swine flu project

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1 TO EVALUATE THE DRIVERS AND BARRIERS AMONG DOCTORS TO USE SWINE FLU H1N1 VACCINE NOW (AUGAST JULY) Summer Project Report Submitted In the Partial fulfillment of the Degree of Master of Business Administration Pharmaceutical MBA Semester-II By PATEL ARCHITKUMAR Roll No.19 Under the Guidance of: Prof. Romy Sebastian Centre for Management Studies Pharmaceutical MBA Submitted To: Centre for Management Studies Ganpat University, Kherva, Mahesana. July 2010

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This project about the swine flu vaccine .,its recommendation and its growinf factors


TO EVALUATE THE DRIVERS AND BARRIERS AMONG DOCTORS TO USE SWINE FLU H1N1 VACCINE NOW (AUGAST JULY) Summer Project Report Submitted In the Partial fulfillment of the Degree of Master of Business Administration Pharmaceutical MBA Semester-II


Under the Guidance of: Prof. Romy Sebastian Centre for Management Studies Pharmaceutical MBA

Submitted To: Centre for Management Studies Ganpat University, Kherva, Mahesana.

July 2010



This is to certify that the contents of this report entitled To evaluate the drivers and berries among the doctors to use the swine flu vaccine now (July-August) by Patel Architkumar Maheshkumar. Submitted to Centre for Management Studies, Pharmaceutical MBA for the Award of Master of Business Administration (MBA Sem-II) is original research work carried out by him/her/them under my supervision.

This report has not been submitted either partly or fully to any other University or Institute for award of any degree or diploma.

Prof. Romy Sebastian Centre for Management Studies Ganpat University. Kherva. Date: Place:



I hereby declare that the work incorporated in this report entitled To evaluate the drivers and berries among the doctors to use the swine flu vaccine now (July-August) in partial fulfilment of the requirements for the award of Master of Business Administration (Sem. - II) is the outcome of original study undertaken by me/us and it has not been submitted earlier to any other University or Institution for the award of any Degree or Diploma.

Patel Architkumar Maheshkumar

Date: Place:



As a partial fulfillment of the MBA programme, I need to make a summer training project report so I have prepared this project report on To evaluate the drivers and berries among the doctors to use the swine flu vaccine now (July-August) This project was undertaken after my second year of MBA, at Zydus Cadila ltd, Ahmedabad. This project work is basically meant to acquire knowledge about the doctor behavior about the swine flu vaccine. Professionalization of management is very necessary. Therefore the personal doctor visit is to make us more intelligent in the management market. Moreover, such visit provide us an opportunity to interact with people who works in those units, and gets some practical experience about their work and working conditions Preparing this project report is a good learning experience for me wherein I came to know about the various new aspects & environment of the Doctors & Consumer behavior in Ahmedabad. I feel great pleasure in submitting this report. I hope you will accept and appreciate my efforts.



I would like to convey my sincere regards to the management of Zydus Vaxxicare, for permitting me to complete my summer training project in their organization. I owe words of acknowledgement to all those who directly or indirectly helped me in my project. In particular I would like to extend my gratitude to Mr. D P Mishra-Marketing Manager at Zydus Vaxxicare. I also express my special thanks to Prof. Romy Sebastian my faculty guide for her cooperation and tremendous support during this summer training. I wish to express my profound gratitude and sincere thanks to our esteemed learned Director Dr. Mahendra Sharma, Director CMS-GNU, and Kherva, who allowed me to conduct the summer project. I would first like to thank my Parents and my sister whose kind and constant support during the project was my biggest strength, and to whom this project has been dedicated. I owe thanks to, Mr. Santosh Pandey, Deputy Manager And Mr. Utsav Shah, Management staff at Zydus Vaxxicare.

And, lastly to the entire staff of Zydus Vaxxicare office and to all the members at the different states .Providing me with first-hand information.

Regards, Archit Patel


CONTENTS Certificate By the Guide Candidates Statement Preface Acknowledgments List of Tables List of Figures & Graphs 1 CHAPTER 1.1 Introduction 1.2 Patent 1.3 Manufacturing 1.3.1 1.3.2 1.3.3 1.3.4 1.3.5 Eight state of the art plants Intermediates & API Formulation API Plants Formulation Plants

Page No.

ii ..iii ..iv ..v ..vii ..viii ..(10-17) .11 .11 ..11 ..11 ...12 ....12 12 ...13 ...14 15 15 .15 16 16 16 .16 ..19 .21 .23 27 .28 30 31

Company Profile

1.4 Corporate control 1.4.1 1.4.2 1.4.3 1.4.4 1.4.5 1.4.6 Introduction of the company Quality Policy Vision Mission HR Philosophy Our care value

1.5 Zydus Vaxxicare 2 CHAPTER 2.1 Introduction 2.2 World scenario 2.3 Indian scenario

Indian Pharmaceutical Company ..(18-37)

2.4 Indian Pharmaceutical with global perceptive ...24 2.5 Key Players 2.6 Strategies & trends 2.7 Research & Development 2.8 Effect of budget


2.9 Michel Porters Five force model 2.10 Pharmaceutical policy 2002 2.11 SWOT Analysis 2.12 Key Issues 2.13 Action Plan 3 CHAPTER Vaccine Market

32 ...33 ...34 ...35 37 (39-55) .40 .40

3.1 Why it is so attractive? 3.1.1 Commitment to vaccine

3.1.2 Acquisition by big Pharma players40 3.1.3 Several new vaccines with blockbuster potential..42 3.2 World-wide Vaccine market 3.2.1 Influenza 3.2.2 Adult 42 .43 .43 .44 .44 .45 .45 .45 .46 ..47 ..47 ..48 ..49 ..49 ..50 ...51 ..52 ..53 ...53 ..54 ..55 ..55

3.2.3 Proprietary paediatrics/ adolescent....43 3.2.4 Enhanced paediatrics 3.2.5 Basic paediatrics 3.3 Major Vaccines 3.3.1 Pneumococcal vaccine 3.3.2 Polio vaccine 3.3.3 Meningitis vaccine 3.3.4 Rotavirus vaccine 3.3.5 Tuberculosis vaccine 3.3.6 BCG vaccine 3.3.7 MMR vaccine 3.3.8 DTP vaccine 3.3.9 Hepatitis B vaccine 3.3.10 Malaria vaccine 3.3 11 Japanese encephalitis vaccine 3.3.12 West vile vaccine 3.3.13 Ebolo vaccine 3.3.14 Cervical cancer vaccine 3.3.15 Typhoid vaccine 3.4 Indian Vaccine Market





(57-85) 58 59 .63 , 63 .64 65 68

4.1 Introductions 4.2 Influenza A Virus 4.3 Bird flu 4.4 Spanish Flu 4.5 The swine flu of 2009 4.5.1 History of Swine flu 4.5.2 New H1N1 Virus

4.5.3 Preventing and diagnosing influenza68 4.5.4 Information about human influenza virus.69 4.5.5 Cold or Flu ....71 ....72 .73 .74 4.5.6 How reduce the risk of pandemic influenza .....71 4.5.7 How wioll the UN help? 4.5.8 Preparedness 4.5.9 Care for yourself & others

4.5.10 During the transport to work.77 4.5.11 Pandemic H1N1 Deployment and vaccination.78 4.5.12 Statement from WHO global advisory..79 4.5.13 Indian study 5 CHAPTER Research Methodology ..82 ..(86-90) .87 .87 .87 .90 Marketing Research ..(91-99) ....92-98 99 Conclusion And Recommendation ...(100-102) .101 .102 103 104 .105

5.1 Research Approach 5.2 Objectives 5.3 Research Design 5.4 Limitation 6 CHAPTER

6.1 Question-Answers 6.2 Interpretation 7 CHAPTER 7.1 Conclusion 7.2 Recommendation APPENDICES I Questionnaire II Bibliography


LIST OF TABLES 1. Name of Personal & designation 2. Growth Of Pharmaceutical Industry 3. Key players 4. R & D expenditure 5. Various strains of Influenza A 6. Diff. Between Cold & Flu 7. Country wise vaccine manufacturer 8. Country wise vaccine distributed and administered 9. IPD and OPD cases of Influenza A 10. H1N1 & Seasonal cases 11. Sample size of survey

Page No. .17 26 28 31 61 71 79 79 83 84 88

LIST OF GRAPH: 1. Age groups v/s number of positive cases ( Page no.84) 2. Age groups v/s number of deaths( Page no.85) 3. Pie chart of Que-1( Page no.91) 3.1 Pie chart of After media campaign and before media campaign 3.2 Pie chart of flu vaccine user and non-flu vaccine user 4. Pie chart of Que-2( Page no.94) 4.1 Pie chart of After media campaign and before media campaign 4.2 Pie chart of flu vaccine user and non-flu vaccine user 5. Pie chart of Que-3( Page no.96) 5.1 Pie chart of After media campaign and before media campaign 5.2 Pie chart of flu vaccine user and non-flu vaccine user 6. Pie chart of Que-4( Page no.98) 7. Influenza virus circulate round the year( Page no.101) 1 India- Pune 2 India-Delhi




1.1 Introduction: Zydus Cadila healthcare is a pharmaceutical company headquartered at Ahmedabad in Gujarat state of western India. The company is the 5th largest pharmaceutical company in India. With US$290m in turnover in 2004. It is a significant manufacturer of generic drugs. Cadila Healthcare did its IPO on the Bombay Stock Exchange in 2000. Its stock code on the Bombay Exchange is 532321. In 2001 the company acquired another Indian pharmaceutical company called German Remedies. On June 25 , 2007 the company signed an agreement to acquire 100 percent stake in Brazil Quimaica e Pharmaceutica Nikkho do Brazil Ltd a (Nikkho) for around 26 million dollars. 1.2 Patents: ZRC has filled over 108 patents in various therapeutic area of NME Research, Process Research, Novel Process Research, Novel Drug Delivery & Biological, since its inception, Several of them have already been granted US patents. The company is pioneer, offering healthier dietary options to the consumers. The product range comprises Sugar Free Gold Indias NO. 1 sweetener with a market share of over 70 percent Sugar Free Nutura a zero calorie escaroles based sugar substitute, Sugar Free Dlite a low calorie healthy drink & Nutralite a premium cholesterol free table spread. Nutralite has emerged as the 2nd largest brand in the category of butter & butter substitutes. The company also caters to the skincare segment with its EverYuth & Dermacare brands, which occupy a unique distinction of being a skincare brand from a healthcare company Enriched with the power of natural ingrediants, EverYuth has a strong presence in advance skincare segments like Soap- free , Face washes , face mask, scrubs etc. 1.3 Manufacturing: 1.3.1 Eight state of- the art plants Four formulation plants one each at Moraiya in Ahmedebad , Goa , Baddi & Sikkim. Two API plants at Ankleshwar & Dabhasa.11

An Agiolax plant in Goa An API plant in Mumbai to Manufacture key intermediates of pantoprazole.

