Académique Documents
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Service
Business.
A.Vikram Sathish
Indian companies
have recently focused
a lot on R&D in the
pharmaceutical
sector.
CAGR of 37.6%.
The Indian CRAMS market stood atUSD1.21 bn in
2007, and is estimated to reach USD3.16 bn by
2010.
SCOPE
• Pharmaceutical companies increasingly outsource to
third parties to save money, speed up processes and
get products into the market quicker.
• Outsourcing allows companies to focus on their core
competency areas and expedite the entire process.
• In Asia pacific, large biopharmaceutical companies
outsource to their local and regional partners.
• CRO's (Contract Research Organizations) move up the
value chain with the desire to serve only few global
customers rather than diversify in different areas.
• Additionally, they are slowly converting into SMO's
(Site Management Organizations), where protocol
development and monitoring takes place in addition to
R&D.
Outsourcing Business Space
Range of Services
Pipeline Intermediates
EMERGING
PHARMA Matured Intermediates
Pipeline API’s
Dosage Development
FINE
CHEMICAL Pipeline & Matured
COMPANIES Intermediates
Global Pharmaceutical Outsourcing
Declining R&D output & high costs
continue to pose challenges to
profitability
Blockbuster drug launches expected
to drop from 14 in ’03 to 4 in ’08
Drug Product Withdrawls (Vioxx)
and safety concerns (Crestor)
By ’08 patent expirations will
account for $ 72 bn in current sales
Leading
to
Global Outsourcing
DRIVERS
B. Cost
C. Increase Productivity
D. Speed up New product
Development
D. Expand skills &
Source: AT Kearney Report
Changing Face of Industry
Declining R&D output & high costs
continue to pose challenges to
profitability
Blockbuster drug launches expected
to drop from 14 in ’03 to 4 in ’08
Drug Product Withdrawls (Vioxx)
and safety concerns (Crestor)
By ’08 patent expirations will
account for $ 72 bn in current sales
Leading
to
Global Outsourcing
DRIVERS
B. Cost
C. Increase Productivity
D. Speed up New product
Development
D. Expand skills &
Source: AT Kearney Report
Facts & Figures - INDIA
• Highest number of FDA approved plants outside USA
• Largely English speaking workforce
• IT capital of the world
• Democracy of 1 billion
• TRIP compliant
• UK based legal system
• Structured and reasonably transparent financial markets &
banking system
• Dependent on oil for energy
• Well entrenched entrepreneurial culture & developed private
sector
• Superior education level
• Infra-structure in need of development
• Largest market-share in generic API production
• Export & Western oriented
Changed IP Scenario in India
Global standards followed on IPM
CDAs, MoUs, Non-Use Agreements, etc – routinely
implemented
Work ethics & “Need-to-know” work practices
Employee Contracts & Employee retention
mechanisms
Legal provisions & remedies available
Qualified API source
Cheap Source of And
intermediates Efficient Process
R&D Resource
Ø Language
Ø Manufacturing Infrastructure
Disadvantag
es
ØCapability in Niche Segments (Ex. Controlled
Substances)
ØCommunication
Track record
Expertise
QESH
Scope for Compliance
scale-up Capacity
Analytical Commercial
Sourcing
IP Security
Lead times
Skill
Stick to timing
Technologies
cGMP
Communicatio
n
Causes for negative experiences
DIFFERENTIATORS
DIFFERENTIATORS
ØInnovation First to
Speed
Market
ØDelivery Quality
ØCost Cost
Frequency
ØCommunication
ØQuality
Transparency
ØGeographical Reach Quality
ØTrustworthiness
ØFlexibility
ØCustomer Delight
.. Favor India as
destination
Choosing the Right Partner in India;
a Selection Model
QUALIFIERS DIFFERENTIATORS
Global Interests
Speed
Ownership pattern
Costs
Final Partner
Regulatory
Communication
Compliance
Project
Financial Stability
Management
Understanding IP
Track Record
Reporting
Understanding
compliant
the
Capability &
West
Infrastructure
Changing Paradigm
Range of Services
Outsourcing services +
In License the product for
Indian & Asian Markets
India’s Conclusion of Strengths…
Speed
Competitiv
e Pricing
Full cGMP