India's Pharmaceutical Machine Manufacturers: From Imitation to Innovation - Pharmaceutical Technology

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India's Pharmaceutical Machine Manufacturers: From Imitation to Innovation

Pharmaceutical Technology

"When we look at the how the pharma industry developed in Germany, we see that the precision and polished appearance of the machines, from the automation, grade of steel, to the craftsmanship in the welding, has developed over the past 30 years 85 I am shocked and surprised to see how much India's pharma-machine manufacturers have evolved in such a short period. The Indian machines look and run almost as good as ours," remarked Heino Weidner, managing director of Weipack Packaging Group in Germany.

Weidner was in Mumbai for the Pharmaceutical EXPO 2006, an exhibition of machinery and technology held at the same place and time as the CPhI India exhibition in December of that year. He described the reasons behind his technical collaboration with an Indian company, Elmach Packages Ltd., "They have the technical understanding required to make these machines and the respect for intellectual property [IP] that is necessary for collaborative development."

The primary concerns of European and US brand-name manufacturers collaborating with Indian companies are IP protection and the necessary legal framework to enforce their claims of patent infringement. Several Indian machine makers have made great efforts to protect the IP interests of their foreign partners. Matt Neumann is vice-president of sales and marketing for Aylward Enterprises, a company that manufactures blister feeding systems for packaging machines. He points out, "We knew we would not be able to sell anything in India, exported from the United States, except our know-how and technology. That's why, when Elmach approached us a few years ago, we made an agreement whereby Elmach would pay us a royalty for the technology we licensed out to them. As Americans, we fear giving out the technology we worked hard to develop because it is our primary asset. But, Elmach reinsured us with the necessary legal protection of our technology on their behalf. Now, I believe the patent laws in India are such that we can safely protect our technology."

Indian pharmaceutical-machine makers and their Western counterparts increasingly are exploring collaborations and partnerships with each other to innovate or share new technology. Together, they are targeting more price-conscious developing countries. "We currently have technical tie-ups with Paul Mueller Company, in the United States, for manufacturing single- and multiple-effect stills used in water-for-injection systems and pure steam generators. They gave us the technology and we started manufacturing a co-brand for the Indian market. Soon, we will start exporting under this co-brand to neighboring countries like Bangladesh," elaborated Himanshu Shah, the managing director of Neela India Pvt. Ltd. Shah was torn between pursuing sales in developing countries because they yield higher margins and sales in Europe or the United States because they require better technology.

Interest in trading directly with the West appears to be fading. On the other hand, hardly any IPMM denied exploring opportunities with Western companies in more speculative markets such as South America, Africa, Southeast Asia, and Eastern European countries. As K.P. Kumar, managing director of Rapid Pack Engineering Pvt. Ltd., states, "We have focused on developing markets with price-conscious multinationals that are manufacturing outside of Europe and America, like South America, Africa and Turkey. Providing our machines to multinational companies and their facilities in those markets has greatly increased our international exposure and credibility with regulatory agencies like the US Food and Drug Administration, the UK Medicines and Healthcare products Regulatory Agency. Now, inspectors from regulatory bodies are more familiar with our machines."

It is widely perceived that inspectors from governmental regulatory agencies and other international bodies are more stringent and enforce higher standards for facilities and machinery produced in developing countries. Some IPMMs believe this to be a conspiratorial trade regulation, an indirect method of limiting the foreign trade of Indian machines. Foreign inspectors would argue that imposing higher standards on developing countries is a basic process essential for establishing standards. Because standards gradually tend to slacken, setting higher expectations ensures that over time, standards will harmonize with internationally accepted norms.

When a foreign regulatory inspector sees an Indian machine operating in internationally approved facilities next to brand-name Western machines, the inspector becomes less critical when scrutinizing new facilities that predominately use Indian machines. In return, this reassures drug manufacturers that Indian machines are manufactured and used in accordance with international standards and do not jeopardize the inspection and approval of their facility. This is one of the many reasons that India has the most FDA-approved facilities in the world.


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