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India is a robust success story in branded and unbranded generics space. The Hathi Commission report implemented in 1969 and the Indian Patents Act 1970 laid the foundation for growth of generic formulation industry.
These interventions prevented product patent and made compulsory licensing easier. Thereby, Indian entrepreneurs mastered the process of reverse engineering life-saving medicines. This came as a blessing to an India that was very weak from socioeconomic angle. Further this led India to become a global supplier of affordable generics. There is a strong ecosystem in India for pharmaceutical formulation manufacturing and marketing – both domestic and exports.
India supplies 20 per cent of generic pharmaceutical formulations to the world. About 50 per cent of medicine requirement of Africa continent, 25 per cent of USA’s generic requirement and 40 per cent of UK’s medicine requirement is from India.
India makes up to 92 per cent of anti-AIDS medicines and 50 per cent to 60 per cent of world’s vaccine requirement is met from India. One in three vaccines administered by WHO is an Indian vaccine. This is why MSF (Medicines Sans Frontiers) calls India: Pharmacy of the world.
India capitalizes on ANDA opportunity
Having a strong wicket in the generic (branded and unbranded) medicine manufacturing and marketing in domestic India market, came handy to play the ANDA (abbreviated new drug application) opportunity.
USA is the prime pharmaceutical market with highest per capita pharmaceutical spending and USA is 40 per cent of the world’s pharmaceutical market - and hence attractive to Indian generic manufacturers.
The background for the genesis of ANDA market is the Hatch-Waxman Act 1984, when two US lawmakers Orin Hatch of Utah, USA and Henry Waxman of California, USA sponsored this Act in the US Congress.
The idea of this Act was to make it easier and systematic with lesser clinical trials for entry of low-cost bioequivalent generics into USA market - since patented branded medicines were very costly and causing stress on USA patients.
The catch is ANDA can be filed only when the patent is about to expire, hence, patent expiry date is vital. US FDA publishes the “Orange Book” that lists approved medicines and patent related data including patent dates. ANDA filing happens near the patent expiry date usually, and it takes six months to thirty months for ANDA approval.
Through ANDA success, India has become very strong in the global generic market: the turnover of pharmaceutical industry of India, including exports, has reached Rs 4,17,345 crore in 2023-24, registering a growth of 10 per cent over 2022-23. The pharmaceutical industry in India is currently valued at US$ 50 billion.
India is not a walled garden
After India signed on the TRIPS (trade related intellectual property rights) agreement proposed by WTO (World Trade Organization), in 1994, today, the IPR (intellectual property rights) concept has become very vital - since product patent become applicable. The reverse engineering approach can be done only for the ANDA business opportunity. For patented medicines, reverse engineering is not possible unless the patent has expired. This has put the spotlight on IPR dimension.
IPR is an umbrella term covering trademark, trade secrets, geographical indication, design, copyright and patents. IPR is not an easy task – it is very different from the reverse engineering mindset. Traditionally, Indian pharma has not been keen on IPR, however, TRIPS has changed the situation altogether.
In the 1980s and before, even trademark brand name, brand logo and brand symbol registrations were not very seriously taken. However, with the brand purchase phenomena in contemporary Indian pharma and the financial power of legacy pharmacy brands - has made trademark concept very vital.
Product patent involves protecting an invention. Product patent has a different product lifecycle compared to the brand product lifecycle. The patented product lifecycle has a trough before the launch of the product. It is this trough phase where investments go in for proof of concept, preclinical and clinical trials up to phase 3 - that makes the patented product lifecycle different from the brand product lifecycle.
Indian pharma has to start relationships with academia and other contract research organizations to learn the trough phase of patented product lifecycle management. Indian pharma should also start assembling an IPR team that is adept at creating the inventory of IPRs, value them and learn about product patent filing, patent protection, and patent litigation.
A successful product patent grants humungous financial benefits to the innovator company. If we have to take an international example, Viagra the innovator brand at its peak made annual sales of US$ 2.10 billion during its 15-year exclusive marketing rights period.
The celebrated patented product brand, versatile anticancer product Keytruda (pembrolizumab) has an astonishing annual 2023 sales of US$ 25 billion (approx. Rs. 2,11,000 crores and note that the entire domestic India market is approx. Rs. 2,17000 crores (2024)!).
