1. WELCOME RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 1 Promoting Responsible Business in Pharmaceuticals and Private Healthcare Sector STATE LEVEL STAKEHOLDER DIALOGUE

2. PRESENTATION ON KEY FINDINGS: BRCC PROJECT- GUJARAT 11 th September, 2012 CUTS INTERNATIONAL – RAMAN DEVELOPMENT CONSULTANTS PVT. LTD.

3. Presentation Points RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 3  A brief introduction to the project  A brief introduction to the Approach & methodology  Key Stakeholders  Findings of Pharma Sector – Environment Related Inquiry  Findings of Pharma Sector – Marketing & Distribution Related Inquiry  Findings of Private health care sector – Environment Related Inquiry  Findings of Private health care Sector – Marketing & Distribution Related Inquiry

4. BRCC Project Overview 4 Business Regulation and Corporate Conduct - BRCC Implementers:  Consumer Unity & Trust Society (CUTS International)  Norwegian Institute of International Affairs (NUPI)  Raman Development Consultants Pvt. Ltd. (RDC) – Gujarat State Partner Duration: April 2011 to December 2012

5. BRCC Project  Sectoral Focus :  Pharmaceutical Sector  Private Healthcare Sector  Geographical Focus :  Andhra Pradesh  Gujarat  Himachal Pradesh  West Bengal

6. Policy & Regulatory Framework Business Development Optimal Practical Facilitating Optimal Practical Facilitating Responsible Ethical Society friendly Environment friendly Responsible Ethical Society friendly Environment friendly Inclusive Sustainable Inclusive Sustainable

7. Business Regulation & Corporate Conduct Regulation Mandatory Guiding Benchmarks Conduct Government Society Environment

8. Objectives of the Project  Address the regulatory and operational constraints faced by businesses in India.  Motivate firms to adopt ‘Responsible Corporate Conduct’.  Evolve a policy discourse between business community and policymakers to facilitate a policy environment that promotes business development in a sustainable manner. Thrust: Encouraging responsible corporate conduct and building optimal regulatory framework through focused, informed and continuous discourse among government, business and stakeholders

9. Key Areas of Inquiry 9  Current Situation and gaps  Why have the regulatory safeguards not effective in addressing the gaps?  What should be done to make the regulatory safe guards work?  What role is expected from the industry collectives? RDC/ CUTS/ BRCC-Gujarat : 11-9-2012

10. Critical Issues in Pharmaceutical Sector  Environment Problem : Current level of adverse environmental Impact Why have the regulatory safeguards not worked where there are significant impacts ? What should be done to make these regulation work, so that such adverse impacts can be minimized?  Marketing & Distribution Problem : Current status of incentives provided by companies to doctors and chemist Its impact on ‘Rational Use of Drugs’ Why have these incentives continued despite regulations? What can be done to ensure companies undertake their marketing supporting rational use of drugs? Presence of expired drugs in the market? Reasons of presence in spite of regulations What should be done to make betterment in the drug supply chain?

11. Critical Issues in Private Healthcare Sector  Environment Problem : Current status of bio-medical waste management practices by hospitals and diagostic service providers If situation is problematic, explore why it is so despite regulations How the situation can be corrected Steps taken by hospital associations/industry bodies What are the good practices? Drivers of good practices  Marketing & Distribution Problem: Prevalence of ‘cuts/commission to doctors by diagnostic service providers Why ‘cut/commissions’ exist in spite of regulatory safeguards? How the situation can be corrected Steps taken by hospital associations/other associations What are the regulatory barriers? Extent to which Standard Treatment Protocol are followed Reasons for deviation and other non compliances How it can be ensured hospitals promote alignment with Standard Treatment Protocols Adequate measures by HCPs to respect and address diagnosis & treatment related queries of clients? Any other self regulatory mechanisms in place?

12. Stakeholders for Pharma Sector  Government Department  Health and Family Welfare Department  Gujarat Pollution Control Board  Food and Drug Control Administration  Commissioner of Industries  Associations of Pharmaceutical Industry including Small, Medium and Large Scale Manufacturers (Formulation and Bulk drug Industries) & Other related stakeholders  IDMA  Indian Pharmaceutical Association  Pharma Export Council  Ahmedabad Chemist Association  Gujarat State Medical Representatives Association

13. Stakeholders for Pharma Sector  Industrial Associations  Gujarat Chamber of Commerce and Industry  Associated Chambers of Commerce and Industry of India (ACCII)  FICCI  ASSOCHAM  Local GIDC Associations  District Level Industrial Associations  Academic Institutions  Individual Pharmaceutical Firms  Civil Society Organizations  Media  Community residing in proximity of Pharma Units

