India As a Market of Generic Drugs

GS Paper III

News Excerpt:

Janaushadhi Kendras are at the centre of a rising wave of non-branded generic medicines and could be replicated in other countries.

About Generic Drugs in India:

  • Generic drugs, copies of innovator medicines, are made once the patent ends.
  • Definition: A non-branded medicine that, in respect of dosage, is equivalent to a branded or reference-listed drug, administration, and effectiveness is known as a generic medication. 
  • India is primarily a branded generic drugs market, where several pharma companies sell their own brands of generic molecules. 
  • The generic drug must, per FDA regulations, include the same active component as the brand name medication, as well as the same dose, potency, safety, usage circumstances, and mode of administration.
  • For example, the paracetamol molecule can be bought in the market as Calpol, Crocin, Dolo and other trade names. 
    • These are thus referred to by the oxymoronic term of branded generics and these are what the common man usually buys.
  • Usefulness:
    • Usually, 90-95 percent less expensive than branded medicine, 
    • Prove to be safe and effective,  
    • Easily available, 
    • Both generic and branded medications are governed by the same laws, by the D and C Act of 1945.

Position of Generic Medicine in India:

  • India is the third-largest country in terms of volume and the fourteenth-largest in terms of value in the pharmaceutical sector because of the idea of using traditional medicine.
  • In the world’s supply of DPT, BCG, and measles virus vaccinations, India has risen to the top. Indian medicine is preferred worldwide thus making India the “pharmacy of the world”.

Trade generics (generic generics, or those without a brand name): 

  • These are also sold by pharma companies, but they don't market it through doctors. Instead, these are pushed directly into the distribution network.
  • Trade generics are usually packed in thousands, and meant for hospitals and dispensaries. 
  • In the absence of marketing costs, the prices of non-branded generics can be lower than those of branded generics.

About Pradhan Mantri Bhartiya Janaushadhi Pariyojana (PMBJP):

  • With an objective of making quality generic medicines available at affordable prices to all, PMBJP was launched by the Department of Pharmaceuticals, Ministry of Chemicals & Fertilizers, Government of India in November, 2008. 
  • The Scheme is implemented by a society registered under the Societies Registration Act, viz., Pha­r­maceuticals and Medical Devices Bur­eau of India (PMBI).
  • The PMBI sources medicines only from facilities certified by WHO-GMP (Good Manufacturing Practices Standards adopted by the World Health Organization). Also, there are quality inspectors who check for any substandard medicine getting into the system.
  • Objective:
    • Ensure access to quality medicines for all sections of the population especially the poor and the deprived ones. 
    • Create awareness about generic medicines through education and publicity to counter the perception that quality is synonymous with high price only. 
    • Generate employment by engaging individual entrepreneurs in the opening of PMBJP Kendras.
  • Under the scheme, dedicated outlets known as Janaushadhi Kendras are opened to provide generic medicines at affordable prices. 

Janaushadhi Kendras:

In India, Janaushadhi Kendras sell generic drugs that are priced 50 to 60 per cent lower than the popular brands. 

  • The rapid expans­i­on of the Kendras is not only providing livelihoods but also playing a critical role in saving out-of-pocket expenditure for patients.
    • An estim­a­ted 1 million to 1.2 million people on av­erage buy medicines every day from Jan­au­shadhi Ken­dras across India.

  • During FY23, the PMBI sold Janaushadhi medicines worth Rs 1,236 crore, which led to savi­n­gs of Rs 7,416 crore for citizens.
  • The government is targeting sales of Rs 1,400 crore for the PMBJP programme in FY24. 

Expansion of Private sector:

  • The rising penetration of trade generics is also denting the value growth of the Rs 1.9 lakh-crore domestic pharma market. 
  • Big pharma companies, such as Cipla, Alkem, and Torrent Pharma, sensing an opportunity in the huge volumes, have entered the trade generics space.

Why branded generics rule the Indian pharma market:

  • Indian pharmaceutical industry’s success is due to various factors including a trained labour base, low manufacturing costs, and a robust R&D infrastructure. The majority of items sold worldwide are generic.
  • Due to India’s pharmaceutical manufacturing sector’s consistent expansion, pharmaceutical companies worldwide are establishing production facilities there.
  • The Cen­tral Drugs Standard Control Organization, the drug regulator, began an enforcement drive — including action aga­inst testing labs and clinical research bod­i­es — to curb poor manufacturing practices.
  • It costs around 33 percent less to produce active medicinal components in India than it does in the US. 
  • In the absence of brands, such as in the case of trade generics, some consumers might miss that promise of quality. 
    • A recent report said that 15 percent of the medicines produced by small companies failed to meet quality standards, as against the nat­ional average failure of 2 percent.
  • As the wave of generics spreads in the country, other countries have sought Ind­ia’s help to replicate this model of Janau­sh­adhi Kendra network. 
    • Nigeria wants to set up stores similar to these Kendras in an attempt to make availa­ble medicines available at affordable prices.

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