The Banyan Tree: Volume I : Move Towards Holistic Health

THE BANYAN TREE: VOLUME I : MOVE TOWARDS HOLISTIC HEALTH

( By Editor : Carol Huss )

Go To:

Section II : Issues

are many reasons why drugs are misused. We discuss some of the important ones below.

DRUGS ARE PROFITABLE
Much as the drug industry likes to deny it, the marketing and manufacture of drugs is one of the most profitable businesses in the world.
In 1973, according to the Hathi Committee report, 49 multinational drug firms were holding foreign equity of more than 40% and 17 firms less than that. By 1986, according to Indian Government sources, 44 multinational companies (MNCs) in India have ‘dominant control by their principal international companies’ (See Table 1).

Table 1
Number of MNCs in India and their Country of Origin

Country of Origin

No. of Companies

USA

Switzerland

West Germany

Others

Table 2 shows that formulations were the major preoccupation of the MNCs and they did very little basic drugs or bulk drug manufacture.

Table 2 Market Share of National Sector and MNCs
	Bulk Drugs			(Rs. in crores) Formulations
	1976-7	1983-4	1976-7		1983-4
National Sector (including public sector)	85	290	40.6		930
MNCs (both FERA or ex-FERA)*	63	65	292		615
Source: Indian Drug Statistics. 1984-85. Ministry of Chemicals and Fertilisers, p.103. *[FERA refers to the Foreign Exchange Regulation Act (1973)]

Accoding to FERA a company is considered ‘foreign’ if more than 40% of its ‘Equity in india is held by its foreign parent company or equivalent foreign agency’. Section 29 of the FERA lays down that all non banking foreign branch companies and those incorporated in India with foreign equity of more than 40 percent require the permission of the Reserve Bank of India to carry on, establish, purchase shares of, and acquire wholly or partly any undertaking engaged in activities whether of trading, commercial or indutrial nature. The FERA also laid down guidelines for foreign branch companies to reduce their equity to 40 percent or less. In practice, even though the foreign subsidiary reduces its equity even less than 40 percent, it still continues to be controlled as has been observed, by the foreign parent company. This defeats the purpose of Section 29 of FERA.
The profitability and share prices of some major drug companies in India is shown in Tables 3A and 3B. In addition to drugs being profitable, a significant percentage of medicines marketed are of doubtful efficacy and many have no value, and/or are harmful. However, drug companies are able to push these drugs successfully because of the millions spent on advertising and persuading doctors to use them.

Table 3A who Says the Drug Companies are Incurring Losses Company-wise Financial Data with Profitability Ratios for Selected 30 Pharmaceutical Companies
	Name of Company	Financial Year	Total assets	Net sales	Gross profit	% return on total capital employed
1.	Glaxo Lab	Jun.83	98.75	136.17	14.28	14.80
2	Hind Ciba Geigy	Dec.83	62.04	101.18	10.89	14.12
3	Hoechst (I)	Dec.83	49.70	80.67	9.00	28.25
4	Sandoz (I)	Dec.83	41.81	63.17	6.56	11.23
5	Alembic	Dec.83	33.08	56.26	5.99	15.64
6	Pfizer	Nov.83	37.50	52.08	5.99	15.64
7	may & Baker	Dec.83	31.29	41.30	5.98	6.67
8	Ranbaxy	Dec.83	37.53	37.06	3.83	13.58
9	Boots India	Dec.83	15.18	33.69	3.48	14.21
10	Burroughs	Aug.83	29.05	32.68	4.55	15.44
11	German Remedies	Dec.83	20.99	31.77	4.39	22.13
12	Cynamid (I)	Nov.83	17.76	27.55	4.95	15.44
13	Parke Davis	Nov.83	8.85	26.08	2.51	13.14
14	Warner Hindustan	Nov.83	8.55	25.45	2.53	15.55
15	E.merck (I)	Dec.83	18.52	23.18	2.12	19.38
16	Richardson hind	Jun.83	10.18	23.30	3.15	20.21
17	Roche	Dec.83	15.30	22.30	4.50	28.34
18	Cipla	Oct. 83	13.14	20.54	1.44	5.42
19	Unichem Lab.	Sep.83	10.16	19.56	19.56	12.09
20	Abbott Lab	Nov.83	7.53	15.28	1.80	14.09
21	Searle (I)	Dec.83	10.35	13.52	0.92	12.07
22	Boehringer	Apr.83	6.53	11.35	3.26	29.40
23	Duphar Int.	Dec.83	7.01	12.49	-0.47	21.25
24	Nicholas Lab.	Jun. 83	9.84	11.31	1.29	12.20
25	Fulford (I)	Dec. 83	5.88	9.42	0.64	22.18
26	Jayant Vitamin	Jun.83	14.81	8.81	1.08	20.44
27	Amrutanjan	Mar.83	4.25		0.50	21.59
28	J.L.Morison	Dec.83	4.92	8.52	1.01	17.93
29	Chemo Pharma	Jun.83	3.09	0.12	0.05	7.93
30	Zandu Pharma	Mar.83	4.47	4.94	0.50	16.27
Source: Chemical Weekly, March 5, 1985

