A Critical Analysis of Concentration and Competition in the Indian Pharmaceutical Market
It can be argued that with several players marketing a large number of brands, the pharmaceutical market in India is competitive. However, the pharmaceutical market should not be studied as a single market but, as a sum total of a large number of individual sub-markets. This paper examines the metho...
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| description | It can be argued that with several players marketing a large number of brands, the pharmaceutical market in India is competitive. However, the pharmaceutical market should not be studied as a single market but, as a sum total of a large number of individual sub-markets. This paper examines the methodological issues with respect to defining the relevant market involved in studying concentration in the pharmaceutical market in India. Further, we have examined whether the Indian pharmaceutical market is competitive.
Indian pharmaceutical market was studied using PharmaTrac, the sales audit data from AIOCD-AWACS, that organises formulations into 5 levels of therapeutic classification based on the EphMRA system. The Herfindahl-Hirschman Index (HHI) was used as the indicator of market concentration. We calculated HHI for the entire pharmaceutical market studied as a single market as well as at the five different levels of therapeutic classification.
Whereas the entire pharmaceutical market taken together as a single market displayed low concentration (HHI = 226.63), it was observed that if each formulation is defined as an individual sub-market, about 69 percent of the total market in terms of market value displayed at least moderate concentration. Market should be defined taking into account the ease of substitutability. Since, patients cannot themselves substitute the formulation prescribed by the doctor with another formulation with the same indication and therapeutic effect, owing to information asymmetry, it is appropriate to study market concentration at the narrower levels of therapeutic classification. |
| doi_str_mv | 10.1371/journal.pone.0148951 |
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Indian pharmaceutical market was studied using PharmaTrac, the sales audit data from AIOCD-AWACS, that organises formulations into 5 levels of therapeutic classification based on the EphMRA system. The Herfindahl-Hirschman Index (HHI) was used as the indicator of market concentration. We calculated HHI for the entire pharmaceutical market studied as a single market as well as at the five different levels of therapeutic classification.
Whereas the entire pharmaceutical market taken together as a single market displayed low concentration (HHI = 226.63), it was observed that if each formulation is defined as an individual sub-market, about 69 percent of the total market in terms of market value displayed at least moderate concentration. Market should be defined taking into account the ease of substitutability. Since, patients cannot themselves substitute the formulation prescribed by the doctor with another formulation with the same indication and therapeutic effect, owing to information asymmetry, it is appropriate to study market concentration at the narrower levels of therapeutic classification.</description><identifier>ISSN: 1932-6203</identifier><identifier>EISSN: 1932-6203</identifier><identifier>DOI: 10.1371/journal.pone.0148951</identifier><identifier>PMID: 26895269</identifier><language>eng</language><publisher>United States: Public Library of Science</publisher><subject>Acquisitions & mergers ; Analysis ; Antitrust laws ; Biology and life sciences ; Classification ; Competition ; Datasets ; Drug Industry ; Drugs ; Economic aspects ; Economic Competition ; Formulations ; India ; Market size ; Market value ; Markets ; Medicine and Health Sciences ; People and Places ; Pharmaceutical industry ; Pharmaceuticals ; Public health ; Social Sciences ; Studies</subject><ispartof>PloS one, 2016-02, Vol.11 (2), p.e0148951-e0148951</ispartof><rights>COPYRIGHT 2016 Public Library of Science</rights><rights>2016 Mehta et al. This is an open access article distributed under the terms of the Creative Commons Attribution License: http://creativecommons.org/licenses/by/4.0/ (the “License”), which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited. Notwithstanding the ProQuest Terms and Conditions, you may use this content in accordance with the terms of the License.