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BioSpectrum (India) - - Bio Contents -

Once again it’s time to wel­come the new year. Ev­ery new year brings hope. Some­times the hope is based on a solid foun­da­tion of rea­son­ing or/and anal­y­sis of pre­vi­ous de­vel­op­ments. But, some­times it is merely an ex­pec­ta­tion or a wish with­out any base. For In­dian health­care sec­tor, var­i­ous stud­ies and pro­jec­tions have brought good news and are show­ing hope of bet­ter per­for­mance.

De­spite gen­eral slow­down of econ­omy, the health­care sec­tor is the fastest grow­ing sec­tor. Its growth is pro­jected to con­tinue till 2020 as the fac­tors like ris­ing in­comes, greater health aware­ness, life­style dis­eases and in­creas­ing ac­cess to in­sur­ance that help pro­pel the growth till now will con­tinue. Var­i­ous or­gan­i­sa­tions have made pro­jec­tion of the health­care sec­tor’s growth rang­ing from 16 to 22 per cent CAGR and reach­ing to USD 280 bil­lion by 2020.

Deloitte, in one of its re­ports, has pro­jected the health­care spend­ing in In­dia to grow 16.1 per cent each year till 2019. Both, FICCI-KPMG re­port and In­dian Brand Eq­uity Foun­da­tion, have al­most sim­i­lar pro­jec­tions. They all have painted a bright pic­ture of 2017 and ahead. But, in view of the much dis­cussed pos­si­ble ef­fects of the de­mon­eti­sa­tion on the econ­omy, it will be im­por­tant to watch care­fully if the sec­tor per­forms this year as per the ex­pec­ta­tions.

In the pro­jected growth of the sec­tor, a ma­jor con­trib­u­tory fac­tor is pri­vate play­ers. Gov­ern­ment’s cur­rent spend­ing of 4.1 per cent of GDP, much less than APAC re­gion’s an­tic­i­pated av­er­age of 6.5 per cent, is ex­pected to con­tinue, ac­cord­ing to the Deloitte’s pro­jec­tions. How­ever, the gov­ern­ment has set a tar­get to in­crease spend­ing on the health­care in­fra­struc­ture de­vel­op­ment from 1.2 per cent to 2.5 per cent. Still, this would be much less than re­quired as the health­care in­fra­struc­ture is very poor. Ser­vices in the pub­lic hospi­tals have to be stretched much be­yond their max­i­mum lim­its due to the ad­verse ra­tio of pa­tients to in­fra­struc­ture.

For the In­dian pharma sec­tor too, sim­i­lar bright pro­jec­tions have been made till 2019. For part of pharma sec­tor in­volved in pro­duc­tion and sale of fixed dose com­bi­na­tion (FDC) drugs, the new year brought some hope as the Delhi High Court in the last month of 2016 ad­mit­ted pe­ti­tions chal­leng­ing the gov­ern­ment’s or­der ban­ning 344 FDC medicines, im­ply­ing set­ting aside the or­der.

The gov­ern­ment had banned these FDC drugs in March 2016 fol­low­ing the ex­pert com­mit­tee re­port that they have lit­tle therapeutic value, un­safe, pro­mote an­tibi­otic re­sis­tance, some banned in other coun­tries, and sold with­out the ap­proval of drug con­troller as they are man­u­fac­tured un­der the li­cences is­sued by state gov­ern­ments. The Drugs Con­troller’s no­ti­fi­ca­tion ban­ning these drugs was chal­lenged in the court by pharma com­pa­nies by fil­ing over 450 pe­ti­tions.

The pe­ti­tions were al­lowed as the court felt that the gov­ern­ment had not fol­lowed the pro­ce­dure pre­scribed in the Drugs and Cos­met­ics Act, 1940, to ban the drugs with­out con­sult­ing Drugs Tech­ni­cal Ad­vi­sory Board or Drugs Con­sul­ta­tive Com­mit­tee and giv­ing three months no­tice to drug man­u­fac­tur­ers be­fore the ban.

The gov­ern­ment has two op­tions now. It has al­ready moved the Supreme Court with a plea to com­bine and trans­fer all cases in the mat­ter, to com­bine all pe­ti­tions on the is­sue, or it can also re-is­sue the ban or­der by fol­low­ing the pre­scribed pro­ce­dure.

There are two lessons in the whole is­sue. The gov­ern­ment has to care­fully ex­am­ine and im­ple­ment the pro­ce­dures pre­scribed by the law to avoid em­bar­rass­ment of strik­ing down of its or­der on tech­ni­cal grounds. The sit­u­a­tion arose to a cer­tain ex­tent due to the li­cences is­sued by states. Such types of loop­holes need to be plugged. Be­sides the al­lo­ca­tions and ex­pen­di­ture, the gov­ern­ment will have to pay at­ten­tion to such is­sues too for the ro­bust growth of the sec­tor during this year.

Milind Kokje Chief Edi­tor milind.kokje@mmac­tiv.in

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