The future of Indian pharmaceutical sector looks extremely positive. Indian pharma companies are vying for the branded generic drug space to register their global presence. Several Indian pharmaceutical companies have acquired companies in the US and Europe and many others are raising funds to do so. The Indian Pharmaceutical industry meets approximately 95% of the country’s pharmaceutical needs. The present turnover of the Indian Pharma Industry is approximately $ 9.0 billion of which the share of exports is 40%. India’s pharmaceutical companies can also operate at much lower profit margins that their Western counterparts. Today, India produces some of the cheapest drugs in the world, especially because labor costs are 50 to 55% cheaper than in the West. Industry experts indicate that infrastructure costs are 40 % lower and fixed cost is estimated to be 12% to 20% less that in the United States and Western Europe.
INDIAN PHARMACEUTICAL INDUSTRY: A VISION WITH ITS STRENGTH AND WEAKNESS Dr. A. SELVARAJ*
Health is defined both as a cause and effect of economic development. Therefore, pharmaceutical industry is defined as an essential factor that can contribute to the economic development. In addition it provides significant socio-economic benefits to the society through creation of jobs, supply chains and through community development. The industry also plays an important role in the technological innovation which may reduce the cost of economic activity elsewhere in the economy. Players in the pharmaceutical industry include branded drug manufacturers, generic drug manufacturers, firms developing bio-pharmaceutical products, non-prescription drug manufacturers, firms undertaking contract research. Indian Pharmaceutical Industry is playing a key role in promoting and sustaining development in the vital field of medicines. Around 70% of the country's demand for bulk drugs, drug intermediates, pharmaceutical formulations, chemicals, tablets, capsules, orals and vaccines is met by Indian pharmaceutical industry. A number of Indian pharmaceutical companies adhere to highest quality standards and are approved by regulatory authorities in USA and UK. Pharmaceutical Industry in India is one of the largest and most advanced among the developing countries. It provides employment to millions and ensures that essential drugs at affordable prices are available to the vast population of India. Indian Pharmaceutical Industry has attained wide ranging capabilities in the complex field of drug manufacture and technology. Indian Pharmaceutical sector is highly fragmented with more than 20,000 registered units and is very top heavy. The leading 250 pharmaceutical companies control 70% of the market with market leader holding nearly 7% of the market share. There are also 5 Central Public Sector Units that manufacture drugs. Pharmaceutical Industry in India has been de-licensed and industrial licensing for most of the drugs and pharmaceutical products has been done away with. Manufacturers are now free to produce any drug duly approved by the Drug Control Authority. Indian pharmaceutical industry got a major boost with the signing of General Agreement on Tariffs and Trade in January 2005 with which India began recognising global patents. After recognizing the global patent regime the Indian pharma market became a sought after destination for foreign players.
India holds the lion's share of the world's contract research business as activity in the pharma market continues to explode in this region. Over 15 prominent contract research organisations (CROs) are now operating in India attracted by her ability to offer efficient R&D on a low-cost basis. Thirty five per cent of business is in the field of new drug discovery and the rest...