The Indian pharmaceuticals market is the 3rd largest in terms of volume and 13th largest in terms of value. Branded generics prevail the drug market, making up nearly 70 to 80 % of the market.
India is the most prominent provider of generic medicines globally with the Indian generic products reporting for 20 % of global exports in terms of volume. In the recent past, consolidation has become significant attribute of the Indian pharmaceutical market since the pharma segment extremely fragmented. According to the IBEF report, “By 2020, India is likely to be among the top 3 pharmaceutical markets by incremental growth and 6th largest market globally in absolute size”, also, a number of medicine companies promoting their operations in India. India basks significant position in the global pharmaceuticals sphere; the country also has good number of scientists and other life science professionals who have the strength to maneuver the drug industry ahead to an even more eminent position.
The UN-backed Medicines Patent Pool has signed 6 sub-licences companies like: Aurobindo, Cipla, Desano, Emcure, Hetero Labs and Laurus Labs, permitting them to make anti-AIDS (generic) product Tenofovir Alafenamide for 112 developing countries.
According to India Ratings, a Fitch company, the Indian pharmaceutical industry is estimated to grow at 20 % compound annual growth rate (CAGR) over the next 5 years. The Indian pharma industry, which is expected to grow over 15 % per annum between 2015 and 2020, will outperform the global pharma industry, which is set to grow at an annual rate of 5 % between the same period. Presently the market size of the pharmaceutical industry in India stands at US$ 20 billion. This level of growth is predicted even in the face of an anticipated slowdown in exports, which are projected at a CAGR of 7.98%.
Investments in the Industry:
The union cabinet has given its nod for the rectification of the existing foreign direct investment policy in the drug segment with the objective to permit foreign direct investment (FDI) up to 100 % under the automatic channel for producing of medical devices pertaining to certain specifies.
According to report from Department of Industrial Policy and Promotion (DIPP), the drugs and pharmaceuticals sector attracted cumulative foreign direct investment inflows worth US$ 13.45 billion between April 2000 and December 2015.
Some of the major Investments:
- Pink Blue Supply Solutions Pvt. Ltd has raised Rs 1.5 cr in a seed round of funding from TermSheet.io, a transaction-focused service provider for start-ups and investors.
- CDC, the UK’s development finance institution, invested US$ 48 million in Narayana Hrudayalaya hospitals, a multi-speciality hospital, with an aim to expand affordable treatment in eastern, central and western India.
- Dr Reddy’s Laboratories (DRL), has entered into a strategic collaboration agreement with TR-Pharm (Turkey) to register and subsequently commercialize 3 biosimilar products in Turkey.
- Lupin Limited (Lupin) has completed the acquisition of GAVIS Pharmaceuticals LLC and Novel Laboratories Inc. (GAVIS), in a deal worth USD 880 million cash free and debt free, which is expected to enhance its product pipeline in dermatology, controlled substances and high-value speciality products.
- Torrent Pharmaceuticals entered into an exclusive licensing agreement with Reliance Life Sciences for marketing 3 biosimilars products (Rituximab, Adalimumab and Cetuximab) in India.
- Cipla, a global pharmaceutical company, has acquired two US-based companies, InvaGen Pharmaceuticals Inc., and Exelan Pharmaceuticals Inc ., for US$ 550 million.
- Emcure Pharmaceuticals has acquired Canada’s International Pharmaceutical Generics Ltd and its marketing arm Marcan Pharmaceuticals in order to boost its global expansion drive.
- Glaxosmithkline Pharmaceuticals has started work on its largest greenfield tablet manufacturing facility in Vemgal in Kolar district, Karnataka, with an estimated investment of Rs 1,000 crore.
- Indian Immunologicals Ltd plans to set up a new vaccine manufacturing facility in Pondicherry with an investment of Rs 300 crore.
- Intas Pharmaceuticals is the first company globally to develop and launch a biosimilar version of Lucentis, the world’s largest selling drug for treatment of degenerative eye condition.
The supplement 2015 of the Indian Pharmacopoeia (IP) 2014, promulgated by the Indian Pharmacopoeia Commission (IPC, is an autonomous institution of the Ministry of Health and Family Welfare which sets standards for all drugs that are manufactured, sold and consumed in India) on behalf of the Ministry of Health & Family Welfare, is anticipated to play an important role in bettering the quality of medicines that would successively elevate public health and stimulate the growth and development of Indian biopharmaceutical industry.
The Government of India brought out ‘Pharma Vision 2020’ targeted at creating India a global leader in end to end drug manufacture. Clearance time for new establishments has been decreased to encourage investments. In addition, the government of India brought in process such as the Drug Price Control Order (DPCO) and the National Pharmaceutical Pricing Authority (NPPA) to handle with problems of affordability and availability of drug products.
Some of the major Initiatives:
Indian Pharmaceutical Association (IPA), the professional association of pharmaceutical companies in India, plans to prepare data integrity guidelines which will help to measure and benchmark the quality of Indian companies with global peers.
Indian Pharmaceutical Association (IPA) plans to machinate data integrity guideposts which will assist to evaluate and bench mark the quality of Indian drug companies with multinational peers.
The Government of India aims to make inducement for bulk drug manufacturers, to promote ‘Make in India’ programme and cut down dependence on imports of active pharmaceutical ingredients (API).
The Department of Pharmaceuticals has set up an inter-ministerial co-ordination committee, which would periodically review, coordinate and facilitate the resolution of the issues and constraints faced by the Indian pharmaceutical companies.
The Department of Pharmaceuticals (DOP) planned to launch a venture capital fund of Rs 1,000 crore to encourage start-ups in the research and development in the pharmaceutical and biotech industry.
The state government of Telangana has arranged India’s largest integrated pharmaceutical city spread over 11,000 acres near Hyderabad city, complete with effluent treatment plants and a township for employees, in a bid to pull investment of Rs 30,000 crore.
The Indian drug industry has a long way, presented strong growth, made significant move on infrastructure development, technical, research and development capacities and has become one of the major sources for Indian economy also by 2025, the pharmaceutical market size is expected to grow to US$ 100, driven by increasing consumer spending, rapid urbanization and raising healthcare insurance among others. Government of India has taken many initiatives to cut down costs and lower healthcare expenses. Rapid introduction of generic medicines into drug the market has stayed in focus and is anticipated to do more good to the Indian drug companies. Furthermore, the lunge on semi urban and rural health programmes, lifesaving medicines and preventive medicines also forecast well for the Indian bio pharma companies.