Transcript Slide 1

IP AND GLOBALISATION OF INDIAN
PHARMACEUTICAL INDUSTRY:
EMERGING CONCERNS FOR
INNOVATION AND ACCESS
Santhosh M.R.
Centad
17-18, March 2012
National Law University Jodhpur
India: Health/ill-health Profile
• Problem of double burden of diseases
• The major communicable diseases (CDs)
– infectious and parasitic diseases,
– respiratory diseases
• The major non-communicable diseases (NCDs)
– malignant neoplasm, diabetes mellitus, neuropsychiatric disorders,
sense organ disorders, cardiovascular diseases, respiratory diseases,
digestive diseases, musculo-skeletal diseases, congenital anomalies
and oral diseases
• Besides these we have
– maternal conditions, perinatal conditions and nutritional deficiencies.
Maternal mortality rate and Infant mortality rate are still high.
Health Profile….
Health profile ….
India
Srilanka
US
Bangladesh
Neglected Diseases
1.Malaria2.Tuberculosis3.Leishmaniasis (Kala Azar)- 93 deaths
4.Lymphatic filariasis
5.Leprosy
6.Dengue
7.Schistosomiasis
8.Onchocerciasis
9.Chagas Disease
10.African trypnosomiasis
Trachoma*
Meningitis*
* MSF
Post-1990 policy environment
Post -1990: Major Changes
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•
•
•
•
IPR regime- TRIPS compliant- Patent act
Foreign investment- 100% FDI
Import and Export- liberalised
Price control- only 74 bulk drugs under DPCO
Quality standards – GMP/Schedule M
Mixed Responses from commentators
• Keayla (1994) and Amit Sengupta (1994) cautioned
about the possible threats and ramifications of new
policy reforms.
• Sengupta (1999) and Jayashree Watal (2000) argued
that there would be sharp increase in the drug prices in
India.
• “India may become a centre of global importance in
pharmaceutical production and research and thereby,
enhance its position in the world economy” (Smith
2000:12).
• “a number of Indian firms will successfully weather the
transition and come out as more innovative
companies.” Lanjouw (1997)
Major concerns
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•
•
•
•
•
Changing Policy direction
Unfettered entry and Exit of Capital
Mergers and Acquisitions (M&As)
Increasing contract manufacturing
Increasing contract research
Out- licensing of molecules under
development
• Increasing import- dependence
Policy Environment
• Meager public investment in Health
• Export- centric- Regulated markets targeted
– High Value -Low-volume
• FDI- centric policies
– 100 FDI-automatic route-
• Self-reliance is no more important concern
• Local manufacturing is not encouraged
– More profitable to import from cheaper destinations
such as China
Disease Focus of New Chemical Entities’ based Drug
Discovery Pipeline
Source: Abrol, Dinesh et.al(2011)
Share of star researchers involved in communicable and non
communicable disease 1991‐2011
CD, 22%
NCD, 78%
Abrol, Dinesh et.al (2011)
Foreign Direct Investment in pharmaceuticals
in India (Rs. Million)
Year
Drugs
&
Total FDI
% Pharma
Pharmaceuticals
1991-1995
2317.7
131735.9
1.8
1996
2426.9
103970.2
2.3
1997
1881.5
164258.2
1.1
1998
838.4
133398.6
0.6
1999
757.3
168678.2
0.4
2000
2079.9
123537.5
1.7
2001
4081.8
167777.6
2.4
2002
2510.5
181955.6
1.4
2003
2793.3
116171.7
2.4
2004
15704.2
172665.2
9.1
2005
5107.3
192990.9
2.6
2006
9757.3
503856.4
1.9
2007
11405.7
797355.6
1.4
2008
11085.9
1397688
0.8
2009
9783.6
1309820
