India is one of the fastest-growing pharmaceutical markets in the world, and its market size has nearly doubled since 2005. The Indian pharmaceutical market is expected to reach US$ 20 billion by 2015, growing at a compound annual growth rate (CAGR) of 11.7 per cent during 2005–2015 and establish its presence among the world’s leading 10 markets. India is also the third-largest market in the world in terms of volume and fourteenth in terms of value.
India accounts for 8 per cent of global pharmaceutical production. Indian firms produce about 60,000 generic brands across 60 therapeutic categories. In addition, Indian firms manufacture approximately 500 different active pharmaceutical ingredients (APIs). Manufacturing costs in India are approximately 35 to 40 per cent of those in the US due to low installation and manufacturing costs.
Moreover, according to an Ernst & Young and industry body study, the increasing population of the higher-income group in the country, will open a potential US$ 8 billion market for multinational companies selling costly drugs by 2015.
Further, IMS Health India, which tracks drug sales in the country through a network of nationwide drug distributors, estimates the healthcare market in India to reach US$ 31.59 billion by 2020.
According to IMS Health, for the full year 2010, the Indian Retail Pharmaceutical Market was valued at US$ 10.2 billion, growing at 16.5 per cent over 2009. The pharmaceutical market has shown a strong double digit growth for the second successive year.
As per the estimates of the Ministry of Commerce, Government of India, a whopping amount of US$ 6.31 billion will be invested in the Indian pharmaceutical industry by 2015. Also, the Indian pharmaceutical off-shoring industry is predicted to be a US$ 2.5 billion opportunity by 2012, due to the low cost of research & development (R&D) in India.
According to the All India Organisation of Chemists and Druggists (AIOCD), the pharmaceuticals industry in India will grow by over 100 per cent over the next two years.
"The people are increasingly becoming health conscious and the sell of all types of medicines, particularly anti-biotic, will zoom up in the coming years. We expect the business to double by 2012", as per JS Shinde, President, AIOCD.
Diagnostics Outsourcing/ Clinical Trials
According to the research published by RNCOS titled 'Indian Diagnostic Market Analysis', the Indian diagnostic services are projected to grow at a CAGR of more than 20 per cent during 2010-2012.
Some of the major Indian pharmaceutical firms, including Sun Pharma, Cadilla Healthcare and Piramal Life Sciences, had applied for conducting clinical trials on at least 12 new drugs in 2010, indicating a growing interest in new drug discovery research.
According to MrSrikant Kumar Jena, Union Minister of State for Chemicals and Fertilisers, India tops the world in exporting generic medicines worth US$ 11 billion and currently, the Indian pharmaceutical industry is one of the world's largest and most developed.
India tops the world in exporting generic medicines worth US$ 11 billion.
According to McKinsey report ‘India Pharma 2015- Unlocking the potential of Indian Pharmaceuticals market’ – Generics will continue to dominate the market while patent-protected products are likely to constitute 10 per cent of the pie till 2015. Moreover, as per a press release by research firm RNCOS, the report titled ‘Booming Generics Drug Market in India' projects the Indian generic drug market to grow at a CAGR of around 17 per cent between 2010-11 and 2012-13.