Union Budget 2021: Govt should invest in clinical trials, enable policies to empower pharma sector
With poor historical spends on healthcare, there is an urgent need to raise the allocation substantially for health as a proportion of GDP
In the wake of the pandemic that struck in 2020 paralysing businesses and lives of people, the expectations from Budget 2021 centre around the allocation of higher spending towards healthcare. The pandemic brought home the need for a strong healthcare infrastructure to ensure a sustainable economy. Experts in the sector, pharmaceutical firms and startups share their expectations from Budget 2021 with Firstpost.
Nikhil Chopra, CEO and Whole Time Director, JB Chemicals and Pharmaceuticals
Budget 2021 is expected to focus on proposals that revive demand and boost economic activity. To give the necessary fillip to the Indian pharma and healthcare sector, we expect the government to form enabling policies that will empower the industry to establish India as the pharmaceutical hub for the world. While the Budget should continue to ensure wider implementation of schemes like Ayushman Bharat, as against the marginal increase in budget allocation for healthcare every year, Budget 2021 should put health on top priority and increase spends on public health substantially from previous years.
Azad Moopen, Founder, Chairman and MD, Aster DM Healthcare
It is important to at least double the healthcare budget from last year's meagre allocation. This would help to improve access to affordable care for the masses. The Budget should also be able to create capacities for vaccinating India’s large population against COVID-19 which is key to end the pandemic and revive the economy. Allocation of sufficient funds to cover about 40 percent of the low-income population who fall under the Ayushman Bharat scheme through free vaccination should help in addressing this.
Sanjiv Navangul, MD and CEO, Bharat Serums and Vaccines Ltd
The need of the hour for the industry is the availability and affordability of life-saving drugs for our billion-plus populace. The Union Budget should address long-standing special incentives and subsidies to encourage indigenous drugs and API production in line with Atmanirbharta. There should be tax cuts on life-saving drugs to make them affordable. We must also provide full medical cover to proactively help indisposed and senior citizens. Grants to Indian companies that make novel drugs should be made available to speed up patents and inventions. Flexible pricing policies that can encourage up to 7 percent MRP increase year-on-year and giving 300 percent deduction for R and D expenses will be beneficial for the industry.
RB Smarta, Managing Director, Interlink
Budget 2021 needs to bring strategic and implementable ideas on board to make them real in India. The central government can play a crucial role in terms of enabling health policies, programmes and resources to health. Understanding it is a state issue, policy, procedures and SOPs need to be formed by the centre to evaluate the participation of states. India must get its coveted position in API in the world and PLI-like schemes and allocation will reduce imports and increase exports. Pharma entrenchment in Artificial intelligence and machine learning needs to be promoted and special allocation for pharma startups with time-bound progress should be established.
Suresh Raju Founder, Fitday.in
Post-pandemic, India is going to be the country of choice for the healthcare sector. The current imports of $2.7 billion worth of nutraceuticals have significantly primed India to attract foreign investments. The government should invest in clinical trials, fund universities and decipher hidden Ayurvedic treatments and ancient texts. The FSSAI licensing should have a more stringent and streamlined department just for nutraceuticals.
DS Negi, CEO Rajiv Gandhi Cancer Institute and Research Centre
Ayushman Bharat is no doubt a highly positive step towards attaining the objective of universal healthcare. However, more allocation needs to be apportioned for its continued success. We expect the government to apportion larger funds towards preventive health and wellness segments. India woefully lacks in hospital beds required for its populace. Higher tax incentives to the private sector towards modernising medical facilities will go a long way in ensuring better healthcare, more investments and thereby generate more employment.
G Surender Rao, MD, Yashoda Hospitals
I expect the government to continue to strengthen health reforms from the previous years to boost domestic health infrastructure, provide jobs, and increase health insurance penetration with additional tax benefits. Health insurance should be made a mandatory subscription for every voter in the country and by virtue of this, compliance will help reduce the burden and out-of-pocket expense for all voters. With access to the country’s ‘COVID-19 Emergency Response and Health System’ established by the GoI, we now need to adopt an extensive, multifarious allocation and investments plan. While building a strong infrastructure, it is essential that additional funds be specially allocated towards training medical staff, establishing and improving the supply chain of vaccines, medicines and accessibility.
