pharmexcil Digest - August 2009pharmexcil.com/data/uploads/Pharmexcil Digest- August 2009.pdf · 3.2 Human Swine Flu- A Rare Global Pandemic Expert Opinion from Datamonitor In response

pharmexcil Digest August 2009

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DISCLAIMER This monthly update has been prepared as a service to pharmaceutical exporters from India and pharmaceutical importers in other countries, by PHARMEXCIL (Pharmaceuticals Export Promotion Council of India). No part of this report may be reproduced, stored in a retrieval system or transmitted in any form or by any means, without prior permission, in writing from PHARMEXCIL and Datamonitor, India.

PHARMEXCIL does not recommend or endorse any specific companies or commercial products and brand names which may find mention in these Monthly News Digest. Through the information contained within these monthly updates PHARMEXCIL does not express any opinion whatsoever concerning the legal status of any country, territory, city or area or of its authorities, or concerning the delimitation of its frontiers or boundaries.

Table of Contents

1. Chairman’s Message ..................................................................................................2

2. Executive Director’s Desk .........................................................................................4

3. Features......................................................................................................................6

3.1 USFDA widens its Regulatory Watch ..................................................................6

3.2 Human Swine Flu- A Rare Global Pandemic ......................................................8

3.3 Herbal and Traditional Medicines in Indian Context....................................... 10

4. Country Focus.......................................................................................................... 13

4.1 The US Pharmaceutical Market: Brand Erosion at Patent Expiry – Opportunity

for Indian Pharma companies focusing on generics............................................... 13

5. Pharmexcil Activities ............................................................................................... 16

5.1 Pharmexcil activities during July 2009 ............................................................... 16

5.2 upcoming Pharmexcil activities......................................................................... 18

5.3 Highlights of Budget 2009-10 for Pharmaceutical & Allied Sectors.................. 20

6. News......................................................................................................................... 23

Knowledge Partner

Vol.1 Issue 2

August 2009

PHARMACEUTICALS EXPORT PROMOTION COUNCIL (Set up by Ministry of Commerce, Govt., of India)

H.O.: 101, Aditya Trade Centre, Ameerpet , Hyderabad – 500038 Tel: 040-23735462/23735466, Fax: 91-40-23735464

E-mail: [email protected]


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1. Chairman’s Message

Dear Member, I am happy to present the second issue of

‘pharmexcil Digest’, which received

tremendous response from the various

stakeholders of Pharmexcil.

For quick facilitation of services to

exporters of drugs and pharmaceuticals

from the State of Gujarat, our council is

opening its branch office in Ahmedabad

on August 13, 2009. At this juncture, I

would like to thank Mr. Dinesh Patel,

Chairman, Themis Medicare Ltd., for

extending full cooperation by offering his

premises situated in a central commercial

location temporarily for setting up of the

office. We are expecting the Government

of Gujarat to provide us a place for

establishing a permanent office in

Ahmedabad in the near future.

I am also happy to inform you that

Pharmexcil is organizing an international

event, “Indo-Africa Pharma Business

Meet” from 17 – 19 September, 2009, in

Hyderabad. This is part of a project

approved by the Ministry of Commerce &

Industry. We are inviting Drug Regulators,

Procurement Agencies, Manufacturers/

Distributors, and the media from about 18

African countries. About 80 delegates are

expected to attend this business meet. As

part of this event, Pharmexcil is also


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organizing an exhibition, a buyers/sellers

meet and technical sessions. I hope all our

members will use this opportunity to

further their business interests.

I am pleased to inform you that the

Committee of Administration of

Pharmexcil has decided to institute the

‘Pharmexcil Export Awards’ for

outstanding export performance and

“Best Patent Award” for patents secured

from any Patent Granting Authority. For

export performance, there will be three

Awards (separately for SSI, Non-SSI and

Merchant Exporters) in the form of

Trophies, Merit Certificate, and Emerging

Exporter in each of the product categories

covered by the Council. The filled-in

application forms have to be submitted to

the Council on or before August 25, 2009,

which will be forwarded to the Expert

Committee, appointed by the Committee

of Administration, for their

recommendations. All the winners will be

presented the awards in the next Annual

General Meeting of the Council, which

will be held from 17 – 19 September 2009

and coinciding with the “Indo-Africa

Pharma Business Meet” at Hyderabad.

Thanking you,

Yours Sincerely,

Venkat Jasti


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2. Executive Director’s Desk

Dear Member, I take immense pride in stating that we

have received a remarkable response from

our members for the initiative of

pharmexcil’s very own monthly bulletin,

‘pharmexcil Digest’. We will continue to

render our best efforts in transforming

this information product as an effective

communication channel between

Pharmexcil and its members.

Currently, Pharmexcil is leading a business

delegation to South Africa, Botswana,

Mozambique and Zambia from July 22 –

August 05, 2009. This delegation is a part

of the “Project for Brand Promotion of

Indian Pharmaceuticals in Africa”, being

undertaken by Pharmexcil with the active

support of the Department of Commerce.

The visit of the delegation also coincided

with an important event, namely, “India-

SA Business Meet”, organized in

Johannesburg on 23rd July, 2009, by the

Indian High Commission. Dr. Surinder

Singh, DCGI, gave an insightful

presentation, explaining the various drug

regulatory systems followed in India for

production and distribution of generic

medicines. He also tried to dispel the false

impression of several participants from

the South African Pharmaceutical

Industry and Regulatory Authorities that

the spurious drugs are produced in India.

During the discussion, the increasing

threat to generic medicines made in India

being labeled ‘counterfeit’ and seized by

European authorities was also addressed.

Shri Lanka Srinivas, a reputed Pharma

Professional has given a presentation on

Indian Pharmaceutical Industry.

I would like to bring to the notice of the

members that in the backdrop of the

recent reports of seizure of Chinese origin

generic medicines with “Made in India”


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labels exported to Nigeria by NAFDAC

authorities (Nigeria), Pharmexcil has

alerted all its member exporters to Nigeria

to take note of these developments and to

keep a close watch on their own generic

products marketed in Nigeria.