A patented pharmaceutical product has enormous financial benefits. Observing the remarkable success of semaglutide (Novo Nordisk patent holder and due to the semaglutide success story, the market capitalization of Novo Nordisk is greater than Denmark GDP, Denmark is the HQ of Novo Nordisk), Indian pharma major Sun Pharmaceuticals has embarked on the journey of bringing patented utreglutide to the market for management of type 2 diabetes mellitus and obesity. This is a remarkable and praiseworthy IPR product patent mindset effort, which is the need of hour in Indian pharmaceutical sector.
One very vital aspect of patent regime is going beyond a single product patent to a patent thicket mentality. This implies filing multiple patents on a technology to broaden the patent coverage, block competitors, and extend the patent life.
Another key factor is patent evergreening, which involves filing new patents on incremental innovations of the existing product, to delay entry of low-cost generics and increase patent lifespan. Thus, IPR including product patent mindset is very intellectually demanding and starkly different from the reverse engineering mindset.
Today, India is not a walled garden, India is signatory to TRIPS and Indian pharma should evolve in both: the IPR product portfolio and reverse engineering (branded and unbranded generics) product market. This can happen only when the IPR ecosystem becomes stronger.
Learning from Japanese pharma industry story
Japan is the cynosure of pharmaceutical research and innovation. Breakthrough drugs such as ivermectin (treatment for elephantiasis), donepezil (Alzheimer’s Disease management drug), cephalosporins such as cefoperazone and cefixime, the fluoroquinolones - ofloxacin and norfloxacin, proton pump inhibitor rabeprazole and other drugs such as meropenem (the ICU antibiotic) are all invented in Japan.
Japan in the 1940s was also a broken economy due to atomic bombing. However, Japan scaled up to becoming the innovator pharmaceutical country due to close pharmaceutical company and academia ties, plus the IPR mindset including product patent regime. Thereby, we observe from the 1940s, while India has become a producer of affordable generics (pharmacy of the world) due to non-IPR reverse engineering mindset - Japan has become the innovator of pharmaceuticals due to IPR mindset.
Now it is imperative Indian pharma puts accent on IPR mindset including product and process patents.
The API and excipients story
Indian chemists are remarkable in being able to work out the chemical synthesis of various drugs and intermediates. India holds the position of being the world’s third largest producer of APIs by volume. The challenge is key starting materials being imported from China, and this China dependence at times can be troubling due to pricing pressures. Indian API pharma needs to deepen ties with academia and increase the base of pharma professionals involved in API and excipient research and production. Only then will the ecosystem evolve to make India a competitive and dependable supplier of APIs and excipients.
Whither the biogeneric focus?
Indian pharma & academia ecosystem has a long way to go, in creating linkages for knowledge and skill development in biogeneric sphere. There is a lot of monies to be made in this sector, however, there is no broad based skill set. Courageous business building steps come from confidence, which comes from knowledge and skills. Pharma professionals are more of herbal and chemical (non-biologicals) based thinking. Biogeneric and innovator biologicals can come if biotech tinkering labs and other components of biological ecosystem are developed.
Confidently marching ahead
Indian pharma is confidently moving in the veterinary, herbal and nutraceutical space too. India’s Ayurvedic wisdom is being harnessed in the dynamic nutraceutical space, poised to reach US$ 18 billion by 2025.
Cosmetic license-based products such as oral care specialty toothpastes are also trending. The India oral care dental market is about Rs. 15000 crores per annum of which Rs. 12000 crores approx. is the toothpaste market.
Medical devices industry is seeing traction. The Indian clinical trial industry is also on upswing due to better regulatory approach (estimated to be a US$ 2.21 billion market). India has a good pool of knowledge workers; hence this is powering the US$ 21 billion Indian CRAMS industry (contract research and manufacturing services).
Overall, Indian pharma is flourishing due to entrepreneurship, ecosystem for generics, policy support from the governments, however, our active participation in industry academia joint projects and global marketing through various trade shows will provide a further shot in the arm. Focus is required on IPR, biologicals and biogenerics to continue the robust growth story of Indian pharma.
(The author is VP Business Development, Group Pharmaceuticals, Bangalore)
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