ACKNOWLEDGEMENT 
1. The Pharmaceutical Research and Development Committee (PRDC) was set up under the chairmanship of Dr. R.A. Mashelkar, Director General, CSIR to study and identify the measures needed to strengthen R & D base of the Indian pharmaceutical industry. 2. The Indian Pharmaceuticals Industry is today self-reliant in several areas. The low levels of profitability combined with comparatively small size of the companies was largely responsible for the low investment in R & D, which has been largely concentrated on process development for known drugs. The coming century will pose several challenges to the industry, not the least of all will be the new IPR regime. 3. The Committee enunciated a vision for Indian pharma R&D as :. "To provide intellectual capital to make available safe, cost-effective, contemporary, quality therapeutics to the people of India to help reduce percentage of mortality and morbidity and to emerge as a significant player in the global market place." In consonance with this vision, a grand dream for production, export and investment in pharma R&D was evolved. This report suggests the measures by which such a dream and vision could be realised. 4. Priority areas for Indian pharma R&D have been identified. India’s excellent expertise in developing new and innovative processes for known molecules needs to be exploited in a greater measure. Priority needs to be given for initiation of new drug development for diseases of relevance to the Indian population, while at the same time seizing opportunities to become a global player by introducing globally competitive products based on new molecules, new delivery systems, etc. 5. To achieve such objectives, the existing human resources in conventional methods of drug discovery need refurbishing alongside acquisition of newer tools of drug discovery. Identification of such tools, estimation of the new human resource requirement, the levels of required investment and the centres where such investment could be made have been specified in the report. 6. Citing the unique opportunity for India to become a leading centre for clinical trials, the Committee has called for basic changes in the legislation allowing import of animals, contract research, and a legal status for institutional animal ethics committee. Furthermore, establishment and operationalisation of a cGMP, GLP and GCP monitoring authority has been recommended.
7. Recognising the crucial role played by the Indian systems of medicine in the health care needs of our population, the Committee has recommended major and specific initiatives to strengthen and modernise the existing infrastructure. Proper scientific documentation of our traditional knowledge base in the internationally accepted format and media has been suggested as a priority. 8. A higher level of innovation and IPR management coupled with strategic manufacturing and aggressive marketing will largely determine Indian pharma industry’s future. Specific measures for strengthening the IPR system with action points for the Government, judiciary and the legal system, industry, S&T and educational system have been suggested. Some suggestions for enacting a TRIPs compatible IPR legislation, which protects the interest of the consumers and allows a platform for the growth of Indian pharma industry have been made. 9. In the backdrop of a strong trend towards globalisation of regulatory and scientific requirement pertaining to safety, efficacy and quality issue, the Committee has recommended a professionally managed and efficient regulatory mechanism under the Central Drugs Standard Control Organisation. Several specific measures have been suggested to facilitate creation of a new structure for CDSCO. 10. Recognising that the significant areas of healthcare of relevance and value to the Indian populace will not be addressed by the companies in the developed world, the Committee has recommended the establishment of Drug Development Promotion Foundation, which will promote such R&D. This foundation will be truly autonomous and independent of the government, with a well defined legal structure. The Committee has also detailed the functions, management and financing of the Foundation. 11. On the funding of R&D, the Committee has suggested several fiscal and non-fiscal measures. Most importantly, an effective venture capital financing environment needs to be created by removing the existing roadblocks, which have been specifically identified. For attracting R & D towards high cost-low-return areas the Committee recommends mandatory collection and contribution of 1% of MRP of all formulations sold within the country to a fund called ‘Pharmaceutical R & D Support Fund’ to be administered by the Drug Development Promotion Foundation. In a major recommendation the Committee has suggested that a significant portion of the proceeds realised under DPEA should be credited to this fund. 12. Finally, concrete action points for the government agencies and departments have been specified with time frames. The Committee has urged the government to quickly set-up an enabling mechanism under the Department of Chemicals and Petrochemicals to initiate implementation of its recommendations in a time bound manner.
I PREAMBLE
The composition and other details of the committee are at Annexure-1.
2. Functioning of the Committee The Committee decided to interact with and seek the views of a very wide section of stake holders such as scientists, medicinal practitioners, industry associations, consumer interest groups, non-governmental organisations, and others. In all the committee had the benefit of inputs from over 100 stakeholders ( Annexure-2). Considering the mammoth task involved and the need to focus on and devote time to issues of Intellectual Property Rights and prioritisation of R&D it constituted two sub-groups to study the two areas in detail. The composition and Terms of Reference (TOR) of the two sub-groups are given in Annexure-3. The committee held six meetings before it finalised the Report.
Thomas A Stewart
II R&D IN PHARMA INDUSTRY The Indian drug and pharmaceutical industry has made rapid strides over the years. Today the industry is manufacturing practically the entire range of the therapeutic products; it is capable of producing raw materials for the manufacture of a wide range of bulk drugs from the basic stage and a range of pharma machinery and equipment. The industry has achieved global recognition as a "low cost producer of quality bulk drugs and formulations". Leading Indian companies have established marketing and manufacturing activities in over 60 countries including USA and Western Europe. The phenomenal progress made by the industry over the years is depicted in Tables 1 & 2.