0.7
Source : compiled from - SIA News letters and DIPP website
M&As
Target company
Acquirer
Country of
origin
Year
Amount
(USD)
Matrix lab
Mylan Inc
US
August 2006
$736 mn
Dabur Pharma
Fresenius Kabi
Singapore
April 20, 2008
$219 mn
Ranbaxy
Laboratories
Limited
Shantha Biotech
Daiichi Sankyo
Japan
June 11, 2008
$4.6 bn
Sanofi Aventis
France
July 27, 2009
$783 mn
Orchid Chemicals
(injectible business)
Piramal Healthcare
(domestic
formulation)
Paras
Pharmaceuticals
Hospira
US
$400 mn
Abbott
Laboratories
US
December 16,
2009
21 May 2010
Reckitt Benckiser
Group
UK
14 December
2010
$ 720.6
Million
$ 3.72 bn
Private Equity Presence in Indian Pharmaceutical Industry
Select cases of PE in pharma
Year
Feb 2004
Feb2004
Dec2004
Mar2005
Aug 2005
Jan2006
Mar2006
Nov2006
Jun2007
Sep2007
Nov2007
Dec2007
Dec2007
Jan2008
Jun2008
Jul2008
Aug2008
Oct2008
Oct 2009
Company
Matrix Laboratories
Aurobindo Pharma
Glenmark Pharma
Malladi Drugs
Jubilant Organosys
Unichem Laboratories
Claris Lifesciences
Arch Pharmalabs
Morepen Laboratories
Morepen Laboratories
Unimark Remedies
Cadila Healthcare
Torrent Pharma
Gland Pharma
Bioplus Lifesciences
Inventia Healthcare
Nectar Lifesciences
Strides Arcolab
Deccan Health Care Pvt. Ltd.
Investor
Temasek
StanC PE
Actis
India Advantage Fund
General Atlantic LLC
New Vernon PE
Carlyle Asia
India Advantage Fund
StanC PE
Avenue Capital
Citi Venture Capital
ChrysCapital Investment Advisors
Greater Pacific Capital
Evolvence India
AIF Capital
NYLIM Jacob Ballas
Citi Venture Capital
HSBC Global
Nexus India Capital Advisors Pvt. Ltd.
Size(In $ Mn)
74
20
67.7
23
60
13
20
22
24.4
19
29
14
16.61
30
31
21
23.6
35
3.22
Aug 2009
DiagnoSearch Life Sciences
Pvt. Ltd
JM Financial India Fund
7.24
Aug 2009
Jun 2009
NovaLead Pharma Pvt. Ltd
Anjan Drugs Pvt. Ltd.
Kotak Private Equity Group
Evolvence India Life Sciences Fund
8
5.2
Source: compiled from Khan (2011) www.dealcurry.com
Exit of PE from Pharma
Date
PE
Company
Mode
Buyer
Size($ Mn)
Jul-09StanC PE
Aurobindo Pharma
Open
Market
Public
13.81
Jun-10Greater Pacific Capital
Torrent Pharma
Open
Market
Public
49.14
Dec-10Actis, Sequoia
Paras Pharmaceuticals
M&A
Reckitt Benckiser
Dec-10Carlyle Asia
Claris Lifesciences
IPO
Public
NA
Oct-10BTS India
Parabolic Drugs
IPO
Public
NA
726
Source: http://www.dealcurry.com/20110225-Rx-ExpiringPatents-Attract-PE-Interest-in-Pharma-Companies.htm
Select contract manufacturing deals
Indian company
Multinational
Product/comments
Lupin Laboratories
Fujisawa
Cefixime
Lupin Laboratories
Cyanamid
Intermediates
Lupin Laboratories
Apotex
Cefuroxime Axetil, Lisinopril (Bulk)
Nicholas Piramal
Allergan
Bulk and Formulations, APIs for levobunolol and brimonidine
Nicholas Piramal
Advanced Medical Optics
Eye Products
Nicholas Piramal
Pfizer
10 year contract manufacture and supply of hospital products
Nicholas Piramal
Pfizer
Seven year contract for R&D services in the animals health division
Nicholas Piramal
Astra Zeneca
Nicholas Piramal
GSK
5 year contract potentially $ 350 MM for supply of products as per acquisition of
Morepeth Facility
MOU for drug intermediates; no fixed tenure
Wockhardt
Ivax
Nizatidine (anti- ulcerant)
Dishman Pharmaceuticals
Solvay Pharmaceuticals
Dishman Pharma
Astra Zeneca
6 projects, including supply of starting material and intermediates for Eprosartan
Mesylate
