Novartis, Sanofi seek gold in rural India

If you were wondering why Big Pharma has been enamored of rural India, here's one reason: A $19.5 billion public program designed to improve healthcare for 742 million Indian villagers, Bloomberg reports. No wonder the likes of Novartis (NYSE: NVS) and Sanofi-Aventis (NYSE: SNY) are dispatching staff all over the countryside.

The Indian government is aiming to reduce rates of infant mortality, tuberculosis and malaria by beefing up its clinics in the countryside. Together with rising incomes, the public spending is expect to increase the rural market for drugs to at least $6 billion by 2020 from $1.5 billion last year, PricewaterhouseCoopers tells the news service.

Novartis has been working since 2007 to partner with rural doctors under a program called Arogya Parivar, or the "good health of the family." The company's reps hand out referral cards that sick patients can take to their doctors and pharmacies, too. The goal is to make its meds accessible to 100 million Indians over the next two years--up from 42 million now--the company's Indian vice chairman tells Bloomberg. "An up-front social commitment leads to business in rural areas," Ranjit Shahani says.

Meanwhile, Sanofi started its Prayas ("endeavor") program last year, recruiting city doctors to mentor rural physicians. It's sponsored workshops for more than 5,500 doctors so far, plotting to reach 100,000 of them by 2015, local executives say. And Sanofi has more than 300 sales reps charged with stocking village pharmacies, too.

"The rural strategy is one of Sanofi-Aventis' key growth levers," Pratin Vete tells Bloomberg. "The unique selling proposition of our rural initiative and the Prayas model is the strong network of doctors that we are building."

- see the Bloomberg report