14. Stakeholders for Private Healthcare Sector  Government Department  Health and Family Welfare Department  Gujarat Pollution Control Board  Medical Associations  Gujarat Medical Council  Indian Medical Association  Ahmedabad Medical Association  Private Hospitals  Biomedical waste management units  Academic Institutions  Civil Society Organization  Media  Consumers availing services of private hospitals

15. Approach and Methodology RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 15 RespondentData collection toolApproach Pharmaceutical firm- Manager/ Director/ CEO/ Accountant Semi-structured questionnaire & collect best practices documents Scheduled interview with prior consent on tele-talk/ eMail/ personal visit Private Hospital- RMO/ Manager/ CEO/ Accountant Semi-structured questionnaire & collect best practices documents Scheduled interview with prior consent on tele-talk/ eMail/ personal visit Medical RepresentativeSemi-structured questionnaireSnow balling Prescription AnalysisPrescription of OPD PatientsXerox/ Digital photo with consent AssociationsSemi-structured questionnaireScheduled interview with prior consent on tele-talk/ eMail/ personal visit

16. Status of Field Work Particulars Ahmed abad Vadoda ra Bharuc h ValsadTotal Pharmaceuti cal Firms 4010121375 Private Hospitals 50108775 Medical Representati ves 2510--35 Prescription Collection 135-10-145 Associations7 -- -7 16 RDC/ CUTS/ BRCC-Gujarat : 11-9-2012

17. Findings of Pharma Sector – Environment Related Inquiry RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 17

18. Findings of Phase I: Pharma Firms RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 18  Good Manufacturing Process (GMP)  93.33 % firms are aware, 83.08 % respondents all elements of GMP as below:  Disposal of sewage & wastes in conformity with requirement of SPCB,  Standard operating procedures for sampling, Inspecting and testing of raw materials,  Verification of environmental procedures,  Filling products in powder form exercised with special care so as to avoid contamination of environment  Filter installed to retain dust and protect the local environment

19. Difficulties and Expectations of Pharma firms to follow GMP RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 19 Difficulties%Expectations from Government & Associations % Financial constrains37.96Financial support (Govt) 40.51 Too tough Rules & regulations 14.81Awareness programme (Govt) 27.85 Lack of Government support 12.96 Regular Interaction with Govt 48.39 Lack of awareness among firms/association 6.48 Updating firms on recent development related to technology, Policies, Regulations (Associations) 29.03 No difficulty22.22

20. Contribution of the Pharma industry to the environmental impacts RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 20 Type of pollution1-5 scale (%)6-10 scale (%) Air59.140.92 Water54.8545.17 Land76.4723.52 Hazardous Waster60.0040.00 Health problems in community 61.5338.45 Occupational health57.8942.1 33.33 firms discuss it in board room meeting 86.48 % ensure compliance to env. Practice even in outsourcing through contract or encouragement

21. Contribution of the Pharma industry to the environmental impacts RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 21  82.86% respondents expects different regulatory laws and implementation according to nature of the unit and size of firms  65.33 % firms does not have dedicated Environment Management Department  98.48 % did not receive any assistance from government

22. Social responsibility of Pharma firms RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 22  81.43 % firms covered under survey does not have CSR policy  Out of the firms which reported doing some CSR activities, half of them reported doing it out of individual philanthropic sentiments  91.78 % reported being Unaware of NVGs

23. Pharma Associations.. RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 23  India Drug Manufacture’s Association (IDMA)  Large and medium firms highly adhere regulatory compliance of the different segments of the pharma sector in the state while small firms adhere at medium level.  Lack of awareness among firms/ association and financial constraints reported as among major difficulties to adhere regulatory requirements of GMP by firms  Government should consider providing financial support and should keep firms interest also in mind while formulating such regulations  IDMA does interact with government and other stakeholders on different issues of pharma

24. Findings of Pharma Sector – Marketing & Distribution Related Inquiry RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 24

25. Marketing & Distribution RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 25  Use of Medical Representatives was reported as a major strategy for M&D by 73.24 % firms  68.42 firms reported awareness on Code of Medical Ethics Regulations, 2002  57.50% of firms reported awareness on Uniform Code for Pharmaceutical Marketing Practices

26. Marketing & Distribution RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 26  41.18 % firms reported sponsoring events for doctors  77.42 % of firms reported that Doctors ask MRs for gifts during their visits  68.57% firms reported considering it as bad conduct to ask for gifts  40% firms reported indulging into distribution of gifts/incentives in order to maximize profit and gain new markets, while 24.44 % think that it is ‘essential to survive’

