The Indian pharmaceutical industry has for the past couple of years complained that it tends to get more or less ignored in the budget, and though there were references to the sector this time, not many see them as bold or hugely impactful or transformational.
G V Prasad, co-chairman and CEO, Dr Reddy's told Business Today, "It is a 'safe budget'. Meaning, the key positive of the budget is that there is no big negative for the sector though, there were expectations that it would be a path breaking budget.
Incidentally, even Kiran Mazumdar-Shaw, chairperson and managing director Biocon, referred to it as a "safe budget" calling it a "safe, balanced budget with no surprises." On one hand, she said, there were no nasty surprises, which was a good news but on the other hand, she felt the finance minister did miss an opportunity to announce some signals to the world on the attractiveness of Indian investment climate. She felt the large corporate sector was left out and he could have for instance reduced the corporate tax by say 2 per cent for the large sector.
D G Shah, the Secretary General of the Indian Pharmaceutical Alliance (IPA), said, "One of the positives in the budget is the increased spending on rural, education and infrastructure sector such as better roads and transportation, which could eventually lead to creating a pathway that could lead to expanding the market for medicines in India through better access to healthcare as today only 35 to 40 per cent of population has access to modern (allopathy)."
But one potentially negative measure could be the move to lower the prices of medicines through changes in the drugs and cosmetics rules, he added. Shah feels that may be government could make it mandatory for the doctors to issue generic medicines but he feels that companies could still overcome this by switching from product-specific branding to company branding. As in, Ciprofloxacin of a particular company or Paracetamol of another company.