PHARMACEUTICAL IN RURAL MARKET

PREFACE
The project pharmaceutical in rural market give a i!ea that although over "#$ o% the population live in rural area onl& '"$ o% pharmaceutical ale are in tho e area ( A large ection o% In!ia) rural population *ith a ri ing level o% !i po a+le income that i hitherto uncovere! +& mo!ern me!icine *ill eventuall& come un!er the am+it o% healthcare program an! *ill create a %re h !eman! %or pro!uct !irecte! to*ar! in%ectiou !i ea e ( The project con i t te,t an! ca e *ith In!ian conte,t an! eparate chapter have +een !evote! to emerging pharmaceutical companie gro*th in rural area an! variou trategie u e! +& pharmaceutical companie in rural area to tappe! the rural market(

PHARMACEUTICAL IN RURAL MARKET

OBJECTIVES OF THE PROJECT

To have kno*le!ge a+out the In!ian pharmaceutical in!u tr& in rural area ( To un!er tan! the large untappe! rural market o% pharmaceutical in!u tr&( To un!er tan! *h& there i lo* ale in rural area a compare to ur+an area ( To un!er tan! the pro+lem %ace! +& pharmaceutical companie in rural area ( To un!er tan! the trategie o% pharmaceutical in!u tr& u e! in rural area (

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PHARMACEUTICAL IN RURAL MARKET

METHODOLOGY
In or!er to reali.e the tu!& the o+jective a con i!era+l& volume o% +oth primar& an! econ!ar& !ata i nee!e!( It ha +een there%ore %oun! nece ar& to vi it an o%%ice *hich help poor people %or there me!ical treatment( Primar& /ata ha +een collecte! through a vi it to an o%%ice *hich help poor people %or there me!ical treatment an! help me to gather relevant !ata( 0econ!ar& /ata the in%ormation regar!ing the rural market ha +een !ra*n %rom variou pu+li he! ource ( The !ata relating to pharmaceutical compan& ha +een collecte! %rom compan& recor! ( Thi tu!& i nece aril& +a e! on the limite! kno*le!ge an! little

practical e,po ure the con traint o% re ource an! time have %urther impo e! limit to the tu!& +oun!arie (

PHARMACEUTICAL IN RURAL MARKET

PHARMACEUTICAL IN RURAL MARKET

INTRODUCTION TO RURAL MARKET

Rural Market are !e%ine! a tho e egment o% overall market o% an& econom&3 *hich are !i tinct %rom the other t&pe o% market like tock market3 commo!it& market or La+or economic ( Rural Market con titute an important egment o% overall econom&3 %or e,ample3 in the U0A3 out o% a+out 1### countrie 3 aroun! '### countie are rural3 that i 3 non4ur+ani.e!3 *ith population o% 55 million( T&picall&3 a rural market *ill repre ent a communit& in a rural area *ith a population o% '5## to 1####( In recent &ear 3 rural market have ac6uire! igni%icance in countrie like China an! In!ia3 a the overall gro*th o% the econom& ha re ulte! into u+ tantial increa e in the purcha ing po*er o% the rural communitie ( 7n account o% the green revolution in In!ia3 the rural area are con uming a large 6uantit& o% in!u trial an! ur+an manu%acture! pro!uct ( In thi conte,t3 a pecial marketing trateg&3 namel&3 rural marketing ha taken hape( 0ometime 3 rural marketing i con%u e! *ith agricultural marketing 8 the later !enote marketing o% pro!uce o% the rural area to the ur+an con umer or in!u trial con umer 3 *herea rural marketing involve !elivering manu%acture! or proce e! input or ervice to rural pro!ucer or con umer ( Al o3 *hen *e con i!er the cenario o% In!ia an! China3 there i a picture that come out3 huge market %or the !evelope! pro!uct a *ell a the la+or upport( Thi ha le! to the change in the min! et o% the marketer to move to the e part o% the *orl!( Al o rural market i getting an importance +ecau e o% the aturation o% the ur+an market( A !ue to the competition in the ur+an market3 the market i more than or a aturate! a mo t o% the capacit& o% the purcha er ha +een targete! +& the marketer ( 0o the marketer are looking %or e,ten!ing their pro!uct categorie to an une,plore! market i(e( the rural market( Thi ha al o le! to the C0R activitie +eing !one +& the corporate to help the poor people attain ome *ealth to pen! on their pro!uct categorie ( Here *e can think o% HLL 9no*3 HUL: initiative in the rural In!ia( 7ne o% uch project i the

PHARMACEUTICAL IN RURAL MARKET Project 0hakti3 *hich i not onl& helping their compan& attain ome revenue +ut al o helping the poor *omen o% the village to attain ome mone& *hich i urel& going to increa e their purcha ing po*er( Al o thi *ill increa e their +ran! lo&alt& a *ell a recognition in that area( 0imilarl& *e can think o% the ITC E4Chaupal3 *hich i helping the poor %armer get all the in%ormation a+out the *eather a *ell a the market price o% the %oo! grain the& are pro!ucing( In other vie* the e activitie are al o helping the companie increa e their +ran! value( 0o a it i given a+ove the igni%icance o% the rural market ha increa e! !ue to the aturation o% the ur+an market a *ell a in uch con!ition the compan& *hich *ill lea! the *a& *ill +e +ene%ite! a ho*n +& the ucce o% HUL an! ITC initiative (

PHARMACEUTICAL IN RURAL MARKET

THE INDIAN RURAL MARKET

The rural In!ia ha a plethora o% opportunitie all *aiting to +e harne e!( Not urpri ingl&3 it ha +ecome the late t marketing +u..*or! %or mo t o% the <MC= major ( Man& o% the <MC= companie are +u & %ormulating their rural ho*ing !eep

marketing trateg& to tap the chance (To name %e* companie

intere t in rural In!ia are HLL3 Marico in!u trie 3 Colgate 8 Palmolive an! >ritannia In!u trie ( "# $ o% In!ia? population live in ;'"### village in rural area ( @# $ o% the Population i concentrate! in village *ith a than '###3 *ith Agriculture +eing the main +u ine ( Thi population o% le

impl& ho* the great potentialit& rural In!ia Ha to +ring the much4nee!e! volume an! help the <MC= companie to +ank upon the Aolume 8!riven gro*th( Thi +ring a +oon in !i gui e %or the <MC= Compan& *ho ha alrea!& reache! the plateau o% their +u ine curve in ur+an In!ia( A per the National Council %or Applie! Economic Re earch 9NCAER: tu!&3 there area man& )mi!!le income an! a+ove) hou ehol! in the rural area a there are in the ur+an area ( There are almo t t*ice a man& )lo*er mi!!le income) hou ehol! in rural Area a in the ur+an area ( At the highe t income level there are '(1 million ur+an Hou ehol! a again t -(; million hou ehol! in rural area ( Accor!ing to the NCAER projection 3 the num+er o% mi!!le an! high4income Hou ehol! in rural In!ia i e,pecte! to gro* %rom B# million to --- million +& '##"( In Ur+an In!ia3 the ame i e,pecte! to gro* %rom 2; million to 5@ million( Thu 3 the A+ olute i.e o% rural In!ia i e,pecte! to +e !ou+le that o% ur+an In!ia(

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PHARMACEUTICAL IN RURAL MARKET

CHARACTERISTICS OF INDIAN RURAL MARKET

9A: Cith the increa ing o% rural people? income an! the enhancement o% %armer) purcha ing po*er3 the rural market econom& i %acing a ne* opportunit& o% !evelopment( 7ur pre ent market ha the huge !evelopment potential3 compare! *ith the tra!itional rural market marketing channel3 an! it +ecome convenient an! 6uick( The enterpri e mu t ha the keen in ight3 make the e%%ective u+!ivi ion o% rural market 3 earne tl& tu!ie the characteri tic o% !etaile! goal market 3 then the& can e%%ectivel& utili.e the marketing strategy and develops the rural market. The gradual increasing of farmers income and the multi-level of consumer idea is remarkable Accor!ing to the relate! tati tical !ata3 in '##5 in ome rural area o% our countr&3 inha+itant ) average! governa+le income i "355; RM>3 a gro*th o% '(2 time compare! to -@@;(the pecial !i%%icult %amil& al o +a icall& e cape! %rom povert&( Cage accounte! %or ;2$ o% the %amil& gro income3 compare! to -@@;(*hich i a !ecrea e o% 1(; percentage ( Moreover3 the propert& income an! the hi%t income gre* *ith tea!& tep ( Along *ith the gra!ual enhancement o% income level3 our countr& inha+itant) 6ualit& o% li%e ha! the comprehen ive improvement( Accor!ing to the relate! tati tical !ata3 in '##@3 the citie inha+itant average con umer !i +ur ement achieve! "3@21RM>D the countr& i!e inha+itant average li%e con umer !i +ur ement amounte! to '3555RM>( Accor!ing to the con umer cla i%ication3 the countr& i!e inha+itant) !eman! appear multi4level3 the !eman! tructure ha the remarka+le change3 an! the %armer) con umer i!ea i al o gra!uall& change( The !i +ur ement proportion o% E %oo!3 clothing an! +a ic utilitie E gra!uall& !rop +ut the !i +ur ement proportion o% the tran portation demand urge farmer's the countryside consumer pattern to change, and the change

PHARMACEUTICAL IN RURAL MARKET communication3 the me!ical health care3 the culture an! e!ucation entertainment an! the hou ing rapi!l& ri e (At the ame time3 the countr& i!e inha+itant) con umer i!ea an! the con umer cu tom are changing3 the cit& an! countr& i!e inha+itant +ecome rational an! mature3 *ith con umer i!ea al o !eveloping %rom el%4 accumulation to the appropriate con umption an! cre!it con umption( Cith enhancement o% inha+itant con umption level an! pee!ing up o% li%e rh&thm3 countr& i!e inha+itant) ervice con uming !eman! gro* rapi!l&( The concrete mani%estations are: 9-: The inhabitants domestic electric appliances renewal step speeds up. The family appliance o% comparativel& high technolog&3 high 6ualit& an! lo* price 9color%ul televi ion3 *a her3 air con!itioning an! o on: can +e %oun! in the common %amilie 3 *hich +ecome the hot pot o% con umption in pre ent tage( 9': The health care disbursement rises increasingly. Along with the increase of the inhabitant living standard, they also pay more attention to their own health, health health care care consciousness strengthen increasingly,

disbursement also correspondingly increasing. 91: The transportation communication e pends is fast growing. Along with !uick change of the transportation infrastructure countryside construction, inhabitant have the travel conditions of remarkable improvement"

#oreover, along with the populari$ation of countryside fi ed telephone and mobile phone, the countryside communication enterprise also obtains the opportunity of the swift development.

PHARMACEUTICAL IN RURAL MARKET 9%& The rural consumer market is progressing toward 'normali$ation(, which has presented 'the buyer market 'characteristics )ith the advent of the information age and the rapid development of the rural communications, the rural consumer market is moving toward 'information(. According to the survey investigations, in recent years, for the fi ed telephone, mobile phone, T* channels, networks and other modern communication facilities in rural areas, the coverage population is rapidly villages increasing: with fi ed +n phones ,--., have /hina's already administrative

reached more than 012, the radio and television network nearly covered all the administrative villages. Ce can ee that the rural market) in%ormation channel i +eing gra!uall& unimpe!e!3 the in%ormation tran mi ion pee! i al o gra!uall& pee!ing up3 in certain countr& i!e3 and its information propagation velocity already corresponds to city market. At present, the rural market is nearly the same as the city market. /ommodity is various, and the source of goods is abundant. 3early all the daily necessities, the manufactured item for daily use, the durable consumable and so on, the farmers all can nearby buy. Along with further enhancement of the income, compared with the traditional big city, the rural market has relatively high scale of new 'latest wealthy community'. This community is younger than the traditional wealthy community, which is more thoughtful and more open. To some degree, in the rural market, the supply and demand relation has presented the buyer market characteristics.