Additionally, Shri Ashok Kumar,

Secretary, and Shri Devendra Chaudhry,

Joint Secretary, Department of

Pharmaceuticals, have conducted a

meeting in New Delhi and then in

Chennai on July 13 2009 with local

pharmaceutical exporters to Nigeria to

develop corrective measures to drive out

false impressions on India as supplying

counterfeit drugs.

Pharmexcil has also received some

representations from members that

Libyan Government has issued a notice

barring entry of generic medicines

originating from other than European and

North American regions. The Libyan

Customs authorities have refused to clear

the consignments that had already reached

Libyan ports. On the basis of complaint

made to Government of India,

Department of Pharmaceuticals along

with the Indian High Commission has

taken this matter with Libyan

Government and was successful in

postponing the effective date of

implementation by 4 months. The Indian

Mission in Libya has asked Pharmexcil to

lead a delegation to Libya to dispel the

doubts on the exports from India.

Department of Commerce is likely to lead

the delegation to Libya shortly. On 17th

July, Pharmexcil has organized a

seminar/workshop on “Export

Opportunities for Pharma and Herbal

Industries” at Trivandrum to help the

SMEs to venture/improve their exports in

the Pharma Sector.

In view of recent happenings like seizures

by EU authorities of Indian generic

medicines in transit to various developing

countries in Latin America/Africa on the

grounds of counterfeit/patent

infringement, patent litigations in US

courts, etc., Pharmexcil is organizing a 4th

seminar on patents on August 21, 2009,

for the benefit of its members, where

eminent speakers would be making

presentations on the present IPR scenario.

I would like to request all the members to

make use of this opportunity. In addition

to this, the council is planning to open a

patent office in Mohali shortly.

Yours Sincerely, P.V. Appaji


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3. Features

3.1 USFDA widens its Regulatory Watch Expert Opinion from Datamonitor

According to the US Government

Accountability Office (GAO), the

USFDA inspects relatively few foreign

establishments every year (less than 11%,

1479 units inspected from FY2002 to

FY2007 in more than 51 countries) to

assess the manufacturing of drugs

currently marketed in the US. It takes

approximately 13 years on an average to

inspect all these establishments compared

to 2.7 years required to inspect around

3000 US facilities.

In FY2007, there were around 6, 760

foreign establishments manufacturing

drugs that were exported for the U.S.

market (Source: OASIS, Operational and

Administrative System for Import Support). The

foreign countries that had the largest

number of registered establishments

supplying for the US market are Canada,

China, France, Germany, India, Italy,

Japan and the UK. It made

comprehensive regulatory changes in

FY2007 to determine compliance with

cGMP regulations and assure the safety

and quality of drugs, which resulted in

increasing foreign inspections to a large

extent. China & India are under the scan

now as majority of the active ingredients

are exported from these countries. And

more over, India has the largest base of

Source: GAO analysis of FDA data * includes foreign entities that were registered to manufacture human drugs, biologics, and veterinary drugs

Figure 1: Foreign Registered entities supplying drugs to the US market


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Exhibit No.2: Number of USFDA Inspections in 2007,

Country-Wise

India

19%RoW

25%

Italy

8%

Germany

8%

France

7%Japan

7%

Canada

6%China

6%

Switzerland

5%

United

Kingdom

5%Ireland

4%Source: GAO analysis of FDA data & Datamonitor Research

Warning letters issued by USFDA, 1996 - 2009

China, 11, 3%

India , 10, 3%

Italy, 6, 2%

Canada, 5, 1%

Sw itzerland, 4,

1%

France, 3, 1%

Germany, 3, 1%

Netherlands, 3,

1%

RoW*, 19, 6%

Other, 64, 19%United states,

270, 81%

USFDA-approved drug manufacturing

facilities (~140) outside US.

USFDA issued about 10 warning letters to firms manufacturing in India during the last 12 years and accounted for only 3% of total warning letters issued by USFDA

During the period 1996 – 2009 (upto 21

July), the USFDA has issued about 334

warning letters for non-compliance with

the manufacturing standards. About 81%

(270) of these warning letters are to the

manufacturing establishments based in the

US. Next to the US, manufacturing firms

based in China and India received about

3% each of the total warning letters

issued.

As part of the plant inspections, there

were certain instances of the

manufacturing firms in India receiving

warning letters from the USFDA due to

non-compliance with regulatory norms.

Conclusion: Indian companies need not panic The regulatory authorities in both US and

Europe will continue to take enforcement

action against firms that are identified as

violating manufacturing requirements.

With the increasing percentage of generic

drugs, the regulatory authorities are

going to increase their scrutiny,

irrespective of the size of the

organization. Indian companies will

be required to establish facilities

complying with manufacturing

standards, standard operating

protocols, quality assurances and

data management to ensure smooth

transition in the manufacturing and

marketing of their products.

Figure 2: Number of USFDA inspections by country wise, 2007

Figure 3: Warning letters issued by USFDA, 1996 –

upto 21 July, 2009

Source: Pharmexcil Research, July 2009


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Figure: Number of Laboratory Confirmed Cases

3.2 Human Swine Flu- A Rare Global Pandemic Expert Opinion from Datamonitor

In response to the ongoing global spread

of the novel influenza A (H1N1) virus,

the World Health Organization (WHO)

has raised the worldwide pandemic alert

level to Phase 6 on June 11, 2009 (Source:

Centers for Disease Control and Prevention, or

CDC). It indicates that a global pandemic

is underway with ongoing community

level outbreaks in multiple parts of the

world in more than 70 countries. It has

become the first global pandemic in 41

years.

H1N1 Virus Incidence so far

The first 2009 H1N1 case was reported in

Mexico on 18th March 2009 and it then

spread to the United States and Canada.

According to WHO, the cumulative total

swine flu confirmed cases and deaths as

on 06 July, 2009, were 94512 and 429

respectively (Source: WHO) with 35.9%

cases reported in the United States of

America and 10.8% in Mexico, 8.4% in

Canada, 7.9% in UK, 7.8% in Chile and

the rest 29.2% from other parts of the

world (India - total number of cases - 129

and deaths - Nil). The majority of these

novel respiratory disease cases were found

in healthy young adults.