Intermediate for esomeprazole
Dishman Pharma
Merck & Co
Intermediate for losartan
Dishman Pharma
GSK
Three intermediates
GVK
Wyeth
$ 40 MM FTE contract
Hikal
Degussa
Manufacturing intermediates and API’s
Jubilant
Eil Lilly
5 year contract for discovery of NCE in various therapeutic areas
IPCA Labs
Merck
Bulk Drugs
IPCA Labs
Orchid
Tillomed
Apotex
Atenelol
Cephalosporin and other injectables
Sun Pharma
Eli Lilly
CVS products, anti-infective drugs and insulin
Kopran
Synpac Pharmaceuticals
Penicillin- G Bulk Drug
Cadila Healthcare
Altana Pharma
Two intermediates for pantaprazole
Cadila Healthcare
Boehringer Ingelheim
Gastrointestinal and CVS Products
Zydus Cadila
Eli Lilly
Cardio vascular products
Biocon
Bristol Myers Squibb
Bulk Drugs
Source: Compiled from various sources
Increasing contract research deals
Companies in Contract Research
(excluding Clinical Trials)
Nicholas Piramal
Clinical Trials
Clingene (Biocon)
Aurigene (Dr. Reddy’s)
Jubilant Clinsys (Jubilant
Organosys)
Syngene (Biocon)
WellQuest (Nicholas Piramal)
GVK Biosciences
Synchron
Jubilant Organosys
Vimta Labs
Divi’s Laboratories
Lambada
Suven Lifesciences
Siro Clinpharm
Dr. Reddy’s Laboratories
Relience Life Sciences
Vimta Labs
Asian Clinical Trials (Suven Life
Sciences)
Source: IDMA (2007)
CRO-Market size
1200
1,020
1000
Million USD
800
728
600
Market size
485
400
323
200
202
120
0
12
2001
22
2002
39
2003
70
2004
2005
2006
2007
2008
2009
2010
Source: prepared from Government of India (2008), p.67 based on Zinnov Analysis
Out-Licensing Deals
Select Cases of Out-licensing Deals between Indian and Foreign Companies
Indian firm
Partner
Molecule/Technology
Deal value
Year
Development
phase
Ranbaxy
Bayer
Cipro(NDDS)
$65Mn
1999
NA
Ranbaxy
PPD Inc
RBx 10558
(Dyslipidemia)
$44 mn
2007
NA
Torrent
Novartis
Age breaker (Diabetic)
$3mn
2001
development stage
Glenmark
Forest(for N
America)
Oglemilast(Asthma/COPD)
$190mn
2004
Phase I
Glenmark
Tejin (for
Japan)
GRC 3886 (Asthma/COPD)
$53mn
2005
Phase II
Glenmark
Merck
GRC3200
$247mn
2006
Phase II
Glenmark
Eli Lilly
GRC 6211 (osteoarthritis pain)
$135mn
2007
Phase II
Lupin
Cornerstone
biopharma
Anti-infective (NDDS)
$10.5mn
2007
NA
Lupin
laboratories
Servier
IP data on Perindopril
$26.7mn
2007
NA
Source: compiled from IBEF Reports on Pharmaceuticals 2008, 2009,
Increasing import- dependence
• Importation of bulk drugs and formulations
have gone up
• Bulk drugs – we have a trade deficit
• Getting increasingly dependent on China for
bulk drugs
List of bulk drugs imported from China (APRIL 2011-JUNE 2011)
Name of the bulk drug
Indication
Whether
part of
essential
drug list
2011
1
ACARBOSE IP
To treat Type II diabetes
No
2
AMOXICILLIN TRIHYDRATE
AND CLAVULANATE
POTASSIUM 4:1 IP
Anti-biotic
Yes
3
CEFEPIME DIHYDROCHLORIDE
STERILE IP,
CEFIXIME IP
Anti-biotic
No
antibiotic used to treat infections caused by bacteria such as pneumonia;
bronchitis; gonorrhea; and ear, lung, throat, and urinary tract infections
respiratory tract infections (upper and lower), urinary tract infections, skin and
soft tissue infections, and bone and joint infections caused by susceptible
organisms. It is also used to treat meningitis; peritonitis, cholecystitis, cholangitis,
and other intra-abdominal infections; and pelvic inflammatory disease,
endometritis, gonorrhoea, and other infections of the genital tract.