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PHARMACEUTICAL IN RURAL MARKET

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PHARMACEUTICAL IN RURAL MARKET

SOME MYTHS ABOUT THE INDIAN RURAL MARKET

Myth No. 1:

In the a%termath o% ur+an4rural convergence3 rural market

*ill +e mainl& an e,ten ion o% ur+an market an! *ill eventuall& em+race the pro!uct an! +ran! li%e t&le o% the latter3 upporte! +& higher !i po a+le income 3 aggre ive retail promotion an! a!verti ing(

The Re !"ty: Rural market

repre ent a !i tinct !&namic in ho* the&

come into +eing an! make uni6ue !eman! on ho* the pro!uct i !e igne! an! ho* the +ran! i po itione! an! promote!( =reater the trategic attention to the e uni6ue !eman! 3 a ure greater the chance o% pro!uct) rural market( ucce in the

Myth No #: The market

i.e can +e e timate! +a e! on mere !emographic

interpolation o% current penetration level an! ale volume an! that even %ringe pre ence or limite! acceptance o% li%e t&le con umer pro!uct in rural market *oul! tran late into %uture market potential to +e tappe!(

The Re !"ty:

<ringe acceptance o% con umer pro!uct or +ran! i no

in!ication o% market potential( It actuall& *oul! onl& re ult in higher inci!ence o% +ran! an! pro!uct mortalit& a more %irm tr& to choke tho e egment *ith competing +ran! ( Rural market !&namic in tea! !eman! u taine! e%%ort at +ran! +uil!ing an! pro!uct acceptance(

Myth No $:

That rural market repre ent a more or le

homogenou

matri, o% attitu!e 3 value an! purcha ing +ehavior acro *hat ma& +e terme! Eone i.e %it allE approach(

region lea!ing to

The Re !"tyF The In!ian rural market i

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a comple, mo aic o% min!4 et 3

culture 3 an! li%e t&le ( Chile e!ucation3 emplo&ment3 income3 agricultural

PHARMACEUTICAL IN RURAL MARKET lan! o*ner hip ma& till +e the major !eci!ing %actor accounting %or ocial !i%%erentiation3 the& !o not &iel! reciprocal cohort +ehavioral pattern 3 *ith re pect to con umption pattern 3 purcha ing !eci ion an! prioritie o% pro!uct o*ner hip(

Myth No.%: That rural market

are highl& price4inela tic an! onl& uite!

%or )value4%or mone&) pro!uct a again t premium 6ualit& pro!uct (

The Re !"tyF /e pite lo*er inci!ence o% premium pro!uct purcha e 3 the

rural con umer acro all income egment e,hi+it marke! propen it& to pen! on premium high 6ualit& pro!uct *hich are +acke! +& trong +ran! value 3 *here the& corre pon! to their o*n a piration an! 6ualit& nee! ( The pro+lem reall& lie in market not +eing a+le to o%%er a premium pro!uct in the peci%ic conte,t o% rural !eman!

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PHARMACEUTICAL IN RURAL MARKET

STRATEGIES FOR RURAL MARKET

&A) Product Strategy
7ur countr& rural market i relativel& pecial3 *hich ha the !i%%erent con umer communit& in the !i%%erent ph& iographic region an! the !i%%erent con umer communit&3 ha the !i%%erence con umer !eman!( There%ore3 *hen the enterpri e launche pro!uct to the rural market the& houl! pa& great attention to meet the countr& con umer) nee!3 empha i.ing !i%%erence re earch( The enterpri e nee! to take meet %armer) e,pen e !eman! a the gui!ance3 then a!ju t pro!uct tructure3 increa ingl& improves product !uality, ameliorates product function and develops practicable, solid which are suitable for the rural market. At the same time, product packing and brand also should conform to farmer's consume psychology and the consumer custom. 4ere what need to be emphasi$ed is that the enterprise must base on the enhancement of product's basic function and the reduction of unpractical accessional function, which can not only reduce the product cost and price, but also can help the dissemination of enterprise's brand effect. Although the enterprise also invests the product advertisement in the countryside, the present stage countryside information mainly depends on the oral dissemination, and in the short-term dissemination surface is very big. 5egarding the product's !uality, the inhabitant favors vicinage's approval rather than the advertisement effect. +f the good !uality product obtains the vicinage's approval, it will !uickly get the approval from the wider region.

&B' Price Strategy

Pre entl&3 thi article +elieve the lo* price trateg& i the ke& %actor *hen !eveloping the rural market( =enerall& peaking3 our countr&

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PHARMACEUTICAL IN RURAL MARKET inha+itant) income level i till ver& lo*3 the countr& inha+itant con umption

till take thri%t& a primar& matter( C hen purcha e pro!uct3 the pro!uct price i the mo t important con i!eration %actor to the countr& inha+itant( There%ore3 *hen entering the market3 the enterpri e houl! con i!er a!opting lo* price3 although the hort4term +ene%it i lo*er3 once ei.e the market3 the countr& i!e huge con ume potential *ill +e a+le to +ring the long4term high pro%it to the enterpri e( In +rie%3 *hen the enterpri e !evelop the rural market3 fi ing a product price is a very essential problem. They must considers the countryside consumer characteristics, and measures the enterprise6s own benefit, competitor and market demand and so on, finally fi es the most reasonable product price.

&C) Channel Strategy

Chen choo ing marketing channel3 *e houl! %ull& con i!er the differences between the rural market and the city market. 7ecause the rural market's region is broad, the consumption is separate, its marketing channel is comparatively sole, namely top-down supply relations, once forms the !uite stable supply relations, the loyalty of the downriver dealer to the upstream is !uite high. Therefore, to some degree, the selection of dealer determines whether the enterprise will develop the rural market successfully or not. )hen choosing the dealer the enterprise must not only inspect its fund strength, but also must inspect its construction of sales network , the storage and transportation facility, the oral traditions in the local and so on, then enables it to play the positive role in the rural market.

&D) Promotion and Service Strategy

The tra!itional promotion mean mainl& inclu!e the elling per onnel3 the a!verti ement3 an! +u ine promotion( >ecau e the rural market i comparativel& !i per e!3 the local !i%%erence i big" the cost of the

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PHARMACEUTICAL IN RURAL MARKET traditional selling personnel is too high. #oreover the result is very poor. Therefore the selling personnel are not suitable for the development of the rural market.

&") Advertisement promotion

Along *ith the rapi! !evelopment o% the countr& communication enterpri e3 the in%luence o% the televi ion a!verti ement on the %armer i al o +ig( In vie* o% thi kin! o% ituation3 the *ell4kno*n enterpri e nee! to %ocu on the mo t +a ic unit3 uch a F the count& eat) ne* an! the village an! to*n ) ne* 3 then u e it to propagan!i.e3 o+tain %armer) attention an! the tru t( In a!!ition3 Ethe *all a!verti ementE i one uni6ue marketing metho! o% the rural marketF It %orm i operate imple3 the co t i lo*3 pointe! i trong3 an! impl&3 the maintenance time i long3 an! the !i emination cope i

+roa!( <or e,ampleF the enterpri e ma& +ru h the pro!uct a!verti ement logan on the pea ant hou ehol!) *all3 cau e it ever&*here o+viou l&3 through thi la tingl&3 repeate!l& an! latent marketing mean 3 the countr& i!e con umer all accept the marketing in%ormation regar!le o% active or pa ive( Here *hat mu t +e pai! attention to i the choice o% a!verti ement content mu t have pointed moreover must be melt with the countryside social culture environment, the difference between the advertisement slogan and the acceptable scope of the country inhabitant cannot be too large. The advertisement must put the emphasis on the topic which the farmer pays attention, lets the country consumer think this kind of product is essential to their life.

"") Business promotion

Although +u ine promotion +elong to the hort4term +ehavior3 it can the elling on cre!it( >ecau e the the countr& i!e hou ing timulate the con umer ma ive purcha e pro!uct ( Regar!ing the rural market3 one 6uite e%%ective *a& i con%orma+le p &cholog&3 countr& i!e con umer ha relativel& thick competitive p &cholog& an! +lin!l& imultaneou l& characteri tic cau e the neigh+or an! the relative an! %rien! %re6uentl& !rop

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PHARMACEUTICAL IN RURAL MARKET aroun!3 con e6uentl& the in%ormation i e,tremel& open3 an! the oral ol! an&

!i emination i the main !i emination *a&( There%ore3 i% ome ha 6uantitie o% people to purcha e or tick3 then %orm the goo!(

goo! thing on cre!it3 it *ill prea! ver& 6uickl&3 an! it can lea! the large

(HY THERE IS A NEED TO FOCUS ON RURAL AREAS)

The rural In!ian market3 *hich account %or nearl& "#$ o% the total num+er o% hou ehol! in the countr&3 *itne e! a '5$ annual gro*th in con umer !ura+le %or '##B3 *hile the ur+an market re%lecte! an annual gro*th rate o% "4-#$( Let) look at the %actor 3 *hich make the rural market an attractive propo ition %or the automotive in!u tr&( 1. L

*+e ,-.to/e* 0 .e

Cith a total population o% more than "5# million3 an! covering aroun! @5$ o% the countr&3 rural area have a huge cu tomer +a e( Although !ue to the increa e in ur+ani.ation3 the rural population a a percentage o% the countr&) total population i e,pecte! to %all3 +ut in a+ olute term 3 it continue to compri e a large pool o% cu tomer an! i e timate! to touch @## million +& '#'#( #. I1,*e

.e2 "1,o/e !e3e!.

There have +een everal %actor that have re ulte! in an increa e in income level in the la t %e* &ear ( Accor!ing to e timate 3 the percentage o% hou ehol! earning le than U0/- *a a high a @;$ in -@B53 *hich i

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PHARMACEUTICAL IN RURAL MARKET e timate! to come !o*n to '@$ +& '#'5( 0imilarl&3 the percentage o% hou ehol! earning *ithin U0/' to U0/5 i e,pecte! to increa e %rom -$ in -@B5 to '#$ +& '#'5( Let) look at ome %actor that *ill re ult in increa e! purcha ing po*er in rural In!ia(

' I1,*e

.e "1 M"1"/-/ S-44o*t P*",e &MSP': Recor!

%oo! grain pro!uction 9'1# million tone %or <G#B: an! the increa e in M0P in the la t couple o% &ear have increa e! purcha ing po*er in rural an! emi4ur+an area o% the countr&( <or e,ample3 thi ha re ulte! in an a!!itional income o% INR ;3### per acre per crop c&cle %or pa!!&( 0'N

t"o1 ! R-* ! E/4!oy/e1t G- * 1tee S,he/e

to provi!e gain%ul

&NREGS': The primar& o+jective o% NRE=0 i

emplo&ment to nearl& 25 million rural %amilie 9mainl& lan!le la+ourer : that live +elo* the povert& line( The cheme guarantee -## !a& o% emplo&ment 9in a %inancial &ear: to ever& hou ehol! tho e volunteer to participate( It ha re ulte! in a ri e in minimum *age in man& tate 3 *ith the average *age ri e +eing aroun! 1'$( ,' S"5th

P y Co//".."o1: Accor!ing to e timate 3 5'$ o% the

emplo&ee *ho +ene%ite! %rom the 0i,th Pa& Commi ion live in ECE an! uncla i%ie! citie ( Un!er the pa& commi ion3 the average alar& ha +een increa e! +& '- $3 *hich entail an a!!itional government e,pen!iture o% INR B# +illion ever& &ear in a!!ition to a one4time pa&ment o% arrear %or 'H &ear 3 *hich i e timate! at INR -B# +illion( 2'F

*/ !o 1 6 "3e*: In the la t +u!get3 the government *aive!

agricultural loan to the e,tent o% -##$ %or aroun! 1# million mall an! marginal %armer an! '5$ %or other %armer ( The e %armer al o +ecame eligi+le %or %re h agricultural loan ( The total co t to the government %or the e *aiver i e timate! to +e INR "'# +illion(

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PHARMACEUTICAL IN RURAL MARKET

$ E1 0!e*. .-,h . 7"1 1,"1+ .

