Pharma MNCs operating in India are drawing up aggressive strategies to tap into the rural markets where India’s two-third of the population live.
Aventis Pharma, the Indian arm of the French drug major sanofi-aventis has already recruited a sales team of 300 people under a rural market division launched recently.
Aventis Pharma will launch 10 products initially in its effort to capture a bigger share in fast emerging tier 2 and tier 3 cities of India.
“We have essentially been a Tier I (big city) player and our current revenue from the rural market is negligible,” Shailesh Ayyangar, managing director at Aventis Pharma was quoted as saying
Aventis plans to expand its drug portfolio further by launching another five drugs by January, 2010, reports said.
Aventis Pharma aims to grab 1.5-2 per cent share of the rural market in the next five years.
Aventis Pharma plans to manufacture the product meant for the rural markets through Indian manufacturers on a contract basis to make them cost-effect and on par with the offering prices of companies operating in rural markets.
Aventis Pharma has also identified some broad therapeutic areas to be targetted in the rural marketplace considering the prevalence of disease patterns in these areas such as such as respiratory, gastrointestinal and nutritional diseases.
Currently, the rural markets in India accounts for about 20% of the country’s Rs 36,000-crore total drug retail market.
About two-third of India’s 1 billion plus population lives in rural areas.
Aventis Pharma hopes increasing awareness about healthcare and rise in income will drive the growth in rural regions.
Sanofi has completed the first phase of its rural doctor educational programme ‘Prayas’ covering 3,200 medical practitioners in Bihar, UP and West Bengal.
Besides Aventis Pharma several other multinationals are charting out strategies to exploit the potential opportunities in India’s growing villages.
GlaxoSmithKline and Abbott Laboratories have reportedly ramped up plans to enter the largely untapped rural markets of India in a big way.
MNCs including Eli Lilly, Novo Nordisk, and Novartis are also chalking out programmes to tap the rural customer.
Novartis is currently targeting villages in seven states with low-priced products available in a variety of package sizes. The model supplies medicines to more than 16,000 pharmacies. Novartis also create awareness on health issues using audiovisual interface through health advisors in villages.
Novo Nordisk spread awareness through mobile clinics along the villages in Goa to screen patients for diabetes.
Eli Lilly has been working with the Self-Employed Women’s Association in Ahmedabad to educate people on tuberculosis.
Growing at compounded annual growth rate of nearly 14% in the next few years, the Indian pharmaceutical market is expected to touch USD 40 billion by 2015, predicted a recent report by the global management consulting major Mckinsey and Company.
Indian pharma market, which is currently valued at USD 20 billion, could see the figure almost double in next 5 years majorly propelled by the steady growth in the domestic segment. Related story: Indian pharma market sales up despite recession.
The domestic market which is growing at almost 10 to 14 per cent at present itself will provide US$ 20 to 24 billion in 2015 and the exports and contract manufacturing business, which are growing at 10 per cent per annum, will contribute to achieve the predicted growth.