Pharmaceuticals

August 2022
For updated information, please visit www.ibef.org
Table of Contents

Executive Summary 3

Advantage India 4

Market Overview 6

Recent Trends and Strategies 13

Growth Drivers 18

Opportunities 27

Key Industry Contacts 29

Appendix 31

2
Executive summary

1. Leading pharma producer

5. Robust growth in
• Indian pharmaceutical industry is
expected to reach ~US$ 130 billion by
biotech industry
2030.
• The Indian biotechnology industry
• India ranks 3rd worldwide
pharmaceutical production by volume and
for
5 was valued at US$ 70.2 billion in 2020
14th by value. The country has an 1 and is expected to reach US$ 150
billion by 2025.
established domestic pharmaceutical
industry, with a strong network of 3,000 • The biotechnology industry in India
drug companies and ~10,500 comprises ~600+ core biotechnology
manufacturing units. companies, ~2700+ biotech start-ups
• India is the largest producer of vaccines and ~100+ biotech incubators.
worldwide, accounting for ~60% of the
total vaccines, as of 2021.
2 4 4. Rapidly growing
2. One of the highest
exports healthcare sector
• Indian drug & pharmaceutical exports 3 • Indian healthcare sector, one of the
fastest growing sectors, is expected to
stood at US$ 2,119.08 million in June
cross US$ 372 billion by 2022.
2022.
• Indian drug & pharmaceutical exports
stood at US$ 24.60 billion in FY22 3. Among fastest growing industries
and US$ 24.44 billion in FY21.
• Indian pharmaceutical sector is expected to grow at a CAGR of
22.4% in the near future and medical device market expected to
grow US$ 25 billion by 2025. India is the second-largest
contributor of global biotech and pharmaceutical workforce.
• The Indian pharmaceutical industry generated a trade surplus of
US$ 15.81 billion in FY22.
Note: BIRAC - Biotechnology Industry Research Assistance Council
Source: 1 FICCI - Trends & Opportunities for Indian Pharma 2018, Pharmexcil

3
Advantage India

4
Advantage India
3. POLICY SUPPORT
▪ In February 2021, the government approved a production-linked incentive
2. ECONOMIC DRIVERS (PLI) scheme for the pharmaceuticals sector from FY21 to FY29. The
scheme is expected to attract investments of Rs. 15,000 crore (US$ 2.07
▪ Economic prosperity to improve drug affordability. billion) into the sector. It is also expected to lead to incremental sales of Rs.
▪ Increasing penetration of health insurance to drive expenditure 2,94,000 crore (US$ 40.63 billion) and exports of Rs.1,96,000 crore (US$
on medicine. 40.63 billion) between FY23 and FY28.
▪ With increasing penetration of pharmacies, especially in rural ▪ In June 2021, Finance Minister Ms. Nirmala Sitharaman announced an
India, OTC drugs will be readily available. additional outlay of Rs. 197,000 crore (US $26,578.3 million) that will be
utilised over five years for the pharmaceutical PLI scheme in 13 key sectors
such as active pharmaceutical ingredients, drug intermediaries and key
1. COST EFFICIENCY starting materials.
▪ Low cost of production and R&D ▪ In March 2022, under the scheme SPI* a total financial outlay of Rs. 500
boosts efficiency of Indian pharma crore (US$ 665.5 million) for the period FY 2021-22 to FY 2025-26 were
companies, leading to competitive announced.
exports. Indian drugs and
4. INCREASING
pharmaceuticals exports reached INVESTMENTS
US$ 5.78 billion between April
2021 and June 2021. ▪ The FDI inflows in the Indian drugs and
▪ As of 2019, India’s cost of pharmaceuticals sector reached US$
production is ~33% lower than 19.41 billion between April 2000-March
that of the US.
▪ India’s ability to manufacture high-
2 3 2022.
▪ PharmEasy received US$ 300 million in
quality, low-priced medicines, July 2021 from its existing investors after
presents a huge business acquiring Thyrocare, the diagnostic firm.
opportunity for the domestic These funds will be utilised to continue
industry. Thyrocare's acquisition process. After the
transaction is completed, the online
1 4 pharmacy plans to float the company on
the Indian Stock Exchange.

