Coping and thriving through COVID-19

Learning, flexibility, adaptability, collaboration and innovation are essential
to success

The pharma industry, along with the healthcare sector in India has been significantly impacted by the outbreak of the coronavirus pandemic. Though the pandemic posed numerous challenges for the industry, it also helped the pharma sector to revaluate its role and come out as a reliable provider of affordable, high-quality medicines. Rising to the occasion, the sector made immense efforts to make sure there is easy availability of medicines and vaccines during the pandemic. We have also witnessed the industry come together, with collaborations being built between companies from the outbreak of the pandemic, and the pharma industry has been lauded for the efforts that it has taken to mobilise quickly to try to contain and treat the coronavirus. During the same period, the government took steps in the right direction by introducing the Production linked incentive (PLI) scheme, a phase-wise policy to achieve self-reliance in API production. With so many new developments taking place and challenges to meet up to, the pharma industry has been fortunate enough to learn some critical lessons which will be crucial to spurring growth in volatile and complex business environments.

The key lessons learned from the COVID-19 pandemic are:

Resilience in the supply chain: The pharma industry needs to be self-reliant in the API landscape to make sure there is a continuous supply of medicine that holds immense significance for healthcare security. Some pharma companies have already begun the process of complexifying their supply chains by recruiting two or three alternate suppliers, while others are beginning to integrate their supply chain much more closely with their suppliers and customers.
Collaboration remains crucial: There has been a rapid increase in collaborations and alliances all over the world. In an attempt to find treatment drugs and vaccines, governments across different countries have collaborated with global public health and research institutions along with large businesses to speed up the discovery of solutions. Apart from that, there has been an increase in the speed of granting approvals and cutting of inefficiencies in order to facilitate the processes. It is expected that the world will build on this spirit of using each other’s strengths and working towards a greater good.
Innovation will lead the way: The pharma industry responded quickly by evaluating the possible utilisation of available drugs and exploring more innovative approaches. Given the lack of visibility into the future, many pharma companies were unable to plan for the long term. This led to companies adopting more agile strategies as well as being prepared for different scenarios. Decision making had to be decentralised. Short-term innovations and solutions were encouraged.
Skills can expire: Learning, flexibility, adaptability, collaboration and innovation are essential to success. Learning and widespread adoption of digital happened in the form of WFH, digital conferences, virtual AGMs, teleconsultation and so on. Telemedicine, online teaching, e-commerce, etc. have emerged in a big way. It is unlikely that these trends will be reversed. In the midst of the COVID-19 pandemic and a changing world, it is imperative that India revaluates its present role in the global pharma industry, explore new possibilities to strengthen and consolidate its position in light of economic and geopolitical shifts, and attain self-sufficiency as a globally competitive pharma industry with innovation as a guiding principle for future growth.

To achieve a strong R&D ecosystem, it is imperative to enhance both private and public expenditure on R&D

The outbreak of COVID-19 has caused an unprecedented level of devastation worldwide. At the time when India was slowly recovering from the impact of the massive hindrance caused to the economic growth and loss of livelihood, Prime Minister Narendra Modi envisaged the vision of new India, “Aatmanirbhar Bharat.” This campaign was extended to the pharma sector by introducing a Production Linked Incentive Scheme, having a total financial outlay of Rs 15,000 crores.

The objective of the scheme is to boost India’s manufacturing capabilities by incentivising manufacturers to enhance their investment and production in specific high-value goods such as biopharmaceuticals, complex generic drugs, patented drugs or drugs nearing patent expiry, cell-based or gene therapy drugs, etc. Aatmanirbharta is sought to be achieved by reducing dependence on import of basic raw
materials such as bulk drugs and critical Active Pharmaceutical Ingredients (APIs), and enhance the promotion of domestic manufacturing of critical Key Starting Materials (KSMs)/Drug Intermediates (DIs) and APIs.

The foundation of a continuously evolving and self-reliant pharma sector is a strong research and innovation ecosystem. In order to achieve a strong R&D ecosystem, it is imperative to enhance both private and public expenditure on R&D. The tax incentives on R&D must continue and contribution to scientific research institutions, universities, etc. can be further revised depending on the type of activity.

The central government should also provide export incentives, revise the rates of duty levied and make the approval process for setting up manufacturing units less time-consuming. As regards the Intellectual Property (IP) regime in India, the central government should play a proactive role in ensuring the smooth functioning of patent offices, faster resolution of IP-related matters and proper enforcement of IP rights. Further, to reduce the expenses of the start-ups, the government should introduce a centralised system to provide support services such as testing and validation services, legal support for IP, patenting, etc.

During the pandemic, telehealth emerged as an essential concept and had changed the dynamics of clinical practice. The teleconsultation ecosystem should be strengthened as it is not only an effective way to provide assistance to domestic patients, but also to patients, globally. The doctors and physicians who are not technology-savvy should be trained to face the new challenges posed by COVID-19.

It is noteworthy that during the pandemic, India’s pharma sector contributed actively by manufacturing and exporting critical life-saving medicines globally. India’s pharma sector has the potential to attain self-reliance and the central government has taken some steps to achieve this goal and some more need to be taken, as mentioned above. However, the holistic success of this campaign requires collective effort of the government, industry leaders and stakeholders, research institutions, medical institutions/hospitals, etc.

