Nepali Pharma Industry Present & Future

Nepali Pharma Industry Present & Future
By Diwakar Chhetri

Since Nepal has been categorized as one of the least-developed countries, the Doha Declaration of WTO has made it free from Patents Rights laws till December 31, 2015. In other words, Patents Right law in Nepal will be implemented only from, January 1, 2016 onwards.

Currently, there are 50 least-developed countries as listed by the UN in the world. Among them only 32 countries have become WTO members till now and 10 others are in the process of obtaining the WTO membership. Our neighbouring countries like Bangladesh, Bhutan as well as Myanmar, Maldives, Afghanistan and most of the African nations fall under the category of least-developed countries. Bangladesh is capitalizing its WTO membership with the fullest capacity so far as pharmaceutical products are concerned. Except Bangladesh and Nepal, almost all the least-developed countries solely depend on the imported allopathic medicines. Hardly seven years are left for the implementation of Patents Rights law in Nepal and till date we have failed to prepare ourselves to export medicines to these LDCs and have never given a thought about our stand after 2016.

What are the hindrances which are not allowing us to export? WTO’s ‘Managing the challenges of WTO participation: case study 31’ gives one example. As noted there Gorkha Ayurved Company received a bulk order for their product from a Swedish importer in August 2000. Later the importer cancelled the order mentioning that the Company was lacking GMP certificate and also failed to match the standard. In 2001, the Company exported their product to a Sydney based importer. This importer asked for some sample test of the product, which the Company easily presented. It is a point to note that different countries have their different rules and polices for the import and export of any products. But so far as Allopathic medicines are concerned, WHO-GMP certificate plays a major role.

The Department of Drug Authority (DDA) had made GMP mandatory for importing any of drug-related products into Nepal since 2000. The Department had also imposed the GMP on the domestic pharmaceutical manufacturing companies. As soon as the country obtained the WTO membership, DDA had instructed all the pharmaceutical manufacturers, including herbal medicine producers, to abide by the WHO-GMP code by the end 2006. Till date most of the leading companies have acquired WHO-GMP certificates and many more are going to obtain it. But the companies are still prevented from exporting their products. What could be the reasons that GMP certified companies are failing to export their products even to LDCs? Who is responsible? Or is the WHO-GMP certificate issued by DDA not matching the world standard and not acceptable to other countries?

If ten existing Nepali pharmaceutical companies join together and invest collectively for the establishment of a new factory, with a state-of-the-art of technology, matching with GMP and FDA standard, the export of medicines is absolutely feasible. Such a joint effort not only abolishes the dependency on import but also earns a good amount of revenue for the government. Above all, the country will get ready to accept the challenge, which is likely to emerge after 2015. Countries like Japan, USA, Germany and others have assured trade related technical support to Nepal. So, Nepal has an opportunity to reap the maximum benefits by enhancing her capacity to be more competitive in the international trade. It is now clear that by simply obtaining a WHO-GMP certificate will not serve the purpose; the factory set-up should match with the internationally accepted standard. Nobody can deny that our DDA has to play a crucial role for making our factories technically superior. At least, at present, Nepali manufacturers, with the coordination of DDA, should aim at covering LDCs’ market. For this, the manufacturers industries should be ready to uplift their present technical status.

SCENARIO OF DOMESTIC PHARMA MARKET

The numbers of manufacturing companies are increasing year after year. Still domestic production has failed to replace import. About 65 percent of medicines demand is being fulfilled by foreign industries. The table above clarifies the present scenario of consumption of allopathic medicines in Nepal.

Whenever a new company starts making drugs in Nepal, it tends to manufacture those molecules only which have already been manufactured and marketed by other companies. We envy national brand leaders and we always want to be in a comfortable zone by aping the brand leaders.

If we analyze further, we may find that the antibiotics have a market share of almost 30 percent of total medicines consumed. That is the biggest opportunity sector where our domestic industries should aim at.

The total consumption of antibiotics in 2005-06 was Rs. 2 billion 717 million and the share of the domestic production was only 48.7 percent.

The antibiotics mentioned in the accompanying table, which were imported, have a share of 31.43 percent in total antibiotics market; hence, the domestic industries should fill up such a huge vacant space by increasing their share.

This is the right time to eliminate foreign brands by increasing our domestic market share. But unless and until we become technically superior, we cannot get rid from the increasing import. Within 2015 we should be able to export our domestic products to the market of LDCs. From 2016 onwards the international brands start pouring into the Nepali market and the market becomes highly competitive. Nepali pharmaceutical industries will find it difficult to survive in future if they do not arm themselves now with internationally accepted sophisticated technology and manufacture the medicines of export quality.






























(Chhetri is the General Manager of Asian Pharmaceuticals (P) Ltd.)