Colombia: The Great Indian Investment Wave | PharmaBoardroom

Colombia: The Great Indian Investment Wave

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With the onset of universal public healthcare, new types of foreign actors have been spying fresh opportunities to penetrate the Colombian market. Inward investment from India, in particular, has been increasing year on year, while the number of government sponsored trade delegations promoting the import of India-manufactured generics has multiplied.

“Universal coverage for a population of 50 million has been boosting demand for affordable generic products and these are obviously conditions in which Indian drug firms are well placed to flourish and compete on price.”

Cristhian Antonio Salamanca García, Colombia-India Chamber of Commerce and Industry

“Universal coverage for a population of 50 million has been boosting demand for affordable generic products and these are obviously conditions in which Indian drug firms are well placed to flourish and compete on price,” confides Cristhian Antonio Salamanca García, executive director of the Colombia-India Chamber of Commerce and Industry.

 

“The reforms instituted by the state to modernize the system and add new medicines to the compulsory plan certainly create an opening for outfits like ours to increase our foothold in a market hitherto predominantly controlled by American and European multinational brands,” agrees Kamlesh Thakkar, regional head of emerging markets for Aurobindo Pharma. “Offering high quality products at affordable prices, we calculate this is an optimal moment to ramping up our participation… Our analysis indicates a shift from innovator products to generics as hospitals and clinics strive to reduce cost by cutting profits typically being allocated to larger innovator pharma companies and that it is why we are confidently predicting growth increases upwards of 40 percent for many of our product lines,” he adds.

 

Other entities would appear to be placing similar bets. MSN Labs, one of the fastest-growing Indian generics outfits worldwide, has just established its own affiliate in the Colombia having started their initial engagement three years ago via distributors. “We consider Colombia to be the star performer in Latin America right now. The stable economy, extensive coverage and cost-cutting drive all combine to present an excellent operating environment for a company specializing in highend generics,” reasons Raman Wattamwar, MSN’s regional head for Latin America.

It is not all plain sailing, however, as new entrants do have to navigate a number of regulatory hoops and hurdles. “Before importing any pharmaceutical product you first need to have obtained an INVIMA sanitary registration and that means homologating your product registration from an appropriate third-country authority like the FDA or requesting a technical visit from INVIMA to certify your plant, which will likely involve exorbitantly high costs,” warns Salamanca García.

The physical distances involved also have an impact from a logistical standpoint. “Many of our Indian peers struggle to ensure the uninterrupted availability of all their products. We find ourselves having to be especially attentive to planning so as to be able to mitigate this challenge,” notes Nirlife Latin America Regional manager, Pawan Srivastasa. “Our timeline includes two months of operations in India and a further subsequent two months of transit… If something unexpected comes up, that timeline can be thrown out of kilter and you will risk incurring the wrath of your clients who might experience a shortage,” he elaborates.

The decision of whether or not to use locally embedded distributors also presents a conundrum for those actors seeking to compete ostensibly on price. “The level of intermediation in Colombia remains disproportionately high. One of the reasons why we’ve actually gone to the lengths of setting up our own local offices is because we realized our profitability would be placed at risk if we traded through so many intermediaries,” recalls Cipla’s head of Latin America, Anant Atal.

Writer: Louis Haynes

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