Organisation of the Ayurveda manufacturing industry

Ayurveda is predominant among Indias traditional health systems.It runs parallel to the modern health care sector and has a seventyper cent share of the formal medicine market.Ayurveda manufacturing units can be broadly classified into the organised and the unorganised sectors. The organised sector consists of both large and small manufacturing units.The large manufacturing units comprise the well-established manufacturers who operate in both domestic and international markets.They are the flag bearers of industry and are mainly responsible for the revival and growth of ayurveda. The largest of these, in terms of sales, is Dabur India Ltd.,while Shree Baidyanath Ayurved Bhawan Ltd. (referred to as Baidyanath in short)claims to manufacture the largest range, with over 700 ayurvedic formulations (.Other major players in the industry include: Himalaya Drug Company Ltd., Charak Pharmaceuticals, Zandu Pharmaceuticals Ltd., Unjha Ayurvedic Pharmacy and Arya Vaidya Sala. Many more companies have diversified into ayurveda. These include pharmaceutical companies such as Cadila Healthcare Pvt. Ltd., Albert David Ltd.,Cipla Ltd. as well as corporates from other sectors such as Bajaj Group, Velvette International, etc.Small manufacturing units manufacture a few medicines and operate in a small area. Nonetheless, at times such units are quite strong in their area of operation. There are certain small manufacturing units who cater to export markets only.The unorganised sector includes practicing Ayurvedic experts(vaidyas) and micro-units manufacturing only a few products and operating at local level. A reputed Vaidya generally prepares his own formulations for treatment. The large number of units manufacturing. Ayurvedic medicines can be attributed to the comparatively low infrastructure cost, access to raw material, simple manufacturing process and lack of standardisation of quality and efficacy of medicines.The total annual turnover of the industry was estimated to be Rs25 billion in 1998 (ITCOT 1999). However, this figure accountsfor the registered manufacturers only. It is estimated that the microunits spread across India comprise a market bigger than the organised sector and the total ayurveda market including such units is around Rs. 45 billion.Ayurvedic drug manufacturing companies, whether in the organised or unorganised sector, are mostly family owned businesses.

The origin of most of these companies can be traced back to a vaidya who used to prepare some formulations for dispensing, and the gradual acceptance of medicines led to growth of such units.

Many such companies are now being run by third generation owner managers. The ownership pattern has helped in the transfer of knowledge from one generation to other, thereby enriching the knowledge base of families. But it has also brought conservatism and secretive attitudes into the sector, which has affected its amalgamation with the general stream of development. This observation is most evident in the case of standardisation of raw material as well as medicines.

MAJOR PLAYERS
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Ayurvedic medicines are produced by several thousand companies in India, but most of them are quite small, including numerous neighborhood pharmacies that compound ingredients to make their own remedies. It is estimated that the total value of products from the entire Ayurvedic production in India is on the order of one billion dollars (U.S.). The industry has been dominated by less than a dozen major companies for decades, joined recently by a few others that have followed their lead, so that there are today 30 companies doing a million dollars or more per year in business to meet the growing demand for Ayurvedic medicine. The products of these companies are included within the broad category of "fast moving consumer goods" (FMCG); which mainly involves foods, beverages, toiletries, cigarettes, etc. Most of the larger Ayurvedic medicine suppliers provide materials other than Ayurvedic internal medicines, particularly in the areas of foods and toiletries (soap, toothpaste, shampoo, etc.), where there may be some overlap with Ayurveda, such as having traditional herbal ingredients in the composition of toiletries.

The key suppliers in Ayurveda are Dabur, Baidyanath, and Zandu, which together have about 85% of India's domestic market. These and a handful of other companies are mentioned repeatedly by various writers about the Ayurvedic business in India; a brief description is provided for them, arranged here from oldest to newest:

Dabur India Ltd. is India's largest Ayurvedic medicine supplier and the fourth largest producer of FMCG. It was established in 1884, and had grown to a business level in 2003 of about 650 million dollars per year, though only a fraction of that is involved with Ayurvedic medicine. Last year, about 15% of sales volume was pharmaceuticals, the remaining 85% were mostly non-medicine items such as foods and cosmetics. Dabur's Ayurvedic Specialities Division has over 260 medicines for treating a range of ailments and body conditions-from common cold to chronic paralysis. These materials constitute only 7% of Dabur's total revenue (thus, less than 50 million dollars). Dabur Chyawanprash (herbal honey) has a market share of 70% and chewable Hajmola Digestive Tablets has an 88% share. Other major products are Dabur Amla Hair Oil, Vatika (Shampoo), and Lal Dant Manjan (Tooth Powder). Sri Baidyanath Ayurvedic Bhawan Ltd. (Baidyanath for short) was founded in 1917 in Calcutta, and specializes in Ayurvedic medicines, though it has recently
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expanded into the FMCG sector with cosmetic and hair care products; one of its international products is Shikakai (soap pod) Shampoo. Baidyanath has a sales volume of about 350 million dollars, but most of the product sales are in the cosmetic range. The company reports having over 700 Ayurvedic products, made at 10 manufacturing centers, with 1,600 employees. Included items are herbal teas, patent medicines, massage oils, and chyawanprash.

