Image"If we stop thinking of the poor as victims or as a burden and start recognising them as resilient and creative consumers, a whole new world of opportunity will open up." These first few lines from management guru C K Prahalad's book, The Fortune at the Bottom of the Pyramid, seem to have inspired multinational pharmaceutical companies of late.

MNCs such as Novartis, Roche Diagnostics, Novo Nordisk and Eli Lilly are drawing up blueprints to tap the rural healthcare market in India, which suddenly appears attractive like never before. The rural market makes up 17-18% of the country's $8.1 billion pharma market.

Novartis last year introduced the Arogya Parivar model, which aims at ensuring availability of products at same prices, but different pack sizes, in pharmacies in villages across seven states, including Maharashtra, Gujarat, Chhattisgarh and Haryana.

Ranjit Shahani, vice chairman and managing director, Novartis India, said the model supplies medicines to over 16,000 pharmacies. "Our stockists in district towns supply to village pharmacies. We also create awareness on health issues using audiovisual interface through health advisors in villages," he said. 

Similarly, diabetes giant Novo Nordisk has a project in Goa, through which mobile clinics go to villages and screen people for diabetes. According to an official from Eli Lilly, since October last year, the US major has a project with the Self-Employed Women's Association (Sewa) in Ahmedabad, to educate people on tuberculosis and encourage them to take treatment.

What's with the rural push? With the recent spate of mergers and acquisitions across the industry — Pfizer and Wyeth, Merck and Schering-Plough, Roche-Genentech — MNCs are growing big with each passing second. Still, India remains a mirage as far as their market share goes.

As per estimates by ORG-IMS Research, the Indian arms of GlaxoSmithKline (GSK) and Abbott are the only ones among the top 10 drugmakers in India. The reason is that local manufacturers such as Ranbaxy, Cipla, Lupin and Dr Reddy's Laboratories supply generic medicines, which cost less than half of what MNCs' branded drugs do. Thus, to break into the top league, MNCs have to tap the rural market, said Sujay Shetty, associate director of professional services firm PricewaterhouseCoopers (PwC). "With MNCs increasing their clout through M&As, the India story still remains a distant goal.

They have to expand their presence in India through projects targeting rural segments," Shetty said

Bhuwnesh Agrawal, chairman and MD of Roche Diagnostics India, said as two-thirds of the population is in rural areas and the standard of healthcare is inadequate, it's important to hit that market. According to consulting firm McKinsey, the Indian pharma market will zoom to $20 billion by 2015, of which the rural market will account for over 20%.

Supratim Majumdar, a healthcare analyst at Frost & Sullivan, said urban India is expected to remain a revenue generator, while the rural market would spearhead volume growth.