Be prepared for growth in a “bouncy way”, but don't lose sight of the long term potential of emerging markets including India, says GlaxoSmithKline Chief Executive Andrew Witty, outlining challenges in the region for his successor Emma Walmsley.

“I've always believed that emerging markets are going to grow. But I've also been relaxed with the idea of that they grow in a very bouncy way. And the danger is that you become obsessed with the short term volatility that you lose sight of the long term trajectory,” Witty said, responding to a query from Business Line.

Walmsley takes over from Witty next year, a benchmark as the only lady head of a multinational drugmaker. The move he hoped would pave the way for greater diversity in terms of gender, race, religion and sexual orientation.

Operating in the emerging markets means that “something weird is going to happen somewhere in that portfolio”, he said. And that could be a geographic event, a political event or a pricing event. But the long term potential is gigantic, about 6 billion.

But then again, he adds, the environment has been getting better in these markets, as Governments are making progress on the predictability of their regulatory policies, he says. But there's no getting away from the volatility.

Predictability

In fact, predictability is the only bone he picks with present day controls on drug pricing in India – a grouse voiced by foreign top honchos in the past.

Governments are justified in setting terms that benefits its citizens, says Witty, but a little “warning” would help companies be prepared with supplies to cater to the additional demand that comes in when prices are cut.

“I think it is naïve to sit here and say India should not be concerned about prices. Its ridiculous to say that, India of course should be concerned about prices. And the Government should take a view and it should be working through what is a tenable long term solution which encourages innovation but also makes sure that people get access to decent healthcare. Its completely correct,” he told a select media gathering.

Staying on governments and pricing, with the US Presidential election results to be known by tomorrow morning, Witty says, aside from what the new administration would do, the momentum for change was already being seen in the private market.

Preparedness

Elaborating on efforts to bring in more research preparedness for a “bio-defence” against events like Ebola, Swine flu etc, he said, GSK had mooted a research network that would work in peacetime to be better prepared for war. GSK was offering one of its manufacturing facilities to dedicate research to have vaccines against the “known unknowns”, so they can be deployed at a time of crisis and work is not reactionary, starting start from scratch when a crisis strikes.

jyothi.datta@thehindu.co.in

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