1.3.2. Intermediates and APIs: Specialty chemicals, fine chemicals Advanced intermediates High & bulk actives Investigational bulk actives

1.3.3. Formulation: Oral dosage forms ( Tablets , hard & soft gel capsules) Injectable (sterile liquids & lyophilized) Inhalers, transferals, suppositories & vaccine Formulation development for ANDA candidates at a dedicated Pharmaceutical Technology Center Development of specialized dosage forms Vaccine.

1.3.4. Active pharmaceutical ingredient plants: The company makes active pharmaceutical ingredients at three sites in India: Ankleshwar plants - Zydus Cadila's plant complex at Ankleshwar in Bharuch

District of Gujarat, has been producing drug material since 1972. There are around 10 plants in the complex, which is ISO 9002 and ISO 14001 certified as well as FDA Approved. Total plant capacity at Ankleshwar is around 180 million tones.


Vadodara plant - Zydus Cadila's plant at Dabhasa, in Vadodara District's Padra

taluka (in the eastern part of the district) in Gujarat, was commissioned in 1997 by a company called Banyan Chemicals, and acquired by Zydus Cadila in 2002. The plant has a 90 million ton capacity. It is an FDA-approved facility that is also approved to WHO GMP guidelines.

Patalganga plant - Zydus Cadila acquired an API plant at Patalganga in Maharashtra

state, 70 km from Mumbai, in the 2001 German Remedies deal. This plant operates to WHO GMP standards. 1.1 1.3.5. Formulation plants The company operates formulation plants at six locations:

Moraiya plant - Zydus Cadila's formulation plant at Moraiya in Sanand taluka on the

outskirts of Ahmedabad is the largest formulation plant in India. It plant became Food and Drug Administration (FDA)-approved in 2004/2005. The plant makes tablets, capsules, and soft gel capsules as well as injectable drugs in both sterile liquid and lyophilized form. Zydus Cadila also runs a large R&D operation at Moraiya;

Vatwa plant - Zydus Cadila's plant at Vatwa, an industrial suburb of Ahmedabad,

makes nutraceuticals. The plant was acquired Remedies;

Changador plant - Zydus Cadila's plant at Changodar, 20 kilometres from

Ahmedabad on the city's outskirts, manufactures fine chemicals. Zydus is current constructing a facility at Changodar to make vaccines for hepatitis B and rabies.

Navi Mumbai plant - This operation, at Navi Mumbai in Maharashtra, is a 50/50

joint venture with Germany's Altana Pharma AG, makes intermediates of the drug pantoprazole.13

Goa plants - The Companys plants at Ponda in the southern Indian state of Goa do

formulation work as well as manufacture oncology drugs and a herbal laxative branded Agiolax based on Psyllium seeds.

Baddi plant - In 2004 Zydus commissioned at formulation plant at Baddi, in

Himachal Pradesh state of northern India. The Baddi plant makes solid oral pharmaceuticals. Plant at Mumbai where tablets are made from hands of labours.

1.4. Corporate Control

Mr. Pankaj Patel Chairman Zydus Cadilas major shareholder remains the Patel family. Pankaj Patel (1951) son of the founder, is CEO, In 2004 Pankaj Patel was included by Forbes magazine in its annual List of Indias richest people. Forbes estimated Patels net worth at US$510m, making him Indias 26th richest person However in 2005 Patel dropped off the Forbes list due to a fall in the stock price of Cadila Healthcare. Moreover , there is a team of nine senior level executives- known as the executive committee , who are heads of different operations look after the overall management processes. None of the members except Pankaj Patel are on Board of Directors.14

Recently, in September 2007 Cadila in a joint venture opened a Pharmaceutical plant in Ethiopia. 1.4.1 Introduction to the company One of Indias leading integrated Pharma company MORAIYA PLANT & PHARMACEUTICAL TECHNOLOGY CENTER The origin of the name ZYDUS The name combines the ethos of the Greek God Zeus & dawn of the new Era. The alphabet E replaced Y & D as mentioned above stands for dawn. Zydus like symbolizes their groups aspirations to contribute for the welfare of the people & the society at a large.

1.4.2 Quality policy Zydus Cadila is committed to develop manufacture & distribute products that meet the highest standary of quality standards of quality of both National & International level. Zydus Cadila compile with Current Good Manufacturing Practice (CGMP) in all its products & services. Zydus Cadila shall ongoing endeavor to improve upon the quality there by adding value to the products & enhancing customer satisfaction. Zydus Cadila believes that quality is achieved thought conscious team efforts of all the personnel, individually, & collectively. Zydus Cadila is Dedicated to Life & quality is a way of life of Zydus Cadila.

1.4.3 Vision: Zydus Cadila shall be a leading global healthcare provider with a robust product pipeline & sales of over $1 bn by 2010; we shall achieve sales of over $3 bn by 2015 & be a research based pharmaceutical company by 2020.


1.4.4 Mission: In all its dimensions our world is shaped by a passion For innovation, commitment to partners & concern for people in an effort to create healthier communities globally.

1.4.5. HR Philosophy: We Build People to Build Our Business 1.4.6. Our Care Value: C Competence Building A Adapt to new environment R Respect Human Value E Empower, Enrich & Excel

1.5. Zydus Vaxxicare: Vaccine Business of Cadila Healthcare Limited We are at the forefront of protection against Vaccine Preventable Diseases. We are proud to announce the launch of Indias first indigenously manufactured H1N1 vaccine. Launch of this indigenously manufactured H1N1 Vaccine has proven capabilities of India to the Global community in Researching, Developing and Manufacturing of Safe and efficacious vaccines. Blue print of growth of Zydus vaxxicare business: Capitalize on existing strengths to drive growth In domestic market Regulate vaccine markets in India Expand vaccine business in India. Partnering with Health Care Practitioners to protect against various diseases. Creating awareness among the doctors and public. Entering in the market of the potential vaccine like typhoid,MMR Vaccine.


Sr. No 1 2 3 4 5 6 7

Name of Personal Mr. Tony Parmar Mr. D P Mishra Mr. Santosh Pandey Mr. Santosh Menon Mr. Mahesh Bhuta Mr. Shushil Singh Mr. Utsav Shah

Designation Vice President Marketing Manager Deputy Manager Admin. Manager Sales Manager Sales Manager Executive




The Indian pharmaceutical industry is a success story providing employment for millions and ensuring that essential drugs at affordable prices are available to the vast population of this sub-continent.

2.1. INTRODUCTION: The Indian pharmaceutical industry is one of the fast growing sectors of the Indian economy and has made rapid strides over the years. From being an import dependent industry in the 1950s, the industry has achieved self-sufficiency and gained global recognition as a producer of low cost high quality bulk drugs and formulations. Leading Indian companies have developed infrastructure in over 60 countries including developed markets like USA and Europe. In the last few years, several pharmaceutical companies have demonstrated that they possess the ability to engage in commercially viable research and development activities and become significant players in the international market. The Indian Pharmaceutical Industry is one of the largest and most advanced among the developing countries. It manufactures a wide range of basic drugs and pharmaceuticals, covering several therapeutic regimes including antibiotics, antibacterial, steroids, harmones, vaccines, herbal preparations etc. The Indian pharmaceutical industry is capable of meeting about 70% of the country's requirement of bulk drugs and almost the entire demand for formulations. The setting up of the penicillin factory at Pimpri, Pune in early 1950s and the construction of Indian drugs and pharmaceuticals Limited (IDPL) plants at Rishikesh and Hyderabad in the early 1960s have been milestones in the history of the pharmaceutical industry in the country. These have been the building blocks on which the structure of the pharmaceutical industry in India has been built. The public sector investment in the pharmaceutical industry has been the engine of growth for the industry as a whole in the last three decades. At the beginning of the Eighth Plan, there were about 14,000 units producing bulk drugs and formulations. This number has increased substaintially since then. Mote than 30% of the production of bulk drugs and formulations has increased from Rs. 2.400 million and Rs. 12,000 million respectively in 1980-81 to Rs. 21,860 million and Rs. 104,940 million respectively in 1996-97. Exports of bulk drugs and pharmaceuticals increased from Rs. 1610 million in 1983-84 to Rs. 26,810 million in 1996-97.19

Apart from IDPL there are four other public sector units manufacturing drugs and pharmaceuticals in India; Hindustan Antibiotics Limited, Bengal Chemicals and Pharmaceuticals Limited, Smith Stanstreet Pharmaceuticals Limited and Bengal Immunity Limited. As these units have been making losses owing to outmoded technology, excessive work force, high overheads, weak marketing setups, excessive reliance on institutional savings etc. They are being restructured through revival packages by the Government and are expected to turn around during the Ninth Plan. The Indian Government in 1994 announced the new drug policy. Under this policy, industrial licensing has been done away with. A new Drug Price Control Order was announced in 1995 reducing the number of drugs under price control to 76 from the earlier 142. Though a series of liberalization measures, the drugs and pharmaceuticals industry has registered a higher growth and the country has emerged as a net exporter of drugs during the Eighth Plan period. The National Institute of Pharmaceutical Education and Research has been set up at Mohali near Chandigarh. This institute has been declared as a centre of excellence and is expected to fill a major gap in the area of pharmaceutical education, research and training. A new program for promoting R&D in drugs and pharmaceutical sector was initiated during the Eighth Plan. The thrust of drugs R&D in the Ninth Plan would be on developing new drug molecules through basic and applied research from which industry-institutional linkages would be strengthened, apart from pursuing the objective of effective and efficient computeraided discoveries, setting up of specialized laboratories and adoption of good manufacturing and clinical practices. R&D efforts in the area of tropical diseases, in particular, would be encouraged. A number of R&D programmes have accordingly been identified for being taken up in a coordinated manner in the national; laboratories, public sector undertakings and private sector units. Development of sophisticated formulations such as slow release forms, advanced drug delivery systems, R&D in the area of biotechnology by an understanding of DNA replication mechanism related to the countries needs have been identified as immediate priorities.