The pharma sector has been a key contributor in improving the country’s healthcare and economic development. To emerge as a global hub of innovative medicines and be truly aatmanirbhar, it is required to continue building on its strength and focus on innovation.

To effectively drive innovation in pharma, a mindset of collaboration is required

What will it take for the Indian pharmaceuticals sector to become aatmanirbhar? The only way is to put the country’s pharmaceutical industry on the path of innovation.

There is no denying the fact that in the times of the greatest need during the pandemic, India exported critical life-saving medicines and equipment to other nations, but is that enough? We are certainly far from the point where we are innovating new drugs and vaccines.

India has been doing incredibly well in the realm of manufacturing generic drugs. However, the same isn’t true for developing a new molecule. We might be a big player in generic or copy-cat drug manufacturing, but self-reliance would only come from building a strong infrastructure for innovative drugs and a culture of Research and Development (R&D).

In doing so, the pharma industry needs ample support from the government. An ecosystem of innovation needs to be built, and the initial push for creating such hubs has to come from the government. The pharma industry can build further upon it to take innovation in the field to an altogether new level where it can compete with global players.

Time for collaboration
To effectively drive innovation in pharma, a mindset of collaboration is required so that industry experts, research scholars and start-ups can team up to discuss and brainstorm new ideas and strategies required to give a fillip to innovative technologies for drug discovery
and R&D in the space. Envisioning a self-reliant future for pharma industry would become far easier with coming together of brilliant minds, bringing multiplicity of ideas on the table that can be ideated and explored upon for execution and implementation.

Incentivising investment
Pharma Linked Incentive (PLI) scheme announced by the government will be a driver of growth in the sector. It has been a welcome move by the government, and, in the next step, giving subsidies or tax benefits to pharma companies who are willing to invest in R&D would be crucial for innovation. In the same vein, easing the regulatory process would go a long way.

The role of emerging technologies
Innovation is not just about drug discovery or R&D. It is also about bringing the costs down so that it all becomes possible. One of the ways to reduce costs is by investing in emerging technologies. An area of cost-cutting for pharma could be marketing where spends are high. Utilising digital technologies can ensure bringing the marketing costs down. At a time when the pandemic has created an environment where the use of digital has got accentuated, pharma industry can move towards a hybrid model to engage with physicians. Digital solutions and platforms that allow pharma brands to showcase their brands and products to physicians could be a great way to cut costs that pharma companies incur on marketing and can then park that fund for innovation.

Indian biologics and biosimilars market has huge potential to revolutionise the pharma industry

One of the most prominent effects that are seen due to the COVID-19 pandemic is the increased importance of preventative healthcare all around the globe, particularly in India. The pandemic has also been one of the influencing factors changing the dynamics in the pharma market, with various avenues such as vaccines, monoclonal antibodies and biologics gradually evolving and showing colossal promise of growth.

Biologics and biosimilars –Scope in Indian pharma
Biosimilars is a new and rapidly evolving field in the pharma industry. This is a new concept and various healthcare providers are still grasping its applications. However, having said that, the market players in India showcase willingness and a positive attitude towards biosimilars. For instance, until September 2019, the domestic market of India had received approvals for 98 products of biosimilar origin. Furthermore, 40 biosimilar products are still at the development stage. This shows that we are at a very advanced stage in this field as compared to the rest of the world. Along with this, other biologics such as novel vaccines, which are affordable and competitive, are proving to be crucial for the growth of the market.

Opportunities to look forward in biologics and biosimilars
◆ Robust vaccine industry: India is one of the highest global suppliers of vaccines providing around 60 per cent of the world’s vaccine requirements. Large manufacturing capabilities and R&D-centric approach are some of the key factors for the country’s bright future in the vaccine space.
◆ Soaring biotechnology: Biotechnology-based innovations and products are being encouraged in India. The ‘Make in India’ campaign of the government, along with various initiatives by the Biotechnology Industry Research Assistance Council (BIRAC) and DBT, are providing a conducive environment for biotech-based investments and growth.
◆ Positive market growth: In 2019, the biologics market generated a revenue of $576 million with a CAGR of 11 per cent. This shows that the market is profitable and some of the major pharma-based companies play a vital role in it. For instance, Biocon became one of the first companies indigenously launching biosimilar and biologic products. The company has entered the US markets as well by collaborating with Mylan. Zydus Cadila, Dr Reddy’s and Lupin are some other pharma companies that are venturing successfully in this domain.

Shaping the future of Indian pharma with biologics and biosimilars
The biologics market is facing fierce competition from the generic industry, where the reduced costs of the generic products are resulting in its increased preference. Furthermore, owing to the volatile nature of biosimilars, physicians hesitate to prescribe such products unless complete clinical data is available. Delays in clinical approvals, uncertainties faced in the regulatory domains and complex manufacturing procedures are some challenges that are hurdles for the biologics and biosimilars market.

Despite all the challenges, the Indian biologics and biosimilars market has huge potential to revolutionise the pharma industry. Promising quality, strengthening regulations, harmonising domestic guidelines with highly-regulated international markets and seeking global collaboration are some of the key aspects that need to be worked upon.