Role of Government Agencies and

Pharma Companies

According to WHO, Tamiflu (oseltamivir

phosphate) and Relenza (zanamivir) are the

two United States Food and Drug

Administration (USFDA)-approved

Source: WHO, 06 July 2009


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influenza antiviral drugs that are

recommended by the CDC for use against

the 2009 H1N1 influenza virus out of the

available antiviral treatments for swine flu.

The WHO is working with

pharmaceutical companies and various

governments across the world to make

available Tamiflu with increased reports of

swine flu outbreak.

Roche initiates several steps to address

access to Tamiflu

Earlier Roche has donated about 5m

Tamiflu treatment courses to WHO.

Apart from this, Roche has given generic

approval for three companies – two in

China (Shanghai Pharma and HEC), one

in India (Hetero Drugs) and technology

transfer to Aspen Pharmaceuticals in

South Africa to produce Tamiflu. In

addition, the France-based Sanofi-aventis

agreed to donate 100m doses of pandemic

H1N1 vaccine to the WHO.

Indian companies geared up to

manufacture Tamiflu

India is also well prepared to combat this

pandemic with a stock of ~10m doses of

Tamiflu tablets which is only available

through the public health system. Four

companies, namely Ranbaxy, Cipla, Natco

and Hetero Drugs, have applied for

license for Tamiflu production. However,

Roche has licensed only Hetro Drugs Ltd

to manufacture Tamiflu. According to

industry sources, the Mumbai-based Cipla

has the capability of supplying 1.5m

tablets of the drug, and the Hyderabad-

based Hetero drugs have a capacity of

supplying 80m capsules per month.

Further, the Bangalore-based Strides

Arcolab has commenced the commercial

supply of oseltamivir capsules.

Conclusion

The world is better prepared to combat

this global emergency with Roche’s

Tamiflu and GSK’s Relenza as available

options for the management of the

pandemic swine flu outbreak. However,

the question remains availability of

sufficient quantities of these drugs. Indian

generics companies like Ranbaxy and

Cipla are also well prepared to produce

large quantities of their own versions of

Tamiflu.


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3.3 Herbal and Traditional Medicines in Indian Context Research article by Pharmexcil

The definition of health by the World

Health Organization (WHO) is that

“Health is a state of physical, mental, and

social well-being, and not only the absence

of disease or infirmity.” This closely

resembles the definition laid down in

Ayurvedic texts, more than 3,000 years

ago. Ayurvedic medicine, as practiced in

India, is one of the oldest systems of

medicine in the world. Many Ayurvedic

practices pre-date written records and

were handed down by word of mouth.

Two ancient books, written in Sanskrit

more than 2,000 years ago, are considered

the main texts on Ayurvedic medicine —

Caraka Samhita and Sushruta Samhita.

Significant number of Americans and

Europeans are using Ayurvedic

medicines

In the National Health Interview Survey,

2007, it was found that more than 200,000

U.S. adults used Ayurvedic medicine in

the previous year. Dr. Margret Chan,

Director-General, WHO, at the WHO

Congress on Traditional Medicine in

November 2008, said, “The time has

never been better, and the reasons never

greater, for giving traditional medicine its

proper place in addressing the many ills

that face all our modern – and our

traditional – societies.”

About 52,000 plant species are

estimated to be used for medicinal

purpose

As per a WHO report, 3,000 plant species

have at one time or another been used in

some culture for medicinal purpose. China

has the maximum number of medicinal

plant species (4,941), and it is also the

world’s top exporter of medicinal plants,

followed by India in terms of volume,

whereas in terms of value India stands 4th

after USA and Germany. Germany ranks

4th as importer and 3rd as exporter of

medicinal plants, demonstrating the

country’s major role in trade of medicinal

herbals worldwide. In Germany, over

1500 plant species encountered in some

200 families and 800 genera have been

processed into medicinal products. Uwe

Schippmann (2002) estimates that a total

of 52,000 species of plants are used

medicinally in different parts of the world.


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Global herbal market is valued at US$

62 billion

The use of these complementary and

alternative therapies has become a multi-

billion dollar industry that is expected to

continue its rapid growth. As per WHO,

the Global trade in herbals was estimated

to be about U.S. $62 billion and is

expected to reach $5 trillion by 2050. The

world market for plant-derived chemicals

– pharmaceuticals, fragrances, flavours,

and colour ingredients – alone exceeds

several billion dollars per year. Classic

examples of phytochemicals in biology

and medicine include taxol, vincristine,

vinblastine, colchicines as well as the

Chinese antimalarial – artemisinin – and

the Indian ayurvedic drug - forkolin.

Trade in medicinal plants is growing.

Department of AYUSH initiates steps

to increase exports of herbal products

from India

Herbal medicines are generally considered

comparably safer than synthetic drugs.

However, recent reports challenge such

assumptions; particularly, issues like heavy

metal contamination have been raised in

several countries. The Department of

AYUSH, Government of India, has taken

several steps to address this issue. As per

the order, it is mandatory to submit

batchwise testing report for all Herbal,

Ayurveda, Siddha, Unani medicines that

are exported from approved laboratories,

certifying that heavy metals are within

permissible limits as laid down by the

central government order, dated

14.10.2005. This report is an essential part

of the consignment paper to be submitted

by any exporter. Additionally, the

Department of AYUSH has recently

established a Research Centre at the

University of Mississippi, USA, to

facilitate scientific investigations on Indian

herbal drugs. Such efforts are meant to

enhance quality control and global

acceptability of Indian traditional

medicines. In addition to it, databases like

the Traditional Knowledge Digital Library

(TKDL), developed by CSIR and

AYUSH, provide a scientific classification

structure to traditional knowledge,

providing better understanding and

acceptability of the Indian system of

medicine, and also protect Indian

medicinal plants against unauthorized

patenting in different countries.


