Retail margin on generic drugs may be as high as 1,000%, claims study

Pharmaceuticals
By Durgesh N. Jha, TNN | Updated: Apr 19, 2017, 09.13 AM IST
Ironically , India is one of the world’s largest exporters of generic drugs.

If you think doctors prefer to prescribe expensive drugs when cheaper options are available, you are only partly right. A study in Indian Journal of Pharmacology found that while generic versions were less expensive than the branded ones, the retail margin on generic variants was way higher -sometimes more than 1,000 per cent of the manufacturer’s price.
This implies that retailers have a strong financial incentive to push generic drugs, even if doctors prescribe branded. PM Narendra Modi had on Monday said that government is contemplating a legislation that will make it mandatory for the doctors to prescribe generic drugs. Authored by pharmacologists from Delhi University’s VP Chest Institute and MD University, the 2010 study compares retailers’ profit margin on five common drugs -cetirizine, fluoxetine, ciprofloxacin, lansoprazole and alprazolam.
Dr Anita Kotwani, professor of pharmacology at Delhi University’s V P Chest Institute, told TOI fleecing of patients in this manner continues. “It will not stop until government comes up with regulation to ensure manufacturers drop trade names and sell drugs by their pharmacological name as in the US and other developed countries,“ she said.

Dr Kotwani was the lead author of the IJP study . She said retailer margin for five branded medicines they studied was in the range of 25%-30%, but for their branded-generics version manufactured by the same company it was in the range of 201% -1,016%. “In India, there are very few innovator or patented products. Generic drugsare available in two forms: the branded product which companies advertise and push through doctors and branded-generic which they expect retailers to push in the market,“ she said.
In the IJP study, quality of both branded and branded-generic drug was found to be equally good. But doctors say all generic drugs sold under different name do not have similar quality.

“We have observed that epilepsy goes out of control in epilepsy patients when they changed the brand which is indicative of variation in quality of drugs manufactured by different companies,” said Dr Kameshwar Prasad, profes sor and head of neurology at AIIMS. He added there should be strict control on quality and pricing of generic drugs.
“Doctors are often blamed for coming under the influence of big firms, who lure them with different benefits, and batting for brands. This is partially true. The fact that quality of generic drugs sold under various trade names for same molecule is not uniform, hence lack of trust on the less popular ones,“ said another doctor.
Ironically , India is one of the world’s largest exporters of generic drugs. It exports to over 200 countries, including the highly regulated markets of US, Europe, Japan and Australia. But the experts say quality control is much better abroad. “There are only 1800 drug inspectors in the country .This number is grossly inadequate,“ Dr K K Aggarwal, president of Indian Medical Association, said. He added that less than 0.01% of the drugs produced in the country are tested for quality. “For doctors to prescribe generic drugs, it is crucial that the laws regarding drug testing and quality assurance are strengthened,“ the IMA president clarified.
Prime Minister Modi, while speaking at a function to inaugurate a charitable hospital in Gujarat on Monday, said the government will bring in a legal framework by which if a doctor writes a prescription, he has to write in it that it will be enough for patients to buy generic medicines and he need not buy any other 

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