A frightening new book on the safety of generic drugs could send India’s pharma industry into an even deeper pit

• Katherine Eban’s “Bottle of Lies”, launched in US on May 14, warns Americans against generic drugs made abroad.
• The book is an account of the lapses in good manufacturing practices by drug exporters to US.
• Indian companies are big exporters of medicines to US and are already squeezed between shrinking prices and regulatory pressures.

Drug makers in India have relied on Americans to buy a big chunk their produce for a long time now. It had paid off well for many years until recently. Between rising competition squeezing prices, regulatory pressure to keep prices lower, and an expanding lawsuit into a purported conspiracy, Indian companies have found the US market to be a tougher place than it ever was.

The latest blow has come in the form of a new book, "Bottle of Lies", which "argues that generic drugs are poisoning us," according to the New York Times. It's "an invaluable exposé, a reportorial tour de force and a well-turned epic," the reviewer David Dobbs added.

The controversy that forms the heart of the book is nearly a decade old. Dinesh Thakur blew the lid on an Indian company Ranbaxy for cutting corners and compromising on quality of drugs before quitting the company in 2005. The case unraveled over the years in courtrooms, Congressional hearings, and public discourse that damaged the reputation of India as the 'pharmacy of the world'.

The case has since been settled at the US Federal Drug Administration (USFDA) for $500 million, Ranbaxy has been bought over by Sun Pharma, India's largest drug maker with a huge stake in the US market. But the troubles of Indian drug makers are far from over.

On one hand, there is a two-pronged pressure consistently squeezing drug prices-- one from the Trump administration and the other from the rising competition in generic drugs. Over the past three years, sales per marketed product (in US) have declined by about 30%, according to a report by global investment bank Nomura in March 2019.

At the same time, seven Indian companies -- Sun Pharma, Dr Reddy’s Laboratories, Glenmark Pharma, Lupin, Wockhardt, Zydus Pharma and Aurobindo Pharma-- are facing a lawsuit in over 40 American states for acting like a cartel to keep drug prices up. "However, given intensifying competition due to faster generic approvals and regulatory headwinds, the litigation raises the risk associated with the US generics business for companies involved in the litigation," a report from an Indian brokerage, Motilal Oswal, on May 14 said.

And Eban's book, which will only further worsen the narrative for the Indian companies, had the endorsement from none other than Dinesh Thakur. “The new book ‘Bottle of Lies’ exposes the truth – and it is critical that Congress hold hearings to address generic drug safety in America,” Thakur said at the book launch in Washington D.C. on Tuesday.

Erin Fox, Senior Director of Drug Information and Support Services at University of Utah Health Care (UUHC), who was also present at the launch said that, "The current pass/fail system the U.S. has in place for generic manufacturers overseas is not working. We need either quality metrics for suppliers or more transparency to make quality-based purchasing decisions."

Any regulatory action based on this advice will put Indian companies in a deeper pit than the one they are already in.

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