The Seventh Annual IGPA Conference INDIA Market Projections and Developments by D G Shah Secretary General Indian Pharmaceutical Alliance Prague: June 2004 1
Potential & Problems Indian Pharmaceutical Scene: Perspective Size of Indian Market (March MAT 2004) Value Volume US $ Bn Units Bn 4.37 10.74 12 10 SOURCE: ORG-IMS Volume 10.74 Bn 8 6 4 Value $ 4.37 Bn VISION: 04/04 2 0 2
Potential & Problems Indian Pharmaceutical Scene: Perspective Globalization of Business 80000 70000 60000 CAGR % Period Formlns Total 68,520 Rs Mn 50000 40000 30000 1980s 30 36 1990s 28 26 31,777 37,520 Source: OPPI 20000 10000 0 7,848 20,448 464 1,400 3,714 Formulations Total 351 1981 1,066 1986 1991 1996 2000 Year 3
Potential & Problems Indian Pharmaceutical Scene: Perspective Globalization of Business Year Rs Mn Gr % % Growth 30 25 20 15 2000 68,520 15 2001 87,300 27 2002 98,278 13 2003 118,880 21 15% 27% 13% 21% 10 5 0 2000 2001 2002 2003 Year 4
Market Indian Pharmaceutical Scene: Perspective 2001-02 Rs Mn Globalization: Region-Wise Exports 2002-03 Rs Mn Contrbn % Growth % West Europe 19,179 24,459 20.6 27.5 East Asia 20,674 23,261 19.6 12.5 North America 17,904 22,621 19.0 26.3 Africa 12,886 15,711 13.2 21.9 East Europe 7,852 9,594 8.1 22.2 Latin American Countries 7,213 8,225 6.9 14.0 South Asia 6,633 7,379 6.2 11.3 West Asia 4,377 5,756 4.8 31.5 Other American Countries 1,560 1,874 1.6 20.1 Total 98,278 118,880 100.0 21.0 L A C 7% East Europe 8% South Asia 6% Africa 13% Potential & Problems West Asia 5% North Am erica 19% O A C 2% West Europe 21% East Asia 20% 5 SOURCE: CHEMEXIL
Potential & Problems Indian Pharmaceutical Scene: Perspective Globalization: India s Top 20 Markets Market 2001-02 Rs Mn 2002-03 Rs Mn Contrbn % Growth % USA 16,412 20,234 17.0 23.3 Germany 5,034 7,277 6.1 44.6 Russia 4,811 4,972 4.2 3.3 U K 2,822 4,099 3.4 45.3 China 3,820 3,975 3.3 4.1 Nigeria 3,790 3,548 3.0-6.4 Brazil 3,505 3,441 2.9-1.8 Hong Kong 3,425 3,186 2.7-7.0 Vietnam 2,143 2,624 2.2 22.4 Mexico 1,496 2,483 2.1 66.0 Canada 1,492 2,387 2.0 60.0 Netherland 1,936 2,272 1.9 17.4 Japan 1,513 2,291 1.9 51.4 Sri Lanka 1,527 2,173 1.8 42.3 Singapore 2,012 2,007 1.7-0.2 Spain 1,691 1,880 1.6 11.2 UAE 1,420 1,864 1.6 31.3 Thailand 1,514 1,616 1.4 6.7 Italy 1,198 1,653 1.4 37.9 Bangladesh 1,274 1,494 1.3 17.3 Top 20 62,835 75,476 63.5 20.1 Total 98,278 118,880 100.0 21.0 SOURCE: CHEMEXIL Sri Lanka 2% Japan 2% Netherland 2% Canada 2% Mexico 2% Singapore 2% Viet nam 2% Spain 2% Hong Kong 3% UAE 2% Thailand 1% Italy 1% Bangladesh 1% USA 17% Germany 6% Russia 4% Brazil 3% China 3% Nigeria 3% U K 3% 6
Indian Pharmaceutical Scene: Perspective India s Share ($Billions) 2001A Particulars 2007P 27 Global Mkt 57 6 India's Share 19 22 % Share 33 2001A Potential & Problems 2007P India 22% India 33% RoW RoW Source: Datamonitor/OPPI 7
Indian Pharmaceutical Scene: Perspective DMF Approvals to India: 1985-2002 Potential & Problems 450 400 350 300 250 200 150 100 50 0 Source: US FDA Year New Total 1985 0 0 1989 5 19 1993 10 37 1997 18 65 2001 61 226 2002 76 302 *2003 121 423 * Upto December 10 Only 37 19 0 10 5 14 27 0 65 18 47 1985 1989 1993 1997 2001 2002 2003 226 61 165 302 76 226 423 121 302 8
Indian Pharmaceutical Scene: Perspective DMF Filing: India, a Clear Leader Potential & Problems No. of DMF Filing Source: JM Mutual 9
Indian Pharmaceutical Scene: Perspective Potential & Problems 80 70 60 50 71 50 Robust ANDA Pipeline Current Approvals Pending ANDAs Para 4s First-to-files 40 30 20 10 0 30 22 24 12 12 15 12 12 9 5 3 6 6 1 4 0 0 0 0 0 1 0 Ranbaxy DRL Cipla Sun Wockhardt Zydus Cadila Cipla-Filling through alliances, Sun-Includes Caraco Source: CLSA Report 10
Indian Pharmaceutical Scene: Perspective USFDA-approved Plants Outside the US Potential & Problems 70 60 61 60 50 40 30 20 25 22 10 9 5 7 0 India Italy Spain China Taiwan Hungary Israel Source: CLSA Report 11
Potential & Problems Emerging Models Leveraging Knowledge Base Lead Optimization Synthesizing Designed Structure Manufacture of Clinical Trial Samples Global Clinical Research Projects Moving Up the Value Chain of R & D 12
Potential & Problems Moving up the Value Chain of R & D 2000E 2005 5% NCE 30% 30% NDDS Chiral Analogue 35% 65% Process Development 35% 13
