India is a prominent and rapidly growing nation in global pharmaceuticals. It is considered as the biggest supplier of generic medicines globally, occupying nearly 20% share in global supply by volume, and furthermore supplies 62% of global demand for vaccines. India positions 3rd worldwide for production by volume and 14th by value. India is the only nation with the biggest number of US-FDA-compliant Pharma plants which includes 262+ APIs. India has in excess of 2000 WHO-GMP approved pharma plants, 253+ European Directorate of Quality Medicines (EDQM) affirmed plants with modern cutting-edge technology.
India is the primary source of 60,000 generic brands across 60+ therapeutic categories and manufactures more than 500 various Active Pharmaceutical Ingredients (APIs). The API industry is ranked 3rd largest in the world presenting nearly 57% of APIs to the WHO prequalified list.
The nation is home to in excess of 3,000+ pharma organizations with a solid network of more than 10,500 manufacturing facilities.
- From 2018-19, India’s pharmaceuticals exports were worth around $19.3 billion with a growth of 10.72% consistently.
- India holds 12% of all worldwide manufacturing sites catering to the US market.
- The expense of manufacturing in India is roughly 33% lower than.
Indian pharmaceutical sector is extended to grow to US$ 100 billion, while the medical device market is foreseen to grow US$ 25 billion by 2025. Pharmaceuticals exports from India represent at US$ 20.70 billion in the Financial year 2020. Pharmaceutical exports incorporate intermediates, drug formulations, bulk drugs, herbal, and biologicals products.
India’s biotechnology industry involving bio-agriculture, biopharmaceuticals, bio-services, bioinformatics, and bio-industry is anticipated to grow at a normal growth rate of around 35% consistently to reach US$ 100 billion by 2025.
India’s domestic pharmaceutical market turnover reached roughly Rs 1.4 lakh crore in 2019, up 9.8% every year from Rs 129,015 crore (US$ 18.12 billion) in 2018.
Investments and Recent Developments
The Union Cabinet has given its nod for the amendment of the existing Foreign Direct Investment (FDI) strategy in the pharmaceutical sector in order to permit FDI up to 100% under the automatic route for the manufacturing of medical devices subject to particular issues.
As per the data released by the Department for Promotion of Industry and Internal Trade (DPIIT), The drugs and pharmaceuticals sector attracted cumulative FDI inflows worth US$ 16.50 billion between April 2000 and March 2020.
Some of the recent developments/investments in the Indian pharmaceutical sector are as per the following:
- During December 2019, on a moving annual total (MAT) basis, industry growth was at 9.8%, with price growth at 5.3%, new product growth at 2.7%, while volume growth at 2% y-o-y.
- The Healthcare sector observed private equity of a total of US$ 1.1 billion with 27+ deals in H12019.
- Indian pharmaceutical industry’s export to the US will get a lift as branded drugs worth US$ 55 billion will become off-patent during 2017-2019.
- Innovation and R&D
- To develop new complex generic drugs, enhanced by the New Drugs and Clinical Trial Rules, 2019 and the Atal Innovation Mission (a Government of India initiative with the targets of entrepreneurship and innovation promotion via competition, mentorship, etc.)
- Medical tourism
- Quality services at marginal expenses compared to Europe, US, and South Asia.
- Infrastructure development
- India has the most noteworthy number of US-FDA compliant plants outside the US.
- Strong drug manufacturing
- Expertise in low cost generic patented drugs and a movement towards end-to-end production.
The pharmaceutical industry in India provides a couple of opportunities for investments and trade due to the following factors:
- Concerning India’s huge population it is an excellent center for clinical trials.
- India has productive and cost-effective sources for taking a few to get back generic drugs, particularly the drugs that are going off their patents in the coming years.
- India has abundant manpower with solid technical, scientific knowledge.
- The cost required for research and development is extremely low.
- India houses magnificent laboratories with world-class facilities. It has labs that specialize in process development and the development of cost-efficient drug manufacturing technology.
- India is self-sustaining in terms of the manufacturing of bulk drugs. Practically 70% of the requirements for the formulation of drugs are accessible within the nation itself.
- India’s fast-growing biotech industry, which offers extraordinary potential in the worldwide market, likewise has contributed to making the pharma sector in India an appealing industry to make investments.
Due to all these advantageous elements, India is recognized as one of the leading players in pharmaceuticals in the worldwide market.
Medicine spending in India is anticipated to grow 9-12% over the next five years, driving India to become one of the best 10 countries in terms of medical spending.
Going ahead, better growth in domestic sales would likewise rely upon the ability of organizations to align their product portfolio towards chronic therapies for diseases such as anti-diabetes, antidepressants, cardiovascular, and anti-cancers, which are on the rise.
The Indian Government has found a way to reduce costs and cut down healthcare expenses. The rapid introduction of generic drugs into the market has stayed in focus and is needed for the growth of Indian pharmaceutical companies. Moreover, the thrust on rural wellbeing programs, life-saving medications, and preventive vaccines additionally foreshadow well for pharmaceutical companies.
With such an exceptional initiative of the Indian government, the Indian pharmaceutical industry looks incredibly positive for attracting more foreign investments.