India Premier Pushes For Generic Prescriptions But Hurdles Loom

India’s prime minister has declared that doctors should prescribe medicines using only non-proprietary generic names in an effort to reduce medical bills, but the medical fraternity says the move could jeopardize patient safety, while hurdles mean others see only limited pharma industry impact in the short term.

India’s Prime Minister Narendra Modi has told doctors to write only generic drug names on prescriptions in order to lower patient bills in the country, where medical expenses push tens of millions of people into poverty annually. But critics have said a stringent drug regulatory system needs to be in place before such a move can be implemented.

The All India Drug Action Network, a public health NGO, said obliging doctors to write only non-proprietary generic names on prescriptions could turn out to be a “useless, counterproductive step as a standalone measure” without assurances about availability and strengthening quality controls.

In India, branded generics and originator or off-patent brands dwarf pure generics, whereas in many developed markets such as the UK and US, unbranded generics make up about half the overall category total, according to consultancy Accenture. In India, branded generics can be 10 times costlier than pure generic offerings, according to Drug Controller General G.N. Singh, although sometimes the gap is much smaller.

Also, getting doctors to prescribe medicines under their generic names would give too much leeway to pharmacists who might dispense drugs that offer the best margins, some of which may be of dubious quality, critics add. “Forcing doctors to write down only the generic name would give too much power to chemists – many will decide based on which company gives them the most favorable margin and who knows the quality?” New Delhi cardiologist Sanjiv Zutshi told Pink Sheet.

In the political campaign that swept Modi’s Bharatiya Janata Party to power in 2014, he promised to give “high priority” to the health sector and create “a holistic care system” that was “universally accessible, affordable and effective and drastically reduces the out-of-pocket spending on health.”

“Forcing doctors to write down only the generic name would give too much power to chemists.” – New Delhi cardiologist Dr. Sanjiv Zutshi.

Since its election, Modi’s government has kept spending on public health care as a percentage of GDP at 1%, one of the lowest rates globally, though it has committed to raising that allocation to a still-modest 2.5% by 2025. The government has been focusing instead on increasing the number of essential drugs under price controls and promoting public-private partnerships in health projects. (Also see "India’s New National Health Care Policy Recycles Old Targets" - Pink Sheet, 23 Mar, 2017.)

‘Legal Framework’, Pharma Impact

Now, Modi, who has styled himself as a defender of the poor as he readies for national elections due by 2019, said the government would introduce a “legal framework” to oblige doctors to prescribe by generic names in order to make medical treatment more affordable in India, where hundreds of millions of people live in deep poverty and more than 70% of total healthcare spending is out-of-pocket.

“In the coming days, the government will bring a legal framework under which doctors will have to prescribe generic medicines which are cheaper than equivalent branded drugs to patients,” Modi was quoted by local media as saying on April 17.

The prime minister, who has sounded an increasingly populist note on the hustings in the past year and moved to being less overtly pro-market, proclaimed last month he’s ready to take on “influential interests” to push for “pro-poor” causes, despite “how angry the manufacturers of medicines will be.” In February, Chemicals Minister Anath Kumar said the government was committed to breaking the domination of the “medicine mafia.”

Many in the medical profession say the idea of doctors prescribing only generic names has significant merit to lower patient costs but believe right now Modi’s call may be more political spin than substance. Financial analysts also are skeptical that there will be any immediate big impact on the pharmaceutical industry from Modi’s call, although it signals continued pricing pressure on the sector, where multinationals have been launching branded generics as they seek growth in various emerging markets.

”A shift to a generic-generic model (similar to the US) from the branded generic model currently in India, requires confidence among doctors, pharmacists and patients on the quality of drugs available in market," Jefferies observed. Modi’s urgings should be seen as a “long-term target,” added the investment banking firm, and “may have little material impact without steps for improving the quality standards.”

No Plan Without Quality Harmonization: Biocon

“What’s being proposed by the government is very complex. I think unless you have a very uniform regulatory ecosystem across the country, unless you have the quality of generics all of the same type, you can’t go ahead with a generic policy because right now there’s no clarity on regulatory harmonization” between the states and the national government, Kiran Mazumdar-Shaw, founder and managing director of India’s biggest biotech company, Biocon Ltd., told analysts in a conference call April 28.

The other problem, she said, was a regulatory system that exists at both the national and state level. ”The moment you introduce a state regulator who’s basically free to decide what they want to approve at the state level, it is creating a lot of inequities and anomalies in the quality system.”

In places like the US and the EU, doctors routinely prescribe non-proprietary low-cost generic drugs. But regulators there require testing to ensure the generic versions are “therapeutically equal” to the innovator drug in quality, purity and potency.

Drugs exported by India undergo stringent quality tests, though foreign regulators have found many quality-control lapses involving some of India’s biggest domestic manufacturers such as Sun Pharmaceutical Industries Ltd. But regulation of drugs sold domestically is far patchier and weaker and in the absence of strict quality controls, doctors have come to trust some, usually bigger, companies for quality more than others.

Forcing generic name prescriptions would be a “useless, counterproductive step as a standalone measure” without assurances on availability and quality controls. – All India Drug Action Network

“There are more than 30,000 companies making medicines. Even garages make medicines. Now, as a doctor, I prescribe the medicine. If I’m only writing the generic, who decides which company's medicine patient should take? Is it from one of those big companies with their big reputation or one of the garage operators?” asked Dr. Devi Shetty, a low-cost healthcare pioneer who’s executive chairman of the Narayana Hrrudayalaya Ltd hospital chain.

Reflecting the concerns expressed by some others, Shetty told India’s CNBC network that: “Pharmacists will obviously sell the medicine company's product which gives him the big margin. In the end, the patient suffers.”

Lingering Quality Concerns

A just-released government study found that 10% of all drugs from “government sources” in India were “not of standard quality” or NSQ. At the retail level, the percentage of NSQ samples nationwide was 3%. For individual manufacturing units, NSQ rates ranged as high as 91% in one case.

Even when drugs have passed bioequivalence (BE) tests, they can be flawed due to exposure to heat or humidity due to improper storage. Also, public health advocates say many essential generic drugs frequently are not available in government-supplied public medicine stores.

The government has taken one important step toward quality control, mandating BE studies for only four years after the first approval was granted in India. As a result, most generic drug makers sought marketing approval from the fifth year, sidestepping BE testing. On April 3, the health ministry changed the law to henceforth make BE testing of certain soluble generic drugs compulsory before companies can obtain a license to manufacture.

This brings India into line in terms of global drug regulation. However, the amendment makes no reference to drugs whose manufacture was approved before April 3.

Earlier Attempts

Over the years, various Indian government committees have pushed proposals to oblige doctors to prescribe non-proprietary generics but they have never been implemented. Back in 1975, the Hathi government committee, in an oft-cited report, urged legislators to phase out brand names in a “step-wise manner.”

Just last month the Indian Medical Association reiterated a call for doctors to write only generic names on prescriptions.

“Laudable theoretically, this guidance does not fit in the not-so-robust drug regulatory system of our country which is struggling to provide quality medicines from all manufacturers,” remarked an article in the Indian Journal of Endocrinology and Metabolism in 2015.

From the editors of PharmAsia News.