</rights><rights>2016 Mehta et al 2016 Mehta et al</rights><lds50>peer_reviewed</lds50><oa>free_for_read</oa><woscitedreferencessubscribed>false</woscitedreferencessubscribed><citedby>FETCH-LOGICAL-c692t-a9cdcc3a42e882b06bacb2b8695cd45bcf4e54aafc5f54ddfa7ccd4ffdcbe63d3</citedby></display><links><openurl>$$Topenurl_article</openurl><openurlfulltext>$$Topenurlfull_article</openurlfulltext><thumbnail>$$Tsyndetics_thumb_exl</thumbnail><linktopdf>$$Uhttps://www.ncbi.nlm.nih.gov/pmc/articles/PMC4760714/pdf/$$EPDF$$P50$$Gpubmedcentral$$Hfree_for_read</linktopdf><linktohtml>$$Uhttps://www.ncbi.nlm.nih.gov/pmc/articles/PMC4760714/$$EHTML$$P50$$Gpubmedcentral$$Hfree_for_read</linktohtml><link.rule.ids>230,314,727,780,784,864,885,2100,2926,23865,27923,27924,53790,53792,79371,79372</link.rule.ids><backlink>$$Uhttps://www.ncbi.nlm.nih.gov/pubmed/26895269$$D View this record in MEDLINE/PubMed$$Hfree_for_read</backlink></links><search><contributor>Beck, Eduard J</contributor><creatorcontrib>Mehta, Aashna</creatorcontrib><creatorcontrib>Hasan Farooqui, Habib</creatorcontrib><creatorcontrib>Selvaraj, Sakthivel</creatorcontrib><title>A Critical Analysis of Concentration and Competition in the Indian Pharmaceutical Market</title><title>PloS one</title><addtitle>PLoS One</addtitle><description>It can be argued that with several players marketing a large number of brands, the pharmaceutical market in India is competitive. However, the pharmaceutical market should not be studied as a single market but, as a sum total of a large number of individual sub-markets. This paper examines the methodological issues with respect to defining the relevant market involved in studying concentration in the pharmaceutical market in India. Further, we have examined whether the Indian pharmaceutical market is competitive.
Indian pharmaceutical market was studied using PharmaTrac, the sales audit data from AIOCD-AWACS, that organises formulations into 5 levels of therapeutic classification based on the EphMRA system. The Herfindahl-Hirschman Index (HHI) was used as the indicator of market concentration. We calculated HHI for the entire pharmaceutical market studied as a single market as well as at the five different levels of therapeutic classification.
Whereas the entire pharmaceutical market taken together as a single market displayed low concentration (HHI = 226.63), it was observed that if each formulation is defined as an individual sub-market, about 69 percent of the total market in terms of market value displayed at least moderate concentration. Market should be defined taking into account the ease of substitutability. 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However, the pharmaceutical market should not be studied as a single market but, as a sum total of a large number of individual sub-markets. This paper examines the methodological issues with respect to defining the relevant market involved in studying concentration in the pharmaceutical market in India. Further, we have examined whether the Indian pharmaceutical market is competitive.
Indian pharmaceutical market was studied using PharmaTrac, the sales audit data from AIOCD-AWACS, that organises formulations into 5 levels of therapeutic classification based on the EphMRA system. The Herfindahl-Hirschman Index (HHI) was used as the indicator of market concentration. We calculated HHI for the entire pharmaceutical market studied as a single market as well as at the five different levels of therapeutic classification.
Whereas the entire pharmaceutical market taken together as a single market displayed low concentration (HHI = 226.63), it was observed that if each formulation is defined as an individual sub-market, about 69 percent of the total market in terms of market value displayed at least moderate concentration. Market should be defined taking into account the ease of substitutability. Since, patients cannot themselves substitute the formulation prescribed by the doctor with another formulation with the same indication and therapeutic effect, owing to information asymmetry, it is appropriate to study market concentration at the narrower levels of therapeutic classification.</abstract><cop>United States</cop><pub>Public Library of Science</pub><pmid>26895269</pmid><doi>10.1371/journal.pone.0148951</doi><oa>free_for_read</oa></addata></record> |
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| subjects | Acquisitions & mergers Analysis Antitrust laws Biology and life sciences Classification Competition Datasets Drug Industry Drugs Economic aspects Economic Competition Formulations India Market size Market value Markets Medicine and Health Sciences People and Places Pharmaceutical industry Pharmaceuticals Public health Social Sciences Studies |
| title | A Critical Analysis of Concentration and Competition in the Indian Pharmaceutical Market |
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