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Dr Chintamoni Ghosh
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The pharmaceutical industry is in the front rank of India’s science-based industries with wide ranging capabilities in the complex field of drug manufacturing and technology. The Indian pharma industry can be said to have begun with the setting up of ‘Bengal Chemical and Pharmaceutical Works’ in Calcutta. Subsequently institutes like Kings Institute of Preventive Medicine in Chennai, Pasteur Institute in Coonoor, the Central Drug Research Institute in Kasauli and others were set up. Post-independence, many other public sector companies such as Hindustan Antibiotics and Indian Drugs and Pharmaceuticals were set up to reduce the imports of important antibiotics and also to meet the county’s demand from indigenous production.
Today India has proved to the world that it can produce world standard quality generic medicines. It ranks very high in the third world, in terms of technology, quality and range of medicines manufactured. From simple headache pills to sophisticated antibiotics and complex cardiac compounds, almost every type of medicine is now made indigenously.
The Indian pharma sector is highly fragmented with severe price competition and government price control. It has expanded drastically in the last two decades. There are about 300 large units that control about 70 per cent of the market with market leader holding nearly seven per cent of the market share and about 8000 small scale units together which form the core of the pharma industry in India. These units produce the complete range of pharma formulations, i.e., medicines ready for consumption by patients and more than 400 bulk drugs, used for production of pharma formulations. Consequently, larger companies are cutting back on outsourcing and shifted to companies with facilities in the five tax-free states: Himachal Pradesh, Jammu & Kashmir, Uttaranchal, Sikkim and Jharkhand. SMEs have been finding it difficult to find the funds to upgrade their manufacturing plants, resulting in the closure of many facilities.
In the year 2005, India introduced product patent recognition to all new chemical entities (NCEs) i.e., bulk drugs developed then onwards. This introduction of product patent regime from January 2005 is leading into long-term growth for the future which mandated patent protection on both products and processes for a period of 20 years. Under this new law, India will be forced to recognise not only new patents but also any patents filed after January 1, 1995. Under changed environment, the industry is being forced to adapt its business model to recent changes in the operating environment. Indian pharma industry is mounting up the value chain. From being a pure reverse engineering industry focused on the domestic market, the industry is moving towards basic research driven, export-oriented global presence, providing wide range of value-added quality products and services, innovation, product life cycle management and enlarging their market reach. The old and mature categories like anti-infectives, vitamins, analgesics are de-growing while, new lifestyle categories like cardiovascular, Central Nervous System (CNS), anti diabetic and anti-cancer drugs are expanding at double-digit growth rates.
Domestic market
The industry has enormous growth potential. Factors listed below determine the rising demand for pharmaceuticals.
- The large population of over of a billion
- Increasing income capacity
- Demand for quality healthcare
- Change in disease patterns
- Increased demand for new medicines to combat lifestyle related diseases
More than 85 per cent of the formulations produced in the country are sold in the domestic market. India is largely self-sufficient in case of formulations. Some life saving, new generation under-patent formulations continue to be imported, especially by MNCs, which then market them in India.
Export potential
The pharma sector is one of India’s most important sectors in terms of projected revenue growth from exports and for meeting the needs of Indian population. There are a larger number of markets to which Indian pharma companies can now export as a result of global trade liberalisation and capacity building by Indian companies over the last decade. India, considered as a knowledge intensive economy, is looked upon to make available drugs that are affordable to the developing countries. The recent contribution of Indian generics in fighting AIDS and its contribution to affordable healthcare in the US and elsewhere is widely acknowledged.
Pharma sector in Bengal
Agriculture is the backbone of the West Bengal state economy. Industrial and services sector also contribute in the development of the economy of West Bengal. Pharma industries especially formulation units require less land compared to other heavy industries; return on investment is fast and very good. The modern pharma industry requires less but highly qualified and skilled manpower, which is available in the state as it is evident from the fact that many of personnel from the West Bengal are holding high position in the pharma industries.
Advantages of pharma industry in West Bengal
- Potential market with a target large population in the eastern and north eastern states
- Successful implementation of Land reforms, the rural economy has developed resulting increase of purchasing power
- Prime medical facility in Kolkata, Durgapur and Siliguri for patient from neighbouring countries, especially Bangladesh, Nepal and Bhutan
- NIPER campus is established in the state
- A proposed pharma manufacturing zone and chemical hub
- Special Export Processing Zone (SEPZ) at Falta
- NPPA-CIFG in Kolkata for redresse the grievances of consumer
- Biotech Policy is declared
- Country’s main patent office in Kolkata.
The state government is adopting a number of policy measures in order to accelerate the growth of the pharma industry and to make it internationally competitive. The government’s effort is at best directed to facilitate the growth of industries through various measures. However, the industry requires leadership to galvanise all the efforts at micro level to macro level for intended result.
The Directorate of Drugs Control of the State has extended a helping hand to the pharma producers in meeting global standards in stages. Since all surviving industries in West Bengal are GMP compliant, requirements of advanced tools and technology, validated and aseptic processing will no more be a problem centres.. A strong motivation within the pharma industry is now required to regain its lost pride and position. The effect was negated in government taxation and pricing policies. The driving factors, however, remained as availability of skilled manpower and Phytochemicals, raw materials and access to different global regions through East.
(The author is Director of Drugs Control, Government of West Bengal)