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Export of Herbals from India, 2004 - 2008

0

20

40

60

80

100

120

140

2004 2005 2006 2007 2008

US

$ m

illio

n

AFRICA ASEAN

CIS EU

Latin America M iddle East

NE Asia[excluding middle east] North America

Oceania Other European countries

South Asia

Export of Herbals from India, 2004 - 2008

0

20

40

60

80

100

120

140

2004 2005 2006 2007 2008

US

$ m

illio

n

AFRICA ASEAN

CIS EU




South Asia

India exports herbal and AYUSH

products worth US$ 202.7 million

In 2008, India exported herbal products

worth US$ 116.8 million and AYUSH

products worth US$ 85.9 million. In the

last four years (2004-2008), growth in

exports of AYUSH products (CAGR:

16.75%) was higher than that of herbal

products (13.98%).

Export of AYUSH from India, 2004 - 2008

0

20

40

60

80

100

2004 2005 2006 2007 2008

US

$ m

illio

n

AFRICA ASEAN

CIS EU




South Asia

Export of AYUSH from India, 2004 - 2008

0

20

40

60

80

100

2004 2005 2006 2007 2008

US

$ m

illio

n

AFRICA ASEAN

CIS EU




South Asia


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4. Country Focus

4.1 The US Pharmaceutical Market: Brand Erosion at Patent Expiry – Opportunity for Indian Pharma companies focusing on generics Expert opinion by Datamonitor

The erosion in value of branded drugs to

generics sales is quite inevitable upon

patent expiry. The speed and severity of

erosion depends on various factors like

pricing & reimbursement regulations,

country-specific prescription,

implementation of product life cycle

strategies, success of the targeted brand

and product formulations. The generic

versions are usually available at significant

discount compared to the branded

products. This encourages consumers to

switch towards affordable generic

products, eroding the volume and value of

branded sales.

Table1: Patent Expiry Status of Top Selling Blockbuster Drugs in US

Global Sales (US$mn)

S. No

Brand Name

Company

Description

2008 2007

Expiry date

1 Lipitor Pfizer Hypercholesterolemia and mixed dyslipidemia

12401 12675 24.Mar.10

2 Zyprexa Eli Lilly Schizophrenia and related psychoses

4696 4761 23.Oct.11

3 Geodon Pfizer Schizophrenia 1007 854 2.Mar.12

4 Lexapro Forest Laboratories

Major depressive disorder 2292 2106 14.Mar.12

5 Viagra Pfizer Erectile dysfunction (impotence) in men

1934 1764 27.Mar.12

6 Singulair Merck Prophylaxis and chronic treatment of seasonal allergies

4337 4266 3.Aug.12

7 Detrol Pfizer Overactive bladder 1214 1190 25.Sep.12

8 Humalog Eli Lilly Diabetes Mellitus 1736 1475 7.May.13

9 Sustiva BMS HIV Infection 1149 956 21.May.13

10 Cymbalta Eli Lilly Major depressive disorder 2697 2103 11.Jun.13

11 Temodar Schering-Plough Corp

For adult patients with refractory anaplastic astrocytoma

1002 861 11.Feb.14

12 Celebrex Pfizer Osteoarthritis and Rheumatoid Arthritis

2489 2290 30.May.14

13 Zyvox Pfizer For adults with certain bacterial infections

1115 944 18.May.15

14 Evista Eli Lilly Prevention of osteoporosis in postmenopausal women

1076 1091 10.Mar.17

15 Reyataz BMS HIV/AIDS 1292 1124 20.Jun.17

16 Cialis Eli Lilly Erectile Dysfunction 1445 1144 21.Nov.17

17 Nasonex Schering-Plough Corp

Prophylaxis and treatment of the nasal symptoms of seasonal allergic rhinitis

1156 1092 3.Apr.18

18 Lyrica Pfizer Neuropathic pain caused by diabetes or shingles

2573 1829 30.Dec.18

19 Januvia Merck Type-II diabetes 1397 668 26.Jul.22


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Figure 1: Drivers for Generic Substitution

The United States is spending

approximately 16% of its gross domestic

production on the healthcare and is the

world’s largest generics market,

contributing around 42% to global generic

revenues. Generic prices in the US

undergo a rapid decline, highlighting the

intense generic competition in this

lucrative market, which is exacerbated by

falling prices. Tough competition, a focus

on cost-containment and incentives for

prescribing generic drugs make the US

prone to severe brand erosion

immediately after patent expiry.

The 180-day generic market exclusivity is

one of the main factors influencing the

generic competition in the US market as it

gives first-to-file status for Para-IV

challenge product and preventing other

generic players for a 6-month time period.

For instance, once the patent for Pfizer’s

Lipitor (atorvastatin) expires in March 2010,

the 6-month generic exclusivity for the

generic product will be enjoyed by its

Para-IV patent filers, Teva

Pharmaceuticals and Daiichi-Sankyo

(Ranbaxy).

Across all the markets, drugs within the

highest value group (with annual sales

exceeding US$1b) are subject to the most

intense generic erosion as this price band

offers the largest and most profitable

market. Consequently, this is also the

most competitive segment since targeting

the most successful brands can generate

higher revenues. Going forward, the

branded manufacturers are expected to

face unrelenting generic competition with

products worth nearly US$140bn going

off patent in the next 7 to 8 years.

The Office of Generic Drugs (FDA)

estimates that by 2010 more than

US$20bn of branded drug sales will lose


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patent protection. Although the United

States provides a 20-year patent term, the

effective patent life for drugs in the

United States averages only 11 to 12 years.

The U.S., Germany, France, the U.K.,

Canada, Italy, Spain and Japan are the top

8 generic markets accounting for ~84% of

total global generics sales.

The US saw the strongest erosion for

both oral and injectable drugs, reflecting

the higher levels of generic substitution in

the US compared to other markets. Unlike

oral drugs, brand erosion of parenterals is

initially less aggressive in the US and only

reaches the same level of erosion as oral

drugs after approximately a year on the

market. Parenteral drugs were also heavily

eroded in the US, although this occurred

at a slightly slower rate, given the smaller

market and difficulty in replicating

parenteral drugs. On an average, for

example, brand volume decreased by 25%

after the first quarter of generic entry

compared to 34% for oral brands.


