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Foreign drugs to get cheaper

Indian companies are distributing overseas blockbuster drugs under local licensing, reports Suprotip Ghosh.

india Updated: Jan 01, 2007 18:56 IST

They call it co-opetition, when firms cooperate and compete at the same time. While Indian companies are known to be increasingly competing with western pharmaceutical companies in making cheaper copycat versions of their generic drugs going off-patent, another side to the story is emerging, in which Indian companies are distributing overseas blockbuster drugs under local licensing.

The gainers in this game, called "in-licensing" are the Indian doctor and patient, who are set to get assured quality in patented medicines at special local prices that could be cheaper by up to 25 per cent compared with US drug prices though they would be costlier than the drugs available today, industry officials say.

The trend of using Indian distribution channels started two years back, and is expected to turn to a flood, which will determine the face of the Indian pharmaceuticals market in the coming years. Foreign firms save on costs by using local sales channels, and can pass on the benefits to customers.

Indian patients can now expect to get the latest patented drugs to treat diseases such as hypertension, osteoporosis and high blood pressure.

The new year is expected to see more Indian companies selling in-licensed drugs from multinational companies than ever before, say industry sources.

"Every Indian company would negotiate with the new drug developer to keep the prices reasonable. Typically, an in-licensed drug could be up to 25 per cent cheaper than if a multinational company launches it here," PK Pathak, Senior Director at Dr Reddy’s Laboratories, told Hindustan Times. Dr Reddy’s has in-licensed an arthritis drug known as Celadrin from US-based Cymbiotics.

Hoffman La-Roche, the Swiss multinational, has recently signed an in-licensing deal with Elder Pharmaceuticals to market Bonviva, a once-a month drug for osteoarthritis. The drug, sold in 50 countries, is priced Rs 2,500 ($ 56) per tablet. The Indian price is about 35 per cent cheaper than the price of Bonviva in the Western markets, said Dr GL Telang, managing director, Roche India.

Several large and medium pharmaceutical companies have signed in-licensing agreements in the past two years or so. Companies including Cipla, Biocon, Nicholas Piramal and Wockhardt are already in deals to bring in drugs that would soon be available in the market.

"There is far more literature available for patented drugs than copied drugs. That means the patient can have much better information on all these drugs compared to generic drugs available in the market," said Alok Saxena, director, Elder Pharmaceuticals.

The in-licensing model also means that drugs would have much better availability in the market. Indian companies have better reach to patients and doctors than foreign companies.

E-mail Suprotip Ghosh: Suprotip.ghosh@hindustantimes.com