Prime Minister’s call for prescription of Generic Medicines

In April 2017, Prime Minister Narendra Modi announced Government of India’s intention to move a law to ensure that doctors prescribe generic medicines. This suggestion that doctors write prescriptions in generic names of medicines (unlike now) is based on the idea that products sold as unbranded generic medicines are cheaper than others. A few days later, the Medical Council of India (MCI[1]) came up with a circular[2] directing the doctors practising medicine to prescribe drugs with generic names (as far as possible), with the prescription written legibly and preferably in capital letters. The Indian Medical Association (IMA[3]), while welcoming the push for generic drugs, insists that it is “discretionary and non-mandatory”.

The country’s out-of-pocket expenditure for health is one of the highest in the world, over 60 percent, and also one of the biggest reason for pushing people below the poverty line[4]. This is an ambitious idea given that out of all health expenditure, 72% in rural and 68% in urban areas in for buying medicines for non-hospitalised treatment, according to the India Health Report: Nutrition 2015[5]. While the lower drug prices are likely to free, poorer households from the poverty trap with affordable healthcare in terms of medicines, the challenges around implementation need to be attended before such a law is enforced.

Past experience has shown that such models might not be easy to implement effectively. In 2008, the government launched a chain of pharmacies called Jan Aushadhi stores to supply inexpensive generic medicines. Challenges such as limited number of stores (given the population distribution), in-sufficient availability of the required drugs have marred the effective implementation of the program. While there are more than seven lakh retail pharmacy shops, a large population, specifically rural, still remains underserved. Given their significant role in the last mile delivery and the miniscule margin on generics, it can be assumed that the retailers will prefer selling branded equivalents over generic medicines. Thus, the availability, accessibility and quality of generic drugs will greatly influence the actual impact on the ground.

According to the government’s most recent survey of the quality of drugs in India, 10% of all drugs from ‘government sources’ tested not of standard quality (NSQ). A NSQ drug will compromise patient health. An earlier report of the Comptroller and Auditor General had revealed that the Armed Forces Medical Stores Depot, which serves armed forces personnel, had reported the percentage of locally procured drugs that were substandard at as high as 32% in one year[6].IMA National President K.K. Aggarwal says, “The government itself admits that less than 0.01% of the drugs produced in the country are tested for quality. It will not be fair on the part of the government to expect doctors to prescribe substandard drugs.[7]

Given the current state of affairs, the doctors are questioning as to who will be held responsible if any generic medicine has an adverse affect on the patient. While the concept of reducing the cost is welcome, stringent quality checks of generic drugs seem to be missing in India.

Also, a section of doctors argue there is no concrete evidence to show that generic drugs are equal to branded drugs, with respect to bioavailability, potency, efficacy and impurity content[8]. Besides, some of the branded drugs are available at a lower cost than generic drugs as they have been price capped under the National List of Essential Medicines (NLEM).

Before April 2017, India mandated Bio-Equivalence (BE) studies[9] for only those formulations seeking approval within four years of the innovator product getting approval. As a result, most generic drug manufacturers sought marketing approval from the fifth year onwards, effectively evading the requirement of conducting BE studies. On 3rd April 2017, the Ministry of Health finally amended the Drugs & Cosmetics Rules to make BE testing of all highly soluble drugs compulsory. It is a much welcome move[10].

The central government had already approved a scheme for free medicines and diagnostics in public health facilities in 2011, but, 5 years down the line, most states are yet to implement it at the ground level. In addition to this, the implementation of earlier related legislations hasn’t been very encouraging as there has been little/no consequence for non-compliance.

If the government wants to make the prescription of generics compulsory, it needs to put in place a legal mechanism to guarantee that all generics are bioequivalent to the innovator product. Another good idea could be promotion of drugs in the National List of Essential Medicines (NLEM) so that all drugs are price capped and cheaper. The challenge for the government is to balance its policy objectives of taking the power of the doctor away to prescribe brand name drugs with the reality that generic drugs in India are of questionable quality.

Given the long-term effects of stifling market forces, specifically on research and innovation, it wouldn’t be inappropriate to say that the solution does not necessarily lie in more laws, but in providing more information to the consumer.

[1] Medical Council of India was established in 1994 with the main function of establishing uniform standards of higher qualifications in medicine and recognition of medical qualifications in India and abroad.

[2] Medical Council of India: Circular on Generic Medicine (2017) http://www.mciindia.org/circulars/Public-Notice-Generic-Drugs-21.04.2017.pdf

[3] Indian Medical Association is s a national voluntary organisation, which looks after the interest of doctors as well as the well being of the community at large

[4] The Devex news-item: https://www.devex.com/news/minimizing-out-of-pocket-health-expenditure-for-india-s-poor-87682

[5] The report can be accessed on http://www.ifpri.org/publication/india-health-report-nutrition-2015

[6]The Hindu news-item: http://www.thehindu.com/todays-paper/tp-opinion/generic-medicines-in-a-digital-age/article18287372.ece

[7] The Hindu news-item: http://www.thehindu.com/sci-tech/health/doctors-wary-as-centre-pushes-for-generic-drugs/article18227834.ece

[8]The Hindu news-item: http://www.thehindu.com/sci-tech/health/doctors-wary-as-centre-pushes-for-generic-drugs/article18227834.ece

[9]Bio-equivalence studies are those where generic formulations are tested on healthy volunteers to ensure that they have the same physiological characteristics as their innovator counterparts.

[10] The Hindu news-item: http://www.thehindu.com/todays-paper/tp-opinion/generic-medicines-in-a-digital-age/article18287372.ece