2.2. A DETAILED OVERVIEW WORLD SCENARIO The world market for the pharmaceuticals was valued at US $ 250 billion in 1994 and it is expected to reach US $ 350 billion in the year 2000. Estimated at 538 million, the worlds population in 1991 was 11% larger than in 1985 and almost 21% larger than a decade ago. The USA, European Unions and Japan are the biggest markets for drug formulations (USA 30 billion, E.U. 40 billion, Japan 31 billion in 1992). All new drugs are marketed first in one of these countries. The introductory prices are thus, related to the average per capita income of these countries and are generally out of reach of developing countries. The Pharmaceutical market worldwide, valued at US $ 247.9 billion in 1994 is forecast to grow to US$ 342 billion by 1999 representing a compounded annual growth rate of 7.1%. As per US FDA, of the 348 new drugs placed in the market in the 80s by top 25 drug companies 91 (26%) were new molecules. Even of these, 60 were classified under C category. This means, only 10% of the drugs introduced in 80s offered significant

therapeutic gains over the existing drugs. In the USA and Japan together constitute 45% sale on non-communist world pharmaceutical market. The 50 largest companies produced 66% of the world output of drugs and

pharmaceuticals, and also supply 50% of the pharmaceutical requirements of the developing countries. Among the worlds largest 200 odd pharmaceutical firms, 50 are Japanese and 33 are US firms. The world trade in pharmaceutics is also dominated by the developed countries, which account for over 90% of world exports and about 70% of worlds imports. Though the imports of the developing countries are significant at 25% of total world pharmaceutical imports, their exports account for barely 6 to 8%.


The market for bulk pharmaceutical chemicals are estimated at US $ 32 billion in 1994, is expected to reach US$ 35 billion by 2000. During the mid-nineties more than US $ 100 billion worth of mergers and acquisitions, involving over 15 major companies have taken place worldwide. The US market in generic, is growing at around 20% annually and will conservatively worth about US $ 15 billion by the year 2000. The estimated figure for the generic markets worldwide is about $ 25 to 30 billion. In the next five years it is expected to increase $ 50 billion. Globally, over the last 50 years, about 30% of the drugs have come from academic research while 70% of drugs have been from the product of industrial research. In Germany, more than 50% of the prescriptions are for Generics, though they account for only 14% by value. Worldwide, the business for OTC is estimated to be $ 44.8 billion and enjoys a market share of 28% in the US, 15% in the European Union. The worldwide pharmaceutical market in 1996 reached US$296.4 billion at ex- manufactured prices, up by 4% over 1995. The highest growth was in North America and Latin America, which posted figures of 12% and 8% respectively, while sales in Africa, Asia, and Australia regions fell by 6%. Within North America US achieved 12% growth to US$ 98.6 billion, while sales in Canada by 5% to US$ 4 billion. In 1996, the Italian market grew at 11%, US at 10% and Indian market at 15.8%. In the US, about 40 drugs worth $ 16 billion are set to lose patent by the end of 2002. The world pharmaceutical market is expected to grow at compounded annual growth rate of 6.2% and expected to reach $ 378 billion in 2001. Southeast Asia and China are likely to see the largest jump in market share during the period from 5% in 1997 to 7% in 2001. The world exports of pharmaceutical has increased to US $ 14.4 billion in 1983 to US $ 35 billion in 1993 and is currently around US $ 50 billion giving a compounded annual growth22

rate of around 13%. The world trade in pharmaceuticals is dominated by the developed countries, which account for over 90% of the worlds export. The developing countries together accounted for only 5 to 7% of world pharmaceutical exports; China, India, Hong Kong, Singapore and South Korea are the major exporters. 2.3. INDIAN SCENARIO In India, medicines account for 2.5% in hospitalization and 0.5% in domiciliary treatment cost. Indias exports of bulk actives and intermediates is expected to grow from the current level of US $ 420 billion to about US$ 890 million in the year 2001. The Indian Pharmaceutical market is expected to expand from the US$2.7 billion in 1995 to US$ 5.8 billion (+ 16%) in 2001 and US$ 13.billion (+18% by 2006). There could be sharp dip in the growth rate in the population in India, which is already down to about 1.7% year and is projected to go down further to about 1.5% by the turn of the century and to roughly 1% by2010. OTC Pharmaceutical business is India is expected to jump from Rs.10 billion at present to Rs.25 billion by 2002. Indians per capita expenditure for healthcare remains Rs.115.5 compared to the US (Rs.6876.00) and Japan (Rs.14, 832). In India the values for pharmaceutical production of bulk drugs and formulations in 1995-96 were US$499 million and US$ 2.5 billion respectively. The Indian Pharmaceutical market ranks about 20th in the world and accounts for less than 1% of world market. It is expected by 2003; the market could be worth of $ 7-9 billion (Rs.280 billion to Rs.360 billion). India accounts for 6% of all bulk drugs export. There are about 250 large/medium units and about 8000 small-scale units in operations, which form the core of the industry. There are about 350 bulk drugs i.e. active pharmaceutical molecules having therapeutic values and used23

for production of pharmaceuticals, which accounts for, majority of formulations produced in the country. During the year ending March 1998, pharmaceutical companies for various bulk drugs, formulations and intermediates filed 265 IEMs. These IEMs are expected to generate employment for about 19000 people and there would be an investment of approximately Rs.4.1 billion on these projects. During the same period foreign investment proposal worth approx. Rs.1.6 billion were approved. Between August 1991 and March 1998, Gujarat received 5174 proposals for the projects and topped the list in terms of value of investment, which was estimated to be Rs.1379 billion during that period. Next to Gujarat was Maharashtra and other States receiving more than 5% of the investment proposal are Tamilnadu, Andhra Pradesh, Karnataka, Uttar Pradesh, Punjab and Madhya Pradesh. The top 12 companies in India together will have a turnover of around 50 billion in the domestic market by 2005, or approximately 25% of industry turnover. About half a dozen companies with a turnover of Rs.35 billion by 2005 will be able to spend about 8% of their turnover on research. 2.4. INDIAN PHARMACEUTICALS WITH GLOBAL PERCEPTIVE The Indian Pharma market is valued at US $ 4.5 bn, representing 1.6% of the global size and growing at an average rate of 8-9%. However, the annual per capita drug expenditure is amongst the lowest in the world. India is now a self-sufficient country for its Pharma requirements. From simple headache pills to sophisticated antibiotics and complex cardiac compounds, almost every type of medicine is now made in the country. Infect more than 25% of formulations produced in the country (US $ 3 bn) are exported. Currently, only process patents are recognized in India. However, by virtue of India being a member of the World Trade Organization (WTO) and a signatory to the General Agreement on Tariffs and Trade (GATT) it is bound recognize product patents, latest by 2005. Thus the country is committed to free market economy and globalization.


The process of consolidation, which is now, a generalized phenomenon in the global pharma market has started in India too. The industry is witnessing a consolidation phase with Indian pharma companies increasingly looking at stepping up growth by acquiring

companies/brands. The drug price control order (DPCO) continues to be a menace for the industry. The pricing authority arbitrarily sets prices of drugs that fall within its ambit without giving due consideration even to the costs of production. This has made the profitability of the sector susceptible to the whims of the pricing authority. Companies are resorting to aggressive product launches to dilute DPCO effect. However, as per the recent budget proposal the current list of 74 drugs under DPCO coverage would be reduced considerably to 29. This is expected to increase profitability of companies having relatively older portfolios, particularly MNCs. The average R & D spend in India in-spite of growing at a CAGR of 18% over last five years is just 1.9% of sales as against 9-10% spend by global pharma companies. Though miniscule in comparison to global benchmarks, Indian companies are stepping up their research activities to make themselves more self-sufficient in terms of product development ahead of the year 2005 deadline. Companies like Dr. Reddy's and Ranbaxy have already achieved reasonable measure of success in their R&D efforts. Another peculiar feature of the domestic R&D initiative is a lack of facilities and resources to develop a molecule conduct trials and then launch the product. Indian companies will thus have to depend on their international peers to undertake the more expensive clinical trials and product launches. INDUSTRY SENARIO The pharmaceutical industry comprises 20,053 manufacturing units and provides employment to approximately 33 lakh people. The total production in the country in 19992000 was Rs.19, 737 crores with formulations accounting for Rs.15,960 crores and bulk drugs contributing Rs.3,777 crores. The total capital investment in the pharmaceutical industry was Rs.2,500 crores with R&D expenditure being Rs.320 crores. The countrys exports stood at Rs.6,631 crores in 1999-2000, imports were Rs.3,441, a net surplus of Rs.3,190 crores. (Source: OPPI)