Note: *SPI- Strengthening of Pharmaceutical Industry

5
 Market Overview

MARKET OVERVIEW

6
Structure of pharmaceuticals sector in India

Pharmaceuticals

Active Pharmaceutical
Formulations
Ingredients/ Bulk drugs

Branded Generics Branded Generics

▪ Cardiovascular ▪ Anti-infectives

▪ Anti-Diabetes ▪ Respiratory

▪ Gastro-Intestinal ▪ Pain

▪ Neurological ▪ Gynecology

Source: Dun and Bradstreet

7
Evolution of the sector

1970-90 1990-2010 2010-2013 2013- 2015 2016 onwards

▪ 2014: 100% FDI allowed in ▪ In Union Budget, 2016,

▪ Indian Patent Act passed in ▪ Liberalised market. ▪ Increased patent filings by
1970. pharma players. medical device industry. The FDI increased to 74% in
▪ Indian companies
investment will be routed through existing pharmaceutical
▪ Several domestic companies increasingly launch ▪ Likely adoption of newer
automatic route. companies and 100% for
start operations. operations in foreign sales models such as
▪ Leading Indian pharma new projects.
▪ Development of production countries. channel management,
infrastructure. ▪ India a major destination KAM and CSO. companies are raising funds ▪ The Government of India
▪ Export initiatives were taken. for generic drug ▪ The National aggressively to fund acquisition in unveiled 'Pharma Vision
manufacturing. Pharmaceutical Pricing domestic as well as international 2020' aimed at making
▪ Approval of Patents Policy, 2012 (NPPP- market to increase their product India a global leader in
(Amendment) Act 2005, 2012). portfolios. end-to-end drug
which led to adoption of ▪ 2013: New Drug Pricing ▪ 2015: India has 10,500 manufacture. Approval
product patents in India. Control Order issued by manufacturing units and over time for new facilities has
Directorate of Food and 3,000 pharma companies. been reduced to boost
Drugs this will reduce the investments.
prices of drugs by 80%. ▪ National Health Policy Draft 2015
to increase expenditure in health ▪ The National Digital Health
care sector. Blueprint has the potential
to generate nearly
▪ Patent Act Amendment 2015, it US$ 200 billion in added
includes amendments in Patent economic value for India's
Note: SAFTA - South Asian Free Trade Area, ASEAN - Association of Southeast Asian Nations
Act 2002. healthcare industry over
Source: TechSci Research
the next 10 years.

8
Important segments in Indian pharmaceutical sector

2. CONTRACT RESEARCH AND 3. BIOSIMILAR

MANUFACTURING SERVICES (CRAMS) • The Government plans to allocate
US$ 70 million for local players to
• Contract Research and Manufacturing Services (CRAMS). develop Biosimilar.
• Fragmented market with more than 1,000 players. • The domestic market is expected to
• CRAMS industry has posted 48% CAGR between FY15-18 and reach US$ 35 billion by 2030.
expected to witness a strong growth over 25% over 2018-21.

1. ACTIVE PHARMACEUTICAL
4. FORMULATIONS
INGREDIENTS (APIS) • Largest exporter of formulations in
• Domestic API consumption is expected to terms of volume, with 14% market
reach US$ 18.8 billion by FY22. share and 12th in terms of export
• In April 2019, a high-level task force was value.
constituted to create a roadmap for • Double-digit growth is expected
increasing domestic production of APIs. It’s over the next five years.
exports for FY21 stood at US$ 4.3 billion. • According to Allied Market
• In 2021, the government had approved a Research, the Indian
US$ 955 million production-linked incentive pharmaceutical packaging market
(PLI) scheme to encourage domestic
production of important starting materials,
2 3 was valued at US$ 1,434.1 million
in 2020 and is expected to reach
pharmacological intermediates and APIs. US$ 3,027.14 million by 2030, at a
CAGR of 7.54%.

1 4

Source: 1 RNCOS, BMI, Datamonitor, Kemwell Biopharma, Chemical Pharmaceutical Generic Association, ICRA Report estimates, pharmanewsprwire.com

9
Indian pharmaceuticals market

Indian Pharmaceutical Market (US$ billion)

