Challenges Faced by Pharmaceutical and Healthcare Sectors in West Bengal
The pharmaceutical sector in West Bengal has seen a decline in manufacturing units over the years, while the healthcare sector has witnessed growth in private healthcare facilities. Kolkata has emerged as a healthcare hub in eastern India. A survey methodology was used to gather data from various stakeholders in both sectors to analyze the macro-level issues influencing business responsibility.
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Findings and Inferences from project- BRCC (West Bengal) National Policy Forum 8thOctober 2012, New Delhi Prithviraj Nath CUTS Calcutta Resource Centre pn@cuts.org 1
Overview of Pharmaceutical Sector Overview of Pharmaceutical Sector The genesis of Indian pharmaceutical industry is always traced back to 1901 West Bengal when scientist Acharya Prafulla Chandra Ray laid the foundation stones of Bengal Chemical & Pharmaceutical Works Ltd (BCPL). West Bengal saw the advent of many new pharmaceutical manufacturers during 1970s with the advent of the Patents Act and also encouraging Industrial policy by Govt. Of India. In 2005 product patent was first introduced and GMP was also introduced during this time. West Bengal saw a gradual decline in numbers of manufacturing units from around 1100-1200 in early 90 s to 550 -600 in early 2000s to just around 166 at present. (Source: Directorate of Drug Control, West Bengal) Most of the firms, around 120, are situated in and around Kolkata, around 40 firms are located in North & South 24 Parganas and the rest in other districts of West Bengal. 2
Overview of Healthcare Sector Overview of Healthcare Sector The growth in private healthcare started picking up since the 1990s and introduction of National Health Policy 2002(Govt. of India) and PPP policy 2006(Govt. of West Bengal) boosted it. The total number of health units in the State is roughly around 2000 (leaving out sub-centres) including both private and public units. The number of private hospitals outnumber the public hospitals in the state by more than triple, while the proportion of hospital beds show a absolute reverse statistics with the government figures being more than double the private counterparts. The average number of private health care institutions (excluding physician s chambers) is 0.58 per 10,000 population in the municipal areas of West Bengal Kolkata has emerged as the healthcare hub in eastern India with around 121 leading nursing homes and 63 large hospitals. There are roughly 188 diagnostic centres in and around Kolkata. Other districts with appreciable presence of private healthcare are North & South 24 Parganas, Howrah, Hooghly, Bardhaman and East & West Midnapur. 3
Methodology for the survey Methodology for the survey Sample Composition: Pharmaceuticals - 50 Bulk drug manufacturers - 5 Formulations 45 Private Hospitals ( 2:2:1 ratio was attempted) - 50 Big Hospitals (more than 100 beds) - 22 Medium Hospitals (30 -100 beds) - 16 Small Hospitals (15-30 beds) 12 Medical Representatives - 40 Sectoral Associations 6 Govt. Authorities and regulatory bodies-3 Local Community 6 Prescriptions Analysed-305 Research Tools: (a) Questionnaire Survey (b)Focus Group Discussion Districts covered: Kolkata, North & South 24 Parganas,Nadia, Bardhaman,Jalpaiguri,Siliguri,Howrah. 4
Macro Level issues influencing Business Macro Level issues influencing Business Responsibility in the 2 sectors in the State Responsibility in the 2 sectors in the State Weak Regulatory Regime, more importantly the implementation thereof, to address the issue of unethical business practices in the face of intense competition. Stringent norms under GMP difficult for SME Pharmaceutical units Counter Competitive. Lack of an appropriate HR policy for MRs. Lack of proactiveness and mandate among Business Associations to promote responsible business behaviour by their members. Government s role was opined to be inadequate by many of the sectoral associations. 5
Evidence suggesting violation of Business Evidence suggesting violation of Business Responsibility in the pharmaceutical sector Responsibility in the pharmaceutical sector Majority of pharmaceutical surveyed units don t have dedicated environment management department. Pharmaceutical firms are mostly not willing to fix salaries of Medical representatives Low awareness on UCPMP, NVGs, etc. among pharmaceutical units 20 out of 50 pharmaceutical companies surveyed sponsor events like meeting, workshop, seminar etc for doctors. Medical Representatives (MR) said that gifts are given to doctors though they may not ask for it Though many of the MRs were not forthcoming, some did agree that there is a nexus between doctors and pharmaceutical firms. 6
Communities Voice Out of the 6 communities surveyed only 2 complained about environmental problems. They experience health related problems like headache, vomiting and the bad smell causes discomfort. Water bodies in the locality are also polluted. Weak monitoring and implementation and violation of guidelines by pharmaceutical firms lead to such problems. The community members fight these issues jointly through local club. Opined that industry should be located in special industrial zone. 7
Evidence suggesting violation of Business Responsibility in Evidence suggesting violation of Business Responsibility in the private healthcare sector the private healthcare sector On Regulations: Around 75% of the hospitals follow code of Optimal Healthcare Other guidelines like those on prescriptions, RUD, etc. are not so religiously followed. Low awareness on UCPMP, NVGs, etc. among Hospitals Bigger hospitals seem slightly better off than medium and small hospitals in this respect 8
