As the key knowledge partner for India Pharmaceutical Summit 2012, held in the Hilton Mumbai International Airport Hotel, Mumbai on 12th& 13th July, BMGI presented the ‘elixir’ for making India the top Pharmerging market in the world.

The event was organized by Shanghai based Lnoppen that facilitates business through events and market research across Asia & Europe.With over a hundred participants including Mylan, Ranbaxy, FDC, Neogen and Midas Pharma, the event saw speakers from thought leaders from the industry and regulatory/institutional entities like the World Health Organization (WHO), Indian Drug Manufacturers’ Association (IDMA), Indian Pharmaceutical Association (IPA), Pharmaceuticals Export Promotion Council of India (Pharmexcil) and organizations like Biocon, Reliance Life Sciences, Lupin Bioresearch Center, Global Pharma Tek, Jubilant Life Sciences, Zydus Cadilla, Piramal Healthcare Limited to name a few.

Mr Naresh Raisinghani, chairman for the event and CEO & Executive Director, BMGI, in a brief presentation, articulated how Indian Pharma was poised for growth. He presented the polarity for India, where on one hand the global innovators’ dilemmas – the patent cliff, the declining R&D productivity leading to thin pipeline of new drugs, the pressures on pricing – are causing worry and on the other, markets are banking on India for generics as it is one of the Pharmerging markets.

He illustrated that India has the opportunity to be at the epicentre of the generics revolutionwith the rise in population (set to grow to 1.35 billion by 2020) and coupled with increasing life style diseasestogether with higher disposable income levels enables it to spend more on healthcare. Leveraging the low cost manufacturing India offers coupled with the increased spending by the Government on healthcare infrastructure and providing 100% FDI for health & medical services, the Indian Pharmaceutical narrative is only set to expand. This will provide lucrative opportunities for the global Pharma industry to focus on India with the landscape already changing with various mergers and acquisitions / licensing such as Ranbaxy, Piramal Healthcare, etc., Mr Raisinghani added.

Reinforcing Mr Raisinghani’s estimates,Mr Subhi Reddy, Pharmaceuticals Export Promotion Council of India (Pharmexcil) shared that India’s Pharmaceutical Exportsis projected to be among the top five in 2013-14. Mr Reddy added that India is the largest exporter of formulations by volumes with a 14% market share and that there is a lot of untapped opportunity.

Plotting the trend of the Indian industry, Mr Naresh Raisinghani recounted from the time where most drugs sold were only MNC based, and the first game changer came with the India Patent Act leading to the birth of the booming generics industry. The second major changecamewhen India decided to become globally competitive and the Patent Law being aligned with global norms in 2005, opening the doors for Exports and Indian firms being considered for CRAMS giving a new dimension to India as a Pharma destination. The future wave would not only look at India as the generics headquarters, but would show a shift towards co-holders of development of Innovator Drugs, Biosimilars and Clinical trials, he predicted Mr. Daara B Patel, Secretary General of Indian Drug Manufacturers’ Association (IDMA) supported this by sharing that every third tablet consumed in the world is “Made in India”

Illustrating the patent cliff and the Indian opportunity for Bio Similars as mentioned by Mr Naresh Raisinghani, both Mr Rahul Padhye, Corporate Development, Reliance Life Sciences and Mr Sriram Akundi, Head of Quality & Regulatory Affairs from Biocon shared thataffordable medicines will not be available for the patients and the way to make this was through partnerships or out-licensing deals. Mr Padhye shared that, at least 50% of the Biopharmaceutical market is contributed by the Indian Biosimilars market that is growing at 20% p.a. Mr Akundi urged the industry to look at Biosimilars which is a product that is equivalent of a generic in Pharma.

Mr Raisinghani signed off by identifying 5 key challenges that need to be managed to unleash the potential for high growth in India which include rural reach, skilled labouravailability and dichotomy of price controls, enhancing medical insurance coverage as a hedge towards distributed medical expenses and strengthening IPR laws as we moved more from Patent Challenge to Patent Protect era.

Dr Monir Islam,Director, Health Systems Development, WHO, Regional office for South East Asia elaborated ona recent analysis by the WHOin seven countries in SE Asia which reveals that only a few countries know what drugs they are using and cautioned the industry to keep a watch on quality.He elaborated on WHO’s Global Strategy & Plan of Action (GSPA)-this includes promoting sustainable financing mechanisms for developing countries on Public Health Innovation and Intellectual Property which seems as a direct countermeasure to the challenges outlined earlier by the Chairman of the event. One of the recommendations from the report, he stated, was to get all countries to commit spending at least 0.01% of GDP on government funded R&D to meet the health needs of developing countries.

Dr PM Naik, Project Director, Zydus Cadilla spoke about the importance of creating world class infrastructure for GMP compliant facilities.The Ex-President of Indian Pharmaceutical Association (IPA) firstly described the various reasonsfor a pharmaceutical organization to go for a new facilitythat included growth, constraints in capacity or even a regulatory requirement or tax benefits. Dr Naik mapped basic requirements for world class facilities for manufacture of potent drugs, steroids, API, etc. in detail before emphasizing that pharmaceutical organizations today need to look at Operational Excellence seriously as constant improvement gives competitive edge. He signed off urging the industry to “awake, arise and act in the right manner”

Looking at exports as a percentage of sales and being in a generic market, if an organization chooses not to comply with GMP, would its profits not be optimised?The discussion on this and other important questions confronting the Indian pharmaceutical industry was moderated by BMGI’s Mr Naresh Raisinghani and the panellists included Dr Naik, MrKenny Gregson of Huber and Mr Easwar, Senior VP, Ranbaxy. Dr Naik stated thatif one is making a ton of product, adhering to GMP prevents the practice of conclusion being made on the entire batch to be released from the sample that is tested. Mr Easwar opined GMP enables low process variability leading to high quality products.He added that the notion that it costs money is a misplaced one and furtherstressed that it is about the right blend of process technology, productivity and right design.Mr Gregson stated that it will be very dangerous to work in an approach where there is no focus on quality andend up damaging the reputation.

