The cost of generic medicines of PMBJP outlets for treating various conditions range from 0.01 days’ wages to 0.47 days’ wages for the lowest paid unskilled worker in Maharashtra. One inherent limitation of this study is that we have tested pair of branded and branded-generic medicines that were manufactured by the same “reputed” company. Though it is expected that both the versions should have the same quality but perception for any branded-generic is same among doctors and patients. So to start with, we have taken both branded and branded-generic products of the same company and studied not only the quality but also the price structure.
The World’s Pharmacy: India’s Generic Drug Industry
- The regulatory framework in India for pharmaceutical pricing and reimbursement aims to ensure fair pricing of essential drugs and provision of adequate reimbursement mechanisms to facilitate patient access and simultaneously also promote innovation and enhancement of production capacity of healthcare providers.
- “Now what happens is most of the time we don’t get adequate supply of these Jan Aushadhi products in definite time.
- A 3-tiered public healthcare delivery system is catering to the needs of the population of these two districts.
- The profiles of the physicians and pharmacists are provided as additional files (Additional files 2 and 3).
- There are only 74 bulk drugs which are under price control[15]and are called scheduled medicines.
- Generic drugs offer an important tool for reducing the overall healthcare expenditure.[17] As more and more patents expire, the generic versions of the pharmaceutical market are expected to continue for increased sales.
The following were identified as the key focus areas to bolster the Indian pharmaceutical and healthcare sectors. Thus, from a practical point of view, Indian pharmaceutical companies should invest more in R&D, attempting to attract talented human capital. Otherwise, they will lose the highly qualified national workforce that will favor MNCs in the field.
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In the USA substitution is allowed and patients accept generic substitution if physician approves of the same. Generic substitution rates have increased remarkably there, probably due to greater acceptance by physicians and pharmacists as well as encouragement from the third party payers.[20]Cheaper generics are one of the important factors to reduce health-care cost. Studies involving comparative evaluation on quality of branded and their generic counterpart may be made mandatory for the generic (or branded-generic) manufacturer and their reports should be made public to promote generic use and prescriptions. Unlike developed countries, people in developing countries pay the cost of medicines out-of-pocket. Universal access to medicines, a critical component of Sustainable Development Goals, is intended to ‘ensure access to safe, effective, quality and affordable essential medicines for all [24].
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In other words, the overall coverage of essential drugs in PMBJP list is just 57%, when compared to the total number of essential medicines included in NLEM. We have used a mixed-methods approach, with the survey-based quantitative component supplemented by a qualitative component consisting of in-depth interviews (IDIs). Data were gathered on the availability, stock-outs, price and affordability of 35 essential medicines and 2 consumables. Our unparalleled team of in-house experts monitor P&R policy developments, outcomes and data analytics around the world every day to give our clients the edge by providing critical early warning signals and insights. With the availability and usage of generic drugs, the experience with these drugs will increase and it will be possible to compare the real-time effectiveness of generic drugs vis-à -vis brand drugs.
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But India’s thriving generics industry could only do this because these medicines were developed before it had to implement the 1995 World Trade Organization (WTO) agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). But just to begin to pursue that objective requires more information than the FDA has today. The FDA has pretty much admitted that it is ineffective at managing America’s generic drug shortage problem, pointing the finger at the drug and medical device makers. In May 2022, FDA Director Dr. Robert Califf admitted in congressional testimony that supply chains are too narrow and too dependent on single sources. Another example is in contrast dyes, which are administered to patients before CT scans to improve health care professionals’ visibility of the circulatory system and help identify blood clots in cancer patients.
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The mean drug availability at PMBJP stores located in the vicinity of PHCs and district/rural hospitals was 51% and 61% respectively. While more than 70% of PMBJP pharmacies across all levels of care in Palghar region had palliative care medicines, anti-epileptics, analgesics and antacids, the availability of anti-cancer, anti-asthmatic and electrolyte balancing drugs were found to be very poor (less than 30%). Aside from collecting primary data, secondary data such as the price information of some PMBJP medicines and their leading brand name counterparts (in terms of market share) were gathered from the web portals of PMBJP and MedGuideIndia.com respectively. The website provides information on a wide range of drugs available in the Indian pharmaceutical market including their prices.
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SII separately has a manufacturing agreement with AstraZeneca to produce one billion doses of the Covishield vaccine, which the UK company is developing with the University of Oxford. Another challenge to India is wealthy countries protecting their pharma industries to ensure drug security. In August, President Trump issued an executive order that called for the elimination of drug imports, both as active ingredients and formulations. The price ceiling policy has been in place for more than 20 years, but it has neither been very successful nor free of consequences for pharma companies. Generic drug manufacturers do not have to spend extra money for drug discovery and preclinical and clinical trials. Generics are available at a lower cost; they provide an opportunity for savings in drug expenditure in a country.
