Pharmaceutical Industry- A Promising Future
The development of pharmaceutical industry in general has contributed greatly to higher life expectancy along with decreased rate of death. The Indian pharmaceutical industry has undergone constant evolution owing to the continuous research and development taking place. Pharmaceutical companies at present deal with either generic drugs or brand medications. The pharmaceutical industry has in recent times proved to be the most lucrative with attractive revenue returns of 17%. Novartis, Bayer, Pfizer, and GlaxoSmithKline are the major global players among pharmaceutical and biotech companies. These companies safeguard their inventions by applying for patent rights. The Indian pharmaceutical industry, being highly organized, is central in achieving sustained development in the arena of global medicine. The strong points of Indian pharma industry include low manufacturing cost, talented and professionally skilled work force, and cheap labor. The industry is expected to achieve a healthy growth rate of 9.9% per year. All these factors helped India to rank 3rd in the global market with respect to volume of manufacture. Major Indian pharma companies include Ranbaxy, Cipla and Dr. Reddy’s.
Owing to its highly lucrative nature and due to its ability to provide ample opportunities for growth, the Indian pharmaceutical industry is wholly supported by the government. Liberal policies of the government further lead to increased foreign investments which make the future of Indian pharmas promising.
Future initiatives of the Indian pharmaceutical industry:
Tremendous scope of the Indian pharmaceutical industry in recent future is due to the following projects which are seriously being considered.
- A study conducted by FICCI-Ernst & Young revealed that India would in all probability open an 8 billion US$ market targeting multinational corporations dealing in costly drugs by the year 2015.
- The study also predicted the domestic pharma market to touch 20 billion US$ by 2015 in all likelihood.
- Healthcare expenditure by public in 2007 increased from 7% of GDP to 13% by the year 2015.
- Tie-up between Dr Reddy’s Laboratories and GlaxoSmithKline to facilitate the production and sale of generic drugs in global markets abroad took place.
- A Mumbai centered pharma company, Lupin is presently researching options to gain 200 million US$ in the field of oral contraceptives in the US market.
Future scenario of the Indian pharmaceutical industry
The field of pharmaceuticals experienced an accelerated rate of growth and generated revenue which increased from 11.4 billion US$ in the year 2010 to 13 billion US$ in the year 2012. The major constraint faced by the life sciences sector is scarcity of talented work force.
The companies belonging to the Indian pharmaceutical industry can be broadly classified into two: domestic companies of Indian origin and multinational corporations or foreign companies. Major companies include Novartis, Bayer, Pfizer, GlaxoSmithKline, Dr. Reddy’s Laboratories, Cipla, Biocon, and Ranbaxy.
Steps taken to achieve growth further in the pharma industry involves diversification, innovation, hiring and carrying out expansion abroad. Many of the Indian pharmaceutical companies concentrate on developing novel products or provide services within the existing norms of business models.
Delivering reasonably affordable healthcare to the huge population in India poses the greatest challenge to Indian pharmaceutical industry. Secondly, the pharma industry has to abide by numerous rules, laws and regulations with respect to patent, clinical trials, production and marketing of medicines and drugs. Stringent regulations have proved to be a challenge even in the field of regenerative medicine. Some expected developments in the field of Indian pharma industry include introduction of new health insurance programs, increased number of hospitals in towns, quality health care options, improved infrastructure of treatment centers and easy availability of treatment facilities.
The Indian Pharma industry is highly profitable and offers scope for growth due to the host of initiatives taken by the Indian government to support the pharma sector. Indian pharma industry can diversify and get involved in various activities such as drug manufacture, drug discovery, generics, clinical research and trials outsourcing and last but not the least, marketing of the drugs.
With the change in epidemiological profile of India, the demand for medicines needed to treat cardio-vascular problems, central nervous system disorders or other lifestyle related diseases is increasing day by day. India is providing tough competition to global pharma companies in many aspects. India has commendable expertise in the manufacture and production of drugs. Therefore, the Indian pharma sector is able to achieve the status of world leaders in the field of production of vaccines and generic drugs. Accepting and complying with the laws of patenting results in protection of intellectual property rights which succeeds in maintaining a favorable environment for research in India. Cost effectiveness of clinical trials leads to lower cost of drug manufacture. All these factors encourage foreign investment in India and contribute towards strengthening the backbone of the Indian economy.
The Indian pharmaceutical industry is undergoing evolution at a very fast pace and due to this it has to face both opportunities and challenges with equanimity to achieve a strong foothold in the global pharma industry. Several new tie-ups and mergers both in the domestic and international arena promise an exciting future for the Indian pharmaceutical industry. Indian Pharmaceutical companies which direct their efforts towards developing the local market will achieve moderate growth owing to increased competition from firms that are dependent on global pharmaceutical companies. It will also prove to be difficult for domestic firms to carry out their own drug discovery research because they may be avoided by foreign investors as potential candidates for licensing partnership if they are unable to demonstrate growth. Outsourcing opportunities for advanced intermediates and generic drugs provided by these global majors would be cancelled if the domestic subsidiaries were unable to achieve increased global supply or impeccable customer care services. In any case, Indian companies will have to carry out an effective examination or evaluation routine to adopt and execute plans which will result in more effective participation in the global arena. Only then Indian pharmaceutical industry can emerge as the global pharmaceutical leader of the century.