Naresh probed the panellists with his second question: Lean comes from the auto industry and Six Sigma popularized by GE, does Lean and Six Sigma help in Pharma kind of business?Mr Easwar felt there is a paradigm shift taking place where an organization is working on a concept where raw material is fed at one end and tablets obtained at the other in a span of 6 hours where it takes 365 days today. All this is possible only if one has the understanding of the process. Dr Naiksupported the thought and saidthe principles of Six Sigma allow one to control quality and recounted the horrors of working with variation where one batch had a lower impurity level than other two batches. Mr Gregson felt that Six Sigma and lean system are practices where in you look to improve and continuously look to raise the bar.

Given the challenges that have been recounted so far, how would the Indian Pharmaceutical Industry counter them?Mr Nirmalya Banerjee, Business head & Senior Principal Consultant, BMGI presented the elixir for transforming the Indian Pharmaceutical Industry. Describing the key chronic issues the industry faces today that include lesser success rate yet high lead times of R&D, lack of harnessing market potential by focusing on product and not the outcome, lower inventory turns, less efficient supply chain leading to high cost and lack of consistency in the process outcome – Mr Banerjee charted out key strategies for finding the elixir that will address these issues.

Contrasting the R&D Spend by Pharma companies with the number of approved products, the business head for the Pharma industry vertical suggested Design for Six Sigma approach that has a success rate more than 3 timesof the conventional approach.Urging the industry to Innovate to Breakthrough, Nirmalya outlined the rapid innovation strategy for exponential growth by expanding the window of focus not just to include the expectations of the customer but the “Job To Be Done”.

To facilitate a rapid & an efficient supply chain and increase inventory turns, adopting a Lean way in moving from batch to flow would be the strategy to be adopted which has the potential to reduce in process inventory by 35%, production lead time by over 60%, unit cost of conversion by 20% and increase the direct labor productivity by over 40%. Mr Banerjee said adopting the Six Sigma way would enhance process consistency & reliability and this would directly seek to make processes more capable. He urged the industry to integrate the 4 strategies forhigher revenue growth, increased customer satisfaction, faster & efficient processes and a satisfied customer. Almost the importance of a framework for operational excellence and business growth, Mr Aravindan Raghavan, General Manager, Corporate from Piramal Healthcare Limited shared the Operational Excellence Journey where the process improvement parameters are under a business excellence model named “Manthan” that sought to counter high costs, varying cultures at different sites, high demand customers at its inception which provided an input to developing a model and a framework. The BMGI supported initiative at Piramal had two models: culture development and profit development which led to major initiatives that included ideation, shop-floor development, energy & solvent management, supply chain transformation and sales force effectiveness. The model reaped benefits that included increased employee engagement, external customer delight, facilitated better communication, reduced operational expenses and primarily improved yield and capacity.

He further added that slowly Piramal is moving towards Organizational Excellence before sharing a case study on energy management where the expenditure on energy was reduced by 14% using lean and six sigma principles.

As if reinforcing the importance of strategy for operational excellence, Mr Kulbhushan Gupta, senior Vice President & Global Head, Business Excellence from Jubilant Life Sciences spoke about the business turnaround for the Pharmaceutical unit. Outlining Jubilant’s business excellence strategy he shared a case study where the market demand grew suddenly for formulation & API business. Mr Gupta recounted several problems the team faced and explained the various process improvement tools that were used which included principles from New Product Development, a Pull based system – Kanban, Quality Function Deployment and Design of Experiments to name a few, that helped reduce the development time by 40 - 50%. He stressed the importance of a focused structure and a framework for improving operations and hence the business.

How will we know if a generic product is as good as the innovator product? This question was answered by Dr Ravisekhar Kasibhatta who is the Vice President –CR in Lupin Bioresearch Center in his eloquent talk on Bioavailability/Bio Equivalence Studies in India. Dr Kasibhatta explained the process of comparing a generic product and an innovator product is called a Bio Equivalence study and it is important there be uniformity in standards in terms of Quality, Safety & Efficacy. He established that Pharmacokinetic-Pharmacodynamic Studies is a better tool during development as it has the potential to shrink the size of clinical trials since the conventional BE studies become impossible to establish safety ∓ efficacy.

While Mr T V Narayana, Vice President, Chairman Education Division from the India Pharmaceutical Association (IPA) urged improvements in education in Pharmacy in India with increased academia-industry interactions, the role of a Pharma firm in investing in educating the country’s population was probed by Dr Islam, Mr Padhye and Mr Kasibhatta. While it was felt that therapies available make people vulnerable to effects of nonstandard practices by physicians and Mr Padhye felt it would not be possible for the industry to reach out to the people and educate them as it would be unethical. The opportunity could be made possible through websites but that is the best that could be done.

Dr Albinus D’Sa, Deputy director India Office, US Food & Drug Administration gave a complete breakdown of Health and Human servicesand the detailed break up for fees for ANDAs and DMFs.