Zandu Pharmaceutical Works was incorporated in Bombay in 1919, named after an 18th-century Ayurvedic. The company focuses primarily on Ayurvedic products (in 1930, pharmaceuticals were added, but the pharmaceutical division was separated off about 30 years later). However, today Zandu has a chemicals division and cosmetics division. Its total sales volume is about 45 million dollars. One of its current projects is to develop a dopamine drug from a plant extract, applying for new drug status in the U.S.

The Himalaya Drug Company was established in 1934 in Bangalore. It currently has a business level of about 500 million dollars and has a U.S. distribution division (Himalaya USA). It is known in the U.S. for the product Liv-52, marketed as a liver protector and therapy for liver diseases like viral hepatitis; the product was first marketed in India in 1955.

Charak Pharmaceuticals was founded in 1947, and currently has three distribution centers in India; it produces liquids, tablets, and veterinary supplies. It has gained a large advantage with its new product Evanova, a preparation containing 33 herbs and minerals and non-hormonal active ingredients used as a menopause treatment alternative to HRT. Soya is one of the main ingredients in this product. The product also contains Ayurvedic herbs that act like selective estrogen receptor modulators as well as asparagus root (shatavari), which reduces the frequency and intensity of hot flashes.

Vicco Laboratories was established in 1958. It mainly produces topical therapies based on Ayurveda and is best known internationally for its toothpaste product, Vajradanti, which has been marketed in the U.S. for more than 25 years.

The Emami Group, founded in 1974, provides a diverse range of products, doing 110 million dollars of business annually, though only a portion is involved with Ayurvedic products, through its Himani line; the company is mainly involved with toiletries and cosmetics, but also provides Chyawanprash and other health products.

Aimil Pharmaceuticals Ltd., incorporated in 1984 and engaged in manufacturing and sale of both generic and proprietary Ayurvedic medicines, with a business level of about 20 million dollars annually. Its wide range of Ayurvedic herbal formulations, covering most therapeutic segments, was honored by the Indian government's National Award for Quality Herbal Preparations and National Award for R & D in the year 2002. It is known for its proprietary formulas for hepatitis, diabetes, menstrual disorders, digestive disorders, and urinary diseases.

STATUS OF AYURVEDA IN INDIA

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The Indian government and non-government organizations have been collecting statistics on the Ayurvedic system in India and these data about the manpower and institutional aspects of Ayurveda have emerged:

Number of registered medical practitioners: 366,812 Number of dispensaries: 22,100 Number of hospitals: 2,189 Number of hospital beds: 33,145 Number of teaching institutions (undergraduate): 187 Number of upgraded postgraduate departments: 51 Number of specialties in postgraduate medical training: 16 Number of pharmacies manufacturing Ayurvedic medicines: 8,400

In India, 60% of registered physicians are involved in non-allopathic systems of medicine. In addition to the nearly 400,000 Ayurvedic practitioners, there are over 170,000 homeopathic physicians; India has about 500,000 medical doctors (similar to the number in the U.S., but serving nearly 4 times as many people). Reliance on Ayurvedic medicine is heavy in certain regions of India, such as Kerala in the Southwest. Many Ayurvedic practitioners in small villages are not registered.

SWOT ANALYSIS

STRENGTHS:

Good remuneration with reasonable cost of cultivation. Diversifiction of crop species. Knowledge on plants and their use in therapy and remedy. Skilled, lowcost Manpower.

WEAKNESSES:

Lack of awareness amongst the growers. Lack of Marketing infrastructure which leads to distress selling and hence low revenue generation amongst the few ones who dare to venture into something that is not routine. High Cost due to low yield & poor quality of the produce due to nonusage of latest/ scientific farming technic. Lack of proper Govt Support. Often it is found that Stae Government officials are not able to help the farmer in the correct way.