140.0

120.0

100.0

80.0

60.0 120.0

40.0
65.0
20.0 42.0

-
2021 2024 2030

▪ Globally, India ranks 3rd in terms of pharmaceutical production by volume and 14th by value. The domestic pharmaceutical industry includes a network of 3,000
drug companies and ~10,500 manufacturing units.
▪ According to the Indian Economic Survey 2021, the domestic market is expected to grow 3x in the next decade.
▪ India’s domestic pharmaceutical market stood at US$ 42 billion in 2021 and likely to reach US$ 65 billion by 2024 and further expand to reach ~US$ 120 billion by
2030.
▪ The Ayurveda sector in India reached US$ 4.4 billion by 2018 end and grow at 16% CAGR until 2025.
▪ In November 2020, Prime Minister Mr. Narendra Modi dedicated two future-ready national premier Ayurveda institutions to the country to mark celebrations of the
‘5th Ayurveda Day’. Also, World Health Organisation (WHO) announced the setting up of the Global Centre of Traditional Medicine in India.
▪ In terms of overall revenue, the Indian pharmaceutical market increased by 13.9% in January 2022.
▪ As of August 2021, CARE Ratings expect India's pharmaceutical business to develop at an annual rate of ~11% over the next two years to reach more than US$
60 billion in value.
▪ In the global pharmaceuticals sector, India is a significant and rising player. India is the world's largest supplier of generic medications, accounting for 20% of the
worldwide supply by volume and supplying about 60% of the global vaccination demand. The Indian pharmaceutical sector is worth US$ 42 billion and ranks
3rd in terms of volume and 13th in terms of value worldwide.
▪ According to India Ratings & Research, the Indian pharmaceutical market revenue is expected to be over 12% Y-o-Y in FY22.
Source: Department of Pharmaceuticals, PwC, McKinsey, AIOCD AWACS, , IQVIA, CII

10
Pharmaceuticals export to continue witnessing positive growth
Drugs & Pharmaceuticals Exports from India (US$ billion) Major Export Destinations in India’s Pharma Export in FY20 (%)

North America
30.00
Africa
25.00 13.0%
24.6
20.00 22.44 5.6% 34.0% EU
20.70
19.14 6.8%
15.00 16.89 16.78 17.28 ASEAN
6.9%
10.00 LAC

5.00 15.7% Middle East

18.0%
0.00
Others
FY16 FY17 FY18 FY19 FY20 FY21 FY22

▪ India is the world’s largest provider of generic medicines; the country’s generic drugs account for 20% of global generic drug exports (in terms of
volumes). Indian drugs are exported to more than 200 countries in the world, with the US as the key market.
▪ India is the 12th largest exporter of medical goods in the world. The country’s pharmaceutical sector contributes 6.6% to the total merchandise exports.
▪ Exports of Indian pharmaceuticals, including bulk drugs, intermediates, drug formulations, biologicals, AYUSH & herbal products and surgical products,
reached US$ 16.28 billion in FY20.
▪ Medical Device industry is expected to reach US$ 50 billion by 2030, growing at a CAGR of 15%.
▪ India’s drugs and pharmaceuticals exports stood at US$ 24.60 billion in FY22 and US$ 22.44 in FY21.
▪ In FY21, North America was the largest market for India’s pharma exports with a 34% share and exports to the U.S., Canada and Mexico recorded a
growth of 12.6%, 30% and 21.4%, respectively.
▪ India’s formulation surged 18% and the bulk drug exports rose 9% y-o-y in the first half of FY21, according to a report by Crisil.
▪ According to a report released in September 2021 by the global consulting firm Kearney in collaboration with the Confederation of Indian Industry (CII),
India's vaccines industry could grow from US$ 2 billion to US$ 5 billion in the next decade, as new Indian and global pharmaceutical companies have
started including vaccines as a key part of their portfolios.
▪ India could restart deliveries of COVID-19 shots to global vaccine-sharing platform COVAX in November-December 2021 for the first time since April
2021. The World Health Organization (WHO), which co-leads COVAX, has been pushing India to resume supplies for the programme, particularly after it
sent ~4 million doses to neighbours and allies in October 2021.
Note: EU - European Union, ASEAN - Association of Southeast Asian Nations, LAC - Latin America and the Caribbean,
Source: Department of Commerce India, Department of Pharmaceuticals, India Business News, Global Trade Atlas, KPMG US-India Dynamic June 2018, Pharmexcil

11
R&D spending in Indian pharmaceuticals
R&D spending by top pharma companies in FY20
R&D Investment by Indian Pharma Companies* (% of sales)
(US$ million)
250
10.0
9.0 200 225
8.0 204
8.7 8.5 8.6 8.4 150
7.0 7.9 173
6.0 7.2 100 137
5.0 50 72
4.0 57 48
3.0 0