The leading 250 pharmaceutical companies control 70 per cent of the market with the market leader having a share of around seven per cent. Over 60 per cent of Indias bulk drug production is exported and the balance is sold locally to other formulators. With more than 85 per cent of formulation production in the country sold in the domestic market, India is largely self-sufficient in the case of formulations, even though some life saving, new generation, under patent formulations continue to be imported, especially by MNCs. GROWTH OF PHARMACEUTICAL INDUSTRY (Rs.Crores) 1965-66 1980- 1997-98 1998-99 199981 Capital Investment Production For : mula tions Bulk 18 Drugs Import Export R&D Expenditure 8.20 3.05 3 112.54 2868.00 3128.00 3441.00 46.38 5353.00 5959.00 6631.00 14.75 220.00 260.00 320.00 240 2623 3148 3777.00 150 1200 12068 13878 15960.00 140 500 1840 2150 2000 2500.00

Source: OPPI


India is one of top five manufacturers of bulk drugs in the world and is among the top 20 pharmaceutical exporters in the world. The industry manufactures almost the entire range of therapeutic products and is capable of producing raw materials for manufacturing a wide range of bulk drugs from the basic stage. The government has taken measures to give impetus to domestic production of drugs and formulations, creating an environment conducive for channelizing new investments into the pharmaceutical sector. However, the industry and experts feel that time has come for the government to announce new policy initiatives, particularly relating to the research and development and pricing regime, in order to propel the industry into a new growth orbit as well as to face the challenges of a WTO-led trading system and a TRIPS-driven product patent environment. Given a conducive policy environment, the R a Mashelkar committee report has set the following targets for the industry by the year 2005: Achieve five times of 1997-98 turnover (Rs.14,691 crores) Attain cumulative dollar exports growth rate of 20 per cent per annum. List at least 20 pharmaceutical companies in NASDAQ. Attract atleast Rs.500 crores investment in new start-up R&D companies. Attain three times increase from the 1997-98-market capitalization figure. In the field of pharmaceutical R&D, the committee has set the following targets: Attain investment in R&D of Rs.1000 crores per annum. File ten new INDs annually. File over 500 patents annually. Export pharma R&D worth over Rs.200 crores per annum. 2.5. KEY PLAYERS The Indian pharmaceutical industry comprises both MNCs as well as domestic companies. While at one time, MNCs dominated the market; their market share has declined steadily from 75 per cent in 1971 to about 35 per cent. In order to boost the domestic industry, the27

government introduced process patents in the Indian Patent Act of 1970. Domestic pharma companies were quick to take advantage of this and developed expertise in process development and manufacturing of pharmaceuticals. As a result Domestic companies had a robust pipeline of products, large therapeutic width and depth and were able to provide masses with the low priced quality pharmaceuticals. Out of the ten top pharmaceutical companies in India, three are MNCs. The top ten pharmaceutical companies operating in India are: Company Ranbaxy Laboratories Glaxo Limited Wockhardt Novartis Cipla Aurobindo Pharma Lupine Laboratories Hoechst Marrion Roussel Cadila Healthcare Dr Reddys Laboratories Source : Prowess-CMIE 2.6. STRATEGIES AND TRENDS Focus on R&D: Major Indian companies such as Ranbaxy, Dr Reddys Laboratories, Nicholas Piramal, Cipla, Lupin and Wockhardt are investing and concentrating on R&D. The R&D activities of Indian companies are targeted both at New Drug Finance Year Dec 1999 Dec 1999 Dec 1999 March 2000 March 2000 March 2000 March 2000 March 2000 March 2000 March 2000 Net Sales 1559 888.3 841.72 793.13 704.28 692.13 485.23 479.86 447.86 436.01 (Rs.Crores) PAT 193.58 77.06 104.55 103.42 133.06 74.6 30.62 27.45 37.69 60.24


Discovery Research as well as Novel Drug Delivery Systems (NDDS). Ranbaxy and Dr Reddys Laboratories have so far led the way. Co-Marketing alliances: In order to increase market penetration and increase their presence in select therapeutic segments, both domestic and multinational companies have entered into product specific marketing arrangements. For instance, Ranbaxy has entered into marketing alliances with Cipla, Glaxo and Hoechst and Nicholas Piramal has tied up with Hoechst. Product rationalization / brand and company acquisition: Domestic

pharmaceutical companies are following a two-pronged strategy. On one hand, they are rationalizing their product portfolio by phasing out low volume products that do not fit with their future strategy. On the other hand, they are scouting for brand acquisitions and even company acquisitions in order to increase their therapeutic reach and market penetration. New product launches: Domestic companies are expanding their therapeutic reach by launching new products in high margin segments, thereby increasing product portfolio and increasing critical mass. However with the introduction of WTO led product patents in 2005, domestic companies would lose their freedom to introduce products in the market. Expanding distribution network: Companies are increasing market penetration through enhanced distribution channels, particularly in the rural markets. This will increase the ambit of access to modern medicines as well as facilitate licensing of products for MNCs in the post product patent regime. Upgraded manufacturing facility: Increasingly companies are in the process of upgrading their manufacturing facilities, adopt GMP standard and getting international regulatory approvals from USFDA UKMCA. Approvals from these agencies would facilitate export to developed countries. Contract manufacturing: Companies are planning to set up contract manufacturing and global sourcing bases for supplying bulk drugs and intermediates to MNCs. Tapping international generic market: Companies are setting up subsidiaries abroad and entering into strategic alliances to exploit long term opportunities in the international generic market in the next five to ten years. They have started applying for DMFs, product registrations and ANDAs worldwide.29

Medium term strategy is to concentrate on products that are going off patent in the next five to ten years. The long-term objective is to enter higher platform of drug delivery systems & niche R&D. 2.7. RESEARCH AND DEVELOPMENT In a country where research and innovation have traditionally been neglected by domestic industry, the pharmaceutical industry is realizing the importance of R&D. The successes enjoyed by a few companies such as Ranbaxy and Dr Reddys in the R&D field have shown the way for others. Several Indian pharmaceutical companies including Cipla, Lupin, Wockhardt, Nicholas Piramal and Torrent are today engaged in R&D activities. Investment in pharmaceutical R&D has been rising steadily. From Rs.220 crores in 1997-98, R&D expenditure rose to Rs.260 crores in 1998-99 and to Rs.320 crores in 1999-2000. This figure is projected to jump up to Rs.1500 crores by 2005. At present, R&D spend accounts for two per cent of the pharmaceutical industrys turnover. This is estimated to rise to five per cent by 2005. Notwithstanding the increase in R&D expenditure, the R&D spend of domestic industry will remain a fraction of the amount invested by ORCs. Experts, however, point out that R&D costs in India are much less than those in the developed world and it is possible to conduct both New Drug Discovery Research and Novel Drug Delivery System programs at competitive rates. The Investigational New Drug stage may cost $100 to 150 million overseas but costs only around Rs.40 to 60 crores in India, says the Mashelkar Committee report. The report adds that while clinical trials cost approximately $300 to 350 million abroad, they cost about Rs.100 crores in India. Apart from comparative cost advantage, Indian R&D efforts are also aided by the presence of a well-established network of research laboratories and a skilled pool of scientific personnel. These need to be leveraged and utilized in an effective manner. Greater collaboration between Industry-Government and academia in this area is required to achieve this. Most Indian companies realize that it will be difficult for them to commercialize their discoveries on an international basis on their own. Therefore they are entering into licensing deals and strategic alliances with international companies. This way their development costs will get shared and returns will accrue faster.


R & D Expenditure: Year 1998-81 1997-98 1998-99 1999-2000 ( Rs. Crores ) 14.75 220.00 260.00 320.00

R & D Expenditure as % of Sales 2.0% Source: OPPI


Although no significant policy initiatives have been announced for pharmaceutical industry in Budget 2003, the long-term direction has been set. The key benefits to the pharmaceutical sector are indirect, with the industry gaining from concessions offered to the healthcare industry as well as new medical insurance scheme for masses announced by the finance minister.

Income tax concessions to pharmaceuticals shall be at par. All drugs and materials imported or produced domestically for clinical trials exempt from custom and excise duties.


2.8. Michel Porters Five Force Model (1) Threat of New Entry: It is high due to tax patent low. Economies of scale are low as the cost of manufacture of reverse engineered product is significantly less thereby making the threat of new entry is high. Product differentiation is neither available for bulk drugs nor is the customer brand loyalties resulting in high threat to new entry. (2) Intensity of Rivalry Among Existing Players: There are 20000 big and small players in the Indian Pharmaceutical Industry, which indicates high level of competition and rivalry. As more and more products move from parented to generic category, rivalry is going to intensify. (3) Bargaining Power of Buyers: Bargaining power of the buyers as a group is low. For companies producing bulk drugs, the buyers are the companies producing formulations which do exercise of bargaining. (4) Bargaining Power of Suppliers: The raw material is chemicals in the form of active ingredients and compatible substances and packaging materials whose suppliers exercise little bargaining power. Pharmaceuticals are in industry where the companies are hearily based on discovery of new molecules and the commercial exploitation of the same. Therefore, the research organization developing molecules can bargain with manufacturing companies to the benefit of former. (5) Threat of Substitute Product: The pharmaceutical industry is primarily allopathic. The alternative approaches are as under.


