India exports generic drugs worth $12.5 billion annually and the U.S is a big market. President Donald Trump has been critical of the fact that the country imports drugs. “..they don’t make them here, to a large extent,” he said early this year. Pharmaceutical imports to America could be a target in the border adjustment tax that Republican lawmakers are trying to impose on imports. But Indian generic pharma sector has advantages that America seeks and will survive the storm, says Vivek Sharma, CEO, Piramal Pharma Solutions. Piramal has 12 locations around the world, including the U.S. Mr. Sharma is based in Boston and spoke to The Hindu ahead of Prime Minister Narendra Modi’s first meeting with Mr. Trump, scheduled for next week, on what the sectorexpects and how the Indian government could help. Excerpts.
Do you think President Donald Trump’s protectionist ideas could negatively affect Indian generic pharma industry?
“In general, the generic pharma industry is growing and will continue to do so as the demand for affordable and quality medicines increases. I also believe that with the right focus on quality, compliance and technology, India will continue to play an important role in the global pharma industry. We have an obligation to maintain global quality standards. Indian companies have made drugs affordable for the entire world. There could be some short-term challenges, but overall I am very optimistic about the future of the sector in the U.S. under President Trump. The U.S. does not have the capacity to manufacture all that it requires. Unlike other sectors like I.T, the pharma industry has not seen movement of employees from India into the U.S. In fact, Indian Pharma companies like ours have created jobs in the U.S. and also retained locals to manufacture medicines in the U.S. for the U.S. markets. While India offers a cost arbitrage, companies like ours that focus on quality, do not compromise on investments required to adhere to global expectations on this front. My business is a services business. We make drugs for other companies. In services business, cost is important. We, however, see that as an opportunity to invest in new capabilities and technologies and many people come to us for the differentiated capabilities we offer. There is a huge demand in the western world for combination of cost advantage and quality.
The U.S. continues to complain that IPR protections are not adequate in India in the pharma sector. Do you think this conflict will flare up under Mr. Trump?
Except in case of compulsory licensing, for India, that is not a big challenge. We have customers from all over the world. In our normal discussions with companies, they don’t make it a big issue and they are very comfortable working in India. They have bigger challenges on this front, particularly China. It is more of a political issue that is raised on and off.
Do pharma companies have a strategy to deal with the rhetoric against manufacturing moving abroad and such issues?
We are passing the message through members of Congress and other bodies about the non- profit work that Indian companies are doing in America and the kind of value that we bring to the American healthcare sector. So, yes, there is an effort being made.
What would you like Indian government to take up with American govt.?
At the government to government level, India must continue to impress upon America to not impose visa restrictions that will disallow free movement of talent. Secondly, we have seen the U.S. Food and Drug Administration (FDA) having a different approach with pharmaceutical companies in India compared to those in the West. We ourselves experience this different approach when the U.S. auditors visit our Indian sites versus our sites in Europe or North America. Our quality standards are global and apply across all our sites across the world. There needs to be a greater level of sensitisation on this issue, about the efforts being made by Indian companies in ensuring global quality standards, across all their facilities.