Wockhardt
Lupin

Pharma
Cipla

Aurobindo

Sun Pharma

Torrent
Dr Reddy
2.0
1.0
-
FY16 FY17 FY18 FY19 FY20 FY21

▪ The Indian pharmaceutical industry is now seeking to move up the global pharmaceutical value chain by investing in R&D for drug development,
drug repurposing, process improvements and digital manufacturing.
▪ In FY20, the highest expenditure on R&D done by Lupin, followed by Dr. Reddy’s.
▪ Sun Pharma’s R&D plan includes developing more products through expanded R&D team for global markets, focussing on more complex
products across multiple dosage forms and investments in speciality pipeline.
▪ As per the Union Budget 2022-23, Rs. 3,201 crore (US$ 419.2 million) has been set aside for research and Rs. 83,000 crore (US$ 10.86 billion)
has been allocated to the Ministry of Health and Family Welfare.
▪ India plans to set up a nearly Rs. 1 lakh crore (US$ 1.3 billion) fund to provide boost to companies to manufacture pharmaceutical ingredients
domestically.
▪ In July 2021, Delhi Pharmaceutical Sciences and Research University (DPSRU) collaborated with All India Institute of Ayurveda (AIIA) to focus on
assessment of application of ayurvedic and medicinal plant-based drugs in modern medicines.
▪ The Import Bank of India (India Exim Bank), in collaboration with the Japan Bank for International Cooperation (JBIC) and the Pharmaceutical
Export Promotion Council of India (Pharmexcil), organised a roundtable with Indian COVID vaccine manufacturers (current and potential) in
September 2021 to discuss their various financing needs and options.
Note: *Top 10 companies as per research by HDFC Securities,
Source: Company website, CRISIL Research, HDFC Securities

12
 Recent Trends and Strategies

RECENT TRENDS AND STRATEGIES

13
Notable trends in the Indian pharmaceuticals sector
2. PRODUCT LAUNCH 3. EXPANSION
• In May 2022, Sun Pharmaceutical Industries Limited through one of its • .Glenmark becomes the first pharmaceutical company to launch
wholly owned subsidiaries plans to launch Bempedoic Acid under the Indacaterol + Mometasone fixed-Dose combination drug for Asthma
brand name Brillo, in India for reducing low-density lipoprotein (LDL) in India.
cholesterol. • In April 2022, Dr. Reddy's Laboratories Ltd. inked a pact with
• In March 2022, Themis Medicare Ltd. (Themis), announced the MediCane Health to announce the launch of medical cannabis
approval of its antiviral drug VIRALEX by the Drug Controller General products in Germany
of India (DCGI).
• In November 2021, Sun Pharmaceuticals announced that it is gearing
up to introduce Merck Sharpe Dohme (MSD) and Ridgeback’s 4. PARTNERSHIPS
molnupiravir under the brand name Molxvir in India. DCGI is currently
reviewing clinical data of molnupiravir for treatment of COVID-19 • In July 2022, Cipla Health signed
among adults in the country. agreement to acquire Endura Mass, a
• In August 2021, Alkem Laboratories introduced Famotidine and renowned nutritional supplement.
Ibuprofen tablets to treat osteoarthritis and rheumatoid arthritis • brand in the category of weight gain.
symptoms in the US. • In June 2022, Cipla partnered with Drugs
• In May 2021, Cipla launched a real-time COVID-19 detection kit for Neglected Diseases initiative (DNDi) to
‘ViraGen’ that is based on multiplex polymerase chain reaction (PCR) announce the launch of a 4-in-1
technology. antiretroviral treatment for children living
• In May 2021, a Bangalore-based start-up—PathShodh Healthcare— with HIV in South Africa.
developed a novel, point-of-care Electrochemical ELISA test that • In May 2022, Dr. Reddy’s Laboratories
enables fast and accurate estimation of antibody concentration of entered into an exclusive partnership with
COVID-19 in clinical samples. HK inno.N Corporation to commercialise
• In May 2021, Zydus Cadil launched a next-generation breast cancer novel molecule Tegoprazan in India &
drug—Trastuzumab Emtansine—at a fraction of its existing cost. select emerging Markets.
• In November 2021, Cadila Healthcare Ltd.
1. INCREASING EXPORTS (CHL) entered into a manufacturing
license and technology transfer
• India’s pharmaceutical export
market is thriving due to strong
2 3 agreement for its plasmid DNA-based
COVID-19 (ZyCoV-D) vaccine with Korea-
presence in the generics space. based Enzychem Lifesciences
• Indian drug & pharmaceutical (Enzychem).
exports stood at US$ 24.60 billion
in FY22 and US$ 24.44 billion in
FY21. 1 4
14
COVID-19 fightback from the Indian pharmaceuticals sector

