“The Indian pharmaceutical industry is a success story providing employment for millions and ensuring that essential drugs at affordable prices are available to the vast population of this sub-continent.”
Richard Gerster
The
Indian Pharmaceutical Industry today is in the front rank of
Indias science-based industries with wide ranging capabilities in the
complex field of drug manufacture and technology. It ranks very high in the
third world, in terms of technology, quality and range of medicines
manufactured. From simple headache pills to sophisticated antibiotics and
complex cardiac compounds, almost every type of medicine is now made
indigenously.
Playing a key role in promoting and sustaining development in the vital
field of medicines,
Indian Pharma Industry boasts of quality
producers and many units approved by regulatory authorities in USA and UK.
International companies associated with this sector have stimulated,
assisted and spearheaded this dynamic development in the past 53 years and
helped to put India on the pharmaceutical map of the world.
Growth Scenario in 2010
India's pharmaceutical industry is now the
third largest in the world in terms of volume. Its rank is 14th in terms of
value. Between September 2008 and September 2009, the total turnover of
India's pharmaceuticals industry was US$ 21.04 billion. The domestic market
was worth US$ 12.26 billion. This was reported by the Department of
Pharmaceuticals, Ministry of Chemicals and Fertilizers. As per a report by
IMS Health India, the Indian pharmaceutical market reached US$ 10.04 billion
in size in July 2010. A highly organized sector, the Indian Pharma Industry
is estimated to be worth $ 4.5 billion, growing at about 8 to 9 percent
annually. Know more out this in our article on
Indian
Pharmaceutical Industry- Future Trends Also check out
Pharmaceutical
Market Trends 2010
Leading Pharmaceutical Companies
In the domestic market, Cipla
retained its leadership position with 5.27 per cent share. Ranbaxy followed
next. The highest growth was for Mankind Pharma (37.2%). Other leading
companies in the Indian pharma market in 2010 are:
- Sun Pharma (25.7%)
- Abbott (25%)
- Zydus Cadila (24.1%)
- Alkem Laboratories (23.3%)
- Pfizer (23.6 %)
- GSK India (19%)
- Piramal Healthcare (18.6 %)
- Lupin (18.8 %)
For details check out
List of
Top 10 Pharmaceutical Companies in India
Future Prospects
The Indian pharmaceuticals market is expected to
reach US$ 55 billion in 2020 from US$ 12.6 billion in 2009. This was stated
in a report title "India Pharma 2020: Propelling access and acceptance,
realising true potential" by McKinsey & Company. In the same
report, it was also mentioned that in an aggressive growth scenario, the
pharma market has the further potential to reach US$ 70 billion by 2020
Due to increase in the population of high income group, there is every
likelihood that they will open a potential US$ 8 billion market for
multinational companies selling costly drugs by 2015. This was estimated in
a report by Ernst & Young. The domestic pharma market is estimated to
touch US$ 20 billion by 2015. The healthcare market in India to reach US$
31.59 billion by 2020. The sale of all types of
pharmaceutical drugs and medicines in
the country stands at US$ 9.61 billion, which is expected to reach around
US$ 19.22 billion by 2012. Thus India would really become a lucrative
destination for clinical trials for global giants.
There was another report by RNCOS titled "Booming Pharma Sector in
India" in which it was projectedt that the
pharmaceutical
formulations industry is expected to prosper in the same manner as the
pharmaceutical industry. The domestic formulations market will grow at an
annual rate of around 17% in 2010-11, owing to increasing middle class
population and rapid urbanisation. Read More in
Future Prospects of Indian Pharma Industry.
Characteristics of Indian Pharmaceutical Industry
The Indian
Pharmaceutical sector is highly fragmented with more than 20,000 registered
units. It has expanded drastically in the last two decades. The leading 250
pharmaceutical companies control 70% of the market with market leader
holding nearly 7% of the market share. It is an extremely fragmented market
with severe price competition and government price control.
The pharmaceutical industry in India meets around 70% of the country's
demand for bulk drugs, drug intermediates, pharmaceutical formulations,
chemicals, tablets, capsules, orals and injectibles. There are about 250
large units and about 8000 Small Scale Units, which form the core of the
pharmaceutical industry in India (including 5 Central Public Sector Units).
These units produce the complete range of pharmaceutical formulations, i.e.,
medicines ready for consumption by patients and about 350 bulk drugs, i.e.,
chemicals having therapeutic value and used for production of pharmaceutical
formulations.
Following the de-licensing of the pharmaceutical industry, industrial
licensing for most of the drugs and pharmaceutical products has been done
away with. Manufacturers are free to produce any drug duly approved by the
Drug Control Authority. Technologically strong and totally self-reliant, the
pharmaceutical industry in India has low costs of production, low R&D
costs, innovative scientific manpower, strength of national laboratories and
an increasing balance of trade. The Pharmaceutical Industry, with its rich
scientific talents and research capabilities, supported by Intellectual
Property Protection regime is well set to take on the international market.
Why India?
Competent workforce: India has a pool of personnel with high
managerial and technical competence as also skilled workforce. It has an
educated work force and English is commonly used. Professional services are
easily available.
Cost-effective chemical synthesis: Its track record of development,
particularly in the area of improved cost-beneficial chemical synthesis for
various drug molecules is excellent. It provides a wide variety of bulk
drugs and exports sophisticated bulk drugs.
Legal & Financial Framework: India has a 53 year old
democracyand hence has a solid legal framework and strong financial markets.
There is already an established international industry and business
community.
Information & Technology: It has a good network of world-class
educational institutions and established strengths in Information
Technology.
Globalisation: The country is committed to a free market economy and
globalization. Above all, it has a 70 million middle class market, which is
continuously growing.
Consolidation: For the first time in many years, the international
pharmaceutical industry is finding great opportunities in India. The process
of consolidation, which has become a generalized phenomenon in the world
pharmaceutical industry, has started taking place in India.
Steps to strengthen the Industry
Indian companies need to attain
the right product-mix for sustained future growth. Core competencies will
play an important role in determining the future of many Indian
pharmaceutical companies in the post product-patent regime after 2005.
Indian companies, in an effort to consolidate their position, will have to
increasingly look at merger and acquisition options of either companies or
products. This would help them to offset loss of new product options,
improve their R&D efforts and improve distribution to penetrate markets.
Research and development has always taken the back seat amongst Indian
pharmaceutical companies. In order to stay competitive in the future, Indian
companies will have to refocus and invest heavily in R&D.
The Indian pharmaceutical industry also needs to take advantage of the
recent advances in biotechnology and information technology. The future of
the industry will be determined by how well it markets its products to
several regions and distributes risks, its forward and backward integration
capabilities, its R&D, its consolidation through mergers and
acquisitions, co-marketing and licensing agreements.
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