Overview of pharmaceutical industry: France and India

Abstract

The ability of the Indian pharmaceutical industry to develop drug at a cheaper rate has contributed to the generic growth 21% CAGR over 2005-06 and 2010-2011 .The share of the Indian pharmaceutical industry in the ANDA in US has increased significantly. India has exploited the rising cost of drugs in the developed nation and has spawned into the generics drug manufacturing. As about $150 billion worth drugs patents are going to expire in 2015, there is ample opportunity for the Indian Generics manufacturer. Crisil Research expects the growth momentum in exports to continue over the next five years, with exports growing at 14-16 per cent CAGR . European Pharmaceutical industry has grown 2.6% in 2011 and the trend sems to slowing down . The reason behind the slow down are the blockbuster drugs falling off patent in 2012 . However the European market tends to reshape itself with more players capable to take on the Generic opportunities as for Sanofi’s Zentiva with the ability to compete with Indian on production costs. Sanofi has invested heavily in Eastern European countries for its generic manufacture. India has shifted to the products patents 2005 from process patent of 1970.But still it has to prove that the multinationals have their right protected against the generics manufacturer in India. People in the pharmaceutical industry were hoping that the recent Novartis, Bayer or Roche cases will clarify India’s Investing environment. It will help research based organization know that whether investing in the development of better medicines for India is a viable long-term option. Some of the Indian players like Dr Reddy’s, Piramal Life Sciences, Glenmark and Sun Pharma are investing in R&D. There are only 70-80 molecules in the pipeline from Indian players, of which more than two-thirds are still in early clinical phases . The same is also true in Europe with companies like TEVA or Synthon, historical Generic manufacturers, investing heavily in Biosimilar combination development for the for the first one and and new Biologics for the second. The internal market for new drugs in India remains very small, The Parmerging markets (Argentina, Brazil, China, Egypt, India, Indonesia, Mexico, Pakistan, Poland, Romania, Russia, South Africa, Thailand, Turkey, Venezuela, Vietnam and The Ukraine) representing less than 2% of the global market before 2010. One can expect the GDP growth of such market to see the share of new drugs increase substantially in the coming years. Ensuring this growth will benefit to Indian companies is another issue. This will be offset by the competition represented by European and Western based pharmaceutical companies, having stronger and more mature pipelines with proven expertise to market new drugs. Government of India has said that hen revise its essential drugs list under the Drug Price Control order to include 348 drugs. The existing essential drugs list has only 74 drugs. The new policy seeks to replace the earlier pricing formula with one in which prices would be decided on the basis of weighted average prices for all brands which have a market share of over 1%. All in all we can identify here that both markets have significant differences, mostly due to available expertise’s and economic heritage. Those two markets seems to now meet each other, with European companies shifting to the Generic manufacture and marketing and Indian companies exploring the New drug development. There are many reasons for those changes, Some of the drivers for such changes are factors like reimbursement policy, shrinking new drugs pipelines, emergence of personalized medicine or regulatory opportunities provided by orphan conditions, just to name a few.