Mumbai: Stephan Gerlich, German drug maker Bayer AG’s India head, spoke in an interview about the way forward for its businesses in the country in line with its new Asia focus. Edited excerpts:
On higher investment in the chemicals business versus crop sciences, healthcare:
While the investment required for a chemical plant is huge, it is relatively small in the other areas... So you can’t really come to that conclusion. We have been investing lately in downstream activities in Bayer Material Science (chemicals) because the customer needs, and such custom-made products can only be produced locally. The investment over the last three-four years by Bayer Material Science is at up to €50 million in different fields and areas. Also, Bayer Crop Sciences and pharma have been here for long.
Growth plan: Stephan Gerlich. Photo: Hemant Mishra/Mint
On the India presence:
The decisive change for Bayer Pharma to come to India happened in 2005 when patent protection was imposed and we started to feel comfortable to come to India in a bigger way... The Indian drug market is developing very rapidly. We have the right products and we are not shying away from launching new products simultaneously or immediately after they are launched in other markets because we are confident that our rights are protected.
On the pricing strategy in India, where affordability is a key issue:
Bayer has patient access programmes for medicine that are fairly expensive and strategically we feel the Indian patient has to have access to modern medicine. Those companies that provide the newest generation (of drugs) have to have a return that allows them to further develop these products and to research for new products. We are very confident that the outcome of the discussion which is on going will be satisfying for the patient as well as the pharmaceutical sector.
On the likelihood of Bayer agreeing to reasonable pricing if talks favour this:
It would be too early for me to tell you if we would be agreeing or not. This is an ongoing discussion I am very confident, in my personal opinion, that the outcome will be fair for both sides because otherwise it will be damaging for both the patient and the products in the market.
On patent linkage in the Indian drug regulatory regime:
I would like to refrain from commenting as in our case there are ongoing legal proceedings. All I can say is that a company like Bayer is a research and development driven company and we fight for our patents and (their) protection as we want to fund further development that we will need 10 years from now and that can only happen if we are, for a certain period of time, protected for those investments that have happened over the last 10 years.
On restrictions in foreign direct investment in the pharma sector, government reservations about consolidation in the industry:
In the pharmaceutical space, how many thousands of companies do we have in India? And if there’s consolidation happening, it’s good for everybody and also for the controlling body.
On government concerns of a monopoly emerging:
No, there are simply too many (companies). This is not the beer business.