Dr Ajit Dangi, President & CEO, Danssen Consulting highlights the need for an action plan to insulate the pharma sector from calamities like coronavirus pandemic and recommends a few measures which can be crucial to achieving this objective
There is no industry in the world which has not been impacted by COVID 19 and the pharma industry is no exception. Firstly, we must acknowledge the excellent work our pharma manufacturers and healthcare professionals are doing by working 24×7 to ensure that patients not only in India but all over the world get their medicines on time. While words like carnage, catastrophe etc. are being used to describe this pandemic, it is also a wake-up call to the industry and the policymakers to learn from this crisis and draw out an action plan to make the industry future-ready and insulate ourselves from such calamities. Following are a few suggestions:
1. API imports– It is now well recognised that our overdependence on imports for APIs and drug intermediates is a major geopolitical risk. While this issue is being discussed for almost a decade, the action plan has been missing. We declared the year 2015 as a ‘ Year of Bulk Drugs’, however, the government announced a package of Rs 14,000 crores to manufacture key APIs indigenously only on March 30, 2020. More than 53 critical bulk drugs covering major therapeutic classes have been identified for domestic manufacture, of which 26 are fermentation-based and 27 are based on chemical synthesis, roping in expertise from National Chemical Laboratory, Pune. DoP has also formulated a scheme namely ‘Assistance to Bulk Drug Industry for Common Facility Center (CFC)’ in any upcoming bulk drug park promoted by the state governments.
We now urgently need to do three things.
One, develop more vendors globally for APIs required for manufacturing essential medicines rather than depending only on one country and second, draw out a plan to incentivise industry to do backward integration for their major brands by putting such projects on the fast track. Apart from giving monetary incentives, accelerating regulatory approvals such as environmental clearance, land acquisition, FDA licences, and amendment of restrictive labour laws and generally improving ease of doing business is also necessary. Needless to mention, states must ensure uninterrupted electricity and water supply and good infrastructure for the smooth functioning of such plants. Thirdly, we need to activate some of our moribund pharma PSUs like IDPL, HAL, BCPL etc. by bringing in newer manufacturing technologies and more dynamic management. While Bureau of Pharma PSUs was established in 2008, it has little progress to show. Similarly, fine institutes like Haffkine Institute, Mumbai which is the oldest biomedical research institute in the country established way back in 1899, can contribute immensely in times like this with their wealth of knowledge in vaccine technologies. They need to be activated.
2. Digitalisation – India rightfully chose the path of digitalisation by announcing its flagship programme ‘Digital India’ in 2015. COVID 19 has given it a spurt as more and more people have started doing transactions online improving efficiency and speed. It is estimated that the E-way billing system for truckers who transport goods like pharma supplies and other goods on national highways across the country has reduced transport time by almost 30 per cent and has also improved GST tax compliance. Similar is the case with fast tag system for tolls. Efficient logistics and supply chain is the lifeline of pharma industry, particularly for temperature-sensitive products and digitalisation will bring speed and efficiency in warehousing, forecasting, planning etc., thereby improving productivity.
While the policy on online pharmacies has been incubating for over two years, very little progress has been made. One of the reasons being resistance from vested interests and fear of counterfeits entering the supply chain. Some of these issues can be addressed effectively by putting appropriate legislations in place. Online pharmacy can also reduce price to patients by cutting down intermediaries.
Another positive development is that Niti Aayog and MCI have just come out with guidelines on telemedicine. They help physicians and encourage them to consider telemedicine as a part of their normal practice using videos, internet-based platforms like web chat, apps etc. without carrying out a physical examination. This fulfils a major gap as until now there were no official guidelines or legislations for the practice of telemedicine. Hopefully, product detailing through medical reps will also undergo a major change.
3. Healthcare spends – Our government’s healthcare spend is just over one per cent of GDP. For a country of 1.3 billion people, this is quite miniscule. While we have been talking about doubling this for quite some time, with the impending economic slump and a probable recession, this is going to be a major challenge. Policies like OTC legislation need to be enacted speedily to reduce the burden on scarce resources like access to medical consultation etc., at least for minor ailments.
4. Impact on industry growth: The Indian pharma industry was expected to grow by 10- 13 per cent in 20 – 21. Fortunately, following representation from Pharmexcil, Government has just lifted the ban on exports of certain essential drugs. However, many manufacturing plants are working at suboptimal capacity due to the absence of workforce, hence this growth rate is unlikely to be achieved. For instance, plants in Uttarakhand which produce about 15 per cent of total formulations in the country, are unable to work to full capacity as only about 15- 20 per cent workforce is reporting to work either because of fear of COVID-19 infection or because the state government has announced full pay even if one is absent from work. Looks like we are likely to end up FY 21 with single-digit growth.
5. Change in human behaviour: WHO has recognised the role of positive change in human behaviour in addressing a crisis of this nature. Good practices like frequent hand washing, social distancing, personal hygiene and good sanitation practices should be continued even when this crisis is over. Drugs and vaccines are not substitutes for good hygiene, sanitation and adoption healthy lifestyles.