I 7ver the &ear 3 the government ha taken variou tep to provi!e rural area *ith a trong cre!it tructure( Regional Rural >ank 9RR> : have +ecome a crucial part o% the rural cre!it tructure in In!ia( The& *ere create! in -@"5 *hen the nee! %or a tronger in titutional arrangement %or provi!ing rural cre!it *a %elt( In!ia currentl& ha aroun! -@# RR> *ith more than -23### +ranche ( I In a!!ition3 cheme uch a the Ki an Cre!it Car! 9KCC: aim to provi!e

cre!it upport to %armer in rural area ( Currentl&3 there are "' million enrolment un!er KCC in rural area D urpri ingl&3 thi e6ual the num+er o% cre!it car! u er in ur+an area ( I Cooperative ocietie have +een the tra!itional ource o% %inance in rural area ( The e ocietie have a mem+er hip o% over -'# million rural people( 7ver he la t %e* &ear 3 che!ule! commercial +ank have al o e,pan!e! their net*ork 3 *hich currentl& tan! at --31;" o%%ice in rural area ( I <rom an automotive compan&) per pective3 the 7EM have trie! to leverage e,i ting %inancial in titution in the e area ( The num+er o% tie4 up *ith local +ank an! N><C ha igni%icantl& increa e! over the la t %e* &ear ( Currentl&3 the hare o% %inancing +& N><C account %or '#$ o% the total num+er o% vehicle %inance!( %. I17*

.t*-,t-*e 2e3e!o4/e1t

In%ra tructural !evelopment in In!ia) rural +elt ha gaine! momentum in recent &ear an! i the ke& to narro* the ur+an4rural !ivi!e in the countr&( Currentl&3 ;#$ o% the village are connecte! *ith roa! net*ork ( A a part o% the Eleventh <ive Gear Plan3 the government plan to con truct -1#3### kilometer o% ne* rural roa! an! ha earmarke! aroun! 1#$ o% the total pu+lic inve tment %or rural in%ra tructure !evelopment( The Pra!han Mantri =ram 0a!ak Gojana 9PM=0G: aim to connect all village *ith a population o% 5## an! a+ove 9'5# in the ca e o% hill& an! !e ert area : *ith

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PHARMACEUTICAL IN RURAL MARKET all4*eather roa! ( The target i to con truct -2;3### kilometer o% rural roa! an! upgra!e another -@;3### kilometer ( Telecom penetration i a %air repre entation o% in%ra tructure a!vancement( It ha increa e! igni%icantl& in rural area in the la t !eca!e *ith the e market contri+uting over "#$ to the total gro*th in the countr&) u+ cri+er +a e( In coming &ear 3 inve tment in rural telecom in%ra tructure are e,pecte! to re ult in More than '5# million u+ cri+er +& <G-5(

'#

PHARMACEUTICAL IN RURAL MARKET

PHARMACEUTICAL INDUSTRY

PHARMACEUTICAL INDUSTRY

'-

PHARMACEUTICAL IN RURAL MARKET The pharmaceutical in!u tr& i con tantl& +eing challenge! to meet the ri ing tan!ar! o% 6ualit& an! to compl& *ith rigorou international compliance 0ar+ane an i olate! regulator& a%et& re6uirement ( Regulator& re6uirement inclu!e </A an! reporting man!ate 3 !rug tan!ar! 3 an! cro 4in!u tr& re6uirement uch a the Act( 7,le& tipulate! +& la*

Compliance i evolving %rom !epartmental initiative to an enterpri e level Ri k Management challenge( In%o 0trength o%%er an integrate! olution %or ucce %ull& meeting regulator& re6uirement *hile imultaneou l& lo*ering a ociate! co t that can other*i e +e u+ tantial( In%o 0trength? 0mart Enterpri e 0uite i +eing u e! in the li%e cience in!u tr& %or upporting ke& proce e an! re6uirement %or compliance at variou tage (

P*e8M *9et St +e: </A con!uct

comprehen ive evaluation o%

Inve tigational /rug Application 9IN/: an! Ne* /rug Application 9N/A: +a e! on the !ata an! !ocumentation provi!e! %or !rug a%et& an! e%%icac&3 ri k management3 compliance i ue %or clinical3 la+orator&3 manu%acturing proce!ure ( In%o 0trength? 0mart Enterpri e 0uite allo* cu tomer to re!uce their !evelopment ri k an! accelerate approval c&cle +& ena+ling them to manage their RJ/ proce e an! commerciali.ation project 3 capture an! track potential a%et& i ue 3 a e i!enti%& potential 6ualit& i ue ( ri k an! implement corrective action 3 an!

D*-+ M 1-7 ,t-*"1+: '-C<R Part '-# an! '-- !e%ine the
(((minimum current goo! manu%acturing practice %or metho! to +e u e! in3 an! the %acilitie or control to +e u e! %or3 the manu%acture3 proce ing3 packing3 or hol!ing o% a !rug to a ure that uch !rug meet the re6uirement o% the act a to a%et&3 an! ha the i!entit& an! trength an! meet the 6ualit& an! purit& characteri tic that it purport or i repre ente! to po e an!

''

PHARMACEUTICAL IN RURAL MARKET %ailure to compl&3 hall +e u+ject to regulator& action( In%o 0trength? 0mart Enterpri e 0uite re!uce non4compliance ri k +& creating a tran parent environment %or proactivel& i!enti%&ing3 tracking an! re olving 6ualit& i ue (

R".9 M 1 +e/e1t:

In%o 0trength?

0mart Enterpri e 0uite

provi!e an integrate! an! %le,i+le %rame*ork %or !ocumenting an! a e ing ri k 3 !e%ining control 3 managing au!it 3 i!enti%&ing i ue an! implementing recommen!ation an! reme!iation plan ( Pharmaceutical Challenge <or a Pharmaceutical Compan& !eveloping a !rug3 the ultimate goal i to en ure the a%et&3 relia+ilit&3 an! high 6ualit& o% the pro!uct( To achieve thi goal3 the compan& mu t a!!re man& challenge 3 inclu!ingF

I1e77","e1t Sy.te/.:

Pharmaceutical companie *ith multiple

%acilitie t&picall& have in!epen!ent3 h&+ri! & tem an! even paper4+a e! & tem in place( In the long term3 ho*ever3 the e & tem are ine%%icient3 re6uiring tremen!ou !i cu man4hour in term o% routing 07P an! other !ocumentation3 o+taining approval an! ignature 3 %ace4to4%ace meeting to change 3 an! manual earch an! retrieval o% !ocument !uring </A in pection ( In%o trength 0mart Enterpri e 0uite i !e igne! to incorporate the *hole compan& at the enterpri e level3 *hile maintaining each !ivi ion? in!epen!ent *ork%lo*(

THE INDIAN PHARMACEUTICAL INDUSTRY

The In!ian Pharmaceutical In!u tr& to!a& i in the %ront rank o% In!ia? cience4+a e! in!u trie *ith *i!e ranging capa+ilitie in the comple, %iel! o%

'1

PHARMACEUTICAL IN RURAL MARKET !rug manu%acture an! technolog&( It rank ver& high in the thir! *orl!3 in term o% technolog&3 6ualit& an! range o% me!icine manu%acture!( <rom imple hea!ache pill to ophi ticate! anti+iotic an! comple, car!iac compoun! 3 almo t ever& t&pe o% me!icine i no* ma!e in In!ia( The organi.e! ector o% the Pharmaceutical In!u tr& ha pla&e! a ke& role in promoting an! u taining !evelopment in thi vital %iel!( International companie a ociate! *ith thi ector have timulate!3 a i te! an! pearhea!e! thi !&namic !evelopment in the pa t %i%t& three &ear an! helpe! to put In!ia on the pharmaceutical map o% the *orl!( The Pharmaceutical In!u tr& in In!ia provi!e e,cellent %acilitie ( It ha 6ualit& pro!ucer an! man& unit are approve! +& regulator& authoritie in U0A an! UK( It ha a pool o% per onnel *ith high managerial an! technical competence a al o kille! *ork%orce( It track recor! o% !evelopment3 particularl& in the area o% improve! co t4+ene%icial chemical &nthe i %or variou !rug molecule i e,cellent( It provi!e a *i!e variet& o% +ulk !rug an! e,port ophi ticate! +ulk !rug ( The In!ian market ha ome uni6ue a!vantage ( In!ia ha a ;1 &ear ol! Pro%e ional

!emocrac&( It ha an e!ucate! *ork %orce an! Engli h i commonl& u e!( It ha a oli! legal %rame*ork an! trong %inancial market ( in!u tr& an! +u ine communit&( ervice are ea il& availa+le( There i alrea!& an e ta+li he! international It ha a goo! net*ork o% *orl!4cla e!ucational in titution an! e ta+li he! trength in In%ormation Technolog&( The countr& i no* committe! to a %ree market econom& an! glo+ali.ation( A+ove all3 it ha a "# million mi!!le cla gro*ing( market3 *hich i continuou l&

'2

PHARMACEUTICAL IN RURAL MARKET The pharmaceutical in!u tr& in In!ia i poi e! to gro* to U0K25 +illion +& '#-5( The gro*th *ill emerge %rom RJ/ ervice 3 e,port o% +ulk !rug an! generic 3 increa e! ale in therapeutic area relating to *omen) an! chil!ren) !i ea e an! +etter penetration into the market( <or the %ir t time in man& &ear the international pharmaceutical in!u tr& i %in!ing great opportunitie in In!ia( The proce in!u tr& ha o% con oli!ation *hich ha +ecome a generali.e! phenomenon in the *orl! pharmaceutical tarte! taking place in In!ia( The Pharmaceutical In!u tr&3 *ith it rich cienti%ic talent an! re earch capa+ilitie 3 upporte! +& Intellectual Propert& Protection regime3 i *ell et to mark it place a a 0unri e In!u tr&(

TOP 1: PHARMACEUTICAL COMPANIES IN INDIA IN #:1#

0R(N7

Compan&

Market 0hare 9$:

'5

PHARMACEUTICAL IN RURAL MARKET

-( '( 1( 2( 5( ;( "( B( @( -#(

=la,o4Cellcome Cipla Ran+a,& Hoech t Marion Rou el 0un Pharma L&!u Ca!ila Knoll Pharma Cockhar!t4Merin! P%i.er Nichola Piramal

5(" 2(" 2(# '(B '(5 '(2 '(1 '(1 '('(-

';

PHARMACEUTICAL IN RURAL MARKET

CHARACTERISTICS OF INDIAN PHARMACEUTICAL INDUSTRY

The trange contour o% In!ia) me!icine market ari e partl& %rom the countr&) ucce in %o tering *i!e4open competition3 *hich ha lo*ere! *i!el& availa+le an! erve! a a mo!el %or other price 3 ma!e !rug

