Tremendous opportunities are available for domestic industry with the introduction of product patent regime in India in 2005. Drug discovery and drug development (clinical trials) activities will not only bring new medicines to the global market cost affectively, but also will bring the value proposition from 12th in the world to possibly 5th or 6th in the world out of the total global market of $650 billion in pharmaceuticals.
Outsourcing and collaborations in drug discovery and development has huge potential. Globally, spending on R&D is to the tune of $70 billion and roughly 30% of it is being outsourced or collaborated in pre-clinical and clinical activities to the tune of $20 billion and whereas, the Indian share is only less than $500 million. The potential of $2 billion in the next two to three years is very much possible.
Globally, biotech industry is growing at very faster pace and the expected market size by 2010 is $ 230 billion and out of which medical segment contributes roughly $150 billion. In this market, Indias share is roughly $2 billion only. Hence there is a tremendous potential to increase our share in this sector also.
However, there are few areas, which are still untapped. The complete utilisation of the Indian system of medicinesAyurveda, Yoga and Naturopathy, Unani, Siddha and Homeopathy (AYUSH)prevalent in the rural areas is now fast transforming into lifestyle drugs, neutraceuticals and cosmoceuticals in the urban areas and becoming global phenomenon, which we have not exploited for commercial gain. The global market in this segment is estimated to be about $30 billion, out of which India has a market share of less than $350 million. This amount is miniscule even though India has huge natural resources as herbals and its derivatives with rich bio-diversity.
Another area, which we have not tapped properly, is in the area of diagnostics (medical and surgical), which has multi-billion dollar global market potential. As one could see that the combined potential market size of all the activities of Pharmexcil will be close to the tune of $1 trillion by 2015 and Indias present market size is only 1.5%. Target for India is to achieve a 5% share of this global opportunity of $1 trillion by 2015 i.e. $50 billion.
However, while there is support from the industry, there are grey areas for growth. One such is that indiscriminate price cutting leading to unhealthy competition thus low value proposition for the individual industry in particular and to the country in general and bigger players not able to collaborate with SMEs.
At the governmental, it is highly fragmented administration for the same sector and no proper co-ordination with counter productive initiatives, regulations and decisions between the constituent ministries. Even though the health of the country brings wealth to the country, this industry is never given a priority neither morally nor monetarily or with clear guidelines and regulations. Further to that, the infrastructure, which all the divisions of industry deserve, is also missing and not enough provisions are made to fulfill that requirement. Initiatives to meet global regulatory regime is much needed to take on the global opportunity like amending rules to do clinical research in all phases and simplifying the import and export procedures in all sectors.
The need of the hour is:
* Making pharmaceutical and allied products area as a thrust and focus area with dedicated and co-coordinated resources
* Infrastructure development. Since India has moved from process patent regime to product patent regime, the government has to initiate specialised courses to meet the new requirement by starting new courses both in biology and medicinal chemistry in the existing centres of excellence with adequate funding so that human resources are available
* To provide infrastructure in all regions for the IPR centres for training and implementation
* To provide the incubation centres, training centres and testing centres for all the segments
Harmonisation of regulatory infrastructure with dedicated committees for faster approvals, be it may be for clinical trials, manufacturing or for marketing activities
Our vision is to establish India as the 21st centurys global sourcing hub for pharmaceuticals and allied medical products and services with public private partnership.
The writer is chairman, Suven Life Sciences