Sanjay Joshi, Regional Managing Principal and Head – Asia, ZS Associates
The year 2020 was a whirlwind for the healthcare sector and has brought everyone’s attention to the problem areas. It has made everyone realise the importance of prioritising the public healthcare requirements and hence it is anticipated that Budget 2021 will bring policies that will bridge the gaps in the current healthcare landscape.
Saurabh Kochhar, Founder and CEO, Meddo
Last year, the Budget allocated only 1.29 percent of the GDP to healthcare which should now increase substantially. We have to have enough funding to achieve our goal of affordable and accessible healthcare. It is time that out-patient care be mandatorily put under the aegis of health insurance cover including Ayushman Bharat to make it more accessible. Reduction of GST rates on life-saving drugs can pave the way for affordable medicine, and adequate tax holidays and concessions for health entrepreneurs, R&D, etc. can usher a golden era of innovation-driven healthcare in our country.
Vivek Desai, Founder and MD, Hosmac India
There is an urgent need for more medical colleges as there is a massive deficit of doctors, nurses, and paramedical staff. The authorities might have to give incentives to the private sector to set up nursing and paramedical educational institutions. The private sector needs a structured financing scheme like the housing finance sector's softer interest regime. Hospital loans are usually given a 5-10 year bandwidth, and that's not enough. Healthcare sector needs structured finance schemes and a more extended moratorium, as unlike sectors like IT, the healthcare sector takes a more extended period to attain break-even. Some rebates on property tax and electricity tariff should also be given for hospitals, as they spend around 3 percent of their income to pay these taxes.
Yogesh Mudras, MD, Informa Markets
We are expecting a healthcare-focused budget which is the need of the hour. We expect the government to especially focus on primary healthcare infrastructure that needs huge improvement in terms of improved access to healthcare for low-income households.
Dipali Mathur Dayal, Co-Founder and CEO, Super Smelly
The year 2020 was tough and a good, strong Budget will come as a relief. We hope it is consumption-friendly, leaving more money in the hands of people to catalyse demand in the economy. Moreover, for startups, we look forward to the simplification of GST and tax relaxation in ESOPs. MSME and startups would need government support to revive businesses and to continue to generate employment. Therefore, easy and cheaper access to credit would certainly bring relief. The personal care sector, in particular, needs steady budgetary support. There is a nationwide movement to transcend from large-scale toxin-based products from international brands to natural, homegrown, and toxin-free brands. Therefore it is important to emphasize the importance of Make in India and vocal for local to strengthen the country’s economy.
Vishal Kaushik, Co-Founder and MD, Upakarma Ayurveda
We are expecting the GST to be brought down from the current 12 percent which is levied on products that have the license to sell as branded Ayurvedic medicines. This will further help cost reduction and easy accessibility of products. The government can also look at providing funds for Ayurvedic practitioners and centres, which will further encourage the domestic and offshore investors to put faith in India for new product developments.
RN Mohanty, CEO, Sightsavers India
With the pandemic raging on, we expect higher spending on healthcare in Budget 2021. The healthcare sector needs immediate attention, especially because most people do not have access to it. Preventive health check-ups can bring down the disease burden substantially with early detection and treatment. Apart from vaccination, government funding will strengthen the healthcare system at different levels which have been stretched in the recent pandemic.
Ameera Shah, Managing Director, Metropolis Healthcare
The lack of adequate public health infrastructure in India combined with a high out-of-pocket expenditure imposes a high financial burden on Indian households and therefore increasing the healthcare budget allocation in the coming decade is of utmost importance. The need of the hour is to strengthen the provisioning of healthcare services through public-private partnerships. This will not only ensure quality healthcare for all citizens but also encourage much-needed private investments into the industry. The government should also allocate funds towards universal vaccine coverage for all citizens and increased testing in order to combat a further surge in infections.
