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Nimesulide: Prices crash

Sanjiv Shankaran

NIMESULIDE is a pain killer that is categorised as a non-steroidal anti-inflammatory drug (NSAID) in medical terminology.

Nimesulide's price trend in the bulk drug market has been chracterised by a significant decline over the last year. The current price level of Rs. 330 per kg represents a 41 per cent decline over the last year.

The declining pattern of price movement has come in the backdrop of a rise in the demand for Nimesulide from the end-consumers. The demand has seen an uptrend because Nimesulide is a relatively new NSAID that has cut into the market-share of older genera tion molecules such as Ibuprofen and Diclofenac. Another factor that may account for the growing use of Nimesulide is that the market for NSAIDs has been growing faster than quite a few other therapeutic segments.

With technology not acting as a barrier to entry, the price trend in Nimesulide captures the intensely competitive and fragmented nature of the Indian pharmaceutical market where a fast growth rate in a molecule has been accompanied by a sharp fall in th e price of the bulk drug.

The primary cause for the crash in the price of the Nimesulide bulk drug (the chemical in the form of an ingredient for the tablet) appears to be increasing competition on the heels of a growing number of companies taking to the production of Nimesulide. While industry officials say that about 70 per cent of the bulk drug market is catered to by a handful of companies, the increase in the number of companies fighting for a market share has had an adverse impact on the price.

Industry estimates that the current year's output of Nimesulide will be around 400-450 tonnes as against about 300-350 tonnes in 1998-99.

In the formulation (drug in a ready-to-consume form like tablet) market, there are a little over 100 manufacturers of Nimesulide. Around 55 of these manufacturers market the molecule under a brand name. The rest market it under the generic name (the chem ical composition). The outcome has been a decline in Nimesulide's formulation price.

The decline in the formulation price itself should have hurt the profitability of manufacturers. In addition to that, the manufacturers may have also been impacted by the undercutting and `prescription substitution' that has increased at the chemists' le vel on the heels of manufacturers of quite a few drugs, trying to influence chemists. The growing competition in the industry is believed to have led to this phase.

At the moment, there appears to be no clear-cut signs of where the price of Nimesulide will bottom out.