2. R&D RELATED TO COVID-19 3.GOVERNMENT INITIATIVES

• In May 2021, the Government of India invited R&D • In November 2021, PM Mr. Narendra Modi inaugurated the first Global
proposals on critical components and innovations in Innovation Summit of the pharmaceuticals sector. The summit will have 12
oxygen concentrators by June 15, 2021. sessions and over 40 national and international speakers deliberating on a
• In May 2021, the Drugs Controller General of India range of subjects including regulatory environment, funding for innovation,
cleared applications from five pharmaceutical companies industry-academia collaboration and innovation infrastructure.
to manufacture anti-fungal drug Amphotericin B used to • In April 2021, the Union Government agreed/decided to streamline and fast-
treat mucormycosis or black fungus. track the regulatory system for COVID-19 vaccines that have been approved
• In April 2021, the Department of Biotechnology, Ministry for restricted use by the US FDA, EMA, UK MHRA, PMDA Japan or those
of Science & Technology, approved additional funding listed in the WHO Emergency Use Listing (EUL). This decision is likely to
towards clinical studies for India’s ‘first-of-its-kind' facilitate quicker access to foreign vaccines by India and encourage imports.
mRNA-based COVID-19 vaccine, HGCO19, developed
by Pune-based Gennova Biopharmaceuticals Ltd.

1. COLLABORATIONS 4. INDIAN PLAYERS GLOBAL

• In August 2021, Glenmark collaborated with EXPOSURE
SaNOtize to introduce spray for COVID-19 • In February 2021, the Russian Ministry of
treatment in India and other Asian markets. Health allowed Glenmark Pharmaceuticals to
• In July 2021, five of India's largest pharmaceutical market its novel fixed-dose combination nasal
companies participated in an outpatient trial of the spray in Russia.
investigational oral antiviral medication, • In August 2021, Uniza Group, an Ahmedabad-
Molnupiravir, to treat moderate COVID-19. based pharmaceutical firm, signed an
• In July 2021, BDR Pharmaceuticals joined forces agreement with Lysulin Inc. (an US-based
with Defence Research and Development firm) to introduce Lysulin, a nutritional product
Organisation (DRDO) to manufacture COVID-19 for Indian consumers.
drugs in India.
2 3

1 4
15
States hosting key pharmaceutical ventures

▪ Sun Pharma's API manufacturing ▪ Wockhardt's facility covers an area of

facility at Toansa, Malanpur, 40,468 sq. meters in Baddi, Himachal
Guwahati, Ankleshwar, Panoli, Pradesh.
Ahmednagar, Maduramthakam.
▪ Baddi is also home to Cipla’s
formulations manufacturing facility.

▪ Mandideep in Madhya Pradesh is

▪ Dholka in Gujarat houses a major the manufacturing hub for Lupin’s
manufacturing facility of Cadila, cephalosporin and ACE-
which spans over 100 acres. Inhibitors.

▪ Cipla has a formulations

manufacturing plant at Indore.
▪ Lupin has an USFDA-approved
plant at Tarapur, Maharashtra. The
facility forms the core of Lupin's
fermentation capabilities. ▪ Piramal’s USFDA-approved manufacturing plant
in Hyderabad.

▪ GlaxoSmithKline has a major facility at

▪ Key pharma companies and CMOs
Rajahmundry, Andhra Pradesh.
such as Mylan NV, Albany Molecular
Research and Cambrex Corp. have
manufacturing facilities in Telangana.

Source: Company Website

16
Strategies adopted
2. DIFFERENTIATION 3. FOCUS ON NEW MARKETS
• Players in the sector are trying to strengthen their • Lupin is making road into new markets such as Latin America,
position in the market and expand themselves by Russia and other East European countries.
investing heavily in R&D activities, such as: Dr • Sun Pharma decided to focus on specialty and chronic
Reddy’s acquired OctoPlus N.V, a Netherlands- therapies such as neurology, oncology, dermatology segments.
based company, to get access to the Poly Lactic- • India plans to set up a nearly Rs. 1 lakh crore (US$ 1.3 billion)
Co-Glycolic Acid (PLGA) technology for the fund to provide boost to companies to manufacture
formulation of complex injectables. pharmaceutical ingredients domestically.

