Indian Pharma space to increase 27 billion dollar by 2016
India’s pharmaceutical sales, worth 22.6 billion dollar in 2012, is expected to register 27 per cent growth to reach 27 billion dollar by 2016, according to the Deloitte 2014 Global Life Sciences Outlook report.
“India’s pharmaceutical sales were $22.6 billion in 2012. They are expected to rise to $23.6 billion in 2013 and reach $27.0 billion in 2016. As a per cent of health care expenditures, pharmaceutical sales were 22.6 per cent in 2012; they are expected to reach 23.6 per cent in 2013 and 27 per cent by 2016,” says the report.
Despite heightened regulatory scrutiny, continued pricing pressures and another year of impacts from health care reform in many countries, the global life sciences sector is exhibiting resilience and reinvention as it employs new research and development (R&D) and business models to cost-effectively deliver innovation, value, and improved patient outcomes, as per the report.
It says that India has a fragmented life sciences industry, with stiff price competition, government price controls, and limited availability of infrastructure. Nonetheless, MNCs are increasing their operations in India and creating opportunities to drive industry growth in the country.
India is among the top five pharmaceutical emerging markets. The double digit growth registered by India’s life sciences and health care industry can be attributed to several socio-economic factors, including increasing sales of generic medicines, continued growth in chronic therapies, and a greater penetration in rural markets. Other growth drivers are heightened health awareness, increasing affluence, changing lifestyles resulting in higher incidence of lifestyle diseases, increasing government expenditure on health care, and a nascent, yet fast growing health insurance industry. In addition, the nation’s low cost of production and R&D boosts the efficiency of Indian pharmaceutical companies and its comparative cost advantage enhances Indian pharmaceutical exports, according to the report.
“The worldwide demand for cost-effective generic drugs is leading India to rise as a hub of generic drug manufacturing. India accounts for over 10 per cent of global pharmaceutical production, with over 60,000 generic brands across 60 therapeutic categories; it manufactures more than 400 different active pharmaceutical ingredients (APIs). The country is the front-runner in a wide range of specialties involving the manufacture of complex drugs,” it says.
“A number of pharmaceutical companies are increasing their operations in India, which has 119 manufacturing sites approved by the US FDA, the highest in any foreign country. The main focus of the Indian companies is on countries with aging populations such as Japan, Africa, and Latin America, which need cheaper drugs. It is estimated that Indian companies will benefit by about $40 billion as 46 US drug patents expire in 2012-15,” it adds.
“Despite the exponential growth, India’s life sciences and health care industry still faces challenges. The outcome of new product patents, drug price control, poor regulatory enforcement, inadequate health care infrastructure, shortage of skilled workforce, increasing patient expectations, ever-changing technology, and quality management and conformance to global standards act as critical barriers in delivering products and services in a sustainable manner,” according to the report.