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5. Pharmexcil Activities

5.1 Pharmexcil activities during July 2009

Following are the major activities/ events

that Pharmexcil is associated during the

month

1. On July 22, Pharmexcil has led a 20

member delegation to South Africa and

other African Countries. Dr. Surinder

Singh, DCGI, Dr. P.V.Appaji, ED,

Pharmexcil, Mr. Raghuveer Kini, AED,

Pharmexcil, Mr. Lanka Srinivas, an

eminent professional from pharmaceutical

industry, Former MD of Sun

Pharmaceuticals, Director on Board,

Aurobindo Pharma Ltd and Senior people

from M/s Natco, Ind Swift, etc were part

of the delegation

2. Shri Ashok Kumar, Secretary, and Shri

Devendra Chaudhry, Joint Secretary,

Department of Pharmaceuticals, have

conducted a meeting in New Delhi in the

first week of July and on July 13 2009, a

meeting was held in Chennai with the

local pharmaceutical exporters to Nigeria

to develop corrective measures to drive

out false impressions on India as

supplying counterfeit drugs.

3. On Friday, 17th July, Pharmexcil has

organized a Seminar/ Workshop on

“Export Opportunities for Pharma and

Herbal Industries” at The Residency

Towers, Trivandrum, in order to help the

SMEs to venture/ improve their exports

in the Pharma sector. This event was

supported by FIHI and EXIM Bank.

Following are the presentations given by


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eminent people on the export

opportunities, drug registrations, etc.

• “Role & Functions of EXIM

Bank” by Ms. Roshanara,

Manager, EXIM Bank

• “Export Credit Guarantee” by Mr.

R. Punniakoti

• “Dietary Supplements in USA” by

Ms. Mansi Ahuja, Vedic Life

Sciences

• “Export Opportunities” by G.

Vijay Kumar, Pharmexcil

• “Drug Registration in ASEAN

Countries” by Dr. G.V.R. Joseph,

Department of AYUSH

4. In July, Dr. P.V.Appaji, ED,

Pharmexcil has held two meetings with

DCGI to discuss several issues related to

exports

5. Dr. P.V.Appaji, ED, Pharmexcil has

visited NIPER, Mohali and met Dr. Rama

Rao, Director, NIPER, Mohali regarding

the establishment of Patent Facilitation

Centre at NIPER, Mohali. Pharmexcil is

keen to open its second centre to render

patent services for the exporters in North

India. Pharmexcil has established a patent

facilitation centre in Hyderabad and

several pharmaceutical companies in SME

have got the benefit of obtaining product

patent status of drugs destined to

developing countries.


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5.2 upcoming Pharmexcil activities

S. No

Event/ Conference

Date Description/ comments

1

Delegation to South Africa, Mozambique, Zambia and Botswana

July 22 – August 05 2009

Pharmexcil is organizing a trade delegation to South Africa, Botswana, Mozambique and Zambia. This delegation is a part of the Project for Brand Promotion of Indian Pharmaceuticals in Africa, being undertaken by Pharmexcil with the active support of the Department of Commerce. The delegation is likely to include regulatory and key senior officials from Ministry of Commerce, Ministry of Health and Department of Pharmaceuticals besides, representatives from industries/ associations, etc. The visit of the delegation also coincides with an important event, namely, “India-SA Business Meet”, being organized at Johannesburg on 23rd July, 2009, by the Indian High Commission.

2

Opening of Pharmexcil Branch Office in Ahmedabad

August 13 2009

Pharmexcil is opening its branch office in Ahmedabad to facilitate exporters in the State of Gujarat

3

Patent Litigation as Barrier in International Pharmaceutical Trade, Mumbai

August 21 2009

In view of recent happenings like seizures by EU / US Custom authorities of the Indian Generic Medicines in transit to various developing countries in Latin America / Africa on the grounds of counterfeit / patent infringement, Patent litigations in US courts etc., Pharmexcil is organizing a seminar, where eminent speakers like Prof. Dr. Shamnaad Basheer, Professor in IP Law, National University of Juridical Sciences, Calcutta, Govt. of India, Dr. Gopakumar G Nair, Advisor, Pharmexcil, etc., would be making their presentations on present scenario.

4 CPhI South America

August 26 – 28, 2009

Pharmexcil will be organizing an India Pavilion by taking 225m2 space. In view of the huge demand for this event in 2008, the council is providing Common Space also in the Pavilion, for the benefit of small exporters. All the stalls are of 9 m2 size and the cost would be €370/- per m2 which includes overall designing of the pavilion, minimum furniture, cleaning charges, insurance, electricity, etc. Cost of Common Space is Rs. 1.50 lakh per member.

5

Indo - Africa Pharma Business Meet, Hyderabad

September 17 – 19, 2009

Pharmexcil is organizing an international event, “Indo-Africa Pharma Business Meet” as a part of project approved by Ministry of Commerce & Industry. About 80 delegates representing Drug Regulators, Procurement Agencies, Media and Manufacturers/ Distributors from about 18 countries are expected to attend this business meet and Pharmexcil is also organizing an exhibition, buyers/ sellers meet and technical sessions.

6

Pharmexcil Awards for Outstanding Export Performance for the years 2005-06, 2006-07, 2007-08 and 2008-09

September 17 – 19, 2009

Committee of Administration of the Council has decided to institute ‘Pharmexcil Export Awards’ for the outstanding export performance. There will be one Trophy and one Merit certificates and one Award for Emerging Exporter in each of the product category covered under council for SSI, Non-SSI and Merchant Exporters separately. The circular can be accessed on the pharmexcil website (http://www.pharmexcil.com/v1/aspx/viewNewsBulletin.aspx?ID=568)

7 Pharmed 2009, Vietnam

September 23 – 26, 2009

Pharmexcil is participating in Pharmed 2009 by organizing an India pavilion. For the benefit of members in Pharmaceuticals / Medical devices & Surgical sectors, stalls of 6 and 9 sq. meters sizes will be offered. There is also provision of Common Space for small exporters.


