COVID-19 Vaccine diplomacy: The world has to hand it to India when it comes to the Pharmaceutical Sector!

By Sandeep Wasnik

The Indian Pharmaceutical sector stands as the world’s 3rd largest in the terms of volume and 10th largest in the terms of value; also, India is the largest provider of generic medicines globally, occupying a 20% share in global supply by volume. Nearly 22% of overall USFDA approved plants accounts in India. The Pharmaceutical sector currently contributes around 1.72% of the country’s Gross Domestic Product (GDP). In the term of all kinds of vaccines, supplies 62% of global demand. Undoubtedly “Made in India” COVID-19 Vaccine diplomacy will increase the percentage share of vaccine supplies of global demand.

In the month of January 2021, India has sent 2 million doses of COVID Vaccine to Brazil. After which President of Brazil, Jair Messias Bolsonaro thanked Prime Minister Narendra Modi for India’s help during the difficult time of the COVID-19 pandemic and also shared the picture of Lord Hanuman carrying lifesaving herb (Sanjivani Booty) from India towards Brazil on his Twitter handle.

Geographical Characteristics of the Northern Triangle of Central America

This is not the first time that India has just helped Brazil like Lord Hanuman, keeping the sense of compassion, friendship and humanity, India has helped many countries and will continue further. There is one more region, the Northern Triangle of Central America (comprises of Guatemala, El Salvador and Honduras), nearly 16 thousand kilometres away from India, with a 34.65million population. Natural disaster, one of the most dramatic geographical characteristics of the Northern Triangle of Central America that periodically strikes, Volcanic mountains runs from Guatemala through Panama are very scenic, they can also be devastating when they erupt. Hurricanes and the resulting floods affect the lowland. Specially Hurricane Mitch (1998) in Honduras, leaving thousands dead and even more homeless, the lowlands are generally hot, humid, and often plagued by disease, while the highlands are cooler and drier.

India and its Pharmaceutical Presence in the Northern Triangle of Central America

India donated medicines, medical supplies, humanitarian aid, cash donation or disaster relief funds, and Bajaj Three-wheelers to Northern Triangle of Central America, due to natural disaster either by Hurricane Stan, strike, damages caused due to eruption of volcano Fuego and in the wake of a serious drought hits Central America Triangle in the year 1998, 2008, 2009, 2011, 2012, 2014 and 2015.

The burden of Disease in Guatemala, El Salvador and Honduras

The burden of Disease has always been a concern for any country in the world, where the government continuously works on the health sector and its policies. In order to decrease common communicable diseases like tuberculosis, pneumonia, and respiratory disease, clean water and sanitation are necessary, with the healthcare system’s provision of both clean water, food and of course medicines, the incidence of infectious and communicable diseases will decrease. The communicable and non-communicable infographic will illustrate diseases in Guatemala, El Salvador and Honduras, also Medical treatment and Medicine to be used to treat these diseases.

About Pharmaceutical Sector in Guatemala, El Salvador and Honduras

The Northern Triangle of Central America is a potential market for the Pharmaceutical sector. From January to December of 2019, the total importation in the Northern Triangle recorded nearly $1.617 billion of pharmaceuticals products around the world, Honduras – $507.88 million, El Salvador – $444.12 million and Guatemala – $665.83 million. The 10-year historic importation info-graph of pharmaceutical products gave clear indications of the rising demand in the Northern Triangle.

The importation of Pharmaceutical products from India in Northern Triangle is recorded $113.885 million, counts 7.57 per cent of the total imports $1.503 billion (excluding India) of pharmaceutical products from around the world, and seems that Indian Pharmaceuticals are lagging in this region.

Although Panama (Colón Free Trade Zone) is not the Pharmaceutical manufacturing hub but still, it is one of the major suppliers of Pharmaceutical products, where Guatemala imports nearly 33.15 per cent and El Salvador – 35.38 per cent from Panama.

Another issue is the urgency or urgent orders of the Pharmaceutical Products in the Northern Triangle, the transit time of vessels from India to the Northern Triangle is nearly 11,932 to 12,159 nautical miles which will take 50 to 60 days, and air shipments are expensive. India Pharmaceutical Industries can seek to make a Pharmaceutical hub (warehouse) in Guatemala or El Salvador. Guatemala Highway CA-1 that joins with CA-8 highway gives easy access to Mexico and El Salvador and this road is also part of the Pan-America highway (Roads stretching across the American continents).

An overview and market entry in Northern Triangle

Guatemala – Above info graphs of pharmaceutical products importation in the Northern Triangle, giving a clear illustration of importation in Guatemala is more as compared to El Salvador and Honduras. The Guatemalan pharma market is big for branded generics, which seems a good opportunity for Indian pharmaceuticals. Ministerio de SaludPública y Asistencia Social (MSPAS) {English Ministry of Public Health and Social Assistance} is Food and Drug Authority in the country.

The registration time of the pharmaceutical products takes around 8 months by Departamento de Regulación, y Control de ProductosFarmacéuticos y Afines (DRCPFA) {English – Department of Regulation and Control of Pharmaceutical Products and Related}, regulates and controls related pharmaceutical products and allow to import, manufacture and market in Guatemala and registration is valid for 5 years.

El Salvador – The pharmaceutical business is highly profitable. Consumption of branded drugs and branded generic products is the rule which counts 90% driven market, leaving a very small percentage for the use of true generics counts (only 8%). The country is also a leading producer of pharmaceuticals in the Northern Triangle with 55 companies. The pharmaceutical products have to be registered with the Dirección Nacional de Medicamentos (DNM) {English – National Medicine Directorate}.

Registration process is done by the Unidad de Registro y Visado {English – Registry and Certification Unit} and the time required could go from 6 months (if the product has been already registered by a level IV national registration agency, i.e., FDA) to 18 months (if it is a fresh new product). An average the registration process takes nearly 8 – 12 months and valid for 5 years, with an annual license fee. The public sector such as Ministerio de Salud (MINSAL) {English – Ministry of Health} and the Instituto Salvadoreño del Seguro Social (ISSS) {English – Salvadoran Social Security Institute} are the bigger buyers in El Salvador.

Honduras – Being as a small country, the pharmaceutical market is the smallest in the region. Brand generic for more than 60% of the total sales and 39% of original brand names and just a very small percentage is left behind for true generics, either locally produced or imported. Considering the mobility limitations of users during the Covid-19 pandemic and in order to support the economy, Agencia de Regulación Sanitaria (ARSA) {English – The Sanitary Regulatory Agency} has enabled processes that will be online and the registration process takes nearly 6 to 8 months.

(The author is Director of Trade and Investment of Grupo 108 and Independent Latin America and Caribbean Countries Market Expert. Can be reached for any query at info@108ca.com. Views expressed are personal and do not reflect the official position or policy of the Financial Express Online.)