A bitter pill to swallow

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: Global pharmaceutical majors are not getting healthy indicators from the $8 billion domestic pharmaceutical market, especially on the intellectual property (IP) and data protection front. A string of high-profile cases in various Indian courts during the past two months have prevented them from getting patents on their drugs.

These rulings have helped Indian drug companies as they can launch generic versions of the blockbuster drugs. Global firms like Novartis, Bayer, Roche and Braun Melsungen blame their woes on the country’s ambigious patenting system. Pharmaceutical majors are already talking of delaying the launch of their blockbuster drugs in the country. Pharmaceutical outsourcing could take a hit and pharmaceutical companies might be reluctant to outsource their drug discovery and development work to India.

Can this threaten India’s promising position in the realm of contract research and manufacturing and drug discovery space? By 2010, global contract research and manufacturing market (CRAMS) is expected to reach around $66 billion from $51 billion at present, when Indian CRAMS market will be around $3.8 billion with CAGR of 51%. Similarly, global drug discovery and development services market is valued at $18 billion and is projected to grow with an estimated CAGR of 17% over 2007-2010. Here again, India is emerging as a hot spot, growing at 65%, that is more than three and half times the global growth rate.

“Global pharmaceutical majors are a worried lot these days. On the one hand, they cannot afford to ignore a lucrative market like India. On the other hand, they are dismayed by the reverses suffered with respect to patents on their drugs. However, I feel that they need not despair as the IP climate in the country is improving, though at a slow pace,” says Arvind Lal, chairman and managing director, Dr Lal Path Labs.