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Reducing healthcare budget, pricing pressure squeezing pharma industry, say leaders.

08 Feb 2017

 HYDERABAD: Indian pharma industry captains have reiterated their concerns over constant reduction in the healthcare budget of the Central government and an increasing pressure on price reduction which is resulting in squeezed margins.

India spends about 1 percent of its gross domestic product (GDP) on public health, compared to 3 percent in China and 8.3 percent in the United States. Despite this low budget allotment, the contribution has been decreasing or kept stagnant in India since several years.

According to Glenn Saldanha, chairman and managing director, Glenmark Pharmaceuticals, “The government is keen on reducing the drug prices, which are already at the world’s lowest, squeezing the Indian pharma industry that has already become very competitive with large number of MNCs and domestic players operating in this space.”

He was speaking on the sidelines of Bio Asia 2017 in Hyderabad on Tuesday.

While the government’s healthcare budget has been reducing, even public-private partnerships have largely not been successful, said Dr Vasanth Narasimhan, global head of drug development and chief marketing officer, Novartis.

K. Taraka Rama Rao, Telangana's industries minister attributed this to the lack of people’s confidence in government healthcare institutions.

While addressing the concern on the investment on research and development (R&D), Dr Narasimhan said, “The bio-technology industry faces a challenge in getting the returns on huge investments they make on the research and development. The pharmaceutical and biotechnology industry around the world invests almost a $150 billion and the question we have to answer is how efficiently we can use the funds and how the companies can get the returns for their investors.”

“Each successful drug development today starts with a discovery or an invention followed by many years of development, creating a market and getting the drug to be actually used by the ethical community," said Nobel Laureate Professor Kurt Wuthrich, Scripps Research Institute, USA in his Key note address. "I lived through this myself, I have seen that it took two generations of medical doctors to adopt MRI and use it where it is more apt to provide information needed.”

Metropolis acquires Sanjivani Pathology Labs in an all cash transaction

08 Feb 2017

 Metropolis has adopted a string of pearls strategy by either partnering or acquiring smaller brands in newer markets.

MUMBAI: Private equity backed diagnostics chain Metropolis has acquired Rajkot, Gujarat-based Sanjivani Pathology Labs in an all cash transaction for an undisclosed amount. Ahead of its planned initial public offering, Metropolis is bolstering its presence in markets it is not present, signaling the trend followed by the top players that are acquiring smaller brands in the race to consolidate and grow.

Metropolis has adopted a string of pearls strategy by either partnering or acquiring smaller brands in newer markets. Metropolis has acquired the entire business of Sanjeevani, thereby strengthening its market share and penetration in Western India and giving it a strong foothold in the underpenetrated Saurashtra region.

Founded in 1993, Sanjeevani Pathology Laboratory, promoted by Dr. Kirit Patel has seven collection centres and four labs. This will now be part of the 150 medical laboratories with over 1000 collection centres that IPO bound Metropolis has.

Metropolis is backed by private equity fund KKR and a Carlyle Private Equity portfolio company. Investment bank Wodehouse Capital was the advisor to the deal.

New rules may discourage domestic manufacturing of medical devices: AiMeD

08 Feb 2017

  The new rules, notified on January 31, classify medical devices in four classes -- low risk, low moderate risk, moderate high risk and high risk.


New Delhi: The Association of Indian Medical Device Industry (AiMeD), while welcoming the new rules for medical devices, has expressed its concerns that the new rules may result in the closure of domestic manufacturing of medical devices and drive jobs out of India as more manufacturing of high risk high technology devices will switch to imports.

 

“At AiMeD, we are delighted with the release of latest medical devices regulations as Separate Rule Book, different from pharmaceutical, and though it has provision of third party certification for low risk medical devices like wheel chairs and syringes etc we are highly disappointed that the high risk product manufacturers regretfully will now not be covered under professional third party certification,” said Rajiv Nath, Forum Coordinator, Association of Indian Medical Device Industry.

 

The new rules, notified on January 31, classify medical devices in four classes -- low risk, low moderate risk, moderate high risk and high risk.

 

“It’s discrimination if Indian manufacturers of high risk medical devices can't have market access till they prove compliance to the rules after a factory inspection but this requirement of factory's inspection is not mandatory for overseas manufacturing plants of medical devices! There's only a provision to opt for this,” Nath pointed out.

 

According to Nath, “The proposed regulations may result in the closure of some units of domestic (medical device) manufacturing and drive jobs out of India as more manufacturing of high risk high technology devices will switch to imports! Though there is a provision for the government to seek expert input for inspection this may end up as a double whammy to satisfy the inspector and the expert as we have experienced in joint inspections by the state and the central government teams from the drugs department.”

 


He further said, “It is rare for an industry to seek regulations but we do not want regulations of the Inspector Raj or traditional kind. The industry is consistently seeking voluntary compliance backed by third party certification from QCI (Quality Council of India), e.g. ICMED (Indian Certification for Medical Devices), as an alternative method of compliance to the rules and waiver of Quality Management Systems Audit by the CDSCO (Central Drugs Standard Control Organization).”

 

“The purpose of regulations is to filter access to unsafe products and ensure patient safety and consumer protection; while these rules will help to do so the medical device industry is also disappointed that there's nothing to penalise pseudo manufacturing by making the country of origin as a labelling requirement and ban the second hand imports of medical equipment to safeguard patients from non-calibrated equipment,” added Nath.

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