India pharma outlook & brand India

The Pharmaceutical industry in India is the world's third-largest in terms of volume and 10th largest in value terms. According to Department of Pharmaceuticals {Indian Ministry of Chemicals and Fertilizers}, the total turnover of India's pharmaceuticals industry between 2008 and September 2009 was US$21.04 billion. The Indian market is poised to grow to levels of US$50bn by 2020 as per IMS.

According to India Brand Equity Foundation, the Indian pharmaceutical market is likely to grow at a compound annual growth rate (CAGR) of 14-17 per cent in between 2012-16. India is now among the top five pharmaceutical emerging markets of the world.

Market Size:

India's drugs and pharmaceuticals industry is expected to grow at a compound annual growth rate (CAGR) of 14 per cent to reach a turnover of (US$ 47.06 billion) by 2018.

The domestic drugs industry, which is valued at (US$ 25.87 billion) at present, according to Care Ratings, is also expected to grow in the local market with aggressive rural penetration by drug makers, increased government spending on health, Urbanization and growing health awareness among people.

India exports pharmaceutical products to more than 200 countries. Pharmaceutical exports are expected to cross the Rs 1 trillion (US$ 16.17 billion) mark this year. "The growth would be around 15 per cent and is driven by formulation exports," said Dr PV Appaji, of (Pharmexcil). During 2013-14, pharmaceutical exports stood at (US$ 14.55 billion). The share of formulations was 71 per cent and growing in percentage terms on annual basis.

India currently exports drug intermediates, Active Pharmaceutical Ingredients (APIs), Finished Dosage Formulations (FDFs), bio-pharmaceuticals, CRAM and Clinical services across the globe

According to PricewaterhouseCoopers (PwC) in 2010, India joined among the league of top 10 global pharmaceuticals markets in terms of sales by 2020 with value reaching US$50 billion.

The government started to encourage the growth of drug manufacturing by Indian companies in the early 1960s, and with the Patents Act in 1970. This patent act removed composition patents from food and drugs, and though it kept process patents, these were shortened to a period of five to seven years.

Growth Trends: India Scenario

World Class Infrastructure

• More US FDA-approved plants (Refer to the graphic representation (1)
• India, Account for 35% of ANDA approvals granted by the US FDA.

The lack of patent protection made the Indian market undesirable to the multinational companies that had dominated the market. The Indian companies carved a niche in both the domestic arena and world markets with their expertise in reverse-engineering, new processes, technologies of drug formulations. The critical was manufacturing & supplying affordable drugs at low costs. Though some of the larger Indian players have taken baby steps towards drug innovation, the industry as a whole has been following the above stated business model till date.

India's biopharmaceutical industry clocked a 17 percent growth with revenues of ($3 billion) in the 2009–10 financial year over the previous fiscal. Bio-pharma was the biggest contributor generating 60 percent of the industry's growth at Re. 88.29 billion, followed by bio-services at Re. 26.39 billion and bio-agri at Re. 19.36 billion.

In 2013, there were over 4,655 pharmaceutical manufacturing plants all over the country.

Government Initiatives

The Government of India has unveiled 'Pharma Vision 2020' aimed at making India a global leader in end-to-end drug manufacture. It has reduced approval time for new facilities to boost investments. Further, the government has also put in place mechanisms such as the Drug Price Control Order and the National Pharmaceutical Pricing Authority to address the issue of affordability and availability of medicines.

Some of the major initiatives taken by the government to promote the pharmaceutical sector in India are as follows:

• The State government like; Andhra Pradesh will provide necessary infrastructure, incentives and skill up-gradation facilities for the pharmaceutical industry. A similar push has been initiated in states of Karnataka and Gujarat.
• The Government of India and the pharmaceutical industry will jointly float a trust to promote the brand image of Indian pharmaceutical globally and fight malicious campaigns.
• India plans to set up industrial parks in the pharmaceutical and information technology (IT) sectors in China to strengthen India-China trade and investment ties.

Road Ahead

• Indian generic drug makers are exploring all options to get a foot in the door to Japan's lucrative but difficult-to-crack US$ 111 billion drug industry after its penetration in Europe and US. The penetration of generic drugs in Japan, the world's largest drug market after the US and Europe, is a little more than 30 per cent.
• The domestic market will also see a significant growth in sales on the back of increasing affluence, changing lifestyles resulting in higher incidence of lifestyle-related diseases, increasing government expenditure on healthcare through schemes like the Central Government Health Scheme (CGHS), National Programme for Healthcare of the Elderly (NPHCE), Rashtriya Arogya Nidhi (RAN) and Janani Suraksha Yojana (JSY) in the next three years, according to Care analysis.
• The rise of pharmaceutical outsourcing and investments by multinational companies (MNCs), allied with the country's growing economy, committed health insurance segment and improved healthcare facilities, is expected to drive the market's growth.

Reva Pharmachem (P) Ltd; is a global pharmaceutical organization operating in Regulated and Emerging Markets. It is a subsidiary of Shilpa Medicare and core areas are; Contract Manufacturing, API's and Drug Formulations. The focus therapies are: ONCOLOGY, ARV's & LIFESTYLE Products.

Brand INDIA, and Make in INDIA are critical progressive strategic goals to be achieved by cohesive working of Indian pharmaceutical Industry and Government. We need to position our capabilities and abilities and establish India as a Quality, Price Advantage Manufacturing Base for Domestic, Emerging and Regulated Nations. We as nation hold the ability which is demonstrated in certain industry facets like; Information Technology, Auto Components and Pharmaceuticals (Generics) but the bandwidth has to be broadened by creating development and growth-oriented environment.

We as a nation are ready to stand by as a facilitator to the world economy for their growth investments in India. Make in India is not a slogan, not an invitation but as a responsibility for all the citizens to create a new world of opportunities.