In what could boost business prospects of Indian generic drug makers in the $4-billion plus pharma market of Sweden, the government there is trying to evolve a consensus to make a shift towards ?generic prescription? system. This implies that the practising physicians there would be asked to mention the name of the salt, popularly known as the ?generic name? instead of the brand name of the drug while writing a prescription. This step would go a long way in making the idea of low-cost generics acceptable to general public and is expected to contribute significantly in further containing the healthcare costs of the Swedish government.

Currently under the generic substitution system in place since 2002, pharmacists have to inform consumers if substitutes to the brand mentioned in prescription are available and the cheapest available substitute product is reimbursed under the Swedish pharmaceuticals reimbursement system. If buyers choose to pay the difference between the cheapest available option and the brand prescribed in case of an off-patent drug, they could buy the latter.

?We are in discussions with various stakeholders to work out the feasibility of implementing a generic prescription system to popularise low-cost, high-quality generic products in Sweden. This would translate into increased acceptability of the generic versions of off-patent drugs in the society and an opportunity of increased participation of Indian pharma companies in the Swedish healthcare system,? Karin Johansson, secretary of state, ministry of health and social affairs, Sweden, told FE.

According to a 2007 official estimate, the generic substitution reform is saving close to $1 billion. Prices of off-patent drugs in Sweden fell more than 40% on an average between 2002 and 2005. As a whole, prices of pharmaceutical products dropped by about 15% in the same period because of the reform. This is despite consumer loyalty studies carried out by Swedish researchers showing that people demonstrate strong brand name loyalty in pharma purchases.

A working paper by David Granlund from Umea University found that Swedish ?consumers are on an average about three times as likely to oppose the switch (to a generic substitute) when a brand-name product or a branded generic is prescribed instead of a generic.? This shows that if the prescriptions specify the ?generic? name instead of a brand name, the resistance that consumers demonstrate towards switching to a generic version could also reduce considerably.

A number of leading India-based pharma companies, including Ranbaxy Labs and Cipla, have presence in Sweden. Around 70 Swedish delegates, mainly from the healthcare sector are now in India to discuss ways to enhance bilateral cooperation.