Companies offer subsidised drugs
No sops for rural phone linkups
Firms told to furnish two sets of EPS figures
A world of wealth that rests on health machines

 
 
COMPANIES OFFER SUBSIDISED DRUGS 
 
 
FROM R.SASANKAN
 
New Delhi, Nov 5: 
The proposal by the leading national pharmaceutical companies to supply medicines to the weaker sections of the society at a subsidised rate has evinced keen interest in the official circles.

Coming as it does in the wake of government’s belated realisation that various subsidies do not reach the targeted groups but are being pocketed by middlemen, this suggestion by the Indian Pharmaceutical Alliance has struck a responsive chord among senior bureaucrats.

The government, which normally spurns representations by various industry organisations, has for a change decided to seriously consider the note submitted by IPA. It is a relatively new organisation that has steered clear of the traditional lobbies like Organisation of Pharmaceutical Producers of India (OPPI) and Indian Drug Manufacturers Association (IDMA).

IPA represents the giants among Indian pharmaceutical companies such as Ranbaxy, Dr Reddy’s Labs, Wockhart Ltd ,Sun Pharmaceutical Industries, and Nicholas Piramal. It realises that the government cannot totally lift controls on prices for obvious political reasons. Price control in a liberalised economy is an anachronism but cannot be done away with in the absence of a viable alternative. In this context, IPA’s suggestion calls for serious consideration.

It has proposed enlarging of the scope of Sarvapriya scheme to include the supply of essential drugs through the public distribution system.This will expand the ambit of access to modern medicine to 90 per cent of the population by 2005.

According to IPA, the scheme will benefit over 30 crore people below poverty line as they will have access to quality drugs at affordable prices. The industry, through a consortium of ORG companies,will undertake to supply these drugs to the PDS at subsidised rates.These drugs under PDS may form part of a basket of new items such as tea, detergent cake, toothpaste, notebook etc. being offered under the Sarvapriya scheme and may be dispensed from Primary Health centres.

IPA seems to believe that primary health centres are free from corruption and can be trusted to take the medicines to the weaker sections.

The Indian pharmaceutical sector is one of the most unregulated in the world with no standards for registration of new drugs and sources of supply. In comparison, Indian companies exporting their products have to face ever-increasing barriers in the form of registration from country to country. The fees are prohibitive and procedures are time consuming and costly.

In this context, IPA’s suggestion to harmonise the standards for the registration of new drugs and sources of supply with those of the regulated market is considered highly sensible. The fees should be raised and made uniformly applicable to all. This will generate requisite funds for the upgradation of the Office of the Drugs Controller General of India.

IPA’s views on the pharmaceutical export potential is quite realistic. Exports which account for $ 1.5 billion at present has potential to grow at 20 per cent over the next five years and take the overall export figure to $ 4 billion by 2005. This can be achieved by moving up the value chain through development of new formulations and offering value-added services. Some initiatives by the government can drive robust growth in the international market.

It is not clear as yet when the new drug policy will be announced. It does not seem to be one of the priorities of the NDA government. Only a bold drug policy can accommodate the views of the IPA and this calls for courage on the part of the political leadership.    


 
 
NO SOPS FOR RURAL PHONE LINKUPS 
 
 
FROM M RAJENDRAN
 
New Delhi, Nov 5: 
The department of telecommunications (DoT) has rejected private telecom operators’ request for compensation from Universal Service Obligation fund for installing phones in rural and in areas that are inaccessible.

Instead, DoT has asked cellular and fixed telephone service providers to decide how they will meet the targets.

“It is a matter between the two operators to agree on arrangements, including expenditure for operations and capital costs. Basic and cellular operators, including Bharat Sanchar Nigam (BSNL), and cellular firms are free to arrive at mutually agreed terms to fulfil their obligations.

It also added that the commercial terms for use of cellular phones to provide VPTs should be resolved between cellular operators and fixed service providers.

“We had received representations from fixed and cellular mobile operators, but both the associations expressed reservations on taking up the project without funding from the Universal Service Obligation. The USO fund can be given only to Bharat Sanchar Nigam Limited. So, we have asked two associations to sort it out among themselves,” a senior DoT official said.

According to a Telecom Commission note, the percentage of villages which have received cellular coverage, but do not have a telephone facility is rather very small and therefore, the cellular phone from existing network could be used to provide village public telephones in a very small way.