27. Findings from MR study RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 27  80% of MR reported that that meeting with the doctors is primarily a part of marketing strategy  Based on the responses, the value addition through the meetings by MRs can be classified as follows:  Information related to new drugs in market (60%)  Information on latest development in pharma industry (37.14%)  Building good relationship between Doctors and pharmaceutical firms (48.17%)

28. Findings from MR study RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 28  85.7% MRs reported being asked by Doctors for any kind of gifts/incentives during their visit  Reporting about the motive of asking for gifts/incentives, major reasons reported were:  To promote product (54.28%)  Giving time to MR to meet (28.51%).  40% MRs reported that it is a regular practice to give gifts to doctors, while 60 % reported that gifts are distributed only on special occasions  54.28 % MRs reported awareness about UCPMP

29. Findings from Pharma Association.. RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 29  India Drug Manufacture’s Association (IDMA) & & Associated Chambers of Commerce and Industry of India (ACCII)  Both association do not have specific mechanism to monitor marketing strategy of member firms.  Both are aware of Code of Medical Ethics Regulations, 2002 and also were in favor of it  Both association are unaware of Uniform Code for Pharmaceutical Marketing Practices.

30. Findings from Pharma Association.. RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 30 Ahmedabad Chemist Association  Incentive regime – reasons are commercial motivation of doctors and weak regulatory framework  Increasing number of companies and number of products is the main challenge faced by ACA  MR's working with different pharmaceutical firms often create pressure on chemists to increase sale of their products  Chemists often sell over the counter (OTC) drugs without prescription  Prescriptions often contain expensive medicines in spite of the availability of cheaper generic version  Aware about Medical Ethics Regulations, (Professional conduct, Etiquette and Ethics) 2002 formulated by Medical Council of India (MCI) and The Uniform Code of Pharmaceuticals Marketing Practices

31. Findings from Pharma Association.. RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 31 Medical Representative Association  Gifts are distributed on regular basis not on only some special occasion. Such gifts are booked by pharma firm under “Gratification” head  Aware about Medical Ethics Regulations & The Uniform Code of Pharmaceuticals Marketing Practices  Incentive regime” in pharma industry is contributed mainly by business strategy of pharma industry, commercial motivation of doctors, and weak regulatory framework  Fix remuneration would be more stable option for MRs  Regulatory set-up is not sufficient and optimal enough to ensure responsible and ethical corporate conduct on the part of Pharmaceutical Firms  GSMRA never had interaction with any other body

32. Findings of Private Health care sector – Environment Related Inquiry RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 32

33. Private Hospital study results RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 33  Coverage of private hospitals under study  69.33 % of private hospitals reported following some guidelines/code of conduct for providing optimal healthcare service to the patients  79.73% reported maintaining patient satisfaction record and want it be mandatory. Same % of respondents mentioned it to be mandatory. Capacity of bed % 10-3026 31-6040 61-9020 >9114

34. Private Hospital study results RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 34  In term of interactions with SPCB, 53.52% found it as “OK, the way it is”, while 32.39 felt there is a “need for improvement”  In terms of interactions with state health administration and 40.91 % find it as “OK, the way it is” while 33% reported that there is a “need for improvement”  80.82% private hospitals reported that they are not part of any association of hospitals

35. Private Hospital study results: BMW RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 35  98.65 % private hospitals are aware of BMW rule 1998  Various mode through which the Hospitals manage BMW were found reported as follows:  Through private BMW service provider – 78.21 %  Though common BMW treatment facility – 17.95 %  Stand alone facility in hospital- 1.28 %  33.33% reported that there is a need for improvement in BMW rules

36. Private Hospital study results: BMW RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 36  Almost all (>99%) the hospitals reported that their staff has undergone the training on BMW. About half of these (50%) reported undergoing process oriented training  82.43% private hospitals reported having some specific mechanism in place to carry out quality assessment of BMW  71.62% hospitals reported submitting periodic reports on BMW management, mainly to SPCB

37. Private Hospital: BMW: Difficulties & Expectations RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 37 Challenges%Expectations from Government % Lack of awareness and training 24.55Training by SPCB & private hospitals 57.14 High cost charged by BMW service provider/ irregularity 20.00Modernization of BMW systems 13.10 Difficulties in segregation & Storage 10.91

38. Private Hospital study results RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 38  65.75 % hospitals reported having a CSR policy in place  89.04% private hospitals reported providing free of cost/concessional treatment to BPL or poor patients  83.10 % hospitals reported no awareness about NVGs