19

S. No

Event/ Conference

Date Description/ comments

8 CPhI Worlwide, Spain

October 13 - 15 2009

Pharmexcil is participating in the event and has booked the India Pavilion at hall no.5. The minimum space to be booked by the exhibitors outside India Pavilion is 20m2 (shell scheme) and 30m2 (bare space). However, in India Pavilion minimum stall size is 12m2 and common space for 8 small exporters.

9 CPhI India 2009, Mumbai

December 1-3, 2009

Pharmexcil will be participating in CPhI India 2009 to be held during 1-3rd December, 2009, at Mumbai. Due to cancellation of CPhI 2008, the exhibitors were given option either to take refund or transfer the amounts paid for CPhI 2009. The members who have opted to transfer the amounts to CPhI 2009 were informed that they would be given preference in allotment of stalls, apart from the benefit of getting the stalls at the same cost as that of 2008. Some of the participants in the India Pavilion at CPhI 2008 have opted to keep their amounts transferred to CPhI 2009. Out of 76 stalls, 43 stalls have been allotted to those members in CPhI 2009 as per their choice and the remaining 33 stalls are available for allotment

All the above information can be accessed from Pharmexcil website on the following link: http://www.pharmexcil.com/v1/aspx/NewsBulletin.aspx


20

5.3 Highlights of Budget 2009-10 for Pharmaceutical & Allied Sectors Compilation of important announcements in the Union Budget by Pharmexcil

Following are the important

announcements related to

Pharmaceutical/ Healthcare industry

made by Finance Minister Mr. Pranab

Mukherjee during the general budget for

2009-10

• Export Credit and Guarantee

Corporation (ECGC) Cover

An adjustment assistance scheme to

provide enhanced ECGC cover at 95

per cent to badly hit sectors had been

initiated in December 2008 to mitigate

the difficulties faced by the exporters.

In view of the continuing contraction

in exports, the benefits of this scheme

have been extended up to March

2010.

• Market Development Assistance

(MDA)

The MDA Scheme provides support

to exporters in developing new

markets. With many traditional

markets still under financial stress,

greater effort is required to identify

and develop new markets. It has been

proposed to enhance the allocation

for this scheme by 148% over Budget

Estimate 2008-09 to Rs.124 crore.

• Support to Micro, Small and

Medium Enterprises (MSMEs)

MSMEs have been affected by the

slowdown in exports and the indirect

effect of the global crisis on domestic

demand. To support this sector, it has

been proposed to facilitate the flow of

credit at reasonable rates, by providing

a special fund out of Rural

Infrastructure Development Fund

(RIDF) to Small Industries

Development Bank (SIDBI). This

fund of Rs.4,000 crore will incentivize

Banks and State Finance Corporations

(SFCs) to lend to Micro and Small

Enterprises (MSEs) by refinancing 50

per cent of incremental lending to

MSEs during the current financial

year.

• National Rural Health Mission

(NHRM)

The National Rural Health Mission is

an essential instrument for achieving

our goal of Health for All. There has

been an increase of Rs.2,057 crore

over and above Rs.12,070 crore

provided in the Interim Budget.


21

• Rashtriya Swasthya Bima Yojana

(RSBY)

RSBY which was operationalized last

year has received very good initial

response. More than 46 lakh BPL

families in eighteen States and UTs

have been issued biometric smart

cards. This scheme empowers poor

families by giving them freedom of

choice for using healthcare services

from an extensive list of hospitals

including private hospitals. The

Government proposes to bring all

BPL families under this scheme. An

amount of Rs.350 crore, marking 40%

increase over the previous allocation,

is being provided in 2009-10 Budget

Estimates.

• Fringe Benefit Tax

The Finance Act, 2005, introduced the

Fringe Benefit Tax on the value of

certain fringe benefits provided by

employers to their employees. It has

been proposed to abolish the Fringe

Benefit Tax on ESOP, Sweat Equity

and Superannuation Funds. The tax

burden will now be borne by

employees.

• Research and Development (R&D)

The competitive ability of an economy

rests on its progress in the area of

R&D. In order to incentivize the

corporate sector to undertake R&D

work, it is proposed to extend the

scope of the current provision of

weighted deduction of 150% on

expenditure incurred on in-house

R&D to all manufacturing businesses

except for a small negative list.

• Customs, Excise and

Countervailing Duty on some life

saving drugs

On influenza vaccine and nine

specified life saving drugs used for the

treatment of breast cancer, hepatitis-B,

rheumatic arthritis, etc., and on bulk

drugs used for the manufacture of

such drugs, it has been proposed to

reduce the customs duty from 10 per

cent to 5 per cent. They will also be

totally exempt from excise duty and

countervailing duty.

Customs duty will also be reduced

from 7.5 per cent to 5 per cent on two

specified life saving devices used in

the treatment of heart conditions.

These devices will be fully exempt

from excise duty and CVD also.

With the Government's proclaimed

objective of introducing a Goods and


22

Services Tax (GST), both at the

national and State level, some more

steps in that direction are necessary.

One measure that would facilitate the

process is the further convergence of

central excise duty rates to a mean rate

- currently 8 per cent. The FM has

reviewed the list of items currently

attracting the rate of 4 per cent, the

only rate below the mean rate. There

is a case for enhancing the rate on

many items appearing in this list to 8

per cent, which it is proposed to do,

with the following major exceptions: -

drugs, pharmaceuticals and medical

equipment besides other sectors.

• Exemption of Service tax for

Councils

The Export Promotion Councils and

the Federation of Indian Export

Organizations (FIEO) provide a

valuable service in augmenting our

export effort. It has been proposed to

exempt them from the levy of service

tax on the membership and other fees

collected by them till 31st March,

2010.

• Direct Taxes

It has been proposed to raise the tax

exemption limit for:

• Senior citizens by Rs. 15,000/- from

Rs.2.25 lakhs to Rs. 2.40 lakhs;

Women by Rs. 10,000/- from Rs.

1.80 lakhs to Rs. 1.90 lakhs;

• For all other individual tax payers by

Rs. 10,000/- from Rs. 1.50 lakhs to

Rs. 1.60 lakhs.

