Investment Opportunities in India

November 24, 2011

A Brief on the Pharmaceutical Industry in India

The pharmaceutical industry in India has indeed extended its base and created a greater scope for manufacturing various drugs in tablet, capsule, injectable, liquid and oral forms. This in turn has also enhanced the scope for manufacturing of bulk drugs under various therapeutic categories. There are about 400 bulk drugs available in the Indian market and among them about 300 are produced domestically. Apart from that India has emerged as one of the most favoured destination for creating successful collaboration in the sphere of Research & Development bioinformatics, contract research and manufacturing and clinical research. This in turn has made way to grow greater compliance with international standards in terms of current Good Manufacturing Practices (cGMP), as Good Laboratory Practices (GLP) and Good Clinical Practices (GCP).

Factors influencing the development of the Pharmaceutical Market:

India has created a distinct entity in production of generic medicines sold in the global market. Alongside, India has even established itself as one of the fastest players among the ones steadily growing up in the global pharmaceutical sphere. Here are some of the important factors that have accelerated the growth of the drugs and pharmaceutical market. They are as follows,

  • The enhancing rate of population
  • The growing income
  • The improvement in the infrastructure of the healthcare sector
  • The increasing rate of critical ailments related to lifestyle, such as, diabetes, cardiovascular diseases, and central nervous system; and others.
  • Health insurance penetrating deeper
  • Adopting more of patent products
  • Expiration of patents and the increase of aging population in Europe, US and Japan

This is the reason why pharma industry in India is at an emerging state with more and more multinationals from the domain joining the sector. The proof can be coined from the fact that about 15 out of 20 pharmaceutical giants ruling the world have their presence in India. In fact, drugs and pharmaceutical industry in India had been the among the sectors that attract high FDI and this quite bear testimony to the fact.

Now let’s peep into the key characteristics of the pharma industry in Indiaand this will surely enable us to find out the significant features pertaining to the sector. Here it goes,

  • Production of 70% of bulk drugs proved to be self reliant and almost the entire requirement is met by formulations within the country
  • Low production cost
  • Low R&D costs
  • Manpower decked with innovative, scientific thought
  • National laboratories with world-class facilities
  • Specialized Efforts towards process development and development of cost effective technologies
  • Increasing balance of trade in pharma sector
  • Efficient and cost effective source for procuring generic drugs, especially the ones going off patent in the next few years
  • An excellent centre for clinical trials in view of balancing the population diversity.

Now, if it is about finding the link between Indian retail industry and pharmaceuticals then it can be well seen that the estimated value of pharma retailing has been set at about 300 billions in which 15 percent of the 51 lakh Indian retail stores being chemists. It can also be said that pharma retail sector in India is so far being dominated by unorganized players but at the same time it can also be said that a major commove followed by consolidation of the pharma sector in the Indian retail industry will be witnessed soon.


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