!eveloping countrie ( The pharmaceutical market in In!ia i e timate! at U0 K ;(B +illion in '#-#( It account %or B$ in term o% volume o% *orl! pro!uction an!-(-$ in term o% value( =lo+all& it rank 2th in volume term an! -1th in value( The market i highl& %ragmente! *ith more than '#3### manu%acturer ( Ho*ever3 onl& '5# o% them are in the organi.e! ector repre enting "#$ o% the pro!uction( The market i inten el& competitive( The market hare o% the top ranking compan& i 5("$( Mo t o% the Multi4National Companie 9MNC? : operate in In!iaD +ut onl& 2 %igure in the top -#( The top -# pharmaceutical companie together cover aroun! 1-$ o% the total market( 0ome +a ic characteri tic o% the In!ian Pharmaceutical In!u tr& areF

1' C-!t-* ! D"3e*."ty:

Ce are a countr& o% at lea t %ive ethnic group 3 i, !i%%erent religion 3 -; major language 3 522 !ialect an! a lan!ma o% 13B"3';1 6 km 4 e6ualing all o% Europe put together an! *ith ome tate larger in i.e than ome major European nation ( Get our marketing people !evi e trategie that appeal to a varie! a cu tomer +a e a the aggre ive Punja+i3 the emotional >engali an! the intellectual Tamilian among t other ( In thi conte,t3 it i intere ting to note ho* marketing per onnel *ho con!uct pro!uct launche an! +rie%ing e ion 3 intelligentl& alter their approache to ell their i!ea at !i%%erent venue roun! the countr&(

'"

PHARMACEUTICAL IN RURAL MARKET 0uita+l& aggre ive in the North3 appealing to emotion in the Ea t3 to logic in the 0outh an! to the intellect in the Ce tM Thi a+ilit& to tailor approache to uit cu tomer trait an! p &che i an a+ilit& that can +e e%%ectivel& leverage! in international marketing

#' I1 2e;- te he !th, *e .4e12:

In!ia ha con i tentl& un!er pent on healthcare an! rank among t the lo*e t healthcare pen!er in the *orl!( It continue to un!er pen! vi 4N4vi the recommen!ation ma!e +& variou committee et up to a!vi e on ocial improvement o% healthcare in the countr&( That inve tment in

in%ra tructure *ill pre!icate u taina+le economic !evelopment i recogni.e! +& economi t an! +ureaucrat alike3 &et the e inve tment have +een !ela&e! %ar too long an! *ill oon +egin to mani%e t an! +ur!en the nation *ith high ocial an! economic co t (

A11- ! D*-+ E54e12"t-*e Pe* C 4"t (

'B

PHARMACEUTICAL IN RURAL MARKET

$' Vo!-/e D*"3e1:

The In!ian pharmaceutical market i e entiall& volume4 rather than value4!riven( Even a light variation in volume ale ha a !irect +earing on the overall gro*th o% the market( %' Re+"o1

! 2".e .e 4 tte*1:

=ro*th o% population in In!ian u+4continent an! other !eveloping A ian countrie *ith imilar !i ea e pattern an! purcha ing po*er coul! provi!e opportunitie %or In!ian pharmaceutical in!u tr& to %ocu %actor in thi on !eveloping molecule in the e market ( 0ucce e%%ectivel&( egment *oul!

+e !epen!ent on the a+ilit& to tailor !rug to uit regional !i ea e pro%ile co t

<' A!te*1 t"3e Me2","1e.:

Alternative me!icine 3 *hich inclu!e A&urve!ic3 her+al3 homeopathic3 Unani an! 0i!!ha3 are tra!itionall& u e! +& a large egment o% the population3 particularl& *-* ! area ( in

The / *9et %or alternative me!icine in I12" i e timate! at U0K"1# million an! the government3 recogni.ing the contri+ution o% the e & tem 3 ha e ta+li he! a eparate !epartment to encourage tan!ar!i.ation in manu%acturing an! packing metho! an! 6ualit& improvement( 0ome MNC? have !emon trate! intere t in RJ/ o% her+al !rug an! are eeking joint venture *ith In!ian companie (

'@

PHARMACEUTICAL IN RURAL MARKET

PHARMACEUTICAL INDUSTRIAL TRENDS

The pharma in!u tr& generall& gro* at a+out -(54-(; time the =ro /ome tic Pro!uct gro*th ( =lo+all&3 In!ia rank thir! in term o% manu%acturing pharma pro!uct +& volume( The In!ian pharmaceutical in!u tr& i gro*n at a rate o% @(@ $ till '#-' an! a%ter that i e,pecte! to gro* at @(5 $ till '#-5(

In '#-#4--3 In!ia e,porte! !rug *orth U0K"(' +illion in to the U0 an! Europe %ollo*e! +& Central an! Ea tern Europe3 A%rica an! Latin America(

The In!ian vaccine market *hich *a *orth U0K;;5 million in '#-#4 -- i gro*ing at a rate o% more than '#$

The retail pharmaceutical market in In!ia i e,pecte! to cro -1 +illion +& '#-5(

U0K -'4

The In!ian !rug an! pharmaceutical /ecem+er '#--(

egment receive! %oreign !irect

inve tment to the tune o% U0K -(21 +illion %rom April '### to

DRUGS LA(S
1#

PHARMACEUTICAL IN RURAL MARKET At pre ent the %ollo*ing Act an! Rule ma!e there un!er that govern the manu%acture3 ale3 import3 e,port an! clinical re earch o% !rug an! co metic in In!ia(

The /rug an! Co metic Act3 -@2#( The o+ject o% thi Act i to regulate the import3 manu%acture3 !i tri+ution an! ale o% !rug (

The Pharmac& Act3 -@2B( The aim o% thi la* i to regulate the pro%e ion o% Pharmac& in In!ia(

The /rug an! Magic Reme!ie 97+jectiona+le A!verti ement: Act3 -@52 Thi Act i meant to control the A!verti ement regar!ing !rug ( It prohi+it the a!verti ing o% reme!ie allege! to po e matter connecte! there*ith( magic 6ualitie an! to provi!e %or

The

Narcotic

/rug

an!

P &chotropic

0u+ tance

Act3

-@B5

Thi i an Act to con oli!ate an! amen! the la* relating to Narcotic /rug 3 to make tringent provi ion %or the control an! regulation o% operation relating to Narcotic /rug an!(

INDIAN RURAL PHARMACEUTICAL INDUSTRY

1-

PHARMACEUTICAL IN RURAL MARKET Although over "#$ o% the population live in rural area onl& '#$ o% pharmaceutical ale are in tho e area ( A large ection o% In!ia) rural population *ith a ri ing level o% !i po a+le income that i hitherto uncovere! +& mo!ern me!icine *ill eventuall& come un!er the am+it o% healthcare program an! *ill create a %re h !eman! %or pro!uct !irecte! to*ar! in%ectiou !i ea e (

U*0 1 Met*o Cla I Cla II Cla III Cla IA V"!! +e.

&=' tot ! . !e. "5 '1 '5 B -B '5

= o7 G*o6th #:118#:1# '' '5 11 -2 -# 4B -1

Hence3 the greate t market potential e,i t in In!ia) interior an! rural market *here the gro*th rate i e timate! at '5$ per &ear( Currentl& the reach o% allopathic me!icine in rural area i onl& ';$( The reach i poor !ue to non4availa+ilit&3 ina!e6uac& an! un!erutili.ation o% me!ical %acilitie in village ( 7nce the in%ra tructure 9+oth ph& ical 4 roa! 3 communication an! health 4 ho pital 3 primar& health center : improve a it mu t3 rural market %or me!icine *ill open up( Aroun! "## million people3 or "#$ o% In!ia? population3 live in ;3 '"3### village in rural area ( @#$ o% the rural population i concentrate! in village *ith a population o% le than '###( 7% thi a large percentage o% village !o not even have the %acilit& o% roa! or rail tran port an! have to travel mile on motorc&cle O cooter 3 +ic&cle or +ullock cart to reach the neare t progre ive village %or meeting their +a ic nece itie ( Cherea the tate government J N=7 have ma!e e%%ort to*ar! provi!ing %e* o% the e +a ic nece itie it i the <MC=? like HLL3 Ai!eocon3 Hero Hon!a J E cort *ho have trie! to provi!e e ential pro!uct %or +etter

1'

PHARMACEUTICAL IN RURAL MARKET living con!ition to thi !eprive! cla the proce through their rural marketing e%%ort ( In

the e companie have truck gol!3 +oth in term o% pro%ita+ilit& a

*ell a pro!uct penetration in to the rural p &che3 la&ing the %oun!ation o% a long4term +ene%it to the e companie ( Ho*ever3 there ha +een a con picuou a+ ence in thi !irection +& the Pharmaceutical Companie 3 *ho are uppo e!l& the health provi!er o% the nation( It *oul!3 o% cour e +e un%air3 not to mention the pioneering e%%ort o% a %e* Large pharma hou e in thi !irection e(g( =la,o0mithKline3 /a+ur an! Alkem etc( *ith varia+le ucce e ( The rea on %or thi pathetic lack o% intere t are man&3 the non4e,i tence o% !i tri+ution channel 3 retail outlet or %or that matter even 6uali%ie! !octor *ho are prepare! to !o &eoman? o*n a *ell a their %amilie ? com%ort an! intere t ( In a!!ition to the e %actor one coul! perhap al o a!! that majorit& o% the +ig companie have more than -### ale per onnel3 +a e! at virtuall& ever& /i trict Hea! Puarter o% the tate 3 *ho uch travel to virtuall& all rail tran portation i availa+le an! hence there i ervice to their countr&men3 living in !eep interior o% the countr&3 +& acri%icing their

interior market *here roa! or cope to make the pro!uct o% their companie availa+le in the e interior market ( Un!er tan!a+l& the e companie !o not perceive an& nee! %or %urther penetration into more remote village (

KEY PLAYERS IN INDIAN RURAL PHARMACEUTICAL INDUSTRY

11

PHARMACEUTICAL IN RURAL MARKET

There are everal national an! international pharmaceutical companie that operate in rural In!ia( Mo t o% the countr&) re6uirement %or pharmaceutical pro!uct are met +& the e companie ( 0ome them +rie%l& !e cri+e! +elo*F o% are

&1' R 10 5y L 0o* to*"e. L"/"te2

pharmaceutical manu%acturing

the +igge t

compan& in In!ia( The compan& i ranke! manu%acturing %acilitie in ho*e! a pro%it o% R --;(;

at the Bth po ition among the glo+al generic pharmaceutical companie an! ha pre ence in 2B countrie inclu!ing *orl! cla La+oratorie '##@4'#-# P1 Net Pro%it Re ult crore a compare! to R corre pon!ing perio! la t %i cal( -# countrie an! erve to cu tomer %rom over -'5 countrie ( Ran+a,& 1@2(5 crore !e%icit 3 recor!e! !uring the

&#'

D*. Re22y>. L 0o* to*"e.

manu%acture an! market a

*i!e range o% Pharmaceutical +oth in In!ia an! a+roa!( The compan& ha ;# active pharmaceutical ingre!ient to manu%acture !rug 3 critical care pro!uct 3 !iagno tic kit an! +iotechnolog& pro!uct ( The compan& ha ; </A plant that pro!uce active pharma ingre!ient an! " </A in pecte! an! I07 @##an! I07 -2##- certi%ie! plant ( /r( Re!!&) P- <G-# re ult ho* the revenue o% the compan& at R ( -B3-B@ million *hich i up +& '-$( /uring thi 6uarter the compan& intro!uce! '2 ne* generic pro!uct 3 applie! %or '' ne* generic pro!uct regi tration an! %ile! 2 /M< (

12

PHARMACEUTICAL IN RURAL MARKET &$'

