Dean Rao in his welcome address expressed the ISB’s willingness to contribute to the public health scenario in India. He said that the institute would initiate health awareness programmes in the future, and facilitate an equitable and professional health care system for the masses.
Ranjit Shahani, VC and MD Novartis India Ltd, and President (OPPI), in his keynote said, “Health care is not a paradox but a challenge”. The main obstacle that the pharma industry faced, according to him, was the inability to communicate its value proposition. “The challenge is to build on our corporate reputation, to foster responsibility and reliability and to win public confidence.” Shahani stressed that research in the pharma industry is a long process which involves clinical trials, safety aspects etc. Moreover, it is an expensive proposition. This meant that cost per patient is also on the rise. The challenge that the industry must take on full front is to improve the quality of life while building on innovative treatments. Shahani said that the healthcare infrastructure scenario in the country is insufficient, and availability of drugs is alarmingly low specially in the rural sectors. A public private partnership, according to him, is essential to provide healthcare to Below-Poverty-Line families in India. While India is poised to be one of the top 10-pharma players in the world, Shahani ironically pointed out to the high mortality rates and cases of night blindness in rural India. While India boasts of having the lowest priced medicine, much of the benefits are inaccessible.
The discussion then moved on to talk about how intellectual property can be harnessed for sustainable competitive growth. “The pharma industry has taken globalisation as an opportunity and not as a threat,” voiced Ajit Dangi Director General, OPPI. He said that to sustain the dynamic growth that the pharma industry is witnessing, an environment that fosters innovation is required. Here comes in Intellectual Property, which comprises of trademarks, copyrights, traditional knowledge, design rights etc. Dangi pointed out that in a country like India which is a biodiversity hub, it is essential to balance national interest, healthcare issues, availability and medicinal prices in order to use IP as an aggressive commercial weapon. Pointing out to the importance of IPR training courses he said that institutes like ISB can go a long way to institutionalize it. “IP should be an integral part of business strategy and not just a legal or R & D issue. Latent IP of a company can help it take leadership positions and help in competition,” said Dangi.
Unlike other industries, Pharmaceutical industry has been able to weather the wave of globalization primarily because it managed and protected its IP well. He believes that the future growth of an industry or a company depends on a) financial capital b) Management talent and c) Environment that fosters research. Existence of favourable IP provisions helps foster innovation, which inspires growth of the industry.
According to him, a national IPR policy in healthcare is formulated by considering following four attributes:
b) Science & Technology; Research & Development
c) Availability of medical facilities and price of the facilities
d) Healthcare Services
Quoting example from famous case studies, Dr Dangi stressed on the importance of managing IP. He laid down few key opportunities related to IP provisions and IP management for Indian Pharmaceutical companies:
b) International clinical trials
c) Technology Services
d) Herbals Neutraceuticals
e) Bioinformatics, Biostatistics
f) Training & Development
g) Turnkey Projects
h) Contract R&D;
Kwela Handa, MD, Pfizer, focused on making regulatory changes competitive. “In India, regulation is more of control in nature and prohibits growth. Unlike the IT and telecom industry, the Pharma industry is still struggling under the yoke of over-regulation,” he said. Pointing out to the fact that a right regulation system could increase productivity by 60 per cent, Handa said that in India there is a vast difference of mindset between the government and the industry, which needs to be addressed. “We need an optimum regulatory frame work and the government doesn’t have the mind set to put this in place. We need open transparent regulations and not some draconian laws. Regulations cannot be political driven,” he said. He brought to light the fact that the government spends only .09% of the GDP on health care whereas the WHO recommends a 7 to 8%.
