Challenges Cited to Indian Pharmaceuticals' New Era

Industry experts have outlined likely challenges as India's drug industry moves toward its new era of patent protection and modernisation. Although the country's new intellectual property law could represent potential foreign direct investment of as much as US$10bn, there are concerns that progress has been insufficient in a number of areas.

One key concern is the ability of Indian companies to innovate, as the country's research base is largely fragmented, with little co-ordination within the university system despite an abundance of well-trained clinical research staff. Notably, full clinical trials are a legal novelty in the country. Experts have also cited a lack of venture capital funding necessary to bring innovative medicines to market.

Further, the issues of regulation and pricing remain a cause for concern. A move to a multi-tier pricing model has been suggested, as Indian companies will have to respond to low margins in the domestic market and higher selling prices on the international market. Recent government moves to increase tariffs on exported medicines are understood to have had a negative impact, and could act to discourage progress towards India's new model of an innovation-focused, export-driven drug industry.