This years’ resolution will be bringing the industry together and making it stronger
BR Sikri, Director, ABS Mercantiles
The year 2013 was one of the most challenging years for the pharma industry. We have seen all the hurdles in this year: implementation of new drug pricing policy (DPCO-2013), requirement of efficacy data by the DCGI for all FDCs, introduction of bar code system, COPP issue, introduction of GLP, GDP. Industry suffered heavily due to the new pricing policy and sudden change in Government policy on FDCs. On DPCO front, there was a huge divide between manufacturers, stockists/distributors and retailers, because of which 2013 was one of the most unproductive years, which dragged this so called ‘recession proof industry’ into the worst recession I have observed in my entire career. The pharma industry was the only industry which was growing at healthy pace of 15 to 17 per cent, but this year it witnessed single digit growth. Owing to reduction in retailers margin from 20 per cent to 16 per cent in the wake of new drug pricing policy, no retailer was ready to purchase material from the manufacturers thereby resulting in vacuum of medicines in the market and suffering by patients. Consequently, the pharma manufacturing industry, which works in India with an objective to serve common man, buckled under pressure and decided to pay 20 per cent commission to retailers by cutting their own margins.
However, now the pharma industry is trying to put this difficult phase in the past and is looking forward for the positives which are in store for the industry in the coming years.
We can proudly say that Indian generics have very well established itself in the global market due to consistent supply of good quality medicines at affordable prices. Global pharma industry cannot ignore Indian pharma industry, as we have the talent, infrastructure and willingness to grow. Indian pharma industry is expected to touch `1,25,000 crores in years to come. It implies that there is huge opportunity for all of us. There is strong potential for exports of generic pharma from India given the country’s comparative advantage in manufacturing of generics. India’s share in the global generic market is roughly five to six per cent and likely to reach 25 to 30 per cent over a period of time. Pharma exports from India continue to grow at a healthy rate of 18 per cent unaffected by the challenges that are being faced by other industries at a government level or at a macroeconomic level. In fact the recent depreciation of the Indian rupee against US dollar has added fuel to the fire and affected the growth potential of this business adversely. So all of us should take a resolution for 2014 that we will all work together and will make India a most sought-after destination for any pharmaceutical product.
On the personal front, in 2014, I would like to concentrate more on bringing the industry together and make it stronger to face the challenges and its growth in double digit. Our loyalty towards the great country has to remain unflinching. Although lot of tsunamis may come in between, we have to go a long way to grow to bring strength to the economy of our country because youth, which counts for more than 60 per cent population of this country, looks forward towards seniors like us and we owe this responsibility to the country.
Also, it is observed that stakeholders are going to court for each and every issue and getting their grievances redressed but my resolution for 2014 will be to humbly request the Government to sit with stakeholders, give them a patience hearing and resolve the issue internally with the industry so that valuable time of court, government machinery and industry is not wasted and we do more of the constructive and positive work for the overall growth of the nation. Jai Hind!