Saturday 4 October 2014

Healthcare for the Indian people

Healthcare for the people of India, particularly the poor people, is in a terrible state.

The government hospitals are in a terrible state. Even a premier medical institute like the All India Institute for Medical Sciences, New Delhi, looks like a railway platform, with hundreds of people waiting for several hours to be attended to.

As regards private clinics, they are simply too expensive and beyond the reach of poor people.
 So what do poor sick people do ? They go to quacks. Quack doctors in almost every town are perhaps 5-10 times the number of qualified doctors.

In a case I had before me in Allahabad High Court I found that in some towns in U.P. whole clinics have been set up by quacks or people having fake medical degrees.

 The Primary Health Centres in the rural areas( at least in U.P. about which I am familiar as I am from there ) are meant to be attended by state government doctors, but the reality is that most of the government doctors of the Provincial Medical Service who are posted there come there only for a couple of hours once or twice a week, and the rest of the time they are secretly running their private clinics in the cities.

Many medicines are prohibitively expensive for the poor people. So what do the poor people do ? Some go to quacks, and some go to their death.


  1. DUE to the Indian Patents Act 1970, Drug Price Control Order (DPCO) 1979 and the emergence of public sector undertakings (PSUs) in pharmaceuticals production, like IDPL, HAL etc, India achieved complete self-reliance in pharmaceuticals, as noted by the UNIDO in 1982. As a result, a large number of Indian companies established market dominance, replacing the earlier dominance of the multinational corporations (MNCs) and even started exporting medicines to the West. Today, India is the second largest producer after the US and fourth largest exporter of low-priced quality medicines including those for treating cancer, HIV etc.


    However, the drug MNCs are coming back to India in full force, while the US and EU are concentrating attacks on Indian drug companies by blocking their entry into western markets; by destabilising the pharmaceuticals market in India through a patent regime; by changing over to market-to-decide drug prices; and by attacking the medical practitioners, medical representatives, drug traders, and the people in general.

    Facing a continuing economic crisis, the US and EU countries have adopted massive austerity measures including huge cuts in governmental funding for health sector. These cuts resulted in a rapid contraction of medicine markets in these countries.

    In such a situation, the US-EU drug MNCs are trying to prevent Indian companies from selling low-priced India-made medicines in their countries, while desperately looking for medicine markets in developing countries like India.

    On the other side, taking advantage of the crisis created by the neo-liberal policy regime, the Manmohan Singh government is desperate to invite FDI to India to meet the current account deficit.

    Both these have created conditions for massive entry of drug MNCs in India through FDI route. Their aim is --- acquisition of Indian companies and destabilisation of the Indian pharmaceutical market to create difficulties for Indian companies to operate.

    For these two purposes, using its ‘Current Goods Manufacturing Practice’ (cGMP) as an instrument, the US launched concerted attacks on all Indian medicines as if they were ‘adulterated’ and ‘substandard.’ To suit its purpose, the US regularly changes its ‘current’ GMP and, on this ground, accuses Indian medicines as adulterated. Under US law, any medicine not fulfilling cGMP is called ‘adulterated,’ which definition is simply incorrect. This has been established by the Supreme Court of India while dismissing a PIL against Ranbaxy on June 25, 2013 and by World Health Organisation in its May 2013 statement.

    Yet concerted media campaign through paid news is going on around the world to dub Indian medicines are adulterated, substandard and therefore not fit for consumption.

    But the government of India is now a willing partner in this dirty US game, allowing the US Food & Drug Administration (FDA) to establish its offices in New Delhi and in some other cities with several drugs and other inspectors checking drug trials in government and private hospitals in India; checking drug manufacturing units in India; checking import of raw materials and intermediaries on India’s borders; and sending reports to Washington for declaring India-made drugs as adulterated and substandard! India’s spineless drug control administration under the union health ministry just asks Indian drug manufacturers to send only a copy of the US FDA’s notice if their medicines are declared as ‘adulterated’ under the cGMP!

    Instead of protecting one of its main exports, of Indian medicines, the government of India is in fact playing subservient to the US.


    The government of India has allowed 100 per cent FDI in pharmaceuticals and during 2007-2011, Rs 50,000 crore came in, but mainly for acquisition of Indian companies. Instead of standing up against the MNCs as before, more Indian companies are offering themselves for sale to MNCs. Behind-the-curtain bargains are going on. The government remains a silent onlooker despite the concern expressed by many members of parliament and reportedly by some ministers.

    On the US drug lobby’s demand about patents, union commerce minister Anand Sharma assured his US counterpart in a meeting on January 31, 2013 in New Delhi that the ‘Compulsory Licensing’ clause of the Indian Patent Act would not be used despite the Supreme Court’s judgement in Glivec case because, he said “the government of India is a responsible government.” But responsible government for whom --- for the foreign drug cartels or for the country’s self-reliance in drug production, for availability of low-priced drugs to the Indian people?

    As we know, product patent of medicines was not allowed in India since independence till the then union commerce minister Pranab Mukherjee signed the WTO’s TRIPS agreement in Morocco in 1994. Amendments to Indian Patent Act were made during 1999-2006 for TRIPS compliance.

    Using about 60 years period of actual and virtual no patent on drugs, Indian companies successfully occupied the Indian market through strong marketing networks, even in remote places, with their strong brand image, giving tough fight to drug MNCs. This was achieved only in India and in no other country in the world.

    In a market economy, every commodity, without exception, is sold through marketing of brands amid brand competition. Under the drugs and related laws in India, marketing of drugs is confined only to registered medical practitioners, hospitals, medical institutions and pharmacists by legally authorised sales promotion employees who are commonly known as medical representatives. As such, the sales promotion of medicine brands is entwined with medical practitioners, hospitals, medical representatives and pharma traders.


