JOIN USA string of issues, ranging from patents and drug safety, to pricing and foreign direct investment (FDI) norms have put the approximately Rs 1 lakh crore Indian pharmaceutical industry in uncertainty, according to senior director and lifesciences leader at consulting firm Deloitte Touche Tohmatsu's India arm, Charu Sehgal.
In a media interaction on the sidelines of a conference on healthcare management system here, she said, “There are many concerns that will be seen in the next six months...patent protection, pricing of drugs, FDI. The industry is in a huge state of flux.”
The new drug price control order (DPCO) notified last month has increased the number of essential drugs from the earlier 74 to 348 and capped their prices using simple average price formula. This is likely to impact revenues of the Rs 70,000 crore domestic pharmaceutical market.
On drug safety, without naming the company, she said that the recent issue of an Indian generic drug maker being fined $500 million after pleading guilty to felony charges in the US has indeed “jolted” both patients and the government. She however said that the case should not be considered as rampant in India, while conceding that it is a “wake up call” for the industry.
The controversy over allowing 100 per cent FDI in brownfield pharmaceutical projects through the FIPB route at present, is likely to come up for review shortly due to concerns over series of acquisitions of Indian pharma firms by foreign companies on fears that availability of life-saving drugs manufactured by them could pose a challenge.
The government currently permits 100 per cent FDI in greenfield projects through automatic approval route.