Trump has promised to roll back and replace the Obamacare, the Affordable Care Act, which is as much a reflection of Republican policy as an effort to discredit the most ambitious project of President Obama’s two terms. Trump’s seven point healthcare agenda, Trumpcare if you like, has the same intent as Obamacare, i.e. to reduce the price of healthcare, but differs in the method.
Indian generic companies are expected to directly benefit from Trumpcare’s seventh bullet point, which promises to break down import barriers to allow US drug providers and consumers access to less expensive, safe products from overseas. India already accounts for more than a third of medicines sold in the US. Stock prices of companies like Sun Pharma, Lupin, and DRL, which have a sizable presence in this market, are being tipped as good buys as their revenues from the US market could see an uptick thanks to Trumpcare.
All indications are that President Trump will want to start with a bang and silence his critics, much in the same way India’s Prime Minister Narendra Modi did in his first year. Modiji’s latest decree to demonetise Rs 500 and Rs 1000 notes, which make up more than 80 per cent of the currency in circulation, is his prescription to curb counterfeit currency and corruption/ black money. But his critics point out that while strong medicine can cure the disease, it must not end up killing the patient.
Pharma companies in India see regulatory reform in much the same way. Besides the migration to Indian Accounting Standards (Ind AS) this June and the GST regime next year, other sector specific decisions due in 2017 could be a mandatory code for marketing of pharma products, a decision on the legality of combination drugs, guidelines for online pharmacies as well as a ban (partial or complete) on PET as a packaging material for medicines.
Some of these regulations are already mandatory in global pharma markets and any resistance is counterproductive. For instance, resistance to India’s track and trace initiative has seen smaller companies lag global serialisation deadlines, which may keep them out of global markets.
Could 2017 see some moderation in regulatory pressure on some fronts, as Modiji prepares for a re-election in 2019? As part of the ease of doing business initiative, the Prime Minister’s Office seems to have stepped up the pressure on India’s medicine pricing watch dog, the National Pharmaceutical Pricing Authority, as well as pharma and health secretaries to address concerns of pharma companies. Health activists warn that dilution of pricing norms might be good for the industry but painful for patients.
Our last issue of the year, as always, will be a survival guide for 2017, with exclusive insights, predictions and prescriptions from industry veterans on such impending changes. Make sure you don’t miss it!
Viveka Roychowdhury
Editor