Strategies for tough times

Squeezed between stringent regulations on the home front and sluggish global economic conditions, the Indian pharmaceutical market would seem to be a harrowing place to be. But a few savvy players are playing out that old tried and tested adage: when the going gets tough, the tough get going. And such players have managed to carve a niche for themselves, even converting adversity to opportunity. Express Pharma’s Anniversary issue focuses on what should be the ‘Strategies of Success’ for players.

For instance, while Ajaz S Hussain, a former deputy director at the US FDA’s Office of Pharmaceutical Science exhorts companies to adopt strategies for making high pharma quality affordable; Ranjit Shahani, Vice Chairman and Managing Director, Novartis India believes that ethical behaviour will drive success. On the business strategy front, many Indian pharma companies have morphed with the market. For instance, Pawan Chaudhary, Chairman and Managing Director, Venus Remedies points out how his company focused on unmet segments as revenues from the antibiotic segment started fading.

On the intellectual property (IP) front, India as a country continues to invite censure. A recent release from the US Chamber of Commerce’s Global Intellectual Property Center urges India to ‘encourage innovation in the country and strengthen its IP laws to utilise its vast knowledge pool and create more jobs’.

India’s Government cannot be faulted for doing its best to protect the interests of its people. In fact there are signs that even bodies like the World Trade Organization (WTO) will side with the ‘Davids’ on this issue. The island nation of Antigua has suffered major losses in the past decade when the US blocked Antigua-based online gambling sites in the US. Even though the WTO ruled in favour of Antigua in 2004, the US refused to change its stance. In retaliation, the island nation approached the WTO asking for a suspension of US IP rights to make up its losses from online gambling. In spite of objection from the US, in 2007, the WTO granted the island nation preliminary rights to ignore US IP claims. Antigua has now got permission for permanent suspension of US IP rights, thereby legalising its stance. The island nation is reportedly taking steps to set up a platform to allow it to monetise or otherwise take advantage of this latest decision of the WTO.

This ruling of the WTO dispute panel could have implications for many Indian pharma companies who have been dubbed pirates of pharma IP. Even though there is global criticism of India’s IP laws, industry observers point out that these complaints have never been taken to the WTO. Perhaps such India baiters feared that the WTO would side with India, like they did with Antigua.

But there is no doubt that the pharma sector in India is being over-regulated. Policy makers are deciding to err on the side of safety. For instance, the FDI policy is causing a lot of heartburn to global companies like Mylan. In his article, Rajiv Malik, President, Mylan chronicles his company’s successful innings in India but clearly states that unfavourable developments in FDI policy could “force us to reconsider our investment plans for India, delay greenfield developments indefinitely, or postpone expansion plans for capital and/or technology.”

Similarly on the clinical research and trials front, major regulatory changes in the last year seem to have given the jitters to global players. Quintiles recently closed down a Phase 1 facility in Hyderabad, which was a joint venture with the Apollo Group, citing the challenging regulatory environment. It is not just MNCs who are feeling frustrated with the current scenario. FICCI’s Business Confidence Survey for July and August showed that India’s business confidence was at its lowest during the last 17 quarters.

Midst the gloom and doom scenario, Express Pharma decided to look beyond the near term and focus on the big picture. Our forthcoming issues continue in the same vein: the issue dated Nov 16-30, also our CPhI/P Mec/BioPh India special issue, we focus on some of the proven ‘Paths to Success’.

Do write to me for more details.

Viveka Roychowdhury
Editor

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