4. M&A IN BIOTECH
• In February 2021, Aurobindo
Pharma announced plans to
procure solar power from two
open access projects of NVNR
1. COST LEADERSHIP Power and Infra in Hyderabad.
The company will acquire 26%
• Sun Pharma is trying to achieve
share capital in both companies
cost leadership by Vertical
with an US$ 1.5 million
Integration: Complex API, which
investment. The acquisition is
require special skills and
expected to be completed by the
technology, are developed and
end of March 2021.
scaled up for both API and
• In October 2020, Aurobindo
dosage forms.
Pharma acquired MViyeS Pharma
2 3 Ventures for Rs. 274.22 crore
(US$ 37.30 million).
• Piramal Pharma Ltd. agreed to
buy a 100% investment in Hemmo
Pharmaceuticals for US$ 104.11
million in cash up front and earn-
outs in June 2021.
1 4

17
 Growth Drivers

GROWTH DRIVERS

18
Supply-side drivers of Indian pharmaceuticals sector
1. Launch of patented
drugs
• Following the introduction of product 5. Patent Expiry
patents, several multinational companies
are expected to launch patented drugs in • About 120 drugs are expected to go

•
India.
Growth in the number of lifestyle diseases 5 off-patent over the next 10 years;
with expected worldwide revenue
in India could boost the sale of drugs in 1 between US$ 80 to 250 billion.
this segment.
• High Court allowing to export patent
drugs, to foreign players in the Indian
market. 4. Over-The-Counter
• According to Sagacious IP, in terms of
(OTC) drugs
patents filed by Indian companies, India
ranks among the top 10 countries in 2 4 • India’s OTC drugs market stood at
healthcare and pharmaceutical sectors. US$7.62 billion in 2021 and is estimated
The number of patents filed by Indian to grow at a CAGR of 19.4% to reach
firms increased to 7,399 in 2020 from
2,548 in 2015. 3 US$18.49 billion in 2026, driven by a
shift in consumer attitudes towards self-
medication, product advancements and
2. Medical infrastructure pharmaceutical preferences for OTC
• Pharma companies have increased drugs over prescription drugs.
spending to tap rural markets and develop
better medical infrastructure. 3. Scope in generics market
• Hospitals’ market size is expected to
increase by US$ 200 billion by 2024. • India’s generic drugs account for 20% of global
• India’s medical devices market stood at exports in terms of volume, making it the largest
US$ 10.36 billion in FY20. The market is provider of generic medicines globally. The
expected to increase at a CAGR of 37% generics drug market accounts for around 70% of
from 2020 to 2025 to reach US$ 50 billion. the India pharmaceutical industry. India supplies
>40% generics to the US market.
Notes: CAGR - Compound Annual Growth Rate
Source: BMI, India Biz, Nicholas Hall & Company, IQVIA

19
Demand drivers of Indian pharmaceuticals sector

2. ACCEPTABILITY 3. PRADHAN MANTRI BHARTIYA

• Rising levels of education to increase JANAUSHADHI KENDRAS
acceptability of pharmaceuticals. • Over 650 million people expected to be covered by health
• Patients to show greater propensity to self- insurance by 2020.
medicate, boosting the OTC market. • The Government plans to provide free generic medicines to half
• Acceptance of biologics and preventive the population at an estimated cost of US$ 5.4 billion.
medicines to rise. • Affordable medicines under Pradhan Mantri Bhartiya Janaushdhi
• Surge in medical tourism due to increased Kendra's (PMBJKs) achieved an impressive sale of Rs. 100.40
patient inflow from other countries. crore (US$ 14.24 million) in first two months of FY21.

1. ACCESSIBILITY
• As per Mckinsey’s report (July
2019), > US$ 200 billion to be 4. EPIDEMIOLOGICAL
spent on medical infrastructure
in the next decade. FACTORS
• New business models expected
to penetrate tier-2 and 3 cities.
2 3 • Patient pool expected to increase
over 20% in the next 10 years
• Over 160,000 hospital beds (until 2030), mainly due to rise in
expected to be added each year population.
in the next decade. • New diseases and lifestyle
• India’s generic drugs account for changes to boost demand.
20% of global exports in terms
of volume, making the country 1 4
• Increasing prevalence of lifestyle
diseases.
the largest provider of generic
medicines globally.