Major PCT Applicants from India Potential & Problems Applicant No. of Applications 2002 2003 CSIR 188 124 Ranbaxy 59 66 Dr Reddy s Lab 19 8 Orchid 17 21 Biocon 9 31 Lupin 9 9 Sun 8 19 Cadila 7 10 Avestha 6 5 J B Chemicals 5 Hetero 41 Natco 15 Wockhardt 9 VISION: 04/04 Other Total 153 480 253 611 14 SOURCE: WIPO
2003 PCT Applications by Type of Applicant Potential & Problems Companies Public R&D Institutions Individuals Universities Total SOURCE: WIPO 339 152 105 15 611 Individuals 17% Universities 2% VISION: 04/04 Public R & D Institutions 25% Companies 56% 15
Potential & Problems Challenges Post 2005 National Patent Law Data Protection Patent Law Treaty (PLT) Substantive Patent Law Treaty (SPLT) Non Tariff Barriers 16
Potential & Problems Challenges Post 2005 National Patent Law: Issues Definition of Patentability EMR/Mail Box Provision Pre-Grant Opposition Manufacture for Exports 17
Potential & Problems Challenges Post 2005 Suggestions for Patent Bill 2004 Introduce TRIPS Compliant Product Patent Regime Establish High Standards of R&D Enshrine US/EU Laws on Inventive Step, Novelty & State of Art Define NCE, Active Moiety & Related Drug Product Discourage Frivolous Patents VISION: 04/04 18
Challenges Post 2005 Potential & Problems Pre-Grant Opposition Sub-section (1) of the proposed new Section 25 seeks to provide for making representation by any person before the Controller. Sub-section (3) seeks to provide for opposition to the grant of patent for revoking the patent within one year from the date of grant of patent on the same grounds, which are available under pre-grant opposition in the existing Act. Sure Way To Litigations 19
Potential & Problems Challenges Post 2005 Manufacture for Exports 92A. (1) Compulsory licence shall be available for manufacture and export of patented pharmaceutical products to any country having insufficient or no manufacturing capacity in the pharmaceutical sector for the concerned product to address public health problems, provided a compulsory licence has been granted by such country, (2) The Controller shall, on receipt of an application in the prescribed manner, grant a compulsory license solely for manufacture and export of the concerned pharmaceutical product to such country under such terms and conditions as may be specified and published by him. (3) The provisions of sub-sections (1) and (2) shall be without prejudice to the extent to which pharmaceutical products produced under a compulsory license can be exported under any other provision of this Act. Model Law For Others 20
Challenges-Post 2005 Protection of Testdata IPA supports provisions to protect undisclosed test or other data submitted to Regulatory Authority in India against unfair commercial use IPA Respects And Supports IPRs 21
Challenges-Post 2005 Protection of Testdata But Data Protection does not mean Market Exclusivity ; Use of originator s data for regulatory approval is not unfair commercial use. Moreover, No Obligation to Go Beyond TRIPs Agreement. Take Calibrated Steps to Measure Impact of these Changes. 22
Patent Law Harmonization Patent Law Treaty (PLT) Potential & Problems Diplomatic Conference Comprising 140 States Adopted PLT by Consensus in June 2000 104 Countries Signed the Final Act For Adoption and 43 Countries Signed PLT Main Features of PLT Harmonizes Formality Requirements Streamlines Procedures for Patenting Substantive Issues Slipped in to the Agenda 23
Challenges Post 2005 Potential & Problems 1st Draft in November 2001 Substantive Patent Law Treaty (SPLT) Revised in May 2002-Lays Down World Patent Law Makes TRIPS Obsolete Secures What Could Not Be Achieved in TRIPS Implications End of Patent Policy as a Tool For National Development Strategies Deviation Can be Subject to Sanctions No Exclusions to What is Patentable A Pipe Dream Takes On Real Proportions! 24
Challenges Post 2005 Potential & Problems Non-tariff Barriers Spreading Doubts About Product Quality Working to Deny/Delay Product Registrations Raising Standards of Regulatory Approvals 25
Potential & Problems The Future is No Longer What it Used to Be dgshah@vision-india.com 26