Strategy to tap generic markets in India The environment The responsibility The strategy The future
C.K.Sabharwal Crop Health Products Ltd -one small voice….
Generic manufacturers, products, markets – environment..
During 1970-1990’s, due to patent expiry,generic pesticides became the fastest growing sector elsewhere as in India. From 10% of total markets world wide in 1995, generic producers at this time supply around 65% of global sales of, off patent products(Anon 1999)., while 35% comes from patented molecules. In India too, major share of technical production/markets comes from off patent/generic products. The Patent Act will now usher in new molecules – from R&D based Companies. Generics face substitution and regulatory uncertainty elsewhere as in India.
Generics….down or up?
Market for generics in India shows sure erosion in price and value offered due to: Large capacity, both for actives/ formulations, at regional/national levels – consolidation ? BT Cotton, changing pest/disease infestations, transgenic crops impact on pesticide demand ? Imports from China etc. both legal and illegal result in wide price difference for same molecules between branded and generic producers. Local producers resorting to price discount strategy, lowering the net value for all times.. Availability of spurious/substandard products,ready to sell network, and corrupt business environment. – kill brand value chain?
Generics going down! – Who is responsible??
We ourselves, the fragmented industry, for failing to look at the global picture, tolerating illegality,partnering corrupt practices, and by an absence of product portfolio management. The Government, which is unable to provide a healthy regulatory environment/understanding. The network and the supply chain, who has the last laugh at the merry bunch of jokers involved in this game of perpetual value reduction. The marketers who wish to easy sell and not work on product stewardship -
Generics – strategic issues..
R&D companies are divesting actives,which can be acquired by other generic producers. Actives registered before 1993 may not be supported due to data generation costs by the majors unless generic producers support use extension for new crops. Generic producers must produce and share data/costs and find new markets Allocate resources for product stewardship such as resistance management, new usages, dose setting. Generic supply and demand issues, production capacity rationalization, investment in data and development.& exports, real challenges ahead! Govt. regulation will limit use of old generics.
Generics - strategy
New solutions to crop problems to meet changing customer needs – need of hour. Performance enhancement of existing active products by improving formulations, application methods, and combinations.(>registration). Offering generics as a part of crop solutions package rather than as stand alone products.relaunch generics – don’t write them off.. Allowing easier route for Combinations Registration, new formulations and export of generics. – is the regulator listening? Produce newly off patent products with additional services and performance/quality guarantees.
Generics - Strategy
Manufacturers, distributors and dealers must stop looking at generics as only(low) profit giving commodities, but look at each product as a crop specific solution provider. Large producers must assume leadership role. Substitution must not be automatic – it must be managed by design.. Many off patent products outside India are potential candidates to be examined for manufacture – export, or domestic development,by Indian manufacturers of actives. This needs positive fast track registration regulation based on reasonable data requirement. Parallel importers from China – eroding or adding value? Introspection/regulation needs/partnership?
Generics – Strategic partnering
R&D Companies in India, and large Indian producers must look at potential partnerships, nationally and regionally, to promote generics by creating a value chain/brands/solutions – to coexist(peacefully) with new (patented) products, and biotechnology or genomic systems. Safer and newer formulations such as SC/WDG/ME etc. must be encouraged to breathe some life into generic value chain. Contract farming, agricultural retail, must get involved into the generic value chain to deliver quality to end users with monitoring capability. Minor use registrations must be on fast track, to encourage precision farming.
Generics – outside India – lessons?
Generic products containing substances listed in Annx. 1 of Directive 91/414/EEC cannot have a MA granted unless the applicant has met requirements of Annexex II and III. /consent. Danger that generic products may disappear from common market according to will of the major manufacturers/former patent holders. Regulations seems to protect major manufacturers from generic competition. Is India headed this way too? (Eco times2/1/06) Not only choose – Data exclusivity – data protection & market exclusivity but share data and implement data compensation schemes.
Regulation – generic products
Regulation should be concerned with safety of environment, quality, bio efficacy and MRL not with market protection or data shields. Regulation should encourage sharing data, partnerships and rules for data compensation,not product monopoly.. Playing with data exclusivity leads to market exclusivity.Drives majors into investing time and resources for minor changes rather than develop innovative products. Patent protection is now 17 to 20 years. Generic industry has a positive role to play. Regulators must recognize this. So must industry.
Protect the generics for sustainable agriculture
Manufacturers must consider with Regulators whether an old generic meets requirements of bio efficacy, safety and cost, before considering replacing it with new products just because of patent, or other considerations. – roadmap? Generic producers must wade through a maze of patents, process chemistry, impurities, field trails, toxicology and protected data, competition, costs,can Indian producers do this? Fast? Industry must forge partnerships of value. To strike an equitable balance between generics / new products. – SME’s – Exit or change ..Will they?
Generics – what’s coming..
Indian Agrochemical industry in present form unsustainable to support innovative strategies in the future for generics. Food safety, environment, health, key regulatory concerns – are these industry concerns too? Corporate need to better handle its image. Our network – partners in crime or value? Provide services not only products! Regulation must facilitate sustainable agriculture with industry, rather than make law to fill jails.. Generics in India …..God & Rain be with you! They are your only support left……..unless..
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