OPPORTUNITIES:

We have a old cultural heritage of Ayurvedic medicine and hence identifying the correct crop for a particular agro-climatic zone is not a problem at all. Generating employment amongst among the rural folk. Target Cancer/Aids, Herat/Diabeties/Obesity/sexual vigour/cosmetics. Greater demand for export of medicinal crops.

THREATS:

Fluctuating market prices. Unexpected climatic fluactuations. Lack of education amongst the farmers makes them very vulnerable especially in the hands of unscrupulous people.

FIVE FORCES ANALYSIS

The pharmaceuticals market will be analyzed taking pharmaceutical companies as players. The key buyers will be taken as end users, both individuals and institutions such as hospitals, clinics or any private or National Health Service, and providers of pharmaceutical production devices as the key suppliers. Threat of buyers: Buyer concentration with respect to the focal industry is higher compared to the allopathic medicine.higher buyer concentration with respect to the focal industry reduces to the bargaining power of the buyers.so,the risk for the focal industry is low. There are a lot of competitors present in this sector.It has been found that the buyers can avail products of different companies depending upon the availability of product.so the overall threat is very high.

Threat of Suppliers: Due to supplier concentration with respect to the industry,low switching cost in changing suppliers and substitutability of suppliers products the overall risk is low.

Threat of Substitute: There is a huge threat of substitute of ayurvedic products and services.The two major alternatives are allopathic and homeopathic treatment. allopathic treatments are famous for prompt and quick remedy of almost all type of diseases.It was found that that most of the people who are not satisfied with ayurveda are planning to rely in allopathic treatment. some of them also planning to switch over homeopathic treatment.
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Threat of new entrant Buyers switching cost is very less considering that there is no fixed investment attached to it.so, the perceived risk is very high.due to lower capital requirement of a new start ups and the abundance of the financial option ,we can conclude that a new entry is possible at case in the market.Apart from this some allopathic companies like east india pharmaceuticals also coming in ayurvedic field.so the overall risk is very high.

Threat of rivalry: Due to degree of fragmentation in ayurvedic industry and growth in ayurvedic industry ,the perceived risk is much high.Apart from this the services and product provided by various ayurvedic companies are also the same at large extent.so,this homogeneity is also another reason for high risk.

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CURRENT SCENARIO OF AYURVEDIC INDUSTRY AND THE WAY FORWARD:

Ayurveda has been a lively system of health with an unbroken practice since 3000 years. Although , Ayurveda as a system of medicine has been in practice in India for centuries but its growth as an industry has commenced only a few years back. This was mainly on account of lack of awareness and initiative by its practitioners,industry and even the Government . We have been non-receptive and reclusive for modern techniques and advancement that has occurred in the modern techniques and advancement that has occurred in the modern pharma industry . The classical drugs like Dashmmolarishta and Arjunarishta are also in practice since then . In recent past, the tradition of preparation of medicines by the Ayurvedic practitioner has almost come to an end . Now we find a much organized and commercial production of Ayurvedic medicines in big factories. Ayurveda and its products are becoming popular with increasing demand the world over. The pressure of the People of the respective countries to adopt Ayurvedic products has amounted to many countries now allowing and regularizing sale of these products in to their countries . This has boosted the globalization process. But this initial phase is primarily the phase of enquiry and curiosity Ayurveda has to live upto the expectations , otherwise we have the risk of getting washed out forever. Hence, Ayurveda needs immediate and extensive reorientation to gain scientific credibility, as this traditional old system of medicine if given the opportunity, is poised for an unprecedented expansion globally. There is, therefore, a need to transform Ayurveda into a dynamic, scientifically validated and evidence based which takes its roots from rich knowledge base of oral tradition and scriptures. The major hurdle in the wider acceptability of Ayurveda and its products is the lack of proper standardization techniques and its unpreparedness to accept global challenges. The quality of raw drugs used in manufacturing as well as the finished drugs of Ayurveda and other traditional systems from India are seen with a suspicion. We need to reassure our global partners by providing them evidence of quality of medicines we prepare in terms of reproducible efficacy and standardization.Some of the reasons for our unpreparedness are: Lack of good teachers and good institutions of Learning. Barring a few like Banaras Hindu
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University (Varanasi) , Gujarat Ayurved University and National Institute of Ayurveda , most of the other colleges are either just average or even below the acceptable limits . This reflects in non-promising Ayurvedic graduates coming out of these institutions. Absence of a basic manufacturing standards or Standard Operating Procedures (SOPs) of various ayurvedic products in this sector. Absence of adequate scientific documentation is, probably the fundamental problem and most serious limiting factor faced by this sector from the very beginning. Problem confronted by the exporters of Ayurveda products is the absence of herbal monographs in Indian Pharmacopoeia. The lack of a killer instinct in the Ayurvedic industry to have a larger share of sales in the domestic as well as in the international market has resulted in loss of opportunities, which should rather have been grabbed not only for the benefit of the industry but also for the benefit of the nation as a whole. The opportunities are still there and we must wake up to harness them if we are looking at globalization of Ayurveda and the international status for our products. The lack of facilitating regulations for the Indian medicinal products in the most of the countries has been the major hindrance for the growth of this sector. There is a strong need to rectify the things at home as well as in terms of standardizing Ayurvedic finished products on quality parameters which involve the FPS (Finished Product Specifications ), the claim support studies whether clinical.or experimental and the safety of these preparations through toxicity studies done in NABL/GLP Laboratories as the requirement may be. Even the manufacturing environment has to be par excellence as many of the authorities like MHRA, SFDA have the inspection and approval of manufacturing locations as an essential element of registration. There has been a gradual change in the attitude although much slower than the time demands. Government of India has started the task of finalizing the Ayurvedic Pharmscopoeia of India (API) . In fact , The Industry has to come forward for photo-chemical profiling of each of the herb used in their manufacturing facilities. Much more difficult is the need to identify at least one biologically active marker compound . Unless and until you have the bioactive marker, no pharmacokinetic studies or bioavailability studies are possible . This is a challenge as it has also come as an obstacle for the registration of Ayurveda product as medicines in most of the countries. Professionals of Ayurveda
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often blame the industry for not selling its goods abroad as medicines and gets the products registered as food supplements. But till you meet the drug norms, you cannot register them as medicinal products or drugs. Authentic substitutes are important specifically for classical products as number of herbs are not available today and many more are already categorized as endangered species. If official substitutes are not given, the Industry will have to shut down shop or has to give false ingredient lists. There has to be review committees specifically for declaring the official substitutes.

