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Pharmaceuticals: Jul 2010

July, 2010

India is among the fastest growing pharmaceutical markets in the world, with its growth rate having nearly doubled between 2001 and 2006. It is ranked fourteenth in the world in terms of value, and is the third largest in terms of volume. The Indian pharmaceutical market is expected to triple to US$ 20 billion by 2015 from US$ 7.1 billion in 2007 at a compound annual growth rate (CAGR) of 12.3 per cent, and establish its niche among the world’s leading10 markets. The clinical trials market in India, currently valued at about US$ 250–275 million, is expected to grow at a CAGR of 30 per cent over the next few years, at nearly double the global average.

Indian companies can manufacture pharmaceuticals for less than half the cost in the US. Indian firms produce about 60,000 generic brands across 60 therapeutic categories. India is the third-largest player in the world with 500 different active pharmaceutical ingredients (APIs). India produces some of the world’s least expensive drugs, since labour costs are 50 to 55 per cent lower than in the West.

The Indian market is highly fragmented with about 8,000 manufacturers. This high competition has driven Indian companies to reduce costs across the life cycle of a product. Many of these plants also have approvals from countries such as Canada, Australia, Germany and South Africa. Healthcare expenditure in India is expected to contribute 6.1 per cent of GDP in 2012. Novartis, Glaxo Pharma and Cipla are amongst major pharma players.

There are19 dedicated pharma special economic zones (SEZs) in various stages of development. The functional pharma SEZs in India include Jawaharlal Nehru Pharma City (JNPC) at Visakhapatnam (Andhra Pradesh), PHARMEZ (Gujarat) developed by Zydus infrastructure and PhaEZ park (Gujarat) developed by CadilaPharma.

Sectoral Presentation (April 2010)

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