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VPRO IS HUGE >> Four growth drivers beyond patent for pharma companies like Sun Pharma, Sanofi 


VACCINES 

The Opportunity: LEANING on the adage that prevention is better than cure, governments, NGOs and grant organisations have been working together to expand the vaccines market, especially in developing and less-developed countries that bear a burden of vaccine-preventable disease. A good example is GAVI, a global public-private partnership that has created funding mechanisms for vaccines. Since 2000, GAVI has committed $4.5 billion towards the purchase of vaccines for poor countries against diseases such as polio, measles and hepatitis B. Recently, it said it would provide additional funding to purchase vaccines against severe rotaviral diarrhoea and pneumonia for developing countries. The opportunity for Indian companies lies in supplying low-cost vaccines to mass immunisation programmes. In parallel, selling vaccines to doctors in emerging markets can be a lucrative adjunct to the drugs business.

Home Truths: THE mass immunisation markets are tender-based ; quality being equal, companies compete entirely on price. Also, buyers are consolidated - a few large multi-lateral organisations do the buying and channel the product to governments for distribution . With emerging markets also tightening their patent laws, companies will have to be content making older vaccines for the doctor's chambers since the new ones - for diseases such as cancer - will be under patent for several years. Or, they should be willing to invest in novel vaccines. 

Challenges: INDIAN generics companies have mostly stayed away from vaccines, preferring to focus on drugs. They have ceded ground to pure-play vaccine players such as Serum Institute of India and Panacea Biotech, which are large suppliers to international organisations. Capability building will, therefore, be the biggest challenge. There will also be a continuous pressure on costs in the tender market for mass immunisation as buyers continuously seek to cut costs in order to immunise more children. MNCs too are showing a willingness to compete on price. Recently, GlaxoSmithKline and Merck announced price cuts on rotavirus vaccines for GAVI-funded programmes. The retail market will be no cakewalk either. In India, for instance, a good number of vaccines such as for chicken pox or pneumonia are deemed 'optional' . Many parents choose not to vaccinate. Companies will therefore need more investments in awareness to drive more parents to inoculate their kids. Since vaccines are biologicals, those wanting to hawk generic vaccines in the West may have to jump the same hoops as with biosimilars. 

Ahead of the Pack: Zydus Cadila is the only leading Indian generics company that has invested in building vaccine capabilities. In 2008, it acquired Italy-based Etna Biotech, a vaccine research company. Last year, it launched the first indigenously developed and produced vaccine against swine flu in the country. It reportedly plans to launch 14 more vaccines in the next four to five years. 
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