Earlier this year, communications minister Ram Vilas Paswan had set up a committee to examine whether cellular networks could be used to meet VPT targets.

Cellular operators had claimed they had rolled out their network extensively. Due to this, a large number of villages had also received cellular coverage and this could be exploited for providing VPTs as well as direct exchange lines (DELs) in villages.

The government has set a target of putting all villages in the country on a telephone line by the end of this year, and increase the rural tele-density from the current level of 0.4 to 4 per cent in three years. Of the 6,07,491 villages in the country, 3,74,605 have already been provided a public telephone each. The remaining 2,32,886 villages will be covered by March 2002.    


 
 
FIRMS TOLD TO FURNISH TWO SETS OF EPS FIGURES 
 
 
FROM OUR CORRESPONDENT
 
New Delhi, Nov 5: 
The Institute of Chartered Accountants of India (ICAI) has asked companies to furnish basic and diluted earnings per share (EPS) for all classes of equity shares.

As part of its new exposure draft on EPS calculations, the institute has said the guidelines will facilitate comparisons of performance between companies in different accounting periods.

The new standard will be applicable to all enterprises, irrespective of whether their equity shares — or potential ones — are traded publicly.

The financial statement should contain basic and diluted EPS, even if there is a loss per share. If the profit and loss statement includes extraordinary items, the company should present two basic and diluted earnings per share figures — the ones which include extraordinary items, and the other which excludes them.

Basic earnings per share should be calculated by dividing the net profit or loss for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period.

If the number of equity or potential equity shares outstanding increases as a result of a bonus issue, or a share split, or decreases as a result of a reverse share split, the calculation of basic and diluted earnings per share should be adjusted for all the periods presented, the institute has said.

More important, companies are unlikely to find an escape route. If the changes occur after the balance-sheet has been finalised, but before the board meeting to approve the results, the per share calculation should be based on the revised number of shares. The formula should take into account the changes in the number of shares.

ICAI has said companies must try to provide a description of equity share transactions or potential equity share deals, other than bonus issues, share splits and reverse-share splits, which occur after the balance-sheet has been made.    


 
 
A WORLD OF WEALTH THAT RESTS ON HEALTH MACHINES 
 
 
FROM RAJA GHOSHAL
 
New Delhi, Nov 5: 
Sybill Storz, chief of Karl Storz, the German medical equipment maker she joined thirty years ago, is possibly one of the richest women in the world, but ask Sybill about her wealth and she is visibly embarrassed.

“I am lucky and glad that I am not the richest woman. All I can say is that I am generating enough for our present needs,” she says, adding, “I see myself as somebody doing the daily work of the organisation, which brings me satisfaction.”

Karl Storz is a German firm that manufactures and markets instruments for endoscopy. Its products are sold across 140 countries.

Endoscopy is popularly known as ‘button hole surgery.’ Instead of cutting open the part to be operated, surgery is conducted through instruments that enter the body through a natural or artificially created orifice.

The instruments come attached with telescopic vision and an endovision camera which shows the images on a computer monitor.

Endoscopy is of great use in diagnosis and also in destroying stones and other growths within the body.

The equipment range between Rs 3 lakh to a crore for an ESWL machine.

The latter, attached with ultrasound and X-ray C-Arm facilities, doesn’t even enter the body but breaks down the stones by local vibrations.

Although Storz has been present in the Indian market for around four decades and has a 60 per cent share of the estimated Rs 200 crore market, the company opened its Indian office only two years back.

The India office looks after marketing and distribution and also offers repairing and other services to its clientele, while the equipment is imported from the company’s production plant abroad.

Storz has four production plants outside Germany — two in the US and one each in Switzerland and France. The company has offices in 20 countries for marketing and distribution.

Sybill, here to attend the Millennium International Urology Congress being held from November 3-5, says that she joined the organisation founded in 1945 by her father, Karl Storz, “like any other trainee.”

This was after she completed her schooling as well as a stint at a finishing school that she attended in Switzerland.

She counts art and travelling as her hobbies, which is when she finds time for herself.

The mantle of the managing the company passed on to Sybill after Karl Storz’s demise four years back.

Continuing the family tradition now is Sybill’s son, who specialises in industrial endoscopy, which takes endoscopy on to industrial and engineering applications.

Sybill however, refused to divulge the net worth of the group on grounds of it being a ‘family-owned business.’    

 

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