Handa spoke about the issue of over-regulation in the Indian market. He said that the ideal role of regulations is to facilitate fair competition and shape the structure and conduct of the industry. However, in recent times, the industry is experiencing an environment of over-regulation in India. He said that the perception of industry towards patents and IPR is significantly different from that of government. While the industry sees patents as safeguard of innovations, government simply views them as tool for WTO compliance. He stressed on the need for linking corporate strategy to the regulatory environment, which can be done by:
a) Defining and understanding impact
b) Stakeholder management
c) Conductions stakeholder analysis
d) Managing tradeoffs
e) Communicating strategies
f) Organizing regulatory management
He expressed concern about lack of optimal government framework to introduce and implement IPR laws and provisions. Few of the government policies that are cause of concern are:
b) Delay in decisions
c) Price control
d) Labour regulation
e) No drug reimbursements in form of labour
f) Code of marketing practices
He concluded by saying that the business models for Indian pharmaceutical companies are evolving and some key models are:
b) Core generics companies
c) Partnership seekers
d) Niche players
Co-relating Intellectual Property with the tale of the three blind men who have different views about the elephant, Sails Ayyangar, MD Aventis Pharma Ltd, traced out the history of patent, from the 19th century diktat that patent was enemy to free trade to the present scenario where patent is the key to manage economic prosperity. “65% of the pharma industry would not have launched a product if there was not patent,” he said. “The reason is the long lag period in the research arenas of the pharma sector, and also because of the high investment in the R&D.; Ayyangar posited advantage India as a mantra to strengthen the IP in the industry. “We have exclusive brainpower, we have entrepreneurship in our blood, we have excellent manufacturing facilities, all we need is to build a reputation and get out of the copycat label. We need to manage IPR for forging alliances and for clinical research,” he said. Encouraging ISB students to venture into this sector Ayyengar said, “The Pharma industry is an industry of choice and a challenging one for young business minds.”
Analyzing the phenomenon of medical tourism Vishal Bali, CEO Wockhardt Hospitals said the initial euphoria of a first world patient being treated in a third worlds hospital is over. He claimed that Healthcare Delivery is going to be the major key driver as far as the growth of the pharma industry is concerned and that Asia is going to be the next best destination for health care practices. Bali said that we have come full circle. “From being a net exporter in patients to the developed world, we have become the net importer,” he said. The reasons being that while in Europe the Social Insurance Scheme is under pressure, the US healthcare comes at a premium rate. “Today we are the treatment destination for the developed world and this is due to the fact the India has above 600,000 doctors, lower medication cost, availability of global healthcare brands, a global recognition of clinical talent and also because of the fact that India is a civilization 5000 years old,” he said. Bali however maintained the need to sustain the advantages. “We need to have consistent cost advantage, have transparency of clinical services and confirm to international quality and standards, he stressed.
Dr P Namperumalsamy, Chairman, Aravind Eye Care System, spoke about his institution’s efforts at providing healthcare to the 500 million who comprise the ‘Bottom of the Pyramid’ segment in India. Aravind’s healthcare strategy aims at subsidising the middle income group and providing free healthcare to the poor people. One way of doing this was through optimisation of their resources – they do 2000 cataract surgeries per doctor per year, where the figure stands at 250-300 cataract surgeries per doctor per year for the rest of the hospitals in the country. And they do not compromise on quality. Aravind was also aiming at making optimal use of IT through telemedicine efforts where paramedics take care of the preparatory activities and a qualified doctor takes care of the diagnosis.
Ratan Jalan, CEO, Apollo Health & Lifestyle Limited, speaking about the medical insurance sector, said that the Mediclaim policy, with all its limitations, was virtually the only product available in medical insurance in the country. He stressed the need for more insurance products in the Healthcare industry.
The afternoon session had a panel discussion on “Indian Pharma in the global game”. Utkarsh Palnitkar, Partner, Ernst & Young, was the moderator for the discussion. He said that the biggest impact of globalisation in the Indian consumer context was that earlier there were two kinds of products manufactured in India – one was ‘export quality’ and the other was meant for lesser mortals in the country. Now, with globalisation, there is only one kind of product available – the ‘export quality’ kind. “The Indian consumer has never had it so good,” he said.