Domestic drugmakers are calling for an “affordable medicine” partnership between India and the US, to ensure a secure and sustainable pharmaceutical supply chain.

Indian drugmakers already carry the legacy of being a pharmacy to the world, but the Indian Pharmaceutical Alliance (IPA) seeks to expand collaboration between the two countries, in a formalised manner, possibly as a preferred partner. This would facilitate an enhanced and resilient trade, involving more products between the two countries, a person familiar with the development said, pointing to medicine shortages the US grapples with.

Earlier this month, top IPA representatives, including the heads of Dr Reddy’s Laboratories, Lupin, Zydus Lifesciences and Sun Pharma, were in Washington to carry this idea forward. IPA’s Secretary General Sudarshan Jain (part of the IPA delegation to the US) told businessline, the partnership to ensure affordable and sustainable pharmaceutical supplies could, at a later point, be expanded to other regions as well. The annual pharmaceuticals-linked trade between the two countries is pegged at $7.5 billion (as of March 2023), he said. In fact, similar partnerships are in place in sectors including energy and semi-conductors, he said.

IPA proposal

The IPA proposal is aligned with a US administration order on US’ supply chains (February 2021), where pharmaceuticals and active pharmaceutical ingredients were identified as a supply chain risk, said Jain. Companies and countries had collaborated on vaccines during the pandemic and present collaborations between the two countries, mostly involve formulations (finished medicines), an IPA representative said. This could be expanded to Active Pharmaceutical Ingredients (APIs) and Key Starting Materials (KSMs), for example, to de-risk the single-source dependence of countries.

In fact, India’s PLI (production-linked incentive) scheme for pharmaceuticals supports the production of these products, the representative said, adding that a framework outlining granular details on the proposed collaboration would be available shortly.

The proposal comes even as some manufacturing units from Indian drugmakers face US regulatory action. Jain said, India was an open economy, and companies faced unannounced regulatory inspections, and took remedial measures. India has the highest number of US Food and Drug Administration-approved plants (over 650), outside the US. On the sometimes contentious differences involving Intellectual Property Righs (IPR), between industry representatives in both countries, Jain said, India respected IP, within the internationally-agreed framework.

IQVIA report

An IQVIA report commissioned by the IPA said, “In terms of prescriptions, Indian pharmaceutical companies supply a substantial proportion of drugs to US residents, with four out of 10 of all prescriptions filled in the US in 2022 being supplied by Indian companies.” Overall, medicines from Indian companies provided $219 billion in savings to the US healthcare system (2022) and a total of $1.3 trillion between 2013 and 2022, it added.

Indian companies supplied 47 per cent of all generic prescriptions filed in the US and 15 per cent of the volume of biosimilars, the report said. In fact, they provided nearly “half of generic medicines paid for through Medicare and commercial insurance, providing affordability to employers and federal programs,” the report said.

Key data

Of the top 10 therapy areas by prescription volume, Indian companies supplied more than half the prescriptions for five: hypertension, mental health, lipid regulators, nervous system disorders, and antiulcerants.

In 2022, Americans filled 6.7 billion prescriptions, and more than 90 per cent were for generics. Generic drugs saved the US health system $408 billion and nearly $2.9 trillion over the last decade.

Source: IQVIA