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As such, pharmaceutical companies are permitted to increase the prices of their drugs by this percentage. The marginal price adjustment is expected to affect 923 scheduled formulations listed in the NLEM, including antibiotics, cardiovascular medicines, tuberculosis drugs, and Parkinson’s and dementia medicines, among others; the small scale of the adjustment renders it meaningless compared to previous price adjustments. However, it instead tipped the balance in favor of the pharmaceutical industry’s commercial interests, and away from access to affordable medicines. For example, the development of a range of long-acting HIV prevention and treatment medicines could be transformative in advancing the end of AIDS — but this can only happen if those medicines are made widely available at low prices through large-scale generic production. India has long been known as the “pharmacy of the world,” producing generic medicines at prices that other developing countries and global institutions can afford. The country was the single largest supplier of pharmaceutical products to Africa in 2018, and accounted for a fifth of the continent’s pharmaceutical imports.
Generic drugs – The Indian scenario
- The national regulator reportedly has fewer than 400 staff to police more than 1,300 factories, and does not even oversee many of the drugs exported to places like Canada.
- With price rises of more than 1,000 per cent in the generics sector, academics would like to see better price regulation.
- New drugs are protected by patents, so only the company that came up with the drug can sell it.
- In this respect, however, foreign companies, as well as national companies, have been reluctant to invest in R&D in India (Ghai, 2010).
- That leads to widely differing standards across India, with the temptation to lower standards to attract more manufacturers.
- These objectives of the investigation highlight the essential explorative nature of the study, which has been finalized as a scenario analysis, adopting a mixed approach of quantitative and qualitative methods.
- Common side effects include gastrointestinal issues and fatigue for both drugs, but specific side effects and patient responses may vary.
In most of the states, free medicines were restricted to targeted beneficiaries like BPL families, beneficiaries of JSSK, Janani Suraksha Yojana (JSY), and enrollees of state-specific insurance schemes. Even among the beneficiaries, the range of medicines given free of cost was not as per the EML nor based on epidemiological load. In Colombia, data exclusivity increased the public health system’s costs by $396 million between 2003 and 2011. Meanwhile, in 2006, the Korean National Health Insurance Corporation calculated that a four-year harvoni price in singapore patent term extension would cost 722.5 billion won — the equivalent of $757 million at the time. This issue came to a head during the COVID-19 pandemic when, after relentless pharmaceutical industry lobbying, the EU and other wealthy countries blocked India and South Africa’s proposal to temporarily waive some TRIPS obligations for COVID-19 medical products. It was the influx of affordable generics from India that helped drive down the price of treatment from over $10,000 to under $100 per year, saving countless lives.
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A sample list of generic drugs available in India along with their indication is depicted in Table 1. Adequate infrastructure is one of the prerequisites for efficient storage and distribution of medicines. Progress in the direction of infrastructure expansion and strengthening improves both service delivery and availability of medicines for the end-users. When faced with challenges of infrastructural shortfall to store and dispense medicines, a few states reported adopting alternative measures to ensure the distribution of medicines. For instance, there were reports of users facing constraints in accessing medicines at these pharmacies due to stock out of generic medicines and distribution of near-expiry or expired medicines and branded medicines, which invariably resulted in OOPE.
Supply chain management (SCM) is the regulation of the flow of goods, finances, and information related to products or services spanning from procurement to distribution to the end-users. Efficient SCM practices are important to ensure the timely distribution of the right products in the right quantity at the right place. Furthermore, the Indian pharma supply chain grapples with issues related to counterfeit drugs and supply chain integrity.
“The two major reasons for the cost pressures are slowing down of the domestic offtake and pricing pressures in developed markets such as the United States and Europe, in addition to some of the pricing pressures also being introduced in India in the domestic markets,” commented Raisinghani. “This is further compounded by regulatory bodies demanding stricter compliance, which are leading to higher compliance costs,” he added. If sponsors, healthcare providers, and regulators work together effectively, then effective use of generic drugs will make medical costs cheaper and also ensure sound treatment options for the patients. Early issuance of guidance notes on the prescription of generic medicines, clarity in dispensing rights, state notification of FDSI, and mandated display of EML at the facilities heighten the awareness of both providers and community members. In line with this, irrational prescriptions and poor adherence to STPs/STGs and EML may be attributed to lack of awareness.
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The rise of drug shortages, the unreliable quality of the output of Chinese and Indian facilities, and the increasing concentration of the industry to one or two manufacturers for many drugs or key ingredients raises real questions over the FDA’s ability to address the shortage problem. Following the Covid-19 pandemic, pharmaceutical supply chains have evolved to become more agile, transparent, and resilient. They have embraced advanced technologies like machine learning and artificial intelligence. There is a significant ongoing investment in automating manufacturing and packaging processes to enhance productivity, operational cost efficiency, and labeling precision.
- Still another example is the antibiotic benzathine penicillin, which is now on shortage.
- Though it is expected that both the versions should have the same quality but perception for any branded-generic is same among doctors and patients.
- In addition, prescription drugs are a significant export category, representing percent of all U.S. exports while showcasing America’s innovative capabilities in ways that save and improve lives globally.
- As a result, the upward revision of their prices helps maintain profitability, but this may not be the case with this year’s price increase of essentially zero per cent.