RB Smarta, Managing Director, Interlink consultancy
Strategically, as planned in National Health Policy-2017, India has an intent of allocating 2.5 percent of GDP by 2025 from existing 1.3 percent of GDP inclusive of public health is very minuscule compared to OECD countries average of 7.6 percent of GDP. A lot needs to be done in an evolving manner to implement long-term strategic intent of a healthy India. The government can play a crucial role in terms of enabling health policies, programmes and resources to health. Understanding it is a state issue, policy, procedures and SOPs need to be formed by central to evaluate the participation of states. Pharma entrenchment in artificial intelligence and machine learning needs to be promoted and special allocation for pharma start-ups with time-bound progress should be established.
Jitendra Chouksey, Founder, FITTR
It is imperative that the upcoming Union Budget 2021-22 gives more thrust to investment in technology. This will help create a conducive environment for emerging technologies such as machine learning and artificial intelligence. It is equally important that there is a focus on reforms and policies that are favourable for the entire startup ecosystem. We believe that the Fit India Movement, which was introduced in August 2019, should be aligned with tech-driven SMEs and MSMEs. This step will not just benefit the businesses but can also take the scheme up a notch. The Government of India should also look at expanding the National Digital Health Mission (NDHM) that was launched earlier last year. A proper focus and dedicated framework comprising the public and private players can strengthen the mission.
Sanjaya Mariwala, Founder President Association of Herbal and Nutraceutical Manufacturers of India; Executive Chairman and MD OmniActive Health Technologies
We expect the government to primarily focus on R&D and innovation in this Union Budget 2021. Our ask from the government is based on four pillars, which will empower the nutraceuticals industry in India: Establish a cross-ministerial task force under a Joint Secretary at the Ministry of Commerce and Industry that creates a plan and sets a goal to make nutraceuticals into a $25 billion industry by 2030 and leverage the huge domestic and export potential that the AYUSH, herbal and nutraceutical industry offers; institutionalise a PPP model to contribute monetarily and non-monetarily towards R and D and innovation needed at all levels of research, technology and manufacturing in AYUSH and herbal sector; funding support for MSMEs either at a zero percent or low rate of interest and tax incentives for investments made in R&D and innovation; and initiate Bulk Drug Parks and Production Linked Incentive (PLI) scheme specifically for the herbal and nutraceutical industry.
Carlos Montiel, Vice President, Latin America and South Asia, Asia, ResMed
Considering the vulnerabilities, the Government of India should focus on the expansion and strengthening of the digital healthcare ecosystem in India while prioritising policies for patient’s data privacy. Investment in infrastructure for the development of additional and advanced medical colleges along with mandatory inclusion of telemedicine in the course details should be a priority to enable and prepare the next generation of health professionals this digital phase.
Dharminder Nagar, MD, Paras Healthcare
The Budget should focus on increasing public spending on healthcare. Other than that, there is a significant need for reviving the local demand. There is an urgent need to provide the viability gap funding by the government for investors who set up hospitals in smaller cities to increase the provider base for Ayushman Bharat. It can be coupled with an increase of package rates of Ayushman Bharat for more hospitals.
Amritah Sandhu, Founder and Director, CareIndia Health
It is crucial that the government plans on how to improve primary healthcare infrastructure in tier II and III cities. It may be advantageous to work alongside private players, to ensure doctors are actually present in these facilities. Private players can be incentivised, both financially and in terms of easier regulations to take up this challenge. The government should tighten the licensing norms for both existing and new pharmacies, where they inspect that all staff selling medicines are certified pharmacists and keep records of prescription and schedule X drugs.
Gurpreet Sandhu, President, Council for Healthcare and Pharma
With poor historical spends on healthcare, there is an urgent need to raise the allocation substantially for health as a proportion of GDP with particular attention to R and D in biotech, epidemiology and pharma including vaccines while ramping up of healthcare infrastructure. Keeping in mind the abysmal doctor-patient ratio, we need to scale up our medical education infrastructure, both quantitatively and qualitatively. There must also be added focus on preventing infections in the hospital environment while also addressing the creeping problem of antibiotic and antimicrobial resistance.
Neha Motwani, CEO and Founder, Fitternity
There is a critical need to invest in preventive care and fitness. Offer tax incentives to organisations committed to ensuring the health and fitness of people.
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