Introduction:
The Indian government recently implemented a ban on 14 fixed-dose combination (FDC) drugs, citing concerns over their therapeutic justification and potential risks to individuals. FDCs are medications that contain multiple active drug ingredients and are typically prescribed for specific diseases.
Banned FDCs:
One of the prominent FDCs on the list of banned drugs is nimesulide+paracetamol, a combination commonly used to alleviate pain associated with toothache, ear pain, joint pain, headache, menstrual cramps, and fever.
Another banned combination is amoxicillin+bromhexidine, often prescribed for lower respiratory tract infections. Notably, the ban primarily targeted drugs in the cough and cold segment, including combinations that contain codeine, an opioid pain reliever.
Background and Rationale:
This ban follows recent incidents of deaths linked to the use of cough syrups exported from India. These incidents raised concerns about the scrutiny of Indian drug regulators and negatively impacted the reputation of Indian pharmaceutical companies.
Impact on the Market:
The ban will lead to the removal of several popular over-the-counter drugs from the market. This includes well-known cough syrups such as Mankind's Codistar and Tedykoff, as well as Glenmark's Ascoril C.
While the ban also affects some drugs with significant market share, analysts do not anticipate a substantial disruption in revenues for most companies.
Mitesh Shah, a pharmaceutical research analyst at Nirmal Bang Institutional Equities, stated, "Among the companies that had their drugs on the banned list, Alkem Laboratories, Mankind Pharma, and Abbott India are likely to experience a 1-2 percent impact on their revenues."
For others like Cipla or Glenmark, the impact is expected to be less significant. The ban is also expected to lead to increased scrutiny in receiving drug approvals at the state level, as the Drugs Controller General of India (DGCI) becomes more cautious about FDC drugs in the market.
Impact on Listed vs. Unlisted Companies:
Bino Pathiparampil, Head of Research at Elara Capital, believes that the drug ban will not have a material impact on many listed companies.
Listed companies tend to have their quality checks well-managed, and as a result, the ban is unlikely to pose significant challenges for them.
However, unlisted players may face difficulties around safety and compliance regarding drug regulations.
The recent incidents of people suffering due to the use of Indian cough syrups have been attributed to lapses at small, unlisted pharmaceutical companies. As a result, tightening regulations is seen as a step in the right direction.
Conclusion:
The ban on these 14 FDC drugs in India is a significant regulatory move that aims to ensure the safety and efficacy of pharmaceutical products.
While it may have varying impacts on different pharmaceutical companies, it underscores the importance of stringent quality control and compliance measures in the industry.
0 Comments