- Similarly, stock-out of medicines was calculated for the reference period of six months.
- The pharmaceutical industry was once concentrated in Europe and North America, but has spread increasingly into the developing world, where low costs cater to a growing Western pressure.
- For all the above-described reasons, they find manufacturing generic drugs more lucrative, as the outcome is guaranteed.
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For the industry to retain its position as the largest generic drug supplier, it must continue improving regulatory compliance of manufacturing sites, as well as developing cost-effective and high-quality manufacturing processes. Reducing the industry’s dependence on the imports of APIs, key intermediates and starting materials will be key to sustaining its global leadership position. Despite the changing dynamics across the global industry, there is a lot to be positive about. India’s export growth for FY 2019 was one of its highest growth rates in the last decade. While margins may be reducing due to the extra costs and regulatory fees, on average, Indian drugs cost 33% less in comparison to their U.S. counterparts, bringing much needed relief to the notoriously high healthcare prices in the United States and elsewhere.
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Canadian, Australian and European regulators also gave passing grades to Ranbaxy, despite the company’s guilty plea to seven offences in the U.S., notes Dinkar Saran, a pharmaceutical-industry consultant with PriceWaterhouseCoopers in Boston. The national regulator reportedly has fewer than 400 staff to police more than 1,300 factories, and does not even oversee many of the drugs exported to places like Canada. That job falls to state-level officials, who have a reputation for being under-trained and corrupt. We will not dispense any prescription medicine without a valid prescription from a licensed/certified doctor physician. A bottle of 21 capsules costs between 5000 and 6000 Indian Rupees, depending on the strength of the medicine, making it very affordable.
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Chinese pharma has also placed much emphasis on using AI and genetics for developing new drugs. This enables firms like XtaIPi to identify thousands of molecules which could be used to treat a disease with fewer resources and time. Jean Lee is a content expert with a background in journalism and marketing, driven by a passion for storytelling that inspires and informs. As the managing editor of The Intake, she is committed to supporting independent practices with content, insights, and resources tailored to help them navigate challenges and succeed in today’s evolving healthcare landscape. For many Americans, the decision between generic and brand-name medications often comes down to cost.
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The industry benefits from cost competitiveness, driven by factors such as lower labor costs, economies of scale, and efficient manufacturing processes. This cost advantage enables Indian pharmaceutical firms to provide competitively priced products both domestically and globally. The extensive scale and diversity of the Indian pharma industry offer resilience and adaptability to the demands of supply chain, enabling it to cater to diverse needs and maneuver through market fluctuations effectively. Such a widespread presence on the global stage underscores the importance of robust supply chain networks capable of meeting stringent regulatory mandates, ensuring high-quality standards, and overcoming logistical hurdles. According to DPCO, the trade margins in the pharmaceutical supply chain should be reduced to allow better penetration of medicines under DPCO and allow a larger population to obtain access. The first-line sellers will receive different percentages of margins to apply, including distributors, wholesalers, retailers (chemists) and hospitals.
On top of all these problems is the large and growing national security risk as more and more drugs become dependent on suppliers from China. Even the common knowledge that we are becoming dependent on a small number of large drug companies for generic drugs understates the dependency on China. Qyobo is a software startup that collects pharmaceutical data from dozens of national and international databases to provide a picture of the drug supply chain that is not only superior to what the patient or the doctor sees, it is probably superior to the knowledge of the FDA.
The study highlights the need to modify the drug price policy, regulate the mark-ups in generic supply chain, conduct and widely publicize the quality testing of generics for awareness of all stakeholders. Supply chain management practices backed by IT-based platforms have shaped estimation, tracking, and monitoring practices for medicines, equipment, and consumables in the Indian health system. Early implementation of such platforms is identified as a key determinant to promote skill development and skill refinement among trained users, allowing the states to gradually saturate and establish them throughout.
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More papers with manufacturing and drug testing data were shredded and tucked away in plastic bags under a stairwell, indicating that Intas executives had manipulated data and tried to cover it up. This scale has been essential in driving production efficiencies and achieving the lower sustainable pricing secured today, strengthening country-led efforts to reach all people living with HIV who need TLD. Empowering patients to personalize their healthcare and connecting them to caregivers has the potential to change the care delivery paradigm. Building on a rich history of developing AI for healthcare, IQVIA AI connects the right data, technology, and expertise to address the unique needs of healthcare. By submitting this form, I agree to receive logistics related news and marketing updates from A.
Paradoxically, low entry barriers have led to fragmented industries that make the sector highly accessible due to competition (Mahajan et al., 2018). Further, we did not fully follow WHO-HAI methodology for calculating availability of essential medicines as the list of surveyed medicines was modified to meet the contextual requirements. Besides, we did not compare the prices of unbranded generics with international reference prices as recommended by WHO-HAI methodology since there is already overwhelming evidence showing that generic prices in India are less expensive compared with international standards. Thus, the scope for generalisability of the study findings, especially on availability and affordability of PMBJP medicines is limited.