India jumps into the generic drug biz to compete with commercial players on price

SINGAPORE--India's government is getting into the generic drug business. The state reportedly will launch its own brand, "Jan Aushadhi," on July 1, planning to sell up to 504 drugs on its "essential" list in direct competition with commercial drugmakers. The government drugs will be available only in Jan Aushadhi-branded hospital pharmacies, and hospitals may be required to use them.

As of now, the venture's price list covers 259 drugs, mostly painkillers, antibiotics and vitamins for chronic ailments such as heart disease, respiratory problems and diabetes. The meds are available in at least 22 hospital pharmacies so far. India's Department of Pharmaceuticals is separating itself from the actual business by contracting with nongovernment and charitable organizations to run the stores.

The Jan Aushadhi Generic Drug Stores brand, seven years in the making, plans to rely on bulk purchases from public and private drugmakers. The companies will be required to supply their versions at prices discounted enough to make them affordable to the population at large.

The Bureau of Pharma Public Sector Undertakings of India (BPPI) has been assigned to oversee the government company to ensure its stores are selling only quality drugs at prices lower than those charged by other drugmakers and pharmacies. The JA stores are intended to provide an umbrella brand for generics.

At some point after the July inaugural of the stores, BPPI plans to require public hospitals to prescribe the Jan Aushadhi brand if possible, the Times of Indiasaid, quoting an unidentified official.

The new business is to be opened in phases, beginning with selling the 100 top-selling generics. More products would be added in the second phase. "Jan Aushadhi" literally means "population medicine" in Hindu.

Part of the delay had been a fear that physicians and others would oppose the effort because it would compete with the private sector. But the Indian Medical Association said its members would support the venture as long as quality is maintained.

Other critics raised questions about the venture's ability to sustain itself and ensure quality at the same time, because the stores' supplies would come from several sources and could be difficult to monitor. But BPPI says its procurement guidelines and constant sampling would make sure the stores sell quality products.

The highest maximum retail price on Jan Aushadhi's list as of December was 589.5 rupees ($9.51) for gemcitabine, the generic version of Eli Lilly's ($LLY) Gemzar cancer drug.

The Jan Aushadhi website says its existence "would redefine the principles of drug prescription by doctors, production by manufacturers and retail trade by pharmacy stores. It would establish and emphasize the efficacy and potency of generic medicines such that quality medicines will be affordable by all for a better quality of life."

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