Indian pharmaceutical sector supplies over 50% of the global demand for various vaccines, 40% of the generic demand for the US and 25% of all medicines for the UK. India contributes the second-largest share of the pharmaceutical and biotech workforce in the world. According to the Indian Economic Survey 2021, the domestic market is expected to grow 3x in the next decade. India's domestic pharmaceutical market is at US$ 42 billion in 2021 and likely to reach US$ 65 billion by 2024 and further expand to reach ~US$ 120-130 billion by 2030. In terms of overall revenue, the Indian pharmaceutical market increased by 13.9% in January 2022.
Globally, India ranks 3rd in terms of pharmaceutical production by volume and 14th by value. The domestic pharmaceutical industry includes a network of 3,000 drug companies and ~10,500 manufacturing units.
In the global pharmaceuticals sector, India is a significant and rising player. India is the world's largest supplier of generic medications, accounting for 20% of the worldwide supply by volume and supplying about 60% of the global vaccination demand.
India is the 12th largest exporter of medical goods in the world. The country's pharmaceutical sector contributes 6.6% to the total merchandise exports. As of May 2021, India supplied a total of 586.4 lakh COVID-19 vaccines, comprising grants (81.3 lakh), commercial exports (339.7 lakh) and exports under the COVAX platform (165.5 lakh), to 71 countries.
India could restart deliveries of COVID-19 shots to the global vaccine-sharing platform COVAX in November-December 2021 for the first time since April 2021. The World Health Organization (WHO), which co-leads COVAX, has been pushing India to resume supplies for the programme, particularly after it sent ~4 million doses to neighbors and allies in October 2021.
In November 2021, Prime Minister, Mr. Narendra Modi inaugurated the first Global Innovation Summit of the pharmaceuticals sector. The summit will have 12 sessions and over 40 national and international speakers deliberating on a range of subjects including regulatory environment, funding for innovation, industry-academia collaboration and innovation infrastructure.
As of August 2021, CARE Ratings expect India's pharmaceutical business to develop at an annual rate of 11% over the next two years, to reach more than US$ 60 billion in value.
Indian drugs are exported to more than 200 countries in the world, with the US being the key market. Generic drugs account for 20% of the global export in terms of volume, making the country the largest provider of generic medicines globally. It is expected to expand even further in the coming years. The Indian pharmaceutical exports, including bulk drugs, intermediates, drug formulations, biologicals, Ayush & herbal products and surgical, reached US$ 24.44 billion in FY21. Indian pharmaceutical exports stood at US$ 24.44 billion in FY21 and US$ 22.21 billion in FY22 (until February 2022).
India's medical devices market stood at US$ 10.36 billion in FY20. The market is expected to increase at a CAGR of 37% from 2020 to 2025 to reach US$ 50 billion.
'Pharma Vision 2020' by the Government's Department of Pharmaceuticals aims to make India a major hub for end-to-end drug discovery. The foreign direct investment (FDI) inflows in the Indian drugs and pharmaceuticals sector reached US$ 1.206 billion between April-December 2021. The Indian drugs and pharmaceuticals sector received cumulative FDIs worth US$ 19.19 billion between April 2000-December 2021. In FY21, North America was the largest market for India's pharma exports with a 34% share and exports to the U.S., Canada, and Mexico recorded a growth of 12.6%, 30% and 21.4%, respectively.To achieve self-reliance and minimise import dependency on the country's essential bulk drugs, the Department of Pharmaceuticals initiated a PLI scheme to promote domestic manufacturing by setting up greenfield plants with minimum domestic value addition in four separate 'Target Segments' with a cumulative outlay of Rs. 6,940 crore (US$ 951.27 million) from FY21 to FY30. In June 2021, Finance Minister Ms. Nirmala Sitharaman announced an additional outlay of Rs. 197,000 crore (US$ 26,578.3 million) that will be utilised over five years for the pharmaceutical PLI scheme in 13 key sectors such as active pharmaceutical ingredients, drug intermediaries and key starting materials. As of August 31, 2021, the PLI scheme received a good response from the industry, with a total of 278 applications. This is likely to benefit 55 manufacturers.
As per the Union Budget 2022-23, Rs. 3,201 crore (US$ 419.2 million) has been set aside for research, and Rs. 83,000 crore (US$ 10.86 billion) has been allocated to the Ministry of Health and Family Welfare. The government allocated Rs. 37,000 crore (US$ 4.83 billion) to the 'National Health Mission'. PM Aatmanirbhar Swasth Bharat Yojana was allocated Rs. 64,180 crore (US$ 8.80 billion) over six years. The Ministry of AYUSH was allocated Rs. 3,050 crore (US$ 399.4 million), up from Rs. 2,970 crore (US$ 389 million). India plans to set up a nearly Rs. 1 lakh crore (US$ 1.3 billion) fund to provide a boost to companies to manufacture pharmaceutical ingredients domestically by 2023.
In March 2022, instructions for the scheme "Strengthening of Pharmaceutical Industry (SPI)" with a total financial outlay of Rs. 500 crore (US$ 665.5 million) for the period FY 21-22 to FY 25-26 were announced.
In March 2022, Themis Medicare Ltd. (Themis) announced the approval of its antiviral drug VIRALEX by the Drug Controller General of India (DCGI).
In August 2021, Mr. Mansukh Mandaviya, Minister of Health and Family Welfare, announced that an additional number of pharmaceutical companies in India are expected to commence manufacturing of anti-coronavirus vaccines by October-November 2021. This move is expected to further boost the vaccination drive across the country.
In July 2021, Delhi Pharmaceutical Sciences and Research University (DPSRU) collaborated with All India Institute of Ayurveda (AIIA) to focus on the assessment of the application of ayurvedic and medicinal plant-based drugs in modern medicines.
India is the largest producer of vaccines worldwide, accounting for ~60% of the total vaccines as of 2021.