39. Findings from Private Health care Association RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 39  Associated Chambers of Commerce and Industry of India (ACCII):  Challenges relating to the Private Healthcare and Pharmaceutical Sector were reported as mainly - Nexus between private health care and pharma sector, Increasing cases related to unethical practices from the part of private health care system Profit oriented approach of private health care sector Lack of regulatory framework to ensure responsible conduct from private health care sector  Aware about NVG and BMW rules  For Long term solution of BMW issues Consistent and better informed government regulations, strict enforcement of regulations and self regulations are key strategies

40. Findings from BMW Service Providers RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 40  Large hospitals perform “fair” for BMW management while medium and small hospitals perform “poor’  Less willingness of hospitals to manage BMW  Waste received from hospitals are segregated properly  SPCB performance was described as ‘good’

41. Findings of Private Health Care Sector – Marketing & Distribution Related Inquiry RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 41

42. Private Hospital study results: RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 42  75. 68 % hospitals reported no awareness about UCPMP  77.03 % reported being aware of Medical Ethics Regulations, 2002  45.71 % hospitals reported having mechanisms in place to ascertain their in-house and/or empanelled doctors follow such guidelines  64.38 % hospitals are in favor of support mandatory prescription audit while 32.88 % are not in favor of it.  83.78 % hospitals reported not having any specific instrument to guide doctors on medicine prescriptions and allowed doctors to prescribe medicine at their discretion

43. Private Hospital study results: RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 43  60.27 % private hospitals does not have any in-house guideline on Rational Use of Drugs in the hospitals  49.32% hospitals favored mandatory STP for private hospitals while 50.68% did not favor it  75% hospitals reported existence of a nexus between hospitals and pharma industry, necessary for two interdependent business entities.  On questioning hospitals about what they consider as determinants of unethical behavior in private healthcare in state, following major responses were reported:  25.23 % - weak regulatory framework  23.42 % - incentives by pharma firms  22.52 % - commercial motivation of doctors

44. Private Healthcare Association.. RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 44 Ahmedabad Medical Association:  The AMA does neither have any state/locality-specific regulatory instruments (code/manual/guidelines etc.) put in place for the private healthcare providers/doctors to follow nor does they have any monitoring mechanisms to ascertain its compliance  Unaware of NVG and UCPMP, aware of Medical Ethics Regulations, 2002  Lack of communication between government and private hospitals is the key issue faced by Private health sector  AMA does not developed any specific instrument (policy/code/manual/guideline etc.) for its member doctors on medicine prescriptions nor on rational use of drugs  STP should be mandatory for doctors/ private hospitals  State health/local health administration should do prescription audit, and private healthcare sector should disease registry

45. Findings from Prescription Analysis RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 45  Coverage: 145 prescriptions from different hospitals in Ahmedabad  In Subscription part:  Gender and age of patient were mentioned in 13.8% prescriptions  Address of the patient was not mentioned in any the prescription  T for tablet and Inj for injection mentioned in all  Dose of drug was not completely written in 75.8% of prescription  Duration of treatment were not mentioned in 84.13% of prescription  Direction of use of drug was not properly mentioned in 77.24%case  In all 81.37% prescription were illegible

46. Findings from Prescription Analysis RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 46  In 37.24 % prescriptions 1-2 drugs were prescribed  In 42.07 % prescriptions 3-4 drugs were prescribed  In 20.69 % prescriptions 5 or >5 drugs were prescribed

47. Findings from Prescription Analysis RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 47 WHO prescribing indicatorsPrescription analysis Percentage of drugs prescribed by generic name 8.97% Percentage of encounters with an antibiotic prescribed 42.75% Percentage of encounters with an injection prescribed 28.96 % Percentage of drugs prescribed from essential medicines list 58.33%

48. Emerging Messages RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 48  Stricter monitoring and effective implementation of rules and regulation by regulators  More, systematic and mandatory efforts for Capacity building of all stakeholders and leadership by state  Systematic efforts to promote increased self regulation with associated sizeable incentives  Industry collectives to take up a more proactive role in effective implementation of regulations  Increased inter-sectoral dialogues for environmental issues due to pharma and private health care firms  Mechanism to curb unethical practices in the sector  Combination of negative and positive incentives for firms for compliances to rules and regulations

49. Thank You RDC/ CUTS/ BRCC-Gujarat : 11-9-2012 49

50. Respondents Total Contacte d (Phone/E mail) Not Interest ed to talk Intereste d/Visite d Not Answered after Appointm ent Gate Out Pharma300+2001001510 P. Hospitals300+150 50+5 MRs60+204030 Hosp. for Prescription 50+3020710 Associations9 0 720 Status of Field Work