Note: RSBY - Rashtriya Swasthya Bima Yojna

Source: ICRA Report on Indian Pharmaceutical Sector, Pharmaceutical Industry: Developments in India- Deloitte, Mckinsey Pharma Report 2020

20
Growing health insurance

Breakdown of non-lifeport
Visakhapatnam insurance
trafficmarket in tonnes)
(million India (FY21) Gross Direct Premiums of Non-Life Insurers (US$ billion)

30.00 CAGR 13.03%

25.00

27.15
26.80
24.32
23.37
29.5% 20.00

19.11
Total size: 15.00

14.71
US$ 27.15 Health Others
10.00
billion
70.5% 5.00

0.00

FY16

FY17

FY18

FY19

FY20

FY21
▪ Increasing penetration of non-life insurance including health insurance will drive the expansion of healthcare services and pharmaceutical market
in India.

▪ A growing middle-class, coupled with rising burden of new diseases, is boosting the demand for health insurance coverage. With an increasing
demand for affordable and quality healthcare, penetration of health insurance is poised to expand in the coming years.

▪ In FY21, gross written premiums in the health segment grew at 13.7% YoY to Rs. 58,584.36 crore (US$ 8.00 billion). The health segment has a
29.5% share in the total gross written premiums earned in the country.

▪ Another boost to the sector will be the National Health Protection Scheme under Ayushman Bharat, announced in the Union Budget 2018-19. The
scheme was launched in September 2018.

Source: IRDA, General Insurance Council, News Articles

21
Favourable policy measures support growth… (1/3)

1
Pharma Vision 2020
• Pharma Vision 2020 by the Government’s Department of Pharmaceuticals aims to make India a major hub for end-to-end drug discovery.

2
National pharmaceuticals policy.
• In 2017, the Department of Pharmaceuticals released a draft National Pharmaceutical Policy with the following objectives:
o Make all essential drugs accessible to masses through affordable prices.
o Provide the Indian pharmaceutical sector with a long-term stable policy environment.
o Make India self sufficient in end-to-end domestic drug manufacturing.
o Maintain world class quality for domestic consumption and exports.
o Create a positive environment for research and development in the pharma sector.
• As per the new policy, the Department of Pharmaceuticals will have control over the National List of Essential Medicines (NLEM), which decides
the drugs for which the Government of India can control the prices.
• In April 2021, National Pharmaceutical Pricing Authority (NPPA) fixed the price of 81 medicines, including off-patent anti-diabetic drugs, allowing
due benefits of patent expiry to patients.

3
Support for technology upgrades and FDIs
• Government is planning to relax FDI norms in the pharmaceutical sector.
• In March 2017, the Government decided to create a digital platform to regulate and track the sale of quality drugs, and it can be used by people
living in the country as well as abroad.
Source: News Sources

22
Favourable policy measures support growth… (2/3)

4
Pharmaceutical Parks
• In January 2021, the central government announced to set up three bulk drug parks at a cost of Rs. 14,300 crore (US$ 1,957 million) to
manufacture chemical compounds or active pharmaceutical ingredients (APIs) for medicines and reduce imports from China.
• In February 2021, the Punjab government announced to establish three pharma parks in the state. Of these, a pharma park has been proposed at
Bathinda, spread across ~1,300 acres area and project worth ~Rs. 1,800 crore (US$ 245.58 million). Another medical park worth Rs. 180 crore
(US$ 24.56 million) has been proposed at Rajpura and the third project, a greenfield project, has been proposed at Wazirabad, Fatehgarh Sahib.

5
Production Linked Incentive
• In September 2020, the government announced production-linked incentive (PLI) scheme for the pharmaceutical industry worth Rs. 15,000 crore
(US$ 2.04 billion).
• The production-linked incentive (PLI) scheme was introduced to encourage Indian manufacturers to produce critical key starting materials (KSMs),
drug intermediates (DIs) and active pharmaceutical ingredients (APIs). To support this, the government granted funds worth US$ 932.66 million.