C"4!

i an In!ian pharmaceutical compan& reno*ne! %or the

manu%acture o% lo* co t anti AI/0 !rug ( The compan&) pro!uct range compri e o% anthelmintic 3 oncolog&3 anti4+acterial3 car!iova cular !rug 3 anti+iotic 3 nutritional upplement 3 anti4ulcerant 3 anti4a thmatic other ervice an! cortico teroi! ( Cipla al o o%%er like 6ualit& control3

engineering3 project apprai al3 plant uppl&3 con ulting3 commi ioning an! kno*4ho* tran %er3 upport( <or the %inancial &ear '##B4#@ the compan& regi tere! an increa e o% ''$ in ale an! other income over the previou &ear(

&%'

N",ho! . P"* / !

the

econ! large t pharmaceutical

healthcare compan& in In!ia( The +ran! manu%acture! +& the compan& inclu!e =ar!enal3 I mo3 0temetil3 Rejoint3 0upra!&n3 Phen e!&l an! Haemaccel( Nichola Piramal ha entere! into join venture an! alliance *ith everal international corporation like Chei i3 Ital&D IAAQ CorpD UK3 <( Ho%%mann4La Roche Lt!(3 Allergan Inc(3 U0A etc( &<'

G! 5o S/"th9!"1e &GSK'

i a Unite! King!om +a e! & tem3

pharma compan&D it i the *orl!)

econ! large t pharmaceutical compan&(

The compan&) port%olio o% pharma pro!uct con i t o% central nervou

re pirator&3 oncolog&3 vaccine 3 anti4in%ective an! ga tro4inte tinalOmeta+olic pro!uct among other ( 7n Novem+er '##@3 the </A ha! announce! that the H-N- vaccine manu%acture! +& =0K *oul! join the li t o% the %our vaccine approve!(

&?'

@y2-. C 2"!

al o kno*n a Ca!ila Healthcare i an In!ian

pharmaceutical compan& locate! in =ujarat( The compan&) -P<G'#-# re ult ho* the net ale at R BB#(1cr *hich i higher than the e timate! R ""1cr( The net pro%it *a R -'2(Bcr *hich *a increa e o% 1@$D the increa e *a on account o% higher ale in rural area

15

PHARMACEUTICAL IN RURAL MARKET

In!ia) Rural Pharmaceutical Market 9-' Month En!e! Ranuar& '#--:

S"Ae B"!!"o1' Pharma ;(@ (1; (12 ('@ ('" ('2 &B M *9et Sh *e &=' -##(# 5(1 5(# 2(1 1(@ 1(; G*o6th R te &=' @(@ -1(2 --(5 4-(' --(" ;(B

Co/4 1y Total Market Cipla Ran+a,& =la,o 0mithkline Piramal Healthcare L&!u Ca!ila

0ourceF 7R= IM0

1;

PHARMACEUTICAL IN RURAL MARKET

1"

PHARMACEUTICAL IN RURAL MARKET

CHALLENGES FACE BY PHARMACEUTICAL INDUSTRY IN RURAL AREAS

Ever& in!u tr& ha it o*n et o% a!vantage an! !i a!vantage un!er *hich the& have to *orkD the pharmaceutical in!u tr& i no e,ception to thi ( 0ome o% the challenge the in!u tr& %ace areF 9-: Regulator& o+ tacle 9': Lack o% tran port %acilit& 9': Lack o% proper in%ra tructure 91: Lack o% 6uali%ie! pro%e ional 92: E,pen ive re earch e6uipment 95: Lack o% aca!emic colla+oration 9;: Un!er!evelope! molecular !i cover& program 9": /ivi!e +et*een the in!u tr& an! tu!& curriculum

1B

PHARMACEUTICAL IN RURAL MARKET

ECPECTAION OF PHARMA INDUSTRY IN RURAL AREAS FROM GOVERMENT

/r&ing pipeline o% ne* !rug 3 increa e! RJ/ e,pen!iture an! increa e! pre ure in the !evelope! nation to +ring the health care co t !o*n ha compelle! MNC to o%% hore RJ/ %urther( Chile In!ia i perceive! a an attractive !e tination to out ource RJ/ *ork !ue to it lo* co t an! high 6ualit& capa+ilitie 3 to put In!ia in a lea!ing po ition3 there i a nee! to provi!e impetu to uch activitie in the %orm o% ta, an! %i cal +ene%it ( Chile currentl&3 *eighte! ta, +ene%it i availa+le %or in4hou e RJ/3 there are no peci%ic +ene%it availa+le to unit engage! in the +u ine engage! in the +u ine o% RJ/( In thi regar!3 the =overnment can pla& it role +& provi!ing +ene%it to unit o% RJ/ +& *a& o% !e!uction %rom pro%it linke! to imilar to tho e given in !evelope! inve tment ( <urther3 +ene%it in the %orm o% re earch ta, cre!it 3 *hich can +e u e! to o%% et %uture ta, lia+ilit&3 economie can al o +e con i!ere!(

I1,!-2e e54e1.e. *e! te2 to *e.e *,h 2o1e o-t."2e R D D! 0

The In!ian pharma pace ha *itne e! multiple innovative move that have trengthene! their a+ilit& to make it +ig in the !i cover&ORJ/ pace( The e In!ian companie incur huge e,pen!iture on over ea trial 3 preparation o% !o ier 3 con ultingOlegal %ee %or NCE 9Ne* Chemical Entitie : an! AN/A 9A++reviate! Ne* /rug Application : %iling *ith the U0 </A( Al o there i a igni%icant amount o% legal co t incurre! in !e%en!ing the patent an! pro!uct ( Chile currentl&3 *eighte! !e!uction i availa+le %or e,pen!iture on in4hou e RJ/ %acilit&3 the provi ion !o not peci%& that the e,pen!iture incurre! out i!e the RJ/ unit Accor!ingl&3 in!u tr& +o!ie have are eligi+le %or *eighte! !e!uction( ought the inclu ion o% e,pen!iture

inci!ental to re earch carrie! out i!e RJ/ %acilit& in In!ia or in an& %oreign countr&3 *ithin the am+it o% *eighte! !e!uction(

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PHARMACEUTICAL IN RURAL MARKET

E5te12 t 5 ho!"2 y to ho.4"t !. 0eyo12 *-* ! *e .

The 6ualit& an! lo* co t a!vantage ha +oo te! the me!ical touri m in In!ia( In!u tr& report ugge t that a+out -5#3### me!ical touri t vi it In!ia ever& &ear( <urther3 me!ical touri m to In!ia i e,pecte! to +ring revenue o% K' +illion +& '#-'( In or!er to capitali.e on the opportunit& an! to trengthen the po ition o% In!ia a a lo* co t health care touri t !e tination3 there i a greater nee! to et4up more an! more tate o% the art health care %acilitie ( Even other*i e3 there i a clear ca e o% augmenting health care & tem in In!ia( =iven that large part o% inve tment *oul! nee! to +e contri+ute! +& private ector3 the =overnment can pla& it role +& provi!ing %i cal +ene%it an! e,ten!ing the e,i ting ta, holi!a& to ho pital et up +e&on! the rural area (

S-0."2y 7o* *-* ! he !th, *e "17* .t*-,t-*e

0peci%icall& *ith regar! to rural an! emi4ur+an area 3 everal companie have taken the initiative to +uil! the uppl& chain in%ra tructure an! !evelop peci%ic pro!uct 44the e tep are not ea & an! carr& huge inve tment ( To promote the !evelopment o% the e area an! have +etter acce private ector a *ell44thi coul! +e in the %orm o% to healthcare haring %acilitie 3 the =overnment3 in a!!ition to it o*n program 3 houl! upport the u+ i!&3 in%ra tructure *ith private ector3 ta, incentive an! o on(

R t"o1 !"Ae ..e../e1t 4*o,e2-*e

A per the in!u tr& practice3 Pharma companie reach out to patient through !octor +& provi!ing %ree ample o% !rug to !octor an! incur other promotional e,pen!iture on eminar an! o on %or e!ucation o% !octor ( Thi create a*arene authoritie a+out the !rug an! ultimatel& help in +oo ting the ale o% the companie ( /uring the cour e o% a e ment procee!ing 3 the revenue o%ten challenge the promotional in%ormation an! a k %or voluminou !ocument *hich are cum+er ome to provi!e( The& al o o%ten !en& ta, !e!uction on an a!4hoc +a i ( In thi regar!3 the =overnment can rationali.e the provi ion +& provi!ing %or claim o% e,pen!iture on a el% certi%ication +a i or on the +a i o% peci%ie! !ocument uch a CA certi%icate an! o on(

2#

PHARMACEUTICAL IN RURAL MARKET

H */o1"Ae 4*","1+ *e+-! t"o1.

Tran %er pricing i another area nee!ing pecial attention %or pharmaceutical in!u tr&( Chile tran %er pricing regulation e,pect companie !ealing in active pharmaceutical ingre!ient 9API :O%ini he! !rug %ormulation 9</< : importe! %rom relate! partie cu tom regulation to maintain higher margin 3 /rug Price eeking to check an&

Control 7r!er 9/PC7: place re triction on the en! elling price( E6uall& create a rever e pre ure +& un!ervaluation o% importe! API O </< ( There i a clear ca e to +eing in harmon& in tran %er pricing3 cu tom an! /PC7 regulation ( 7ther i ue *hich pharma compan&? %ace i compari on o% price o% innovatorO re earch oriente! companie *ith generic companie *ithout taking cogni.ance o% 6ualit& an! e%%icac&( Thi nee! to a!!re cau e igni%icant har! hip %or innovator companie *ho pen! igni%icant co t on re earch( There i an imme!iate the e i ue a *ell( Al o3 *hile it i propo e! that A!vance Pricing Agreement 9APA : an! a%e har+or rule *oul! +e intro!uce!3 it nee! to +e e,pe!ite!(

E5te12 !".t o7 !"7e . 3"1+ 2*-+.

