Pharmaceutical Start-Ups and Clinical Trials Lagging In India

ASSOCHAM, an industry group in India, issued a press release stating its concerns about the falling rate of clinical trials in India — an issue that has many in the industry concerned and frustrated. ASSOCHAM studied the Indian Pharmaceutical Industry (IPI) and reports that, in 2013, only 17 clinical trials were approved, in contrast to 2012, when 55 were approved. The industry association cites a lack of awareness about the need for trials in the Indian population. With 16 percent of the world’s population and only 1.5 percent of global trials, the discrepancy is notable, it says.

A large part of this problem, the industry group says, are the myths that propagate about clinical trials. Those myths say that clinical trials are unsafe, are unregulated, and make patients vulnerable. In addition to ensuring that the industry is promoting awareness of the benefits of clinical trials, ASSOCHAM says that the pharmaceutical industry is making an effort to comply with new regulations that make clinical trials safer. In particular, it points to the Drugs and Cosmetics Amendment Rules 1945 (DCR) and Rule 122 DAB, which offers compensation to families if a patient is injured or dies during a clinical trial.  

Also concerning to ASSOCHAM are the draft Drugs and Cosmetics (Amendment) Rules 2014. Published last April and yet to be finalized, the industry has “certain outstanding concerns.” The group recommends streamlining the rules, bringing them more in line with international best practices. The rules need to be more stable, more predictable, and more transparent. Other issues include bio-equivalence and improved timelines in the approval process.

However, it’s not just the clinical trial industry that has many frustrated. Just last week, The Hindu Business Line also reported on the state of the pharmaceutical industry in India, saying that the barrier to entry is too high for entrepreneurs. SV Veerra Mani, President of the Indian Drug Manufacturers Association (IDMA), said, “This is an industry which is highly regulated with highly controlled prices. Also, it calls for zero defects with stringent regulatory requirements. So, even if we have seen new investments taking place in the sector, no new company has been launched.”

The Hindu Business Line reports that pharmaceutical entrepreneurship in India is “a distant dream.” Due to major deterrents, start-ups are non-existent, even in contract manufacturing. This is due to tough regulatory requirements and the high cost of machinery. Additionally, price controls are a disincentive, as companies cannot be sure they can recover development costs. To remedy this situation, Viranchi Shah, Secretary of the IDMA, told the newspaper that government assistance is needed as start-up costs have quadrupled. If the government were to provide capitol, it would spur growth and boost exports.