Pakistan is a country where 7.3 out of every 1000 people die each year due to non-availability of medicines hence medicines play a very important role in our healthcare system as well as the rest of the world. However, one third of the world’s population does not have access to essential medicines. Poverty and expensive branded medicines are major reasons behind this non-availability and that is where Generic Drugs gain importance. Some drugs that have been around for ages are very cheap for instance, Aspirin. It has been out of patent and is being made by numerous companies competing to undercut each other’s prices for decades. But new medicines, protected by 20-year patents can be extremely costly.

Revenues & Gross profits, Branded vs Generic Drugs 2009 A generic drug is a medication created to be the same as an already marketed brand-name drug in dosage form, safety, strength, route of administration, quality, performance characteristics, and intended use. These similarities help to demonstrate bio equivalence, which means that a generic medicine works in the same way and provides the same clinical benefit as its brand-name version. In other words, you can take a generic medicine as an equal substitute for its brand-name counterpart because the active chemical substance is the same; the medical profile of generics is believed to be equivalent in performance. The generic drug has the same Active Pharmaceutical Ingredient (API) as the original, but it may differ in characteristics such as manufacturing process, formulation, excipients, color, taste, and packaging. A lot of debate has been going on about the pros and cons of using generic drugs and much emphasis has been put on the cost and quality of these drugs. Switching from brand-name to generic drugs seems a very attractive idea when it comes to cost effectiveness especially in Pakistan. In Pakistan, where 77% of medicine expenditures are out-of-pocket payment and where more than 50% of the population earns less than 2US $ per day, the generics could be instrumental in curtailing the cost of treatment and reducing healthcare expenditure provided the prescriber is well-informed and has confidence in the generics, and the consumer is knowledgeable enough to understand the availability of the low-cost brand. Since products under protection pose a higher price tag, such approach allows widening margins on the same API significantly and gives competitive advantage in the industry.

The TRIPS agreement obliges all WTO member countries to accord patents on medicines, but still there is flexibility in this regard. As per the TRIPS agreement, each member country reserves the right to have its own specific format on patents. In fact, the Doha Declaration on TRIPS and Public Health clearly penned down that the TRIPS agreement can and should be represented and enforced according to the WTO Member’s right to safeguard public health and specifically to promote easy access to all. Pakistan is a part of the TRIPS agreement, and since 2000, the Intellectual Property Legislation is duly positioned.

June 2019

Generic Drugs and the Future

Trade Related Intellectual Property Rights (TRIPS) and Pakistan

Thus, developing countries are not bound in any way and have the full right to carve and implement their patent laws, taking full consideration of their respective public health needs. But still what remains the major challenge is the lack of implementation of the flexibilities of TRIPS with regard to the access of medicines. The major reason behind rapid growth of generic product is the availability of authentic drugs to cure major diseases in cheaper unbranded version. The economic burden of ethical drug is reflected by the increased costs of drug development. In the late 1990s new drug developmental costs were $0.9B doubled within few years into $1.8B. In 2003 the cost increased by almost 50% to $2.6B and in 2018 with only one in ten thousand compounds makes it to the market. These have put financial pressure on the ethical companies to increase drug prices, which led to a pressure on government to reduce this burden. This led the ethical companies to struggle keeping profitability on approved drugs for extended periods.

Generic Versus Branded Drugs Market by Country, 2017

The regulatory pathway to register a generic product requires 2-5 years to reach to the market as compared to 8-15 years with new drug development. The costs of generic products are significantly reduced, product can be fully developed and approved for US$ 10- 20M. On the other hand, with patent protection the drug delivery product receives exclusivity period, in some cases going up to 7 years along with approval and some by the patent protection. In a nutshell, generic medicines serve as an important tool to promote access to medicines making them affordable in Pakistan. The practice and utilization of nonproprietary classification should be highlighted and promoted, not only to arrest unnecessary costs, but to reduce the probable prescribing errors as well. Thus, to construct a magnanimous generic market in Pakistan, a combination of strategies such as generic-backed legislation, regulation with dependable quality assurance, professional and public acceptance along with economic incentives should be sought.

Patent Registration Flow Chart Generic Registration Flow Chart

On other side of the border, India which is also known as ‘’Pharmacy of the World’’ is currently spending a major part of their profits on R&D. The government is currently preparing for a multi-billion-dollar investment with 50% public spending on R&D alone as they are more focused on enhancing the effectiveness of existing generic drugs.

Value of Leading Generic Products In Pakistan It has become a necessity for developing countries like Pakistan to organize the concept of R&D in the industry for the sake of generic enhancement rather than working on Patents. Due to environmental changes and multiple factors, we need expansion in life threatening diseases. Existing generic drugs are not enough to address them and advancement in same generics are much needed.

This report is provided only for the information of professionals who are expected to make their own decisions without undue reliance on this report and the company accepts no responsibility whatsoever direct or indirect consequential loss arising from use of this report or its contents.

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References:

• www. gulfnews.com

• www.omicsonline.org

• www.health.harvard.edu

• www.researchgate.net

• www.jpsr.pharmainfo.in