Yes
4
5
CEFOPERAZONE SODIUM AND
SULBACTAM SODIUM STERILE
6
used for infections of the respiratory tract, skin, bones, joints, urogenital system,
meningitis, and septicemia
Antibiotic
No
second-generation cephalosporin antibiotic
Yes
9
CEFOPERAZONE ACID NON
STERILE IP
CEFTRIAXONE SODIUM NON
STERILE IP,
CEFUROXIME SODIUM STERILE
IP
CIMETIDINE IP
treatment of heartburn and peptic ulcers.
No
10
CITICOLINE SODIUM CP,
Cerebrovascular disorders and head injury
No
11
CLINDAMYCIN PHOSPHATE USP
Yes
12
DIPYRIDAMOLE USP
to treat infections with anaerobic bacteria but can also be used to treat some
protozoal diseases, such as malaria
Blood thinner (cardio vascular0
13
DOXYCYCLINE HYCLATE IP
Yes
14
ENALAPRIL MALEATE IP
to treat chronicprostatitis, sinusitis, syphilis, chlamydia, pelvic inflammatory
disease
Anti-hypertensive
15
ENOXAPARIN SODIUM IP
16
ERYTHROMYCIN IP,
7
8
anticoagulant used to prevent and treat deep vein thrombosis or pulmonary
embolism
Anti-biotic respiratory tract infections
No
Yes
No
Yes
Yes
17
FAROPENEM SODIUM JP
Anti-biotic (sinusitis, pneumonia,bronchitis)
No
18
FINASTERIDE IP
treatment of benign prostatic hyperplasia and hairloss
No
19
GLICLAZIDE IP
diabetes
No
20
HEPARIN SODIUM IP
Anticoagulant (Cardio pulmonary)
Yes
21
HYDROCORTISONE IP
to treat certain forms of arthritis; skin, blood, kidney, eye, thyroid, and
intestinal disorders (e.g., colitis); severe allergies; and asthma.
Hydrocortisone is also used to treat certain types of cancer.
Yes
22
ISOFLURANE PH.EUR
used for induction and maintenance of general anesthesia.
Yes
23
L-PROLINE,
Dietary supplement
No
24
INOSINE
Dietary supplement
No
25
MEROPENEM BUFFERED
STERILE IP
broad spectrum injectable antibiotic used to treat a wide variety of
infections, including meningitis and pneumonia
No
26
MIFEPRISTONE CP
abortifacient
Yes
27
PACLITAXEL IP
Cancer chemotherapy
Yes
28
PARACETAMOL IP
Anti-pyretic
Yes
29
PREDNISOLONE ACETATE
USP,
corticosteroid drug with predominant glucocorticoid and low
mineralocorticoid activity, making it useful for the treatment of a wide
range of inflammatory and auto-immune conditions
Yes
30
RANITDINE
HYDROCHLORIDE IP
Antacid
Yes
31
ROXITHROMYCIN IP
No
32
TICARCILLIN SODIUM &
POTASSIUM CLAVULANATE
(30:1) POWDER
antibiotic. used to treat respiratory tract, urinary and soft tissue
infections
treatment of bacterial septicemia, skin and skin structure infections,
lower respiratory tract infections, bone and joint infections, GU and
gynecologic infections, and intra-abdominal infections caused by
susceptible strains of bacteria.
Source: WWW.DEPARTMENTOFPHARMA.GOV.IN
No
Concluding Remarks
• There is no enabling policy environment for domestic
industries
• Pharma R&D is not oriented to the epidemiological
needs of the country
• Government should invest more in health and
pharma research
• Public sector research should be promoted
• Unfettered movement of capital should be controlled
• Should not allow brownfield investments
• Bulk drug industry should be promoted.