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Challenges
As the global market is big and expanding, the Indian herbal industry is focusing on exports. From a global perspective, critical challenges for herbal industry are: Regulatory concerns Consumer perceptions Competition Regulatory concerns The regulatory agencies, world over, are focusing on: Quality Efficacy Safety Standardization of herbal medicines. The new guidelines from US FDA and EMEA cover the need for documentation in the above areas.3

Quality A Major Concern Quality of herbs has become a major concern following reports of heavy metals in Indian herbs. Adulteration of plants is a serious problem. Some of the common adulterants are: botanicals, toxic metals, microorganisms, microbial toxins, pesticides, and fumigation agents. One study showed that 64% of HMP samples collected in India contained significant amounts of lead (64% mercury, 41% arsenic and 9% cadmium). A recent Harvard Medical School study reported that 14 (20%) of 70 HMPs contained heavy metals. However, this problem is not unique to Ayurvedic medicine. Other traditional medicines Chinese, Middle East and South American-have also been implicated. Such contamination can lead to serious harm to patients taking such remedies and could also interfere with the assessment of safety in a clinical trial. Quality has to be assured at all stages herbal raw materials, processing of herbals and finished herbal medicines.
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Substantiation of Clinical Efficacy One of the major issues with HMPs is lack of good quality clinical trials. Even if the animal studies or anecdotal clinical experiences are promising and use of an herb is widespread, such observations cannot predict the results of well-designed randomized, controlled trials. Some of the Indian medicinal plants - Phyllanthus amarus, Picrorhiza kurroa, Tinospora cordifolia, Commiphora mukul, Mucuna pruriens, Boswellia serrata, have been tested in clinical trials. However, a recent review concluded that evidence-based studies on the efficacy and safety of traditional Indian medicines are limited. As there are few good quality clinical trials on Indian HMPs, international researchers have made efforts to confirm Indian data. In a recent double blind randomized placebo controlled trial, 8-week treatment with guggulipid 1 gm or 2 gm did not improve levels of serum cholesterol in population of adults with hypercholesterolemia, and raised levels of LDL-C. Besides, participants taking gugulipid developed a hypersensitivity rash. Such studies cast doubt on the quality of clinical trials of HMPs conducted in India. Most regulatory authorities ask documentation on clinical efficacy of HMPs. Department of AYUSH recommends that manufacturers would be expected to conduct efficacy and safety studies before licenses are granted for Ayurvedic Patent and Proprietary medicines. Safety Issues - Adverse Reactions and Drug Interactions Herbal medicines are generally considered comparably safer than synthetic drugs. However, recent reports challenge such assumptions. Ephedra marketed as a dietary aid in USA, led to at least a dozen deaths, heart attacks and strokes. Other well-known safety issues have been hepatotoxicity of kava and renal effects of aristolochic acid. Besides, drug interactions of herbal drugs are of a serious concern. Serious adverse effects have been reported when the addition of St. John's wort caused serum levels of cyclosporine and antiretroviral agents to fall to sub therapeutic levels. Garlic is reported to increase clotting time in patients taking warfarin.