AYURVEDA: An ancient Indian science, which uses herbal remedies. UNANI: Having Chinese origin. HOMEOPATHY: Founded by German physician. In comparison of the above, allopathy are the most modern medical science and little threat only received from methods of treatment? 2.9. Pharmaceutical Policy 2002: The basic objectives of Governments Policy relating to the drugs and pharmaceutical sector were enumerated in the Drug Policy of 1986. These basic objectives still remain largely valid. However, the drug and pharmaceutical industry in the country today faces new challenges on account of liberalization of the Indian economy, the globalization of the world economy and on account of new obligations undertaken by India under the WTO Agreements. These challenges require a change in emphasis in the current pharmaceutical policy and the need for new initiatives beyond those enumerated in the Drug Policy 1986, as modified in 1994, so that policy inputs are directed more towards promoting accelerated growth of the pharmaceutical industry and towards making it more internationally competitive. The need for radically improving the policy framework for knowledge-based industry has also been acknowledged by the Government. The Prime Ministers Advisory Council on Trade and Industry has made important recommendations regarding knowledge-based industry. The pharmaceutical industry has been identified as one of the most important knowledge based industries in which India has a comparative advantage. OBJECTIVES: The main objectives of this policy are:a. Ensuring abundant availability at reasonable prices within the country of good quality essential pharmaceuticals of mass consumption. b. Strengthening the indigenous capability for cost effective quality production and exports of pharmaceuticals by reducing barriers to trade in the pharmaceutical sector. c. Strengthening the system of quality control over drug and pharmaceutical production and distribution to make quality an essential attribute of the Indian pharmaceutical industry and promoting rational use of pharmaceuticals.33

d. Encouraging R&D in the pharmaceutical sector in a manner compatible with the countrys needs and with particular focus on diseases endemic or relevant to India by creating an environment conducive to channelising a higher level of investment into R&D in pharmaceuticals in India. e. Creating an incentive framework for the pharmaceutical industry which promotes new investment into pharmaceutical industry and encourages the introduction of new technologies and new drugs. 2.10. SWOT ANALYSIS Strengths: Cost Competitiveness Well Developed Industry with Strong Manufacturing Base Well Established Network of Laboratories and R&D infrastructure Access to pool of highly trained scientists, both in India and abroad. Strong marketing and distribution network Rich Biodiversity Competencies in Chemistry and process development. Weaknesses: Low investments in innovative R&D. Lack of resources to compete with MNCs for New Drug Discovery Research and to commercialize molecules on a worldwide basis. Lack of strong linkages between industry and academia. Lack of culture of innovation in the industry Low medical expenditure and healthcare spend in the country Inadequate regulatory standards Production of spurious and low quality drugs tarnishes the image of industry at home and abroad.


Opportunities: Significant export potential. Licensing deals with MNCs for NCEs and NDDS. Marketing alliances to sell MNC products in domestic market. Contract manufacturing arrangements with MNCs Potential for developing India as a centre for international clinical trials Niche player in global pharmaceutical R&D. Threats: Product patent regime poses serious challenge to domestic industry unless it invests in research and development R&D efforts of Indian pharmaceutical companies hampered by lack of enabling regulatory requirement. For instance, restrictions on animal testing outdated patent office. Drug Price Control Order puts unrealistic ceilings on product prices and profitability and prevents pharmaceutical companies from generating investible surplus. Export effort hampered by procedural hurdles in India as well as non-tariff barriers imposed abroad. Lowering of tariff protection

2.11. KEY ISSUES: For India to emerge as a leader player in the knowledge era, the domestic pharmaceutical industry must be encouraged to achieve its full potential. Several Indian pharmaceutical companies have demonstrated in the last few years that they possess the capabilities to successfully carry out financially rewarding research and development activities and become significant players in the international market. A conducive and facilitative policy environment will take the domestic pharmaceutical industry to a higher growth orbit and enable it to face the challenges posed by a WTO led trading system and TRIPS driven intellectual property right regime. In recent times, government has set up a few committees comprising both official and industry


representatives to suggest measures for framing a conducive policy environment but industry is dissatisfied at the pace of the implementation of these recommendations. Price Control: One of the biggest issues facing the Pharma industry relates to the price control regime. The objective of price control was to ensure adequate availability of quality medicines at affordable prices. While this is a laudable objective, the price control system restricts domestic companies from generating investible surpluses. The product patent regime will make it obligatory for Indian companies to invest in R&D if they want to survive. Similarly, the WTO led global trading system will result in import tariffs coming down. For Indian companies to compete with cheap imports, they will have to invest in cost-effective and high quality technology and processes. Therefore, the onset of both the product patent regime as well as tariff reduction will make the requirement for investible surpluses more important than ever before. In this context, a liberalized price control regime becomes even more important. Research and Development: R&D costs in India are much less than that in the developed world and both New Drug Discovery Research and New Drug Delivery Systems programmes can be conducted at very competitive rates. India also has a well-established network of research labs and a strong pool of skilled scientific personnel. The success of a few companies in this area has also demonstrated to the rest of the industry that investments in R&D can yield handsome returns. On the negative side, however, R&D activities in India are adversely impacted by lack of financial resources, inadequate regulatory framework which relates to a host of issues such as lab-testing of animals; outdated and inadequate patent office; long delays in getting required approvals for conducting trials, to name a few problems. Besides liberalization of the price control regime, the R A Mashelkar committee set up by the government has proposed a series of recommendations to deal with these and other issues for boosting R&D activities in the country. The report deals with a wide range of issues, such as fiscal incentives and an appropriate R&D regulatory framework and its recommendations should be expeditiously implemented to give an impetus to R&D activities. The recommendation regarding exemption from price control of companies, which meet the five standards specified by the committee, deserves special attention.


Exports: Indias pharmaceutical exports are currently in the region of $1.5 billion and the industry feels they have the potential to grow at 20 per cent per year taking the overall export figure to $4 billion by 2005. In the coming years, the patent of several blockbuster drugs will expire and this will give Indian companies an opportunity to supply bulk drugs and formulations to international markets. Besides liberalisation of the price control system and action on the R&D front, which would stimulate the export effort of companies, procedural issues need to be eased for boosting exports. 2.13. ACTION PLAN: Price Control R&D Regulatory Availability (1) Price Control Modify the existing Drug Policy Control Order and liberalise the drug policy regime to give domestic pharmaceutical companies an opportunity to generate surpluses. The current system of price control should be replaced by a simple, less intrusive, and transparent system of macro management to cover only formulations. Price control of bulk drugs has become unnecessary as imports are permitted freely. The span of control should come down from the current 40%level to less than 15%. Under the new pricing formula, the only criteria for keeping formulations of a drug under price control should be "monopoly or "inadequate competition. (2) R & D To promote investments in research and development, the government should exempt amount received by Indian companies in consideration for the use of any research based intellectual property rights such as invention, patent, design from tax, provided this amount is utilised for the purpose of in-house research and development within a period of five years.


Tax holiday benefit for ten years should be extended to new research and development undertakings established by existing Indian companies having R&D as one of their main objects and who are also engaged in the manufacture of research based products. Expenses incurred on regulatory approval including clinical trials and review of drugs by the Food & Drug Control Authorities (worldwide, commonly known as regulatory expenditure) should be covered for weighted deduction. Duty free imports of R&D equipment and consumables. Expedite implementation of Mashelkar Committee recommendations. There is an urgent need to develop, notify and implement clear guidelines for all stages of clinical trials. The guidelines should specify the time period for evaluation of results by the concerned authority, beyond which the applicant will be deemed to have been granted approval for the next phase. Delays in processing erode the patent life of a product. (3) Regulatory At present, the infrastructure to deal with patent applications in the country is woefully inadequate and needs to be upgraded. There is a need to increase the number of patent offices and examiners in the country; modernise the patent offices and provide training to the concerned officials to educate them about product patent system and EMR. (4) Availability A system of ensuring affordable medicines to the needy by enlarging the scope of the "sarvapriya scheme could be evolved. Essential drugs for the Below the Poverty Line (BPL) population could be dispensed at subsidised rates through the Primary Health Care centres. The subsidy bill could be footed by the pharmaceutical industry.




3.1 Why is it so Attractive

3.1.1 Big Pharma Upping Their Commitment to Vaccines

The big players in the vaccine world, e.g. GlaxoSmithKline, Sanofi Pasteur and Merck & Co, are anticipating vaccines to become one of their major drivers of growth going forward. So they are upping their commitment to the area. GSK Bio, GSK's vaccines arm, accounted for 8.4 percent of GSK's pharmaceutical turnover in 2006, reporting sales up 23 percent to US$ 3.4 Billion. GSK Bio is set to become an increasingly important part of GSK's business and has been transformed from a tiny company with one product and US$ 3 Million in revenues, into a US$ 2 Billion behemoth with six vaccines in late-stage development GSK's vaccines business has doubled in growth over the past five years and the company expects it to double again over the coming five years. Sanofi Pasteur, together with its European joint venture with Merck & Co, Sanofi Pasteur MSD, is a leader in flu vaccines. In 2006, Sanofi Pasteur accounted for 8.9 percent of SanofiAventis sales, up 22.7 percent to US$ 3.5 Billion (Sanofi Pasteur MSD reported sales of US$ 914 Million, up 5.3 percent). Sanofi Pasteur is well-positioned for growth, as it has a leadership position in influenza, meningitis and boosters, and is also strong in polio, pertussis and Hib (Haemophilus influenza type b), with at least two major product launches anticipated in these areas during 2007, notably Pentacelin the USA and Pentaxim in Mexico. With regards to Merck & Co, the company expects the sales of its vaccines in 2007 to be in the range of US$ 2.8 to 3.2 Billion, up from a figure of US$ 1.7 Billion in 2006 (an increase of 73 percent on 2005). Merck in 2005/2006 launched three vaccines: Gardasil for cervical Cancer/human papilloma virus, RotaTeq for childhood diarrhoea caused by rotavirus, and Zostavax for shingles.Wyeth (now acquired by Pfizer in US$ 68 Billion), the fourth of the 'big five' (Novartis is the fifth), has been the originator of the first billion dollar vaccine, the pneumococcal vaccine Prevnar: it had sales in 2006 and 2007 of US$ 1.9 Billion and US$ 2.4 Billion respectively peak sales in 2009 of more than US$ 3 billion have been predicted.