• It has been proposed to phase out

the 10% surcharge on personal

income tax.

• To tide over the slowdown in

exports, the tax holiday for the

sector has been increased by a year

to include 2010-2011


23

6. News

Pharmaceuticals Exporters Advised to be cautious Exporting Goods to Africa, Latin America via EU Ports

EU nations continue to seize Indian

generic drugs at EU ports. The union

commerce ministry has especially

cautioned exporters sending goods to

Africa and Latin America through EU

ports.

It is strongly advised by the ministry to

consult with the Patent Facilitation Centre

that has been set up by the Commerce

Ministry in association with the

Department of Pharmaceuticals in order

to handle the patent related issues. Patent

analysts have been appointed at the Patent

Facilitation Centre (Pharmexcil),

Hyderabad. The services offered free of

cost include general patent information,

patent status in India and other countries,

interpretation of information, invention

mining, patentability opinion,

infringement analysis and a range of other

services. This measure by the Commerce

Ministry is in response to several instances

of seizure of drugs at EU ports. Although

this issue has been raised at the WTO, the

seizure at EU ports has been ongoing. In

May, amoxicillin that was shipped to a less

developed country, Republic of Vanuatu

in the Pacific, was seized in Frankfurt,

Germany.

In order to curtail this issue, with support

from the Department of Pharmaceuticals,

Govt of India, Pharmexcil has established

an exclusive Patent Cell to direct

exporters in issues related to this subject.

The Commerce Ministry has advised all

the exporters to consult with the Patent

Facilitation Centre to avoid any problems

in the future.

India Approaches WTO over Seizure of Generic Drugs by EU Nations

India is concerned and worried over the

repeated seizure of Indian generic drugs in

the EU. If the bilateral negotiation does

not allow the transit of drugs through its

customs, India will approach the WTO

for further support.

The seizing of drugs in the EU has been

happening as they believe that these

generic medicines infringe on their patent

laws, although the TRIPS agreement

clearly states that any developing country

can purchase life-saving drugs from


24

countries where the medicine is generic or

off patent.

There have been several instances of such

seizures – On March 4th, Dutch customs

seized Aurobindo Pharma’s anti-HIV

drug, which was on its way to Nigeria, the

reason given being they were counterfeit

drugs and violated the international patent

laws. GlaxoSmithKline filed complaints

since it holds the patent for the drug in

EU and the drug is classified as generic in

India. In a similar fashion, a consignment

of drugs to Brazil was seized by the Dutch

authorities; the drug is meant for high

blood pressure and is manufactured by

Dr. Reddy’s Laboratories, Ltd.

Mr. Frank Heemskerk, Dutch Minister for

Foreign Trade did express his views; he

was in favour of providing generic drugs

to the poor and was bound by the EU

regulations. He has expressed his concern

over this and approached the European

Commission to review the customs

regulations and align them with the

TRIPS agreement.

Brazil has also issued similar protests

along with India. In a recent WTO

meeting, India mentioned that the risks

associated with such a practice can tamper

the balance between the IP rights holders

and public policy goals.

Caraco - a subsidiary of Sun Pharma, fails cGMP requirements, products detained by FDA

Caraco Pharmaceutical Laboratories, the

US Subsidiary of Sun Pharmaceutical

Industries Ltd., is facing the heat from the

FDA due to poor product quality. An

inspection by the US FDA of Caraco,

revealed the violations of cGMP

requirements. This led to seizing of the

products developed at the Caraco facility

by the FDA. The US FDA took this step

in the wake of potential risks involved

with respect to patient safety, and if

further non-compliance issues are

observed by the FDA, it will take

appropriate regulatory action and

announce it to the public. Janet

Woodcock, Director of the FDA’s Center

for Drug Evaluation and Research

ensured FDA’s commitment towards

patient safety and its enforcement against

the firms that do not comply with good

manufacturing practice requirements.

In its defense, since January 2009, Caraco

has initiated several voluntary recalls due

to defective manufacturing such as


25

oversized tablets, or a possible

formulation error.

This action taken by the FDA is after

repeated failure by Caraco to meet the US

FDA’s cGMP requirements. The FDA

has imposed an immediate stop on the

distribution of drugs until the firm fulfils

the cGMP compliance. Although this

might cause a shortage in choline

magnesium trisalicylate oral tablets, which

is a widely used pain reliever, the US FDA

will ensure that healthcare providers issue

alternative treatment in the wake of

shortage.

US Senate HELP committee approves 12 years of data exclusivity for innovator products The US Senate Committee on Health,

Education, Labor and Pensions (HELP)

passed ‘The Affordable Health Choices

Act” by a 13-10 vote on July 15, 2009.

The healthcare overhaul bill would give

innovator biologics 12 years of data

protection. However, the amendment has

yet to be approved by US Congress. If this

is passed in its current form, it will be a

major blow for the companies focusing on

the generic biopharmaceuticals.

Sanofi-aventis buys Merieux Alliance’s share in Shantha Biotech On July 27, 2009, Sanofi-aventis entered

into a strategic agreement for the

acquisition of Merieux Alliance’s French

Subsidiary, ShanH, which owns a majority

stake in the Indian vaccines company

Shantha Biotechnics based in Hyderabad.

Under the terms of the agreement, Sanofi

Pasteur, the vaccines division of the

Sanofi-aventis Group, will support

Shantha’s ongoing development as a

platform to address the need for high

quality affordable vaccination in

international markets. Dr. Varaprasad

Reddy, the founder of Shantha

Biotechnics in 1993, will continue to lead

the company as Managing Director. The

transaction, set to close before the end of

the third quarter of 2009, values Shantha

at €550 million (INR 37,400 million). The

firm is valued at about eight times the

projected sales of the company in the

current fiscal year (INR 4,400 million).

Sales are expected to grow significantly

given the commercial resources of Sanofi

Pasteur and through the development and

launch of Shantha’s pipeline of new

vaccines.


