Professional Documents
Culture Documents
Competition Issues in Pharmaceuticals
Competition Issues in Pharmaceuticals
Competition Issues in Pharmaceuticals
Nitya Nanda
CUTS, Jaipur &
Amirullah Khan
IDF, Gurgaon
The Industry
A View
Almost non-existent before 1970, a prominent producer of healthcare products, meeting 95% of the countrys needs now Indian production constitutes about 1.3% of the world market in value terms and 8% in volume terms Likely to grow from about US$5.5bn in 2000 to US$25bn in 2020 Global attention during TRIPs and Public Health debate great promise Doubts if the industry can provide affordable medicines even to the people in India
Total
10
12
Those producing both therapeutic ingredients and finished products Those producing finished products only No pharmaceutical industry Total
18
13
2 1 31
87 59 159
89 60 190
Low
Key drugs Glaxo, Crosslands, Wyeth, Fulford, Merind. etc. Betamethasone and Dexamethasone High Knoll, Roussel, Hind Ciba, Pfizer etc. Very low. Anti-cough: Pfizer, Parke Davis, Nicholas Piramal. Anti-cold: Burroughs, Alembic etc. Anti-asthmatics: Cipla (dominant) E-Merck, Pfizer, Glaxo, Abbott etc.
Vitamins
Off-patent
Very high
Pharmaceuticals Regulation
Consumption patterns are not affected by prices - a unique example of market failure In many countries, government bears most or all of the costs of medicines - As a monopsonist, the government may be able to control drug prices In developing countries, people are covered neither by public nor private insurance The doctors and the pharmacists companies influence them Bypassing doctors - fall prey to company advertisements or to local pharmacists, even in the US
Year
1979 1987 1995 2004
Number of drugs
347 142 74 38
80 60 40 20
In Lieu of Conclusion
Manufacturers demanding more decontrol arguing, competition will improve availability and affordability of essential drugs UPA government's NCMP has promised to "take all steps to ensure the availability of life-saving drugs at reasonable prices" Supreme Court order in the K.S. Gopinath case, March 10, 2003, directing the government to ensure that essential and life-saving drugs do not fall out of price control"
In Lieu of Conclusion
Regulatory regime - hard on the manufacturers but soft on the doctors and the pharmacists Indian Medical Council (Professional Conduct, Etiquette and Ethics) Regulations 2002 not effective Bangladesh example? Bulk drugs buyers are informed producers different approach? Import competition - Few specified life saving products at zero duty but for most others, the effective duty rate more than 56 percent For scheduled (regulated) drugs, the MAPE is 100 percent for domestic and 50 percent for imported drugs