7n the in!irect ta, %ront3 the =overnment can look at e,ten!ing the li t o% li%e aving !rug 3 *hich are eligi+le %or cu tom !ut& e,emption in In!ia( Thi *ill lea! to availa+ilit& o% li%e aving !rug to the patient at re!uce! price an! +ring !o*n the co t o% treatment %or the e ailment ( <urther3 it coul! al o con i!er re!ucing the !ut& on me!ical !evice *hich *oul! lea! to overall re!uction in the co t o% treatment o% patient ( Al o3 =overnment coul! con i!er re!ucing +a ic cu tom !ut& %or %ormulation to %ive percent in line *ith the Chelliah Committee) long4term %i cal polic& recommen!ation(

R t"o1 !"Ae 2-ty .t*-,t-*e

The lev& o% e,ci e !ut& on API at eight percent an! on output o% %our percent ha le! to accumulation o% Cenvat cre!it in the +ook o% manu%acturer 3 e peciall& tho e *ho are not engage! in e,port an! cater onl& to the !ome tic market( <urther3 there are no provi ion to recover the accumulate! Cenvat cre!it3 *hich +ecome a co t to uch pharma manu%acturer ( The =overnment

2-

PHARMACEUTICAL IN RURAL MARKET coul! con i!er rationali.ing the !ut& tructure +& making it at par *ith !ut& on %inal output( Another !eman! ha +een to increa e the a+atement limit allo*e! %or computation o% e,ci e !ut& on me!icament 3 %rom 15 to 25 percent( <urther3 in!u tr& ha me!icine acro ought rationali.ation o% Aalue A!!e! Ta, 9AAT: on tate *ith peci%ic e,emption o% li%e aving !rug an! li%e

aving me!ical !evice ( In a nut hell3 *hile the glo+al !evelopment have le! to e,citing opportunitie %or In!ian pharma in!u tr&3 it i once again in earch o% upport %rom the =overnment to tap the ame( 7n the other han!3 the =overnment i making progre ervice in +ringing t*o major ta, re%orm 3 i(e( !irect ta, co!e3 an! goo! an! ta,D the& carr& an un!erl&ing agen!a o% +ringing ta, re%orm 3

impli%ication o% proce!ure an! minimi.ation o% ta, incentive ( =iven that the =overnment inten! to implement the e legi lation in the near %uture3 it appear that it ma& not +ring in an& major change in thi +u!get(

TECHNIEUES USED BY PHARMACEUTICAL COMPANY IN RURAL AREAS

A a general rule3 rural marketing involve more inten ive per onal elling e%%ort compare! to ur+an marketing( Marketer nee! to un!er tan! the

2'

PHARMACEUTICAL IN RURAL MARKET p &che o% the rural con umer an! then act accor!ingl&( To e%%ectivel& tap the rural market a +ran! mu t a ociate it el% *ith the thing that the rural %olk are %amiliar *ith( Per onal contact *ith the rural cu tomer not onl& %acilitate un!er tan!ing o% the rural min! et +ut al o %acilitate e%%ective ale promotion(

S !e. P*o/ot"o1 Ch 11e!.:

The pharmaceutical companie ? ale people3 manning the van 3 utili.e the variou rural %olk me!ia like /e! .F h t.F 7e.t"3 !.F *e!"+"o-. !ealing a ,e!e0* t"o1. an! m&ria! other ritual to reach them in their o*n language an! in large num+er *here the& a em+le to carr& out their +u ine *ell a meet their %rien! an! a ociate on the e occa ion ( The mela an! haat are ver& important event a the e are normall& hel! either a%ter a harve t ea on or !uring religiou cele+ration e(g( /a era3 /i*ali3 Holi an! imilar occa ion 3 +ecau e the e are the occa ion *hen the 3"!! +e 7o!9 ". "1 /oo2 to .4e12 mone& on purcha e 3 *hich normall& the& *ill not in!ulge in( In participation in +a.aarOmela3 the regional tocki t can pla& an important role !ue to pro,imit& to the area an! kno*le!ge o% the area( Thi emerging market can give 6uick +u ine ( The other availa+le option in the tra!itional rural me!ia are P-44et*yF Fo!9 The t*eF J"1+!e.F ( !! P "1t"1+F De/o1.t* t"o1F Po.te*.F A+*",-!t-* ! G /e. J !i tri+ution o% calen!ar 3 photo car! etc( *ith pro!uct me age ( The po i+ilitie are numerou an! the empha i i on coming up *ith innovative ale promotion trategie an! preparing ale promotion material !irecte! e,clu ivel& to*ar! titillating the p &che o% the rural %olk( Chatever +e the channel o% ale promotion the point to keep in min! are thatF 4

21

PHARMACEUTICAL IN RURAL MARKET 9-: The me age remain at the ite %or a con i!era+le !uration o% time %or the me age to percolate !eep into the min! o% the +ehol!er( Mutilate! po ter 3 *all painting are replace! at the earlie t opportunit&( 9': The ale people maintain regular contact *ith the village %olk through per onal meeting 3 to clari%& an& lingering !ou+t or provi!e a!!itional in%ormation( 91: The me age i imple an! hence ea il& perceiva+le +& the rural cu tomer (

92: The communication o% the me age i mainl& through pictorial !epiction rather than through cop& matter( 95: The concerne! !octor !oe clo e %ollo* up o% the treatment initiate! an! change the me!icine or mo!i%& the !o age che!ule( The other channel o% ale promotion coul! +e the circulation o% Ai!eoca ette on u+ject o% intere t to the village %olk3 along *ith pro!uct me age 3 through =rampancha&at or the cooperative tore %or communit& vie*ing an! u+ e6uent !i cu ion *ith the concerne! ale per onnel or !octor( Chat ha to +e recogni.e! i that there i much more that nee! to +e !one to ervice the rural market ( The ke& i ue that nee! to +e a!!re e! are not onl& availa+ilit& an! a*arene +ut al o the more !i%%icult i ue o% overcoming prevalent attitu!e an! ha+it ( Changing ha+it an! attitu!e are !i%%icult3 to a& the lea t3 o the re ult take long to come( 7ne mu t keep on !ogge!l& *ithout letting up in the mi!!le an! the *eetne o% ucce *ill eventuall& +e reli he!(

TRADITIONAL STRATEGIES FOLLO(ED BY INDIAN PHARMACEUTICAL COMPANIES IN RURAL AREAS ARE

22

PHARMACEUTICAL IN RURAL MARKET Pharmaceutical companie have long courte! In!ian !octor *ith gi%t an! junket ( The me!ical repre entative o% pharma companie approach the e !octor *ith uch varie! gi%t %rom ke&4chain an! pen4hol!er to air4 con!itioner an! colour televi ion ( Pharma companie al o hol! regular regional meeting %or !octor *here the& are invite! along *ith their %amilie to ta& in hotel an! enjo& vacation at the compan&? co t( Man& companie al o take the e !octor on tour a+roa! o a to !evelop goo! relation *ith them an! al o to make them pre cri+e the compan&? !rug ( Thi 3 even though it ma& eem e,pen ive3 i ver& goo! in the long run a it +oo t the ale o% the compan&( A the num+er o% In!ian companie proli%erate! an! their repre entative +egan !e cen!ing on !octor ) o%%ice in !rove 3 the& o%ten *ere given cant time to promote their pro!uct ( 0o the !rug maker +egan pa&ing more attention to pharmaci t ( Incentive to +u& large 6uantitie o% pre cription !rug have +ecome commonplace in In!ia3 *here thou an! o% !rug manu%acturer compete %or hel% pace an! the countr&) hal%4million pharmaci t *iel! an unu ual amount o% clout( In In!ia3 man& patient are too poor or too +u & to ee a !octor an! o%ten rel& on local pharmaci t %or me!ical a!vice( A a re ult3 po*er%ul !rug are routinel&3 an! illegall&3 ol! over the counter(

CURRENT STRATEGIES FOLLO(ED BY INDIAN PHARMACEUTICAL COMPANIES IN RURAL AREAS

In the In!ian pharmaceutical a!verti ing3 pharma companie !o not u e televi ion a a mean o% a!verti ing %or mo t o% their !rug other than !rug

25

PHARMACEUTICAL IN RURAL MARKET %or cough J col!3 a thma etc( Mo t o% the marketing take place through me!ical repre entative o% the compan& an! al o through incentive cheme ( In the rural area 3 mo t o% the patient are not a*are a+out even the imple t o% me!icine an! rel& olel& on their !octor? a!vice a+out *hich +ran! to +u&( Al o3 man& poorer people go !irectl& to the pharmaci t an! take the me!icine that he recommen! %or curing their ailment ( Hence3 the primar& target %or all marketing activitie 3 e peciall& in rural area 3 are not actuall& the en! u er +ut the !octor an! pharmaci t ince the e are the people *ho can recommen! the me!icine J more importantl&3 +ran! 3 to the rural population( The rural population al o relie heavil& on a&urve!ic3 unani an! other uch alternative cure ( Hence3 multinational companie are either entering the e market or tr&ing to *oo the rural population a*a& %rom it(

I11o3 t"3e /etho2. o7 / *9et"1+:

The pre ent campaign +a e! on cu tomer %ocu e! promotion !one +& man& pharma companie ha prove! that in to!a&) *orl! man& people are ucce %ul onl& +ecau e o% innovation ( 0ome o% the e innovative mean areF

He4 t"t". 8 B V ,,"1e C /4 "+1:

The innovation in promoting the Hepatiti > vaccine campaign reall& carve! pecial market potential %or the ame( The cla ical approach in pampering Retailer an! /octor !oe not hol! true( In %act going to the en! u er +& u ing con umer4marketing approach a!opte! +& man& pharma +ig pla&er in thi +elo*( egment ha helpe! to increa e their +u ine ( Thi re ulte! in a %our4%ol! increa e in ale ( The innovative cla i%ication approach i given

2;

PHARMACEUTICAL IN RURAL MARKET

E2-, te C-.to/e*. Ro-te:

Taking e!ucation a the mean to innovate can +e an important tool in pharma innovation ( Cipla? a*ar! %or the +e t pu+lication in car!iolog&3 clinical &mpo ia3 mailing3 provi!ing re%erence are the cla ical approache in innovation ( Ho*ever3 non4cla ical can +e provi!ing o%t*are to /octor %or the management o% ho pital an! clinic or en!ing Email to the /octor *ho have acce to the Computer(

Fo*/"1+ -.e*. ,!-0 Ro-te:

Thi i an innovating approach that can +e con i!ere! activel& +& Pharmaceutical Companie ( 0earle *a the %ir t compan& to initiate Lorno%en Clu+ *herein there *a a 6uarterl& get together o% !octor) %amilie ( Hou e maga.ine *ere circulate! among Lorno%en mem+er ( Thi ha create! intere t among /octor ( Thi proce helpe! to retain lo&al cu tomer to come %rom '#$

Lorno%en( The e innovative *a& gave Lomo%en the no( - po ition in anti4 !iarrhea market( There i a a&ing that B#$ o% the +u ine o% the cu tomer ( There%ore3 retaining a cu tomer i ea ier than ac6uiring one3 a ac6uiring cu tomer re6uire e,pen!iture( Thi i a novel approach *hich Pharmaceutical companie can a!opt a it can give e,tra mileage(

A44!", t"o1 "11o3 t"o1.:

o7

.o," !

/ *9et"1+

*o-te

7o*

2"

PHARMACEUTICAL IN RURAL MARKET Thi i &et another avenue that can +e taken up to +oo t the ale o% the cu tomer ( The Hepatiti !etection campaign3 H&perten ion !etection camp are *ell kno*n in thi !irection( It not onl& help in !etecting %re h ca e +ut al o help in increa ing ale ( 0ample are given to the cu tomer %or ome !a& 3 *hich are %ollo*e! +& the cu tomer un!er upervi ion o% their me!ical /octor ( Thi help to improve the +u ine the ne* cu tomer ( Cricket i a pa ion in In!ia( Recentl& 0un Pharmaceutical ha! a uni6ue *a& on calling ENT peciali t %or the cricket match along *ith their %amil& mem+er ( Thi generate! an intere t among the /octor lea!ing to 6uick re pon e %or the pro!uct )Relie% 4 an anti4col! preparation( Thi i a novelt& compare! to other like partie 3 cocktail 3 !inner etc( No !ou+t3 to!a& ocial marketing i again getting importance +ecau e /octor to!a& are not intere te! in partie Ococktail !ue to large no ( o% companie going %or the ame( There%ore3 there i no innovation in that re pect( in the long term( The ucce o% /aonil an! La i, can +e attri+ute! al o to thi innovative campaign in tapping

A44!", t"o1 o7 *e! t"o1.h"4 / *9et"1+ "1 ,-.to/e* 7o,-.e2 4*o/ot"o1:

To!a& relation hip marketing i a +u..*or! all over the *orl!( People have reali.e! that it i +etter to !evelop goo! relation hip *ith the cu tomer o that the& !on)t *itch over( Relation hip An& %actor not upto the mark can lo*er the relation hip( The companie like Alkem have the practice o% en!ing *ell4kno*n 0r( Manager e peciall& pro!uct manager on %iel! trip ( Thi *ill give them an opportunit& to accompan& a !octor to an& particular venue an! take intervie* !uring traveling *ith him( Thi i an e,cellent innovation in market re earch( Thi al o help to !evelop relation hip( Application o% Computer /ata in en!ing +irth!a& 3 marriage anniver ar& car! can +e u e%ul in +uil!ing up the relation hip( In%act3 the innovation approach *oul! +e i% telephone call *ere ma!e +& 0r( E,ecutive to !octor on uch occa ion ( Recentl&3 the !octor ai! that man& companie take >irth!a& !ate +ut !on?t +other to re pon!