26

ICA Certificate a must for Medical Devices Manufactured in India, Says DTAB

Implementation of Indian Conformity

Assessment Certificate (ICAC) has been

recommended by the Drug Technical

Advisory Board (DTAB) for all the

medical devices manufactured, imported

and marketed in India in order to

ascertain quality and safety of the

products.

M-III, the final draft guideline,

recommends that all the medical devices

companies apply for the ICAC mark and

have the ICA mark specifications on the

product label. The certificate is issued

based on the product class and the

product efficacy standards as set by the

Indian authority.

The quality standard of the product

should be ensured by the Central

Licensing Approval Authority (CLAA),

the regulatory body, and Bureau of Indian

Standards (BIS) as per the ICAC

standards. DTAB also suggests that along

with bearing the ICAC mark, the product

manufacturer must also renew or update

the latest information every five years.

Further suggestions made in the draft

guideline are to appoint a panel of experts

to assist CLAA to evaluate the medical

devices and pay impromptu visits to the

manufacturer to ensure the compliance of

guidelines.

Ban on Expansion of Existing Units Deters the Growth of Pharmaceutical Industry in A.P.; Bulk Drug Units Insist that the AP State Govt lift the ban The increased pollution caused due to the

fast growth in bulk drug manufacturing

had led to a ban on setting new units as

well as expansion of existing units in

Hyderabad and the nearby industrial areas

of Ranga Reddy, Medak, Mahboob nagar

and Nalgonda. The ban on setting new

units was imposed by the Supreme Court

on May 12, 1998. Further, on April 21,

1999, the state government imposed a

permanent ban on new units as well as on

expansion of existing units. However, the

bulk drug manufacturers argue that the

ban was imposed only on establishment of

new units and not on the expansion of

existing units. This issue was taken by the

Bulk Drug Manufacturers Association

(BDMA) to Mr. Ramachandran Reddy,

State Minister for Forests and

Environment. The delegation agreed to

retain the ban on establishment of new

units but requested an immediate lift of

ban from expanding the existing units.


27

The point put across by the delegation

explained the ability of current common

effluent plants (CETPs) to treat the

effluents as opposed to the CETPs before

the ban. The BDMA president, Mr. M.

Narayana Reddy, said that any industry

needs to expand with the help of new

competing technologies in order to

survive in the global competitive

environment and the ban imposed by the

Supreme Court leaves Andhra Pradesh

behind the race as compared to other

states.

Indian Pharmaceutical Industry’s exports are valued at INR 384.3 billion in 2008-09 In reply to a written query, Shri. Srikant

Jena, Minister of State for Chemicals and

Fertilizers, on July 30, 2009, informed the

Lok Sabha that the Indian Pharma

Industry’s exports was worth INR 384.3

billion in 2008-09, and that the total size

of the domestic pharmaceutical industry,

excluding exports and government

purchases, was valued at INR 554.5

billion.

Indian High Commission in Nairobi says Government of Kenya has No Problem with Import of Pharmaceutical Products from India

In the backdrop of seizure of Chinese-

origin drugs with “Made in India” labels,

the Indian High Commission in Nairobi,

in a letter to the Ministry of Commerce &

Industry, Government of India, said that

the, “Government of Kenya has no

problem with pharmaceuticals imported

from India and pointed out that several

manufacturers of generic drugs were

registered through Kenya Medical

Supplies as suppliers to the Ministry of

Health and have been issued with good

manufacturing practice certificates.”

Source: http://www.deccanchronicle.com/latest-

news/kenya-gives-clean-chit-indian-drugs-767

Roche Initiates Tamiflu Reserves Programme Aimed at Developing Economies

The Tamiflu Reserves Programme (TRP)

launched by Roche aims at stocking

Tamiflu (oseltamivir) in case of influenza

pandemic or for the management of

influenza strains that has pandemic

potential.

Roche will ensure the availability of

Tamiflu at a reasonable cost spread over a

few years for the developing nations.

William M. Burns, Roche Pharma CEO,

said that the programme is not proprietary

for Roche and WHO has the opportunity


28

to apply its fundamentals to other

antivirals. He further said that this

programme is complementary to the

initiatives taken by Roche to address

Tamiflu. The cost of Tamiflu per pack for

10 capsules is 5-6 Euros for 75 mg and 2-

2.55 Euros for a 30 mg dose. It would be

Roche’s responsibility to store these

capsules under controlled conditions.

Mr. David Reddy, the Global Pandemic

Preparedness Task Force Leader, said that

this programme will support the

developing nations to be prepared for a

pandemic, since the medicine will be made

available at a reasonable cost. The ensured

storage and security of Tamiflu also

removes the challenge faced by the

developed nation to do the same. The key

nations that would benefit by this

programme are members of the Global

Alliance for Vaccines and Immunization

(GAVI) excluding India. Roche is now in

the process of discussions to establish

coordination by UN partner agencies,

such as WHO or UNICEF, and potential

sources of funding with the help of World

Bank and donor agencies.

Other initiatives taken by Roche to create

access to Tamiflu worldwide include:

tiered pricing for Tamiflu in the

developed and developing nations;.

issuing sub-licenses (to manufacture

oseltamivir) to Hetero in India, Shanghai

Pharma and HEC in China, and

technology transfer to Aspen

Pharmaceuticals in South Africa; friendly

company policy that a patent will not be

enforced in the least developed countries -

this enables the least developed countries

to source anti-virals.

WHO issues Notice to Matrix Laboratories in view of Deviations from WHO’s GMP Guidelines

The World Health Organization (WHO)

issued a notice to Matrix Laboratories on

July 29, 2009, on the grounds of major

deviations from WHO’s Good

Manufacturing Practices (GMP) guidelines

in relation to an anti-retroviral drug

supplied to the WHO for its HIV/AIDS

programme. The WHO’s Quality

Assurance and Safety Department

inspected Matrix’s plant in Vizianagaram

between May 25 – 28, 2009.

Documents

pharmexcil Digest - August 2009pharmexcil.com/data/uploads/Pharmexcil Digest- August 2009.pdf · 3.2 Human Swine Flu- A Rare Global Pandemic Expert Opinion from Datamonitor In response