarcation between the definitions of spurious drugs and those which can lose their original potency because of improper transportation and storage.

If the law-enforcing authorities pick up such medicines from retail outlets, those can easily get categorised as spurious medicines under Section 17A and 17B of the Drugs and Cosmetics Act, 1940. Consequently the concerned manufacturers could be put behind bars with, presumably, no fault at their end.

While stringent punishment is essential for those involved in such heinous crime, the Government should take enough measures to ensure that genuine drug manufacturers are not harassed by the law enforcing authorities, as the courts will have no judicial discretion to award less than minimum punishment, as prescribed under this Act.

Need for clear guidelines for implementation of the amended ACT:

To allay the major apprehension of the industry regarding possible misuse of some provisions of the Act, the Ministry of Health is expected to work out and quickly announce clear guidelines for implementation of the act by the law enforcement agencies in different parts of India.

Will this amendment help to win the fight against counterfeit drugs?

Only time will be able to give that answer. However, by amending the Act, the Government of India has demonstrated its resolve to address the threat of counterfeit drugs with iron hand. Through enunciation of above guidelines, all concerned are expected to be taken on board to effectively curb, if not totally eliminate this growing menace, for the sake of humanity.

By Tapan 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.

Fixed Dose Combination’ drugs market in India is growing faster – are there enough regulatory checks and balances to prevent market entry of ‘irrational combinations’ to ensure patients’ safety?

Posted on by
Reply
The WHO Model of FDCs:The 2005 ʹProcedure to update and disseminate the WHO Model List of Essential Medicines, Criteria for Selection‘ includes the following statement regarding fixed dose combination products (FDCs):ʺMost essential medicines should be formulated as single compounds. Fixed‐dose combination products are selected only when the combination has a proven advantage over single compounds administered separately in therapeutic effect, safety, and adherence or in delaying the development of drug resistance in malaria, tuberculosis and HIV/ AIDS.ʺ

FDCs need to demonstrate clinical efficacy and safety beyond that for the individual drugs given alone. They would also need to ‘demonstrate bioequivalence of the single combined dose unit with the components administered in the same doses separately but concomitantly’.

‘Adherence’ aspect of WHO Model for FDCs is also important. Problems with ‘adherence’ could lead to inadequate and inconsistent dosing, which in turn could lead to development of drug resistance. FDCs, therefore, are expected to improve compliance reducing the risk of development of drug resistance.

However, one of the major disadvantages with the FDCs is lack of flexibility in adjusting dose of individual ingredients, even if it is required for some patients. Internationally, most popular example is the FDCs of antiretroviral drugs for HIV infected patients like, Combivir, Trzivir, Kaletra etc. Besides, there are FDCs for various other disease areas, like, infections, respiratory and cardiovascular disorders etc.

New FDCs are patent protected in the USA:

In the western world, like the USA, new FDCs may also get patent protection. A company may obtain marketing exclusivity for a new FDC even when individual active ingredients go off patent. However, in India FDCs cannot be patented as per Patent Acts of India 2005.

Market attractiveness for FDCs in India:

In India the market for FDCs is very large and growing much faster, in sharp contrast to the western world. Because of growing market demand, pharmaceutical companies in India tend to market FDCs of all different permutations and combination, at times even crossing the line of a ‘sound medical rationale’. For this reason, we find in the website of ‘Central Drugs Standard Control Organization’ (CDSCO), the banned list of so many FDCs.

Lack of regulatory compliance has created a messy situation with FDCs in India:

Introduction of new FDCs does not only warrant a ‘sound medical rationale’ but also ‘strict conformance to all prescribed regulatory requirements’ for the sake of patents’ safety.

To check unfettered market introduction of potentially harmful FDCs, the Ministry of Health issued a Notification in September 1988, including FDCs in Rule 122 E of the Drugs & Cosmetics Rules (D&CR) 1945. In effect, it removed the powers of the State FDAs to give manufacturing or marketing approval of FDCs. After the notification was issued, all manufacturers/marketers of all FDCs are required to apply only to the Drug Controller General of India (DCGI) under Rule 122E of the D&CR 1945 as a new drug, along with the stipulated fees by way of a Treasury Challan.

Since this entire process entails relatively more regulatory data generation, besides the time and expenses involved, the above Rule was continuously and deliberately broken and manufacturing and marketing approvals were routinely sought and obtained from the State FDAs. Many believe that the State FDAs were equally responsible for knowingly flaunting the Law, as were the pharmaceutical companies.

Patients’ safety – the key concern:

This complicity resulted in the market being flooded with ‘irrational combinations’ which posed a real threat to patients’ safety. The state FDAs were reminded of the Notification by the earlier DCGI. 294 FDCs got caught in this dispute. The important issue of patients’ safety in that process got converted into a legal issue, as many FDC manufacturers chose to go to the court of law to redress their grievances in this matter.

Untangling the messy knot:

As the issue got trapped into various prolonged litigations, the current DCGI took initiative of resolving this contentious issue with the help of an expert committee, involving the manufacturers.

This subcommittee cleared 48 FDCs under ‘similar FDCs already approved’, after discussing the merits and demerits, including pharmacodynamics, pharmacokinetics, side effects, dosage, medical rationale etc. of each ingredient and the combinations. The decision of the Sub Committee was then submitted to the Drug Technical Advisory Board (DTAB).

After formal approval of DTAB, a notification is expected to be issued subsequent to which each of these combinations will be construed to be a new drug and any company wishing to market/manufacture the formulation will require submitting its Application in Form 44 to the DCGI to get approval in Form 45. The process will be completed after the balance 142 FDCs, which need further examination, are individually approved.

This issue sends a clear signal to all concerned that resorting to any form of shortcuts to bypass strict adherence to prescribed regulatory requirements, could seriously jeopardise the patients’ safety. The number of FDCs banned by CDSCO and also ban of those FDCs agreed and accepted by the industry without any challenge during the above process, will vindicate this point.

Solving the current logjam is not enough:

Solving the current logjam on FDCs by the DCGI is a onetime exercise and will perhaps clear a serious mess-up created over a long period of time. It can definitely not be an ongoing process. Neither will it be desirable. There is an absolute and urgent need to follow the WHO Model for FDCs, in India, as indicated above, through appropriate regulatory processes. At the same time, the DCGI should ensure strict compliance of the Notification issued by Ministry of Health on FDCs, in September 1988. Otherwise, unchecked entry of FDCs of all possible permutations and combinations could pose a serious threat to patients’ interest and safety.

Meeting unmet needs of the patients with high quality drugs of scientifically proven high efficacy and safety profile should always define the purpose of existence of the pharmaceutical industry. Any patients’ safety related issue deserves no scope for any compromise.

By Tapan 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.