6
Union Budget 2022-23
• As per the Union Budget 2022-23:

• Rs. 3,201 crore (US$ 419.2 million) has been set aside for research and Rs. 83,000 crore (US$ 10.86 billion) has been allocated for the
Ministry of Health and Family Welfare.
• Rs. 37,000 crore (US$ 4.83 billion) has been allocated to the 'National Health Mission’.
• Rs. 10,000 crore (US$ 1.28 billion) has been allocated to Pradhan Mantri Swasthya Suraksha Yojana.
• The Ministry of AYUSH has been allocated Rs. 3,050 crore (US$ 399.4 million), up from Rs. 2,970 crore (US$ 389 million).
Source: News Sources

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Favourable policy measures support growth… (3/3)

7
Biotechnology Industry Research Assistance Council
• BIRAC has been established to promote research & innovation capabilities in India’s biotech industry. The council will provide funding to biotech
companies for technology & product development.
• BIRAC under Small Business Innovation Research Initiative (SBIRI) scheme supports innovations in biotechnology.

8
Biotechnology Based Programme for Women
• Programme on application of biotechnology for women was done to provide employment, skill development, awareness generation, health
improvement & socio-economic upliftment of the women population.

9
National Biopharma Mission
• The Industry - Academia mission was launched in June 2017 to boost development of biopharmaceuticals in India.

10
National Commission for Homoeopathy (NCH) Bill, 2018
• In December 2018, the Government of India approved the National Commission for Homoeopathy, Bill, 2018 in order to have more transparency
in the sector.

Source: News Sources

24
Investments (1/2)
Production Linked Incentive (PLI) Scheme
▪ To achieve self-reliance and minimise import dependency in the country's essential bulk drugs, the Department of Pharmaceuticals initiated the
PLI scheme to promote domestic manufacturing by setting up greenfield plants with minimum domestic value addition in four separate ‘Target
Segments’ with a cumulative outlay of Rs. 6,940 crore (US$ 951.27 million) from FY21 to FY30.
▪ In June 2021, Finance Minister Ms. Nirmala Sitharaman announced an additional outlay of Rs. 197,000 crore (US$ 26.44 billion) that will be
utilised over five years for the pharmaceutical PLI scheme in 13 key sectors such as active pharmaceutical ingredients, drug intermediaries and
key starting materials.
▪ Under ‘Target Segment I’, five applications with an investment of Rs. 3,761 crore (US$ 515.52 million) have been approved.
▪ In September 2021, the Indian government contributed US$ 4 billion to the pharmaceutical and medical industries.
▪ As of August 31, 2021, the PLI scheme received a good response from the industry with a total of 278 applications. This is likely to benefit 55
manufacturers.

Companies under Target Segment II (Fermentation Based Niche KSMs/Drug Intermediates/APIs) are as follows:

Committed Production Capacity Committed Investment Committed Investment

Name of Approved Applicant
(in MT) (in Rs. crore)) (in US$ million)

Natural Biogenex Private Limited 12 31.43 4.31

Natural Biogenex Private Limited 10 26.19 3.59

Natural Biogenex Private Limited 15 39.29 5.39

Symbiotec Pharmalab Private Limited 15 5.00 0.69

Macleods Pharmaceutical Limited 200 198.36 27.19

Optimus Drugs Private Limited 200 35.00 4.80

Sudarshan Pharma Industries Limited 200 57.00 7.81

Optimus Drugs Private Limited 50 30.00 4.11

Source: BMI, Business Standard, DPIIT

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Investments (2/2)

Companies under Target Segment III (Key Chemical Synthesis Based KSMs/Drug Intermediates) are as follows:

Committed Production Capacity Committed Investment Committed Investment

Name of Approved Applicant
(in MT) (in Rs. crore) (in US$ million)

Saraca Laboratories Limited 3,000 50.0 6.85

Emmennar Pharma Private Limited 1,500 21.94 3.01

Hindys Lab Private Limited 3,000 37.60 5.15

Aarti Speciality Chemicals Limited 4,000 77.87 10.67

Meghmani LLP 13,500 55.06 7.55

Sadhana Nitro Chem Limited* 36,000 197.27 27.04

▪ Companies have agreed to invest Rs. 862.01 crore (US$ 118.16 million) in these plants, resulting in ~1,763 employment opportunities. The
government has approved a total of 19 applications totaling Rs. 4,623.01 crore (US$ 633.68 million) in committed investment.

Foreign direct investment (FDI)

▪ The FDI inflows in the Indian drugs and pharmaceuticals sector reached US$ 19.41 billion between April 2000-March 2022.
▪ The FDI inflows in the Indian drugs and pharmaceuticals sector reached US$ 1,414 million in FY 2021-22.
▪ In September 2021, Schott, a pharmaceutical glass manufacturing company, stated that it will invest US$ 82 million to expand its tubing facility in
Jambusar, Gujarat.

Source: BMI, Business Standard, DPