Pharmaceutical
Industry in
India
01 Introduction
Content 0
2
Current State of the
Pharmaceutical Industry in India
Outline 03 Key Trends and Forecasts for the
Pharmaceutical Industry in India
Topics for discussion 04 Government Policies and Regulations
05 Research and Development in the
Pharmaceutical Industry
06 Manufacturing and Supply Chain
Content 0
7
Key Players in the Indian
Pharmaceutical Industry
Outline 08 Market Opportunities and Challenges
09 Pharmaceutical Export and Import
Topics for discussion
10 Technological Advancements in the
Pharmaceutical Industry
11 Healthcare Infrastructure and Access to
Medicines
Content 1
2
Pharmaceutical Education and
Skill Development
Outline 13 Intellectual Property Rights and Patent
Issues
14 Pricing and Affordability of Medicines
Topics for discussion
15 Market Competition and Strategies
16 Future Outlook and Conclusion
A RC H I M E D E S P H A R M A |
VAC C I N E S
Introductio
n
The Indian pharmaceutical industry, once dominated by
overseas companies, saw a significant shift as Indian
companies tapped into global markets, with 90% of sales
occurring outside India by the early 2000s. India emerged as a
key player, producing vaccines and supplying drugs to
developing economies. Despite initial reliance on multinational
companies, Indian firms expanded into the US, Europe, Africa,
and Latin America, offering cheaper alternatives and investing
in R&D. This growth, driven by innovation and strategic
alliances, contributed to a 2% increase in healthcare reform
and solidified India's position as a major global player in
pharmaceuticals, albeit amid fierce competition.
Current State of the Pharmaceutical
Industry in India
The Indian pharmaceutical industry, comprising both large firms and
SMEs, plays a vital role globally. Despite perceptions of innovation
and affordability, challenges persist, including government
regulations and supply chain disruptions, highlighted by the recent
pandemic. Constraints such as raw material quality, skilled labor, and
funding hinder growth. However, India's burgeoning healthcare needs
and expanding pharmaceutical market present significant
opportunities. Valued at around USD 33 billion, the industry ranks
third in production volume and fourteenth in value globally. With
nearly 20,000 manufacturers, the top 150 control 80% of key
therapeutic categories and brands, indicating a concentrated market
landscape amid promising growth prospects.
Key Trends and Forecasts for
the Pharmaceutical Industry
in India
The pharmaceutical industry in India is currently valued at around Rs. 1.5 lakh
crores, with a projected 22% CAGR growth for 2020-25. Exports are forecasted to
reach US$25 billion by 2025-26, compared to US$21 billion in 2021-22. Policy
changes, such as India-Canada trade agreements benefiting the pharma sector, and
initiatives like Ayushman Bharat and the New Health Policy, aim to improve public
health and foster industry development. Simplified drug approval processes,
promotion of the medical device sector, and infrastructure enhancements signal a
dynamic landscape. These measures align with a broader shift towards preventive
healthcare and technological advancements, indicating significant potential for
growth and innovation in the sector.
Government Research and
Development in
Policies and the
Regulations Pharmaceutical
Industry
India's robust engineering tradition aids in
The abolition of process patents in India's
efficient product delivery, IT advancements,
pharmaceutical industry in 1972 marked
and process enhancements, bolstering its
a significant shift, followed by the
distribution chain. While cost reduction is a
establishment of CGPDTM and
strength, weaknesses persist in production
liberalization policies in the mid-1980s.
technology, demand management, and
Collaborative efforts between the
logistics. Strengths lie in distribution
government and industry aimed at
networks, clinical trials, and market potential.
enhancing IPR protection, boosting
R&D decentralization has transformed the
exports, and R&D growth. The sector is
global generics industry, with Indian firms
poised to reach $100 billion by 2030,
eyeing new drug discovery to address
propelled by strategic government
emerging health concerns.
interventions since the 1960s.
Manufacturin
g and Supply
Chain
Ensuring quality and safety in drug manufacturing is paramount,
particularly for small-scale manufacturers, necessitating strengthened
regulatory oversight and legal capabilities. Robust quality models, R&D
standards, and certifications like GMP and GLP are essential, alongside
streamlined licensing processes. Adequate staffing and technological
support for drug testing are crucial. Rationalizing pricing mechanisms and
encouraging systems like Qualified Assured Test Reports (QATRS) can
enhance transparency and accessibility. Simplified licensing procedures
and adherence to GMP norms promote the availability of quality medicines.
Government initiatives like the CMSO aid in bulk purchasing of essential
drugs, while regulatory assistance is needed to expedite approvals.
Coordination between regulatory and program requirements is crucial, as
seen in the case of anti-retrovirals. Collaboration with countries like Nepal
under the Indian Patent Act can facilitate access to essential medicines
while preventing re-exportation.
Key Players in the
Indian Pharmaceutical
Industry
In the Indian pharmaceutical retail market, Cadila Healthcare leads with Rs. 8,027 crores in December 2018,
followed by Sun Pharmaceutical and Mankind Pharmaceuticals. Sanofi and Glenmark Pharmaceuticals rank 5th
and 6th. Sun Pharma acquired Ranbaxy in 2014, securing the 2nd position. Zydus Cadila and Intas Pharma hold
the 8th and 9th positions. Abbott India replaced Lupin Ltd. The top 5 players captured a 22% market share in
August 2019, expected to reach 30%. Players focus on R&D pipelines and complex generics, with an emphasis on
biopharmaceuticals. Consolidation is anticipated, leading to dominance by large players. India aims to achieve a
Rs. 5-lakh-crore market by 2020 by accessing new customers, therapies, and revenue streams. Collaboration
between MNEs and Indian companies is increasing, indicative of the industry's growth potential and changing
landscape.
Market Opportunities and
Challenges
India's pharmaceutical industry is poised for significant
growth, with a projected CAGR of 22.4% from US$19.14 billion
in 2010 to US$50 billion in 2020. The sector benefits from
imperial patent coverage, relaxed regulations, and low-cost
generic drug production. By 2020, the industry is expected to
reach US$93.1 billion, expanding at 20.3%. Growth drivers
include drugs going off-patent and increased R&D
investments. Further, approvals for new drug laboratories and
participation in mergers and acquisitions are anticipated to
drive industry growth, with a projected market size of $55
billion by 2020.
Pharmaceutical Export and
Import
India ranks 14th globally in pharmaceutical imports, heavily reliant on
China for bulk drugs and intermediates. Supply chain disruptions in
2019-2020 highlighted this dependency, prompting government efforts
to expand domestic production and reduce reliance on China. India is a
major provider of generic drugs globally, supplying 20% of exports by
volume and over 50% of vaccine demand. It maintains regional
distribution centers and fosters partnerships for healthcare supply. With
2,700 R&D establishments producing 2-3 new chemical entities, India
aims to tackle life-threatening conditions through innovative research,
leveraging its strong capabilities in drug discovery, development, and
manufacturing.
Technological Advancements in the
Pharmaceutical Industry
Pharmaceutical firms are leveraging technology and data to optimize processes and
improve patient care, collaborating with multinational organizations and research
institutions. Digital health initiatives are enhancing healthcare delivery. The
industry's focus on preventive care drives innovation in areas like complex diseases
and mental health, bolstering the global pharmaceutical market. In India, where
70% still need affordable drugs, technological advancements are crucial. As the
world's third-largest drug producer by volume, India aims for a USD 111 billion
global market share. Structural reforms promote eco-friendly practices, while the
cellular ecosystem and clinical research see rapid growth. CRISPR-Cas9 gene editing
and machine learning hold promise for future pharmaceutical innovation, attracting
global players to India.
Healthcare Healthcare
Infrastructure Infrastructure and
and Access to Access to
Medicines
Medicines The Indian healthcare landscape faces challenges in balancing
quality care with affordability, with private providers offering
Pharmaceutical firms are embracing technology and
better quality but at higher costs compared to public facilities.
collaboration to streamline processes and enhance
Bridging this gap requires a well-structured infrastructure
patient care, with a focus on preventive medicine and
integrating both sectors to ensure equitable resource
digital health. India, as the world's third-largest drug
distribution and service continuity. Adequate hospital
producer, plays a pivotal role, supplying drugs to 150
infrastructure, including beds, diagnostic services, and skilled
countries. The government targets a USD 111 billion
personnel, is crucial for effective healthcare delivery. Shortages
global market share, while promoting cleaner practices
in infrastructure can lead to deficiencies in human resources and
and fostering clinical research. Advances like CRISPR-
hinder access to specialized services. Insufficient investment in
Cas9 gene editing and machine learning hold promise
healthcare infrastructure impedes quality care and limits
for the industry's future. With global pharmaceutical
resource utilization. To optimize health outcomes, investments in
giants investing in India, the sector is poised for
physical capital, supplies, and labor are essential, ensuring the
continued innovation and growth, reflecting its crucial
capacity to deliver necessary services and maximizing the
role in the economy and healthcare landscape.
utilization of trained personnel. Addressing these challenges is
Pharmaceutic
al Education
and Skill
• Coordination between the government and academia is vital for skill
development in the Indian pharmaceutical sector. Programs supported
by the government and regulatory bodies aim to bridge skill gaps and
Development meet industry requirements. Organizations like CDSA and NABL focus
on evaluating and accrediting clinical research practices and laboratory
standards, respectively. Initiatives by NASSCOM offer dual training
programs to equip graduates with necessary skills. However, there
remains a shortage of skilled professionals in various areas like clinical
research and pharmacovigilance. Efforts are needed to address quality,
ethical, and economic aspects of training in these fields. Pharmacy
professionals also require tailored training programs to meet industry
demands effectively. Collaboration between stakeholders is crucial for
nurturing a skilled workforce to drive innovation and growth in the
pharmaceutical sector.
Intellectual Property
Rights and Patent
Issues
India's generic pharmaceutical industry has thrived under previous patent laws that exempted generic players
from patent litigation if they could demonstrate their drugs were produced through reverse engineering or non-
patented incremental innovation. This has made India a global hub for affordable medicines, particularly crucial
for diseases like HIV, malaria, and tuberculosis. Generics have bolstered Indian companies specializing in APIs,
formulations, biosimilars, and generics. However, challenges arose when European agencies seized
pharmaceuticals in transit to developing countries over alleged patent infringements. To align with TRIPS
agreements, India recently amended its patent law, extending patent coverage to pharmaceutical products'
entire life cycle. This change aims to harmonize Indian patent laws with global standards while addressing
international pressures to enhance patent protection for pharmaceuticals.
Pricing and Affordability of
Medicines
The Indian government has initiated various programs to address the
treatment gap for non-communicable diseases (NCDs), aiming to
alleviate the burden on public health caused by NCD-related
complications. However, access-related challenges persist, particularly
regarding the affordability of medications, which constitute a
significant portion of healthcare costs for diabetes patients, especially
those from low-income and marginalized groups. There's a pressing
need to explore strategies to improve medication accessibility, which
could positively impact short-term outcomes and reduce treatment
costs for diabetes and associated complications. Despite
improvements in health indicators, healthcare and medication costs
remain largely unaffordable for many Indians. The pricing and
affordability of drugs are crucial considerations, as affordable
medicines are essential for ensuring healthcare access for all. Globally,
the policy debate on medicine pricing revolves around balancing
incentives for innovation with ensuring affordable prices to sustain
pharma product development.
Market Competition and
Strategies
India's service industry experienced significant growth due to the
availability of cost-effective and skilled manpower. Traditionally focused
on manufacturing, Indian pharmaceutical companies saw increased
investment from foreign entities by the end of 2011, totaling Rs. 41,280
crores, predominantly from countries like Mauritius, Cyprus, the US, UK,
and others.
The industry faces escalating competition, resulting in drug price
reductions that challenge branded companies. However, there's a rising
presence of branded companies adhering to stringent drug regulations,
displacing traditional players. To combat price pressures, India should
adopt innovative business models like the Dahej model, focusing on API
vending, and move away from imitation strategies. Moreover, strict
enforcement of IPR laws is imperative to foster innovation in the sector.
Future Outlook and Conclusion
The pharmaceutical industry is experiencing unprecedented demand for new drugs and related
products, driving growth and expansion in product distribution. Contract research is increasingly
focusing on centers of excellence in India and China due to their abundant workforce and clinical
subjects. Companies are now prioritizing the incorporation of diverse perspectives and the
transformation of suppliers into productive partners throughout the supply network.
The Indian pharmaceutical market is projected to become the world's sixth-largest, having
sustained a remarkable average annual growth rate of 14% over the last three decades.
Research into countermeasures against various threats, including chemical, biological,
radiological, and nuclear agents, continues to propel demand for new drugs and medical
devices.
Indian companies are witnessing a surge in domestic drug manufacturing, partnerships, and
joint ventures. Recognizing the significance of this growth, the Government of India and industry
associations are actively expanding domestic manufacturing and global distribution ties to
ensure product delivery while upholding stringent safety and quality standards.
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