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WHO has urged the governments to establish regulatory mechanisms to control the safety and quality of products.

Standardization of herbal drugs For safe and effective use of herbal drugs, consistency in composition and biologic activity are essential. However, herbal drugs frequently fail to meet this standard, because there are problems of 1) difficulties in identification of plants, 2) genetic variability, 3) variations in growing conditions, 4) diversity in harvesting procedures and processing of extracts, and 5) the lack of information about active pharmacologic principles. In a study of ginseng preparations, the amount of ginsenosides varied from 11.9327.7% of the amount on the label Medical letter cautions, Their (herbal medicines) potency may vary and their purity is suspect, Australian medicines regulatory body the Therapeutic Goods Administration, recalled over 1500 HMPs and suspended production license of Pan Pharmaceuticals after an audit, which revealed problems with company's quality control standards. The Indian companies must focus attention on quality during the whole process chain from -accessing raw materials to finished products to meet global expectations.

Consumer Perceptions HMPs have become popular because of perceived safety and economy and inability of allopathy to cure everything. However, recent reports of contamination and potential for adverse reactions, have tempered the enthusiasm of consumers for these "natural" cures, resulting in decline of sales of herbal products in the United States. The consumers now want more authentic information on quality, safety and efficacy of HMPs.

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The medical perceptions about complementary medicine (including HMPs) are diverse. surveys show that, overall, physicians believe it is moderately effective, while many doctors regard complementary therapies as scientifically unproved. The doctors' are concerned about 1) use of such therapies as an adjunct or an alternative to conventional care, 2) comparative efficacy of complimentary and allopathic therapies and 3) the possibility of adverse effects. In general, globally, the trend amongst doctors is to support the patients' preferences for complementary therapies. However, they want published information from reliable sources on quality, safety and efficacy of HMPs. Competition Amongst the countries with herbal resources, China is a major competition. The discovery of artemisinins as a new class of anti-malarial drugs from Chinese plant Artemisia, has brought Traditional Chinese Medicine (TCM) practices and Chinese HMPs made attractive for research. A random search of MedLine showed that number of publications on TCM was >3 times the number of publications on Ayurveda. The indications for clinical trials of TCM cover the current medical challenges of Allopathy. Some of the therapeutic areas of TCM clinical trials are: neurology, oncology, cardiology, diabetic complications, rheumatoid arthritis etc. These clinical trials are conducted according to scientific and ethical principles of modern clinical research. Chinese government highly values the development of TCM and has announced that by 2010 it will establish a modern TCM innovation system along with a series of standards and norms for modern TCM products, support development of a number of new TCM products and key technologies, and encourage creation of a competitive modern TCM industry. The government efforts are intended to boost the quality of Chinese medicine and enhance China's ability to compete in world markets.

Conclusions
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The future of Indian herbal industry depends on how it prepares it self to face the challenges of the present regulatory concerns, consumer perceptions, and competition. The global regulatory agencies US FDA, European Community have made guidelines for botanicals. Recently, The Australian government has backed increased regulation of the complementary health sector. These guidelines focus on documentation of the key issues - Quality, Efficacy, Safety, and Standardization. Some of these issues will also be applicable to dietary supplements. The international regulatory authorities would expect the data generated (pre-clinical, CMC and clinical) should meet the standards of GxPs (Good Practices) good agricultural practices, good laboratory practices (GLP), good clinical practices (GCP) and good manufacturing practices (GMP). These guidelines will make licensing difficult for HMPs. Besides, the governments are likely to restrict availability of HMPs with toxic potential. WHO has also recommended that it important for governments to establish regulatory mechanisms to control the safety and quality of products and of TM/CAM practice. The consumers doctors and patients- expect innovation and effective options for chronic diseases. The industry has to 1) become creative in designing clinical trials, 2) developing consumer friendly products and 3) effective marketing communication.

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