2B

PHARMACEUTICAL IN RURAL MARKET narrate! thi ( Ho*ever3 thi in relation hip( imple techni6ue help to !evelop a ne* hori.on

I11o3 t"o1 0 .e2 o1 Ret "!e* Sto,9"e.t:

0an!o. a!opte! the con umer in!u tr& i!ea in pharmaceutical promotion an! appointe! clinical peciali t un!er tockie t to promote their pro!uct( It et a tren! in pharmaceutical marketing( 0pecial +ooking conte t among tockie t? repre entative can +e e,ploite! to improve the penetration( 0an!o. e,ploite! thi avenue +& incorporating a hirt a a gi%t to highe t +ooker o% their pro!uct among tockie t repre entative ( Cipla) e,perience o% !etailing an! e!ucating the retailer Training the retailer +e t maintaine! chemi t enhance! their relation hip( In%act3 management un!er tan!ing management3 cricket hiel!3 innovation4u ing training a tool to improve ale can +e ucce %ul( in cu tomer) %inance3 computer3 cu tomer ervice3 picnic3 tre

hop etc can +e innovative approache (

METHODS OF ADDING VALUES TO RETAILERS

2@

PHARMACEUTICAL IN RURAL MARKET

To!a& rural market i emerging a %a t potential egment( 0tockie t role i ver& important in thi egment(

5#

PHARMACEUTICAL IN RURAL MARKET

DRUG DISTRIBUTION CHANNELS

/rug !i tri+ution in In!ia i la&ere! an! regulate!( Unlike in the Ce t3 *here a manu%acturer can !irectl& uppl& goo! at the retail level3 pro!uct in In!ia move through a chain o% interme!iarie ( The manu%acturer upplie goo! to the %ir t la&er compri ing a clearing an! %or*ar!ing agent3 a uper tockie t or a compan&4o*ne! !epot( The e3 in turn3 uppl& to tockie t %rom *ho e premi e goo! are route! to *hole aler 3 me!ical in titution 3 ho pital an! retailer ( The retailer !i pen e the !rug to %inal con umer ( Manu%acturer can !irectl& uppl& to in titution an! ho pital 3 +ut never to a retailer( Ch 11e!. o7 2*-+ 2".t*"0-t"o1

There are even trategicall& locate! me!ical tore organi.ation 3 *hich uppl& to government ho pital an! !i pen arie in rural an! u+ur+an area ( The e organi.ation procure goo! !irectl& %rom companie +& inviting ten!er o a to keep the co t lo*( =overnment ho pital an! in titution al o invite ten!er ( 0ome private in titution al o go in %or ten!er *hile the majorit& negotiate *ith companie to !i count tockie t an! chemi t margin in a!!ition to +ulk purcha e !i count (

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PHARMACEUTICAL IN RURAL MARKET

RURAL MODELS
There i nee! %or innovative rural mo!el having concurrence *ith the health mini tr& *hich *oul! i!eall& act a a no!al agenc& %acilitating the e%%ort o% variou +o!ie like N=7 3 the /i trict or Taluka level IMA +o!ie an! roping in the goo! o%%ice an! el!er ( o% gram pancha&at village Perhap

it i time %or a rethink o% the entire concept o% PHC ( A tart coul! +e ma!e atlea t +& !elinking them %rom !rug procurement a mo t are !e%unct %or *ant o% me!icine ( The ne* mo!el ha to +e *orke! out ve ting private initiative an! partner hip in !rug !i tri+ution an! !i pen ation( Revive an! put li%e into the PHC *ith minimal clinical acce orie an! &oung !octor manning them %or a minimum o% t*o &ear man!ator& po ting( The& houl! pre cri+e the e ential me!ication *hich then houl! +e ma!e availa+le at the private &n!icate! outlet like gram pancha&at o%%ice or rural co4operative *here people pa& or get me!icine on +arter %or their pro!uce( It i here that pharmaci t %rom rural or emi rural area can +e gain%ull& emplo&e!( The& *oul! +e more than *illing to go there an! liai e *ith &oung !octor at the PHC 3 +oth o% *ho *ill have a +urning !e ire to rai e health tan!ar! ( 7% cour e3 the nitt&4grittie have to +e *orke! out peci%ic to each region( Pharma companie *ill have to make the %ir t move to provi!e 6ualit& generic at co t3 not charit&(

5'

PHARMACEUTICAL IN RURAL MARKET

RURAL PHARMACEUTICAL NECT ENGINE OF GRO(TH FOR THE INDUSTRY

In!ian pharmaceutical in!u tr& i gra!uall& picking pace in the rural market ( Chile metro an! citie account %or aroun! ;#$ o% the market hare o% the pharma in!u tr&3 untappe! potential o% rural market it i +eing een a ne,t volume !river o% the in!u tr&( Ri ing income level lea!ing to more a%%or!a+ilit&3 pee!ing up o% health in%ra tructure3 an! li%e t&le !i ea e along *ith health in urance are %uelling the gro*th in rural area ( ERural market gre* at a+out 2#$ to touch K-(2 +illion in '##;4#" an! i e,pecte! to have higher gro*th rate than overall pharma in!u tr&3 ai! ector hea! 4 pharmaceutical 3 KPM=3 Hite h =ajaria( In la t couple o% &ear 3 rural egment ha manage! higher gro*th &ear on &ear( The egment manage! '- $ gro*th in calen!ar &ear '##5 an! @ $ in CG #2( =ro*th in the rural market ha +een le! +& %avora+le economic an! !emographic %actor 3 inclu!ing ri ing income3 in%ra tructure3 increa e! a%%or!a+ilit& o% !rug 3 an! increa e! penetration o% health in urance an! gro*ing organi.e! retail in the rural area3 ai! =ajaria( Health in%ra tructure al o nee! to improve3 a onl& '#$ o% In!ia) total health in%ra tructure i in rural area *here "#$ population live ( Ho*ever3 *ith ri ing rural healthcare e,pen!iture an! improving in%ra tructure %acilitie *hich are encouraging pharma companie to inve t in rural market an! government announcement o% %ive &ear ta, holi!a& %or ho pital in rural area *ill %urther help in %acilitating +a ic healthcare amenitie 3 the KPM= o%%icial ai!( Pharma companie *ill have to %ocu on trengthening their marketing an! !i tri+ution channel along *ith uppl& chain management to capitali.e on the opportunitie rural egment o%%er 3 he a!!e!( Market hare o% the rural pharma ro e %rom -B$ in '##5 to '-$ in '##"( E>& '#-5 rural pharma market *ill +e aroun! '2$ an! market i.e i e,pecte! to reach K2(B +illion %rom K-(' +illion in '##53 a per McKin e& report )In!ian Pharma '#-5)( The report e,pect In!ian pharma market to reach to K'# +illion *hile al o highlighte! that a%ter metro 3 rural egment *ill ee the %a te t incremental gro*th +& '#-5(

51

PHARMACEUTICAL IN RURAL MARKET

MNC PHARMA FIRMS LINE UP TO TAP INDIAGS RURAL MARKET

Pharma MNC operating in In!ia are !ra*ing up aggre ive trategie to tap into the rural market *here In!ia? t*o4thir! o% the population live ( Aventi Pharma3 the In!ian arm o% the <rench !rug major ano%i4aventi ha alrea!& recruite! a ale team o% 1## people un!er a rural market !ivi ion launche! recentl&( Aventi Pharma *ill launch -# pro!uct initiall& in it e%%ort to capture a +igger hare in %a t emerging tier ' an! tier 1 citie o% In!ia( SCe have e entiall& +een a Tier I 9+ig cit&: pla&er an! our current revenue %rom the rural market i negligi+le3T 0haile h A&&angar3 managing !irector at Aventi Pharma *a 6uote! a a&ing Aventi plan to e,pan! it !rug port%olio %urther +& launching ai!(Aventi Pharma aim to gra+ another %ive !rug +& Ranuar&3 '#-#3 report

-(54' per cent hare o% the rural market in the ne,t %ive &ear (Aventi Pharma plan to manu%acture the pro!uct meant %or the rural market through In!ian manu%acturer on a contract +a i to make them co t4e%%ect an! on par *ith the o%%ering price o% companie operating in rural market (Aventi Pharma ha al o i!enti%ie! ome +roa! therapeutic area to +e targete! in the rural marketplace con i!ering the prevalence o% !i ea e pattern in the e area a uch uch a re pirator&3 ga trointe tinal an! nutritional !i ea e ( Currentl&3 the

rural market in In!ia account %or a+out '#$ o% the countr&? R 1;3###4 crore total !rug retail market( A+out t*o4thir! o% In!ia? - +illion plu population live in rural area (Aventi Pharma hope increa ing a*arene a+out healthcare an! ri e in income *ill !rive the gro*th in rural region (0ano%i ha complete! the %ir t pha e o% it rural !octor e!ucational programme UPra&a ? covering 13'## me!ical practitioner in >ihar3 UP an! Ce t >engal( >e i!e Aventi Pharma everal other multinational are charting out trategie to e,ploit the potential opportunitie in In!ia? gro*ing village ( =la,o0mithKline an! A++ott La+oratorie have reporte!l& rampe! up plan to enter the largel& untappe! rural market o% In!ia in a +ig

52

PHARMACEUTICAL IN RURAL MARKET *a&(MNC inclu!ing Eli Lill&3 Novo Nor!i k3 an! Novarti are al o chalking out programme to tap the rural cu tomer(Novarti i currentl& targeting village in even tate *ith lo*4price! pro!uct availa+le in a variet& o% package i.e ( The mo!el upplie me!icine to more than -;3### pharmacie ( Novarti al o create a*arene on health i ue u ing au!iovi ual inter%ace through through health a!vi or in village ( Novo Nor!i k prea! a*arene ha +een *orking *ith the 0el%4Emplo&e! Comen?

mo+ile clinic along the village in =oa to creen patient %or !ia+ete ( Lill& A ociation in Ahme!a+a! to e!ucate people on tu+erculo i ( =ro*ing at compoun!e! annual gro*th rate o% nearl& -2$ in the ne,t %e* &ear 3 the In!ian pharmaceutical market i e,pecte! to touch U0/ 2# +illion +& '#-53 pre!icte! a recent report +& the glo+al management con ulting major Mckin e& an! Compan&( In!ian pharma market3 *hich i currentl& value! at U0/ '# +illion3 coul! ee the %igure almo t !ou+le in ne,t 5 &ear majorl& propelle! +& the tea!& gro*th in the !ome tic egment( Relate! tor&F In!ian pharma market ale up !e pite rece ion( The !ome tic market *hich i gro*ing at almo t -# to -2 per cent at pre ent it el% *ill provi!e U0K '# to '2 +illion in '#-5 an! the e,port an! contract manu%acturing +u ine 3 *hich are gro*ing at -# per cent per annum3 *ill contri+ute to achieve the pre!icte! gro*th(

