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"Tremendous Room for Growth for the Indian Pharma Industry"
The definition of innovation should expand beyond 'reverse engineering' to encompass challenges in drug discovery and development

The Indian pharmaceutical sector currently, is braving odds of weak macro factors of the economy, increasing competition and pricing pressures in certain categories. Even then, Mr Glen Saldanha, Chairman and Managing Director, Glenmark Pharmaceuticals, projects a positive growth outlook of the Indian pharmaceutical industry in an interview with Pharma Bio World.

What are the strategies pharmaceutical companies could use to for meeting unmet needs?
Innovation leading to new drugs is critical to meeting unmet medical need. Existing drugs will continue to be important in meeting the growing demand for healthcare, particularly with the increasing use of generic medication. At the same time, advances in disease understanding and the application of new technologies will be required to ensure the delivery of new medicines. Such approaches include personalized healthcare and predictive science as well as new types of therapy. The challenges of Improving R&D productivity is a critical challenge for the pharmaceutical industry.

Glenmark is the leader in India in the Discovery of New molecules both New Chemical Entity (NCEs) and New Biological Entity (NBEs). Glenmark’s groundbreaking drug discovery efforts are targeted towards therapeutic areas of Inflammation, Pain and Oncology that represent significant unmet medical needs. Glenmark has a pipeline of exciting molecules both new chemical and biological entities, in various stages of clinical development. Most of its active substances are first-in-class globally.

What are key megatrends driving the growth of pharmaceutical industry?
We believe that the growth rate for the domestic Indian pharmaceutical market is set to rise over the medium term due to factors like continued new product launches by Indian firms and measures taken by them on improving effectiveness of field force additions.

Although, the pricing environment, hitherto a favourable one may pose some challenges with issues like Draft National Pharmaceutical Pricing Policy (NPPP) 2011 coming to the fore. The domestic pharmaceutical market has grown at a 14 per cent CAGR over the past 18 years.

However, drug consumption per capita in India is still among the lowest globally. Even adjusting for India having the lowest prices in the world, the per capita consumption volumes are estimated to be 8-12x lower than in the US and Japan. Hence, there is tremendous room for growth for the Indian industry.

Besides, the low per capita consumption, some trends which will influence the growth of the Indian pharmaceuticals market over the next decade are;
• Doubling of disposable incomes and the number of middle class households
• Expansion of medical infrastructure in India
• Greater penetration of health insurance
• Rising prevalence of chronic diseases
• Adoption of product patents
• Aggressive market penetration driven by relatively smaller pharmaceutical companies

India is all set to enter the top 10 pharmaceutical markets of the world by 2015 (from its current position of 14th in terms of size) and will continue to remain a priority market for all operating players. Competition will intensify in this market. The CRAMS opportunity will increase but making it profitable will depend on the way organisations are able to innovate the business model.

What are the short comings of pharmaceutical industry in India?
These are challenging times both for the global and Indian pharmaceutical markets. Patent expirations, lack of new product pipelines, coupled with general economic downturn are just some of the challenges confronting the global pharmaceutical industry.

The Indian pharmaceutical sector on the other hand, is braving odds of weak macro factors of the economy, increasing competition and pricing pressures in certain categories. Competition—both from MNC’s as well as unlisted players has intensified creating pricing pressures across categories. But pricing pressures will not only come from increasing competition, but also from regulatory bodies.

The recently proposed National Drug Pricing Policy in India is just another example of governments across the world trying to control the prices of key drugs to reduce healthcare costs. In such a challenging environment, it is only companies with niche product portfolio and healthy exposure to specialty therapies (which have high entry barriers) that are most likely to outperform the industry. The new changing dynamics of the Indian pharma, calls for more collaboration rather than competition. Glenmark's recent out-licensing deal with Sanofi of France for a new drug is a case in point.

In the coming years, we will see more such collaborations with Big Pharma, which will help Indian companies share risks and generate constant revenue.

In the coming years, innovation will be key to success (and survival itself) for Indian pharma companies. The definition of innovation should expand beyond 'reverse- engineering' to encompass more challenging areas like drug discovery and development.

What is the current situation of R&D and clinical research in India?
So far, the major thrust of the Government was on encouraging generics R&D in India. But now, the Government needs to focus a great deal on encouraging innovation R&D through incentives in Union Budget etc.

The government should also provide increased funding to academic/scientific institutions for developing basic research capabilities in the country.