3.1.2 Vaccine 'Outsiders' Jumping Onto Bandwagon (Acquisitions by Big Pharma Players) Big drugs companies hope consolidation will solve their various problems: the lack of new Blockbuster drugs coming through their research pipelines, looming competition from generic drugs as patents expire, the global economic crisis and an over-dependence on sales40

in America, where health-care reforms will squeeze margins. So, Pharma MNCs today are either spending Millions of dollars in R&D to improve their vaccine pipelines or are investing Billions in acquiring smaller vaccine players. Pfizers recent US$ 68 Billion acquisition of Wyeth can serve as the biggest example. Pfizer Clearly reckons that greater scale is an answer not only to the slower growth in the industry but also to the particular problems that it faces. Lipitor, a blockbusting cholesterol drug that provides US$ 12 Billion in annual revenues, is set to go off patent in 2011. The pipeline of replacements is not flowing with anything like the rate needed to plug the gap. Getting hold of Wyeth would provide some protection: costs could be cut by bringing together research budgets and by reducing vast overlapping marketing operations of the two firms. Another Case study would be Mercks acquisition of Schering-Plough for US$ 41 Billion. The Main attraction of buying Schering-Plough is that Merck will, in one swoop, double (to 18) the number of drugs it has in late-stage development. Merck will also bolster its international and over-the-counter sales, both areas where Schering is strong (70 percent of its revenues come from outside America). Apart from the established vaccine players among big Pharma, other large companies have Recently attempted to join the party. Novartis in 2005 bought Chiron. The transaction positioned Novartis among the top five global vaccine makers with special expertise in the growing area of flu vaccines. Novartis is now the second largest manufacturer of flu vaccines and has created a fourth division in its healthcare sector focused on vaccines and diagnostics. In October 2006, Pfizer agreed to acquire UK-based vaccine company PowderMed, a leader in the development of DNA-based vaccines, its first foray into the area. Pfizer said that it was "strategically committed" to the vaccines business. The PowderMed acquisition was just the first step towards doing that. Pfizer plans to build its vaccines business through its internal capabilities and external sourcing. PowderMed added several vaccines to Pfizer's pipeline, including vaccines against influenza, HPV and hepatitis B. Then in April 2007, AstraZeneca announced the acquisition of biological specialist company Medimmune. Medimmune will inject vaccines into AstraZeneca's empire for the first time the US biotech collects royalties from both Merck and GSK on sales of vaccines for HPV (Gardasil and Cervix respectively) and has a number of vaccines in its early-stage pipeline. Even established companies are increasing their focus on the area, with GSK in 2005 buying both Corixa (a developer of innovative adjuvants) and ID Biomedical, the latter with the aim of boosting its vaccines presence in the USA.41

3.1.3 Several New Vaccines, Many with Blockbuster Potential Several new vaccines, many with blockbuster potential, have been launched by the major Players in recent years. GSK has Rotarix for gastroenteritis, launched in a number of countries since 2005; Globorix, a conjugated vaccine for immunization against diphtheria, pertussis, hepatitis B, Neisseria meningitides serogroups A and C, tetanus and Hib was filed in Europe in March 2007; and a vaccine for H5N1 pandemic influenza was filed in January 2007. Cervical cancer vaccine Cervarix, filed in Europe, Latin America, Asia and Australia in 2006, and in the USA in March 2010. Cervarix is seen by many analysts as GSK's biggest near-term pipeline opportunity, Merck & Co and sanofi pasteur's cervical cancer vaccine, Gardasil, was launched in its first market, the USA, in June 2006 and has since been introduced in several EU markets and Canada. "Gardasil will make a major impact on the Sanofi Pasteur MSD joint venture during 2007. Menactra for meningitis: Menactra, first launched in the US in March 2005, achieved sales of US$ 330 Million for 2006 and US$ 246 Million in the first half of 2007. In 2008 Pravnar remained the top selling vaccine brand with sales of US$ 3 Billion followed by Gardasil at US$ 2.8 Billion and GSK Hepatitis and Infantrix/Pediatrix Vaccines each with sales of US$ 1.2 Billion each. Merck, GSK, Sanofi Aventis, Wyeth and Novartis were the top five vaccine companies. More vaccines are likely to reach sales of US$ 1 Billion and more in the next two years. FDA in 2008 approved 1 new vaccine (Rotarix) Several recently launched vaccines like Rotarix and Menveo are likely to bring in sales of over US$ 1 Billion within 2-3 years of launch. In R&D a follow up Prevanar from Wyeth look very attractive. The market and sales data in 2008 provides once again strong support for the R&D paradigm shift to biologic and within biologic towards human monoclonal antibodies, vaccines, erythropoietins, insulins and interferons.

3.2 Worldwide Vaccine Market

The worldwide vaccines sales in 2008 was US$ 21 Billion as compared to US$ 18.4 Billion in 2007.In percent terms its a growth of 14.1 percent in 2008 compared to previous year (2007). By 2013 the worldwide vaccine market is expected to be achieving the figure of US$ 30.5 Billion.


By Sector Vaccine Market 3.2.1 Influenza Influenza is a viral infection that affects mainly the nose, throat, bronchi and, occasionally, Lungs. Infection usually lasts for about a week, and is characterized by sudden onset of high fever, aching muscles, headache and severe malaise, non-productive cough, sore throat and rhinitis. The virus is transmitted easily from person to person via droplets and small particles produced when infected people cough or sneeze. Influenza tends to spread rapidly in seasonal epidemics. Vaccination against influenza with an influenza vaccine is often recommended for high-risk groups, such as children and the elderly, or in people that have asthma, diabetes, or heart disease. The most common human vaccine is the trivalent influenza vaccine (TIV) that contains purified and inactivated material from three viral strains. Typically, this vaccine includes material from two influenza A virus subtypes and one influenza B virus strain. The TIV carries no risk of transmitting the disease, and it has very low reactivity. A vaccine formulated for one year may be ineffective in the following year, since the influenza virus evolves rapidly, and different strains become dominant. Antiviral drugs can be used to treat influenza, with neuraminidase inhibitors being particularly effective. The influenza vaccine market was valued at US$ 2.9 Billion in 2008, and it is expected to reach US$ 4.7 Billion by 2013 growing with a CAGR of 9.9 percent from 2008 to 2013. 3.2.2 Adult/Travel As the globalization is increasing so as the need to travel from one place to another is also increasing. With rising numbers of international travelers, the world travel vaccine market future prospects seem very bright. Examples include vaccine for Typhoid Vaccines,Hepatitis. A Vaccine, Rabies Vaccine, Japanese B Encephalitis Vaccine and Yellow Fever Vaccine. The adult/travel vaccines market was valued at US$ 1.8 Billion in 2008, and it is expected to reach US$ 3.7 Billion by 2013 growing with a CAGR of 15.4 percent from 2008 to 2013. 3.2.3 Proprietary Pediatrics/Adolescent Three proprietary products pneumococcal conjugate; meningococcal conjugate and varicella dominate the proprietary pediatrics market. Most of this growth has come from the high income countries purchasing new proprietary products. The proprietary products including the Prevnar (a pneumococcal conjugate vaccine manufactured by Wyeth) is by far the fastest growing segment. In 2000, the year of its introduction, sales of Prevnar reached nearly US$


500 Million and in 2007, it reached US$ 2.4 Billion making it the first vaccine to exceed US$ 2 Billion in annual sales. In 2008 worldwide market for proprietary pediatrics was US$ 3.6 Billion an increase of 22.2 percent from the previous year 2007. In addition a number of new vaccines currently under trial expected to come in the market in 2 to 3 years will further boast the market. The proprietary pediatrics market is expected to reach US$ 8.1 Billion by 2013. 3.2.4 Enhanced Pediatrics Enhanced pediatric vaccines include Polio virus types 1, 2 and 3, Measles, Mumps, Rubella (MMR), Hepatitis B, Varicella, Haemophilus influenza B (Hib), Diphtheria, Tetanus, Pertussis (DTaP). They also include DTP with a cellular pertussis (DTaP) as a replacement for the whole cell DTP (DTwP) and Inactivated Polio Vaccine (IPV) as a replacement for Oral Polio Vaccine (OPV). Enhanced pediatric vaccines include several made in combination with DTP, such as DTP-HepB+Hib. Introducing a new enhanced pediatrics vaccine in the market requires a lot of money to be spent on the R&D of enhanced pediatric vaccines. So for revenue generation they focus more on high income markets such as U.S. and Europe for revenue generation. Moreover there are fewer manufacturers for enhanced pediatrics compared to basic pediatric as most of the vaccines are patented. The worldwide market for enhanced pediatrics in 2008 was US$ 4.2 Billion and it is expected to reach the figure of US$ 4.3 Billion by 2013. 3.2.5 Basic Pediatrics The Basic pediatric vaccines are popular in under developed and developing countries. Since these vaccines are manufactured by many manufacturers so they are less expensive, with prices often less than US$ 0.20 per dose. Major basic pediatric vaccines include DiphtheriaTetanus-Pertussis with whole-cell Pertussis (DTwP), live Oral Polio Vaccine (OPV) and the Measles vaccine. UN agencies (WHO, UNICEF etc.) representative of government organization (in India Ministry of Health & Family Welfare) NGOs (Red Cross, etc) are the big customers of these vaccines. However the basic fact is that the market for basic pediatrics is falling from US$ 833.3 Million in 2004 it is expected to reduce to US$ 606 Million by 2013. The major reasons for this is that the most of these vaccines have lost their patents and are sold as low priced generics in third world and developing countries. Moreover there newer and improved versions of these vaccines are now available in the market.


3.4. Major Vaccine Cases, Market Sizes & Future Forecast 3.4.1 Pneumococcal Vaccines Pneumococcal disease is caused by a bacterium called Streptococcus pneumonia. There are more than 90 different types of pneumococcal bacteria; however, only a few types account for most of the serious diseases. Many people carry S. pneumonia in their throat or nose without getting sick. If the bacteria overcome body's natural defenses, then they can cause various diseases. The most serious of these is meningitis, an inflammation of the tissue surrounding the brain and spinal cord. Pneumococcal meningitis is fatal in up to 26 percent of cases. Among people who recover, it can cause permanent health effects, including brain damage and hearing loss. Other diseases caused by S. pneumonia include bacteremia (blood poisoning), pneumonia (lung infection), and otitis media (middle ear infections). Pneumococcal disease is treated with antibiotics, such as penicillin and cephalosporins. In recent years, certain strains of S. pneumonia have emerged that are resistant to one or more commonly used antibiotics. This makes prevention of pneumococcal disease through vaccination even more important. Market Size of Pneumococcal Vaccines & Future Forecast At present one product manufactured by Wyeth as the brand name Prevnar is available in the market. In 2007 Prevnar sales surged 24 percent to US$ 2.4 Billion, making it the first vaccine to exceed US$ 2 Billion in annual sales. It is estimated that over the next 10 years (by 2018) global immunization funding could be as much as US$ 8 Billion for new vaccines. The major drivers for the growth of Pneumococcal vaccine is to come from 30 of the 72 GAVI countries expressed interest in introducing pneumococcal conjugate vaccine between 2008 and 2010. These countries are Benin, Burundi, the Republic of Congo, Rep. of Cote d'Ivoire, Djibouti, the Democratic Republic of Congo, Ethiopia, Ghana, Guyana, Honduras, Indonesia. 3.4.2 Polio Vaccines Two polio vaccines are used throughout the world to combat poliomyelitis (or polio). The first was developed by Jonas Salk and first tested in 1952. Announced to the world by Salk on April 12, 1955, it consists of an injected dose of inactivated (dead) poliovirus. The oral vaccine Number of Polio Cases (in 42 Countries) The confirmed number of polio cases increases by 25.9 percent in 2008 compared to 2007.


However, in previous years polio cases has been decreased by 34.2 percent (2007) and increased by merely 0.91 percent (2006). Market Size of Polio Vaccines & Future Forecast In 2004 the worldwide polio vaccine market was US$ 343 Million and it is expected to reach the values between US$ 800 to US$ 1,000 Million in 2011. 3.4.3 Meningitis Vaccines There are several causes of spinal meningitis. The two most common causes are bacteria and viruses. There are a number of bacteria that can cause meningitis. Before the 1990s, Haemophilus influenzae type b (Hib) was the leading cause of bacterial meningitis, but new vaccines being given to all children as part of their routine immunizations have reduced the occurrence of invasive disease due to H. influenzae. Today, Streptococcus pneumoniae and Neisseria meningitidis are the leading causes of bacterial meningitis. Just like with Hib, there are meningitis vaccines against some types of N. meningitidis and many types of S. pneumoniae. There is a meningitis vaccine to prevent meningitis due to Haemophilus influenzae type b (Hib). The Hib meningitis vaccine is recommended for children two months to five years of age. The Hib vaccine is also recommended in people over the age of five with certain medical conditions. The Hib meningitis vaccine is very safe and effective, with rare occurrences of side effects. There are two meningitis vaccines (meningococcal vaccine) against N. meningitidis available in the United States:

the Food and Drug Administration (FDA) and has been available since 1981.

Both meningitis vaccines can prevent four types of meningococcal meningitis, including two of the three types most common in the United States (serogroup C, Y, and W-135) and a type that causes epidemics in Africa (serogroup A). Meningococcal meningitis vaccines cannot prevent all types of the disease. But they do protect many people who might become sick if they didn't get the meningitis vaccine. Market Size of Meningitis Vaccines & Future Forecast United States is the most potential market for the Meningitis vaccine since strains C and Y are major causes of disease in children less than two years of age. According to an estimate meningitis market is expected to increase from the value of US$ 0.28 Million in 2004 to US$ 1.1 to 1.5 Million by 2010.


3.4.4 Rotavirus Vaccines A rotavirus vaccine protects children from rotaviruses, which are the leading cause of severe diarrhoea among infants and young children. Each year more than 500,000 children die from diarrhoeal disease caused by rotavirus, and another two million are hospitalised. Most deaths occur in developing countries, where access to treatment is limited; however, nearly every child in the world will suffer an episode of diarrhea caused by rotavirus before age five. In 2006 two live attenuated oral rotavirus vaccines were licensed for prevention of severe acute gastroenteritis in children: Rotarixtrade mark (GSK), a human rotavirus vaccine with serotype characteristics and RotaTeqtrade mark (Merck), a bovine-human reassortant vaccine expressing human antigens. In prelicensure trials both vaccines showed high efficacy against severe RV gastroenteritis, low reactogenicity and no increased risk for intussusception (IS) Both vaccines have now been distributed in Millions of doses. Post-marketing data have not shown any gross signal for IS with either vaccine. Number of Rotavirus Cases (in 27 Countries) Rotavirus is the leading cause of diarrhea hospitalization among children worldwide. Rotavirus causes severe diarrhea, vomiting, and fever leading to rapid dehydration. Rotavirus is responsible for the deaths of an estimated 600,000 children worldwide each year, 80 percent of whom live in developing countries. Rotavirus causes nearly 2 million hospitalizations each year. In Asia, up to 45 percent of the children hospitalized for diarrhea are infected with rotavirus. Rotavirus is found in all countries. Almost every child in the world will suffer at least one infection by the time he or she is 3 years old. Market Size of Rotavirus Vaccines & Future Forecast It has been estimated that the rotavirus vaccine market will be worth US$ 2.5 Billion by 2010, primarily driven by high demand for rotavirus vaccines in the developed world. The support for immunization of Millions of new infants is to prevent the hospitalization cost burden,which is estimated to be one Billion dollars per year in the U.S. According to another estimate by GSK the rotavirus vaccine market is expected to be in between US$ 1.8 Billion to US$ 2.4 Billion by 2010. 3.4.5 Tuberculosis (TB) Vaccines Each year, Tuberculosis (TB) kills approximately two Million people according to the World Health Organization (WHO). In 2006 there were an estimated 1.5 Million deaths from TB in HIV-negative people and 0.2 Million among people infected with HIV. While the disease occurs throughout the world, developing nations are hit hardest by the pandemic. Beyond the


tremendous loss of human life, tuberculosis limits economic growth in the poorest countries by striking working people in their most productive years of life. Prevention is vital to the fight against TB. There is a profound need for new vaccines both in developing countries, where TB is endemic, and in industrialized countries, which face an emerging threat of multi-drug resistant TB (MDR-TB). The current TB vaccine known as BCG used extensively throughout the world has limited efficacy. At best, the BCG vaccine is 80 percent effective in preventing tuberculosis for duration of 15 years; however, its protective effect appears to vary according to geography. Existing therapies are decades old, require months of costly treatment, and can fail to eliminate the infection. Vaccine research and development, however, is progressing. Today, there are about a dozen TB vaccine candidates under development, with several candidates undergoing human clinical trials. Increased industry involvement is necessary to build on the scientific progress of these candidates and ensure that new vaccines are ultimately successful. Number of Tuberculosis Cases Tuberculosis (TB) is a major cause of illness and death worldwide, especially in Asia and Africa. Worldwide, 9.2 Million new cases and 1.7 Million deaths from TB occurred in 2006, of which 0.7 Million cases and 0.2 Million deaths were in HIV-positive people. There were an estimated 9.2 Million new cases of TB in 2006 (139 per 100 000 population), including 4.1 Million new smear-positive cases (45 percent of the total) and 0.7 Million HIVpositive cases (8 percent of the total). This is an increase from 9.1 million cases in 2005, due to population growth. India, China, Indonesia, South Africa and Nigeria rank first to fifth respectively in terms of absolute numbers of cases. The African Region has the highest incidence rate per capita (363 per 100 000 population). Market Size of Tuberculosis Vaccines & Future Forecast The expected returns for three vaccine profiles: a replacement for the existing vaccine (BCG replacement), a booster given to individuals already vaccinated with existing BCG vaccines (booster vaccine), and a combination of the two vaccines the BCG-replacement vaccine administered at birth and a booster vaccine given at ten-year intervals (prime-boost strategy). 3.4.6.BCG replacement vaccine (prime): The estimated annual global market for a BCGreplacement vaccine administered at birth is approximately US$ 400 Million at market Peak, representing nearly 50 Million doses per year. High-income markets would Generate half the global revenue. Booster vaccine: The estimated peak annual market for a booster vaccine48

Administered in infancy and at ten-year intervals is more than US$ 700 Million based on 60 Million Doses, with high-income markets driving most of the revenue. Prime-boost strategy: A combination of the two new vaccines in a prime-boost Strategy may be required to achieve optimum protection. The estimated peak annual Market for a prime-boost combination approaches US$ 900 Million from more than 100 Million doses. Most of the demand comes from high-income markets and private Markets in low- and middle-income countries. 3.4.7 Measles, Mumps & Rubella (MMR) Vaccines The MMR vaccine is a mixture of three live attenuated viruses, administered via injection for immunization against measles, mumps and rubella (also called German measles). It is generally administered to children around the age of one year, with a second dose before starting school (i.e. age 4/5). The second dose is not a booster; it is a dose to produce immunity in the small number of persons (2-5 percent) who fail to develop measles immunity after the first dose. In the United States, the vaccine was licensed in 1971 and the second dose was introduced in 1989. It is widely used around the world; since introduction of its earliest versions in the 1970s, over 500 Million doses have been used in over 60 countries. As with all vaccinations, Long-term effects and efficacy are subject to continuing study. The vaccine is sold by Merck as M-M-R II, GlaxoSmithKline Biologicals as Priorix, Serum Institute of India as Tresivac, and Sanofi Pasteur as Trimovax. Number of Measles, Mumps & Rubella Cases The total number of measles cases reported by 2007 is 280.7 Thousand; it is 24.9 percent less than the previous year (2006). West Pacific Region and African Region reported the highest and second highest cases in 2007. The total number of mumps cases reported by 2007 is 408.2 Thousand; it is 36.5 percent less than the previous year (2006). West Pacific Region and American Region reported the highest and second highest cases in 2007. 3.4.8 DTP Vaccines DTP is a mixture of three vaccines, to immunize against diphtheria, pertussis (whooping Cough) and tetanus. Current versions of DTP in Europe do not contain preservatives; older ones contained Thiomersal. In the Netherlands, the acronym DTP is used as well, but differently. In that country, DTP refers to a mixture of diphtheria, tetanus and poliomyelitis vaccines, whereas DKTP refers to a mixture of diphtheria, pertussis ("kinkhoest"), tetanus and poliomyelitis vaccines.49