Prescription Analysis Auditable Prescription: 305 Total number of complete prescription: 14 Prescription not auditable: 22 (8 were illegible) Number of Drugs per prescription: 2.9 Rational Prescription: 1.96 % Irrational Prescription: 98.03 % Prescription containing antibiotic: 26.55 % Prescription containing Analgesics: 27.54 % Average Costs per prescription per day: INR 55.00 Most irrationally prescribed drugs were: (a) Antibiotics (b)NSAIDs (Non-Steroidal Anti-Inflammatory Drugs) (c) PPI (Proton pump inhibitors, gastric acid reduction) (d) H2 Blockers (gastroesophageal reflux disease) (e) Vitamins (f) Antipsychotics (g)Antihistaminics (allergies) No banned drugs were prescribed 9
Corporate Social Responsibility 17% of the Pharma firms and 73% of the Hospitals have CSR policy. The reasons for having CSR activities has mostly to do with goodwill and image. Though hospitals seem to more inclined towards CSR as integral part of their business than Pharmaceuticals. Perception about business responsibility/CSR is mostly limited to charitable initiatives like medical camps, free treatment for the poor, etc. 10
Recommendations Creating incentives for recognising and adopting business responsibility as part of the core business activity and taking penal actions for violation. Pharmaceutical Industry being a very important part of healthcare system needs proper surveillance of the Govt. specially the work conditions and job security of the MRs as these are the determinants of unethical practices. Detailed audit of the CME expenses of the pharmaceutical firms and audit of the income-expense of the service providers. Multi-stakeholder dialogues on important issues and specific guidelines to make policy making more participatory leading to higher ownership. Govt. can weigh down the cost of environmental externalities caused by smaller firms if the GMP norms are relaxed for them vis- -vis the increasing retail price of medicines produced by the bigger firms and reconsider separate GMP norms for the smaller companies. Capacity building of private sector/industry on voluntary guidelines charting a sector specific roadmap to this end 11
Recommendations Higher involvement of Civil Society Organisations towards monitoring ethical & environmental concerns, spread awareness, demystifying technical & jargonised guidelines, rules for common consumers, redressal of grievances etc. to ensure higher transparency. Associations to more actively engage to help make the private sector more responsible and make them aware about the rules and regulations-inclusion of business responsibility clauses in the mandate of associations and periodic assessment with support/facilitation from Ministry of Corporate Affairs Compliance through better self-regulation, capacity building, better communication amongst all stakeholders and greater transparency by encouraging higher consumer understanding and participation. To realise that strong corporate governance and responsible business conduct brings better transparency and better credit rating, goodwill etc. which in turn help them gain financially as well. 12
THANK YOU 13
Awareness Level of Guidelines 100% 90% 80% 21 27 70% 31 60% 45 No Yes 50% 40% 30% 19 21 20% 9 10% 5 0% Med Ethics MCI NVG UCPMP CSR 14 Awareness among Pharma Companies on Selected Regulations and Guidelines
Do you have any dedicated Environmental management department in your firm? Do you have any infrastructure in place to reduce negative environmental effects? Do you think that implementation of regulatory laws should be done differently depending on the size and nature of the unit? Environment Management Have dedicated Env. Mgmt. Dept. Have Infra to Reduce Pollution Rules must vary on Size & Nature 88% 84% 55% 25% 20% 10% 8% 2% 2% Yes No No Response 15
Perception of Pharmaceutical companies about implication of salary structure on Ethical behaviour and areas of ethical concern Salary of MRs vs Ethical Concern vs Initiatives Yes No No Response 63% 55% 51% 45% 39% 37% 37% 33% 33% 33% 33% 18% 12% 6% 4% Willing to Fix salary Target Based Salary Incentive vs Ethics Discussed in Assoc. Discuss with Govt. creates ethical concern Areas of Ethical Concern Yes No No Response 51% 45% 41% 39% 31% 27% 25% 24% 16% Sponsor Events? Ask for Gifts? Problems by Chemists/Stockists 16
Problem Areas as opined by Medical Representatives 100% 90% 4 11 14 80% 70% 25 60% 50% 40% 12 29 26 30% 20% 14 10% 0% Doctors ask for Gift Gifts given to doctors Sponsor events NEXUS-Doctors+Pharma Co No/Others Yes 17
Code Of Optimal Healthcare - Private Hospitals Don t Follow 24% Follow 76% Guidelines & Quality Checking 100% 10 12 13 80% 12 60% 8 No Comments No Yes 15 40% 23 20 20% 15 0% RUD Guidelines Guidelines on prescriptions Mechanism to ascertain compliance Compliance with selected Guidelines by Private Hospitals
Awareness on Guidelines 100% 7 90% 80% 18 20 70% 60% Unaware Aware 50% 39 40% 30% 21 22 20% 10% 0% Code- Med. Ethics ,MCI UCPMP NVG Awareness among Private Hospitals on Selected Regulations and Guidelines 20
Awareness on various Guidelines and Regulation among different Category of Private Hospitals 94% BIG MEDIUM SMALL 76% 70% 53% 53% 52% 30% 20% 14% Have inhouse guidelines prescription Awareness on NVG Awareness on guidelines issued by MCI 21
Pharmaceutical- Have CSR policy? Hospitals- Have CSR policy? 17% 27% Yes No Yes No 73% 83% Hospitals of different size BIG MEDIUM SMALL 100% 52% 50% Have CSR Policy 22
Reasons for doing CSR- Pharmaceuticals 32% 32% 26% 11% Felt by the proprietor Govt regulations Helps maintaining good image Earn goodwill of the society Reasons for Doing CSR- Hospitals 65% BIG MEDIUM SMALL 47% 43% 40% 30% 29% 24% 20% 18% 10% 10% 0% Increases Goodwill We understand our Social Responsibility CSR is an integral part of business Others 23