55

PHARMACEUTICAL IN RURAL MARKET

PROBLEMS FACED IN RURAL MARKETS BY PHARMACEUTICAL COMPANY

The tate o% in%ra tructural ina!e6uac& that the people o% rural In!ia are till en!uring peciall& in the area o% tran portation3 anitation J availa+ilit& o% even the ru!imentar& me!ical %acilitie i appalling( I there no reme!& to thi tangle thenV Companie enormit& J multiplicit& o% the pro+lem houl! %ocu on the opportunitie availa+le in rural market rather than !eveloping col! %eet at the taring at them a a re ult o% tart +& in%ra tructural ina!e6uac&( Let u look at each i ue *ith an un+ia e! min! o that *e are a+le to %in! ome olution to thi tangle( <ir t let u junctureF4 -( Lack o% tran portation hence pro+lem o% approacha+ilit&( '( Non4e,i tence o% !octor an! 6uali%ie! per onnel to provi!e me!ical a i tance( 1( Unavaila+ilit& o% /i tri+utor an! Retailer making pro!uct availa+ilit& virtuall& impo i+le( 2( Heav& capital e,pen!iture %or creating in%ra tructure( 5( Huge e,pen e in creating promotional O propagan!a material in local language an! promotion o% pro!uct to the villager 3 *ho are largel& illiterate an! not accu tome! to uch overture ( ;( Perceive! ina!e6uac& o% return on inve tment an! e%%ort ( making a li t o% uch pro+lem that appear to +e in urmounta+le at thi

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PHARMACEUTICAL IN RURAL MARKET

SOLUTION FOR THE ABOVE MENTIONED PROBLEM

The %ir t pro+lem o% lack o% tran portation coul! +e ea il& re olve! +& procuring o*n van or tempo ( Ma& +e even motorc&cle carrier coul! +e thought o% *here proper roa! are none,i tent( The econ! i ue i more !i%%icult to tackle +ut not impo i+le( Goung !octor 3 %re hl& out o% me!ical college 3 +rimming *ith enthu ia m %or ren!ering el%le ervice couple! *ith a en e o% a!venturi m coul! +e recruite! %or thi purpo e( 0electing right %rom the campu at lucrative pa& package coul! +e the %inal impetu nee!e! to enli t total cooperation o% the ne* !octor ( The e !octor can then +e attache! to a mo+ile clinic i(e( a converte! van or tempo an! ma!e to penetrate into a et o% !eep4 eate! interior village or market ( The i ue o% none,i tent !i tri+ution channel J retail chain al o ha a olution( 7ne *a& to re olve the pro+lem coul! +e +& u ing compan& !eliver& van %or thi purpo e( The e van can reach the pro!uct to the cu tomer in ever& nook an! corner o% the market an! thu re olve the pro+lem o% pro!uct availa+ilit&( Another +ene%it i that thi *ill ena+le the &n!icate! %irm to e ta+li h !irect contact *ith the cu tomer Ocon umer ( Heav& capital e,pen!iture3 un!ou+te!l&3 i one %actor *hich care a*a& mo t o% our goo! intention ( Let u con i!er that t*ent& to t*ent&4%ive mi!4 i.e Pharmaceutical Companie come together an! plan to enter the rural market in real earne t( Then the entire e,pen!iture3 +e it capital or promotional3 can +e !i tri+ute! to the e t*ent&Ot*ent&4%ive companie in tea! o% the total +ur!en %alling on the houl!er o% an& one organi.ationD thu !iluting the %inancial loa! an! +ringing the e,erci e *ithin limit o% %ea i+ilit&(

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PHARMACEUTICAL IN RURAL MARKET

CASE STUDY8 1
A TYPICAL CASE OF A PHARMACIST IN RURAL INDIA IS GIVEN BELO(:
7n a +u & recent 0un!a& a%ternoon at the 0hree 0amarth Me!ical 0tore in the *e tern In!ia agricultural to*n o% /in!uri3 o*ner >apu ahe+ Patil *a openl& elling pre cription !rug *ithout pre cription 3 inclu!ing anti4 an! anti4tu+erculo i !rug ( He u e! a in%lammator& pill 3 ulcer ta+let

note+ook to keep track o% hi regular cu tomer ) %avorite me!icine 3 in ca e the& %orgot the name or remem+ere! onl& the color( Mr( Patil al o !i!n)t !i gui e hi motivation %or recommen!ing certain +ran! ( EThe ultimate !eci ion i +a e! on *hat the margin are3E he ai!( <or %ever F he u uall& recommen!e! a generic ver ion o% the anti+iotic cipro%lo,acinD a recent incentive !eal %rom an In!ian manu%acturer o%%ere! him a '5#$ pro%it margin an! a chance to *in a motorc&cle( Mr( Patil ai! he nee!e! the e,tra pro%it +ecau e man& o% hi cu tomer are poor villager *ho +u& on cre!it an! ometime %ail to pa& up( He ai! he ell vial o% injecta+le me!icine to the area) village !octor ( A in much o% rural In!ia3 %e* o% them have %ormal training in Ce tern me!icine or are even licen e! +& the In!ian government to practice conventional me!icine( Mr( Patil al o let hi cu tomer return an& unu e! pill ( EI tell them to top a%ter a %e* pill i% the& have i!e e%%ect 3E ai! Mr( Patil3 *ho ha a !egree in pharmacolog&( He ai! he *on)t recommen! !rug he +elieve are ha.ar!ou (

5B

PHARMACEUTICAL IN RURAL MARKET

Othe* e5 /4!e.:
=la,o0mithKline) 0mithKline >eecham unit an! 0chering A= o% >erlin3 among other 3 recentl& o%%ere! a promotion !u++e! EMega Merchant F 0ell an! Enjo&(E In e,change %or +u&ing three +o,e o% Primolut4N3 a 0chering hormone pre cri+e! %or men trual irregularitie 3 an! everal other !rug 3 a retailer receive! a %ree +o, o% the anti+iotic amo,&cillin3 an! a ticket %or a !ra*ing %or -'2 vacation in =erman&3 Nepal an! everal In!ian !e tination ( Makaran! /e hpan!e3 general manager o% ale an! marketing %or =erman Reme!ie 3 a& the %our4month promotion *a a Emo!erate ucce (E It +oo te! ale o% ome lo*4 elling !rug +& K- million3 *hile the trip co t the compan& onl& a+out K-##3###( He ackno*le!ge that ome o% Primolut4 N) ale in general are over4the4counter3 +ut he a& the promotion *a n)t The multinational companie *hich !o not o%%er uch cheme have to u%%er at the han! o% the po*er%ul pharmaci t a ociation ( Aino! Topa3 !irector o% La+oratorie ale an! marketing %or the In!ian u+ i!iar& o% A++ott a!!le! a& *hen he joine! the compan& in /ecem+er3 it *a aime! at encouraging that(

*ith huge amount o% e,pire! me!icine returne! +& pharmacie that ha! +ought them un!er incentive program +ut %aile! to ell them( He noti%ie! !i tri+utor that there *oul! +e no more +onu plan a%ter Rul& 1-3 +ut he a& pharmacie imme!iatel& re pon!e! +& re!ucing purcha e o% A++ott !rug ( EI am %acing the mu ic no*3E he a& ( A tu!& +& the >om+a& market4re earch %irm Interlink Healthcare Con ultanc& %oun! that all +ut one o% the top '5 !rug companie in In!ia o%%er uch !i counting !eal at lea t once a month(

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PHARMACEUTICAL IN RURAL MARKET

CASE STUDY #
The .4-*"o-. 2*-+. /e1 ,e:
A major pro+lem %ace! +& pharmaceutical companie to!a& i the gro*ing menace o% puriou !rug in the market( The !ome tic i in !ol!rum ( The menace o% pharmaceutical in!u tr& i no* pa ing through a cri i ( Alrea!& a+out one4 i,th or R -35## crore *orth o% it +u ine puriou 3 counter%eit an! %ake !rug ha hit it +a!l&( In or!er to tackle the pro+lem hea! on3 nine companie namel& Alem+ic Lt!(3 Ca!ila Healthcare Lt!(3 Cipla Lt!(3 /r Re!!&) La+oratorie Lt!(3 Lupin La+oratorie Lt!(3 Nichola Piramal In!ia Lt!(3 Ran+a,& La+oratorie Lt!(3 0un Pharmaceutical In!u trie Lt!( an! Cockhar!t Lt!( have joine! han! un!er the aegi o% In!ian Pharmaceutical Alliance 9IPA:( 0puriou !rug not onl& hurt companie +& lo o% ale 3 the& al o tarni h image an! reputation o% their +ran! ( The con umer get cheate! a puriou !rug !o not treat the ailment an! there%ore the patient continue to u%%er( In ca e o% critical con!ition3 it coul! even +e li%e threatening( The government too u%%er %rom revenue lo a manu%acturer o% puriou !rug !o not pa& e,ci e !ut&3 ale ta, an! income ta,( Like*i e the tra!e in puriou !rug +eing unaccounte!3 tho e !ealing in them al o !o not pa& ta, thereon(

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PHARMACEUTICAL IN RURAL MARKET

VISIT REPORT
I have vi ite! the o%%ice o% All In!ia 7rgani.ation o% chemi t an! !ruggi t at !a!ar on "th octo+er '#-1 an! met Mr(R(0(0HIN/E the pre i!ent o% thi organi.ation( Thi organi.ation provi!e variou !onation an! %ree me!ical treatment to variou poor people *ho u%%er %rom variou !i ea e ( The& organi.e! variou me!ical camp in the rural area an! provi!e them e!ucation relate! to variou !i ea e an! provi!e %ree me!ical treatment( I have a ke! him variou 6ue tion relate! to pharmaceutical in rural area an! accor!ing to him %ollo*ing are the major pro+lem in rural area F i( ii( iii( Lack o% kno*le!ge a+out variou !i ea e !ue to illiterac& Mo t o% the people in rural area are %rom poor %amil& o the& cant a%%or! me!ical treatment( Corruption i the major rea on !ue to *hich variou cheme an! help provi!e! +& the government i not a+le to reach to the poor people( He al o tate! variou olution to the a+ove ai! pro+lem( He ai! that the

rural people houl! take initiative to kno* a+out the variou !i ea e an! houl! take precautionar& mea ure at the earl& tage( He ai! that the pharmaceutical compan& houl! take variou mea ure to improve their ale ( At the en! o% thi report I *oul! like to thank Mr( R(0(0HIN/E pre i!ent o% All In!ia 7rgani.ation o% chemi t an! !ruggi t %or olving m& 6uerie relate! to pharmaceutical in rural area (

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PHARMACEUTICAL IN RURAL MARKET

CONCLUSION
The gro*th o% in titutional ale ha! little impact on the acce i+ilit& o% me!icine in rural area ( A large proportion o% the rural population till !oe not have acce to proper me!ication an! the ituation ma& take long to improve( Rural area contri+ute aroun! '-$ to the total pharmaceutical market( In '##;8#"3 the rural pharmaceutical market *a e timate! at aroun! K-(2 +illion( Nearl& "#$ o% In!ia? population live in rural area *here healthcare in%ra tructure i poor( Cith increa ing rural hou ehol! income 3 the rural market i +ecoming more attractive( Accor!ing to e timate +& the Planning Commi ion3 rural hou ehol! no* pen! -'$ o% their income on healthcare(

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PHARMACEUTICAL IN RURAL MARKET

BIBLIOGRAPHY

-: RURAL MARKETIN= 4PHILIP K7TLER ': IN/IAN PHARMACEUTICAL A007CIATI7N 4RAMA 0CAMG 1: PHARMA PUL0E
4 KAILA0H 0HARMA

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PHARMACEUTICAL IN RURAL MARKET

(IBLIOGRAPHY

-: ***(in!ianin%oline(com ': ***(i+e%(org 1: ***(in!ianpharmaceutical(com

2: httpFOOen(*ikipe!ia(orgO*ikiOMeaning

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