Number of Diphtheria, Pertussis and Tetanus Cases Diphtheria The total number of Diphtheria cases reported in 2007 is 4,273 it is 7.4 percent more than the previous year (2006). South East Asian Region reported the highest case in 2007. Pertussis The total number of Pertussis cases reported in 2007 is 161.8 Thousand; it is 34.9 percent more than the previous year (2006). South East Asian Region and European Region reported the highest and second highest cases in 2007. Tetanus The total number of Tetanus cases reported in 2007 is 19.8 Thousand; it is 35.6 percent more than the previous year (2006). South East Asian Region and African Region reported the highest and second highest cases in 2007. Market Size of DTP Vaccines The total market for DTP combos, in 2004 was US$ 190 Million with GSK having US$ 89.3 Million (47 percent) market. 3.4.9 Hepatitis B Vaccines Hepatitis B is a disease caused by hepatitis B virus which infects the liver of hominoidae, including humans, and causes an inflammation called hepatitis. Originally known as "serum hepatitis", the disease has caused epidemics in parts of Asia and Africa, and it is endemic in China. About a third of the world's population, more than 2 Billion people have been infected with the hepatitis B virus. This includes 350 Million chronic carriers of the virus. Transmission of hepatitis B virus results from exposure to infectious blood or body fluids containing blood. The acute illness causes liver inflammation, vomiting, jaundice and rarely death. Chronic hepatitis B may eventually cause liver cirrhosis and liver cancer a fatal disease with very poor response to current chemotherapy. The infection is preventable by vaccination. Hepatitis B vaccine is a vaccine developed for the prevention of hepatitis B virus infection. The vaccine contains one of the viral envelope proteins, hepatitis B surface antigen (HBsAg). A course of three vaccine injections are given with the second injection at least one month after the first dose and the third injection given six months after the first dose. Afterward an immune system antibody to HBsAg is established in the bloodstream. The antibody is known as anti-HBsAg. This antibody and immune system memory then provide immunity to hepatitis B infection. Percent of Hepatitis B Vaccine Immunization50

Hepatitis B vaccine for infants was introduced in 171 countries (169 in the entire country; India and Sudan in parts of the country) by the end of 2007, up from 164 countries in 2006. Global coverage is estimated at 65 percent and is as high as 88 percent in the Americas. This contrasts with 30 percent in the South-East Asia Region. The African Region has reached 69 percent in 2007, compared to 48 percent in 2006. Market Size of Hepatitis B Vaccines & Future Forecast The worldwide market for hepatitis B vaccine was US$ 1.04 Billion in 2005 and it is expected to reach the figure of US$ 2.10 Billion by 2010. Europe and the Asia Pacific region represent 40 percent but is expected to increase due to rising awareness of hepatitis B and increased public health expenditure in countries like China and India.

3.4.10 Malaria Vaccines Malaria is a tropical disease of major global health significance. There are approximately 300 to 500 Million cases each year and around 2 to 3 Million deaths. Most of these deaths are in children aged 1 to 5 in sub-Saharan Africa, making it the biggest single infectious killer of children in the world. Malaria is caused by several species of the parasite Plasmodium these are P. falciparum, P.vivax (these first two cause most of the vast number of clinical cases of malaria), P. malariae and P. ovale. The research work of our group concentrates on P. falciparum as this is the type that leads to the majority of malaria deaths. The Plasmodium parasite is spread to humans by the bite of an infected female Anopheles mosquito. These mosquitoes breed in areas where there is stagnant water such as swamps and during the rainy seasons of African countries. Unfortunately, the problem of malaria is getting worse as the mosquitoes that transmit the disease are becoming resistant to insecticides and the parasites themselves are becoming increasingly resistant to the drugs used to treat the disease. Vaccines for malaria are under clinical trials in many countries and by 2010 it is expected that first vaccine will be launched. Number of Malaria Cases The total number of Malaria cases reported in 2007 is 88.6 Million; it is 2.3 percent more than the previous year (2006). African Region reported the highest cases in 2007. Market Size of Malaria Vaccines Market Future Forecast The vaccine for malaria is schedule to launch in between 2010 to 2011. In beginning (2012) Malaria will be available only for armed forces costing US$ 30 per dose. The demand from


private market is expected to begin from 2013 costing US$ 15 per dose. Finally in 2015 when the malaria vaccine becomes more affordable costing US$ 7 per dose public market demand will begin. Malaria public market share revenue increases from 43 percent in 2015 to 77 percent in 2025.

3.4.11 Japanese Encephalitis Vaccines Japanese encephalitis is a disease caused by the mosquito-borne Japanese encephalitis virus. The Japanese encephalitis virus is a virus from the family Flaviviridae. Domestic pigs and wild birds are reservoirs of the virus; transmission to humans may cause severe symptoms. One of the most important vectors of this disease is the mosquito Culex tritaeniorhynchus. This disease is most prevalent in Southeast Asia and the Far East. The infection is preventable by vaccination. Japanese encephalitis vaccine is a vaccine used against Japanese encephalitis. Until now, an inactivated mouse brain-derived vaccine (JE-VAX), licensed in the US, Canada, Israel and Australia, has been used as the principal vaccine against Japanese encephalitis. This vaccine is administered in three doses.

A new vaccine, the Japanese encephalitis vaccine IC-51 (IXIARO), has been developed by Intercell. IXIARO is based on an inactivated Japanese encephalitis virus strain, manufactured in cultured Vero cells. IXIARO is approved in Australia and is currently awaiting marketing approval in the US, Canada and Switzerland; in the European Union, it has received a positive opinion from the Committee for Medicinal Products for Human Use of the European Medicines Agency. Number of Japanese Encephalitis Cases The total number of Japanese encephalitis cases reported in 2007 is 8.04 Thousand; it is 18 percent more than the previous year (2006). South East Asian Region and West Pacific Region reported the highest and second highest cases in 2007 Market Size of Japanese Encephalitis Vaccines & Future Forecast Japanese encephalitis disease is more prevalent in Southeast Asia and the Far East. So the growth of Japanese encephalitis vaccine market depends much on the international travelers traveling to Japanese encephalitis regions. Worldwide Japanese encephalitis vaccine market in 2004 was US$ 146.3 Million and it is expected to reach the figure of US$ 405.1 Million by 2012.


From the year 2004 to 2008 Japanese encephalitis vaccine market has grown with a single digit growth rate. But from 2009 to 2012 it is expected that the percentage growth rate will be in the double digit. 3.4.12 West Nile Vaccines West Nile virus (WNV) is a virus of the family Flaviviridae. Part of the Japanese encephalitis (JE) antigenic complex of viruses, it is found in both tropical and temperate regions. It mainly infects birds, but is known to infect humans, horses, dogs, cats, bats, chipmunks, skunks, squirrels, and domestic rabbits. The main route of human infection is through the bite of an infected mosquito. West Nile virus is named after the West Nile district of Uganda where the disease was discovered in 1937, West Nile virus infection can lead to mortality in humans and animals by causing a fatal form of encephalitis, or inflammation of the brain. It is estimated that 20 percent of the people who become infected with West Nile virus will develop West Nile fever. Persons over 50 years of age have the highest risk of developing a severe disease, such as meningitis, an inflammation of the membrane around the brain and the spinal cord, or encephalitis, an inflammation of the brain. Number of West Nile Cases Since 1999 when it was first detected in the US, the West Nile virus has spread across the entire continental United States, causing 27,240 cases and 1,054 deaths.

Market Size of West Nile Vaccines & Future Forecast Currently there is no vaccine or antiviral therapy available to protect humans against West Nile virus. However several companies are trying to make vaccines for the disease. According to an estimate the market for west Nile vaccine will be US$ 400 to 500 Million in 2010. 3.4.13 Ebola Vaccines Ebola is the common term for a group of viruses belonging to genus Ebolavirus, family Filoviridae, which cause Ebola hemorrhagic fever. The disease can be deadly and encompasses a range of symptoms, usually including vomiting, diarrhea, general body pain, internal and external bleeding, and fever. Mortality rates are generally high, ranging from 50 percent to 90 percent, with the cause of death usually due to shock or multiple organ failure. Ebola is transmitted primarily through bodily fluids and to a limited extent through skin and mucous membrane contact. The virus interferes with the endothelial cells lining the interior surface of blood vessels and platelet cells. As the blood vessel walls become damaged and the53

platelets are unable to coagulate, patients succumb to shock. Ebola first emerged in 1976 in Zaire. It remained largely obscure, however, until 1989 with the outbreak in Reston, Virginia.

Number of Ebola Cases Ebola has appeared sporadically since it was first identified in 1976. According to the World Health Organization, approximately 1,850 cases with over 1,200 deaths have been documented since the Ebola virus was discovered. Market Size of Ebola Vaccines & Future Forecast It is expected that by 2011 Ebola vaccine will come to market. At that time its global market size is estimated to be US$ 100 Million in which US government contracts would be worth of US$ 90 Million approximately for every 2 years.

3.4.14 Cervical Cancer Vaccines Cervical cancer is malignant cancer of the cervix uteri or cervical area.