Table 3B
WHO SAYS THE DRUG COMPANIES ARE INCURRING LOSSES
Book Values and Price Share of Pharmaceuticals

	Name of Company	31.12.81	31.3.82	31.12.82	31.3.83	31.12.83	31.3.84	31.12.84	31.12.86
1	Glaxo	20.50	22.00	31.00	21.50	24.00	24.25	24.25	83.00
2	Hindustan					277.50	285.00	262.50
3	Hoechst							375.00	1000.00
4	Samdoz	28.00	27.00	41.00	35.00	42.00	44.00	32.50	87.00
5	Alembic	70.00	91.00	139.00	141.00	122.00	07.50	85.00	145.00
6	Pfizer	24.00	23.50	36.50	31.00	37.25	38.50	40.00	124.00
7	m&b	15.00	15.75	25.00	21.50	30.00	30.50	30.50	71.00
8	Ranbaxy	19.50	26.50	37.50	36.50	49.00	44.00	36.50	155.00
9	Boots	23.00	24.00	39.00	33.00	56.00	67.00	46.00	200.00
10	Burroughs							58.00	190.00
11	German R.	26.50	29.50	35.50	31.00	32.75	36.75	36.00	82.50
12	Cynamid	29.00	28.00	38.00	26.00	34.40	41.00	38.50	95.00
13	Parke-Davis			29.50	23.50	30.00	33.00	29.50	66.00
14	Warner Hind	21.50	22.00	31.00	28.00	37.00	36.00	38.00	110.00
15	E.merck		16.25	33.00	28.50	31.00	34.00	34.50	100.00
16	Ricahrdson	24.00	22.50	39.25	38.00	64.00		63.00
17	Roche			N.A.				19.00
18	Cipla
19	Unichem	145.00	145.00	!40.00	145.00	180.00	167.00
20	Abbott			61.00	22.00	24.00	27.50	27.00	53.00
21	Searle	42.00	35.00	68.00	59.00	47.00	44.00	80.00	407.50
22	Boehringer	16.00	12.75	18.50	14.50	18.00	17.75	11.75	98.00
23	Duphar	30.00	20.00	31.00	25.00	49.00	41.00	30.00
24	Nicholas							19.50
25	Fulford		21.75	34.00	30.00	47.00	56.00	76.50
26	Amrutanjan	41.50	40.00	36.00	40.50	46.00	45.00
28	J.L.Morrison	13.50	13.00	14.50	13.25	14.00	14.00	17.00
29	Chemo-Pharma	32.00	18.00	22.50	22.50	22.50		22.50
30	Zandu	100.00	100.00	100.00	147.50	147.50	200.00
31	bayer								680.00
32	Eskay								210.00
33	Ciba								600.00
Source : Chemical Weekly and Times of India, March 5, 1985 and Feb. 12, 1986

Table 4 GROWTH OF HIGHEST SELLING (1984) NON-ESSENTIAL & HAZARDOUS PRODUCTS (Rs. in Crores)
RANK (1984)	DRUG	COMPANY	1979 SALES	1984 SALES	GROWTH %	PRODUCT GROUP
2	BECOSULES	PFIZER (USA)	6.75	9.98	47.85	B Complex with B 12
3	BARALGAN	HOECHST (FRG)	3.86	6.76	75.00	< Previous Next > Home \| The Library \| Ask an Expert \| Help Talks \| Blog \| Online Books \| Online Catalogue \| Downloads \| Contact Us Health Library © 2023 All Rights Reserved MiracleworX Web Design Mumbai