Table 1. TEMPORAL PROGRESS OF THE PHARMA INDUSTRY
Table 2. GROWTH OF PHARMA INDUSTRY (Rs. in Million)
4. R&D in pharma industry
Investment in R&D by industry as a whole in India has been low, only around 0.6% of the turnover. In the Indian pharmaceutical industry the average R&D expenditure is around 2% of the turnover contributed by around 150 companies. The low investment in R&D is due to the low levels of profitability and comparatively small size of the companies. However, the scenario is now changing. Some pharma companies now spend nearly 5% of their turnover on R&D. In addition to R&D in industry, substantial pharma related R&D is carried out in publicly funded research organisations, mainly by the laboratories of Council of Scientific & Industrial Research (CSIR), Indian Council of Medical Research (ICMR), around 25 universities and a few pharmacy colleges. Some of the new R&D units in industry and a few of the publicly funded laboratories are equipped with sophisticated laboratory equipment, instruments and pilot plant facilities. The R&D manpower is generally highly qualified and proficient in conventional techniques of pharmaceutical R&D. Hitherto, R&D was largely concentrated on process development for known bulk drugs albeit through novel and innovative process routes, invariably substituting for expensive imported raw materials enhancing the productivity and efficiency of the processes, besides research on formulations and known drug delivery systems. India’s R&D forte has been in synthetic organic chemistry and process development. A few new drugs, using conventional screening techniques, have emerged from the Indian R&D, but none of them have been blockbusters. Not much R&D is being pursued in traditional systems of medicine. Even the limited R&D is concentrated on standardisation of raw materials and final products. A few companies are now using modern scientific methods and limited biological screening as well as toxicity studies for validation of formulations.
III THE CHANGING GLOBAL SCENARIO
The health-care costs are rising
world-wide. Leading companies are merging. Strategic alliances and collaborations are
taking place in order to meet the increasing R&D budgetary requirement that exceeds a
billion dollars each for many leading global pharma players. The WTO has imposed upon the
Indian pharma industry the challenge of coping with product patents by the end of the year
2004 and exclusive marketing rights (EMRs) in the interim period. At present, out of ten thousand chemical compounds screened, only one becomes an approved drug in the developed countries. Further about 12-15 years are required for drug development. In order to attempt to reduce the time for drug development to half and to improve the success rate of drug discovery, intelligent screening of sources of chemical compounds is required. For this, on one hand, creation and analysis of new tools and data base of compound sources would be necessary, and on the other hand, new tools, such as combinatorial chemistry, structure based molecule design and high throughput screening would have to be adopted to greatly enhance the levels of productivity of drug discovery. Further more, some of the new sources of NCEs could be plants, microbes, fungi, insects and various venoms. The extracts from these material sources must continue to form a major source of entirely novel structures. The Human Development Report of 1999 has highlighted that there is a tremendous concern about the control of knowledge as tighter intellectual property rights raise price of technology transfer and increase the technological gap and block the developing countries out of dynamic knowledge sector. On the other hand, the major pharmaceutical companies argue that compliance of the provisions of TRIPS would stimulate transfer of technology, encourage foreign direct investment, strengthen R&D investment and also ensure early introduction of new products in developing countries. These arguments are invariably backed by data on increased FDI in some countries where stringent IPRs were introduced. Whereas these claims and counter claims could be debated, the Indian model has to be based on providing medicines at affordable prices to the needy Indian populace on one hand and also leveraging the Indian intellectual prowess on the other, through which India could create its own intellectual porperty. It is clear that an internal networking and co-ordination amongst different constituents of innovation chain has not only become necessary but imperative in order to bring down the time and costs of new drug discovery and its introduction in the market place. This affords a great opportunity to Indian R&D.
Ken Blanchard-
Strategic focus The focus of the committee was on a holistic assessment of the R&D in the sector and that needed for it to emerge as a global player. This strategic assessment is succinctly brought out in the following SWOT analysis. Strengths
Opportunities
Threats
7. Findings It is apparent that Indian pharma R&D has several scientific-techno-economic advantages that by far outweigh the few inherent weaknesses. The opportunities are appealing and attractive and the threats manageable. Thus if the proper policy support and direction is given, the industry can carve out a niche for itself in the global market place.
The significant problems we face cannot be solved at the same level at which we created them. Albert Einstein
V VISION
In the above context, the committee in all sanguinity enunciated the vision for Indian pharma R&D as To provide intellectual capital to make available safe, cost-effective, contemporary, quality therapeutics to the people of India to help reduce percentage of mortality and morbidity and to emerge as a significant player in the global market place.
8. The grand dream People of India shall lead not only a longer life, but life with a much superior quality, with standards comparable to the developed nations. More specifically, the committee envisages that by the year 2005, India shall : (i) In the field of pharma R&D -
(ii) In the field of production, export and investment in pharma industry -
(iii) In the field of strengthening organisational/legal systems -
All of us have a right to dream. Who knows, if this dream were to come true, the Indian pharma industry may feature on the cover page of "The Economist" as appearing at the end of this report.
O creator of the Universe! We meditate upon thy supreme splendour. May thy radiant power illuminate our intellects and guide us in the right directions. The Gayatri Mantra
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PRDC
Report