    To the MNCs, to establish market for their patented medicines, patent image must be established in India; and for this purpose the hitherto established strong brand image of medicines must be destroyed; the entire market in India must be destabilised and its strong brand promotion network broken. This is why concerted attacks on medical practitioners are accusing the latter of being ‘bribe takers’ who prescribe and order generic prescriptions. Medical representatives too are being dubbed as ‘bribe givers’ while drug traders are described as commission hungry.

    Why this attack on Indian medicine brands after six decades of independence? The propagated reason is that brands breed corruption and that their prices are higher than those of generics. Both the assertions are untrue.

    Take the case of high level corruption scams associated with the Manmohan Singh government in different fields. These are certainly not connected with brands but with foreign and domestic corporate houses.

    Pharma business in India is no exception. Super profits of drug companies are being used for bribing for business. The Federation of Medical & Sales Representatives Associations of India (FMRAI) has condemned the drug companies for their corrupt practices for promoting the sale of medicines.

    The FMRAI submitted a petition to the Lok Sabha Committee of Petitions, urging it to institute an enquiry into the corrupt practices of drug companies and assured its members’ evidence in respect of unfair marketing and trade practices of drug companies. It demanded a CBI enquiry into these malpractices, and has been agitating through a public campaign and strikes against corporate corruption.

    But, why the medical practitioners and medical representatives are being targeted instead of the actual bribe givers? If the Medical Council of India (MCI) can prepare strong rules for doctors, why cannot the government frame a law to punish the bribe-giver companies? Why has no criminal action been initiated against them? Medical representatives are only ordinary workers, fighting for their job protection and against repression by the drug companies.

    The scam behind the order of only ‘generic drugs prescription’ in government hospitals has recently been exposed through the CBI enquiry in CGHS hospitals in 15 states. The heath minister of Jammu & Kashmir was recently removed; similarly in Madhya Pradesh the scam tainted health minister was removed as he debarred entry of medical representatives in government hospitals. Most of these had vested interest in local companies and were out to sell generic substandard drugs in government hospitals. Such attempts in other states also require investigation.


    In this regard, it will suffice to quote the union minister of state for chemicals and fertilisers, Srikant Jena, about the accusation of price difference between brands and generics. In a written reply to Question No 194 in Rajya Sabha on November 23, 2012, the minister said, “The prices of generic medicines sold in the open market are generally at par with the prices of the branded medicines.”

    Cost-based drug price control with different category-wise fixed ‘mark-ups’ (percentage of difference of cost and MRP) was issued by the government of India for the first time as Drug Prices Control Order (DPCO) 1979, issued under the Essential Commodities Act 1953. However, it systematically removed several categories of medicines from price control by the DPCO 1987 and again by DPCO 1995, keeping only 74 essential drugs under price control with 100 per cent mark-up. Due to this, the prices of branded as well as generic drugs are high and are rising.

    The central government has prepared a National List of Essential Medicines (NLEM) as per the Supreme Court’s order, but kept it outside the ‘List of Essential Drugs’ (LED) as LED continues to remain under cost-based price control under DPCO 1995.

    Now the Manmohan Singh government has issued a new ‘DPCO’ 2013 completely removing the government’s cost-based price controls on drugs. It allows fixation of drug prices by the market, including those of essential medicines listed in NLEM, just by calculating the average of selling prices in the market of those products which are having more than one per cent market share. The job of the National Pharmaceutical Pricing Authority (NPPA) is only to calculate the market prices of these medicines and issue a circular. All other medicines, including many essential drugs and patent medicines, have no price control and the drug companies are free to increase their prices at will.

    That is the present Drug Prices Control Order of Manmohan Singh government! The ailing people of India are being fleeced by high prices. These constitute a major share of healthcare expenditure and a substantial part of the common man’s total expenditure.

    Many people don’t even know that medicines are one of the highly taxed commodities, next only to petroleum products. The central government earns huge revenues from medicines and the ailing people of India have to pay for it. One of the high taxes of medicines is the excise duty collected by the central government which claims that it collects a ‘low’ --- only eight per cent --- excise duty on medicines! This is in addition to value added tax being collected on medicines.

    Excise duty on a commodity is collected on the production cost. However, in 2005 the central government issued an order that its would collect excise on a medicine’s maximum retail price (MRP). As to why excise duty should be computed on selling price and not on production cost is beyond understanding; what is clear is only that the more the drug companies increase the prices of their medicines, the more excise duty the central government gets. Thus the entire burden is shifted on to the ailing people of India.

    One may well ask: If the central and state governments ask the companies to cut down drug prices and ask the traders to cut down their commissions, why do they impose taxes on essential medicines?

    1) Prevent the takeover of Indian companies by multinationals;

    2) Revive the public sector drug units including vaccine producing units;

    3) Impose a cap on all drug prices; fix the prices of all essential drugs at the minimum possible; stop charging excise duties on essential drugs; excise duties on other medicines must be the minimum; revert to cost based system; stop legitimizing the present market based pricing system;

    4) Ensure the availability of all essential drugs through compulsory manufacturing;

    5) Frame a statutory code of marketing with punishment clause to stop corporate corruption in pharmaceutical sector.

    I urge upon all democratic minded people of the country, including doctors, chemists, judges, science organisations, trade unions etc, to raise their voice against the MNC attacks and the government’s policies on Indian pharma companies; medical practitioners, medical representatives, drug traders and the ailing people of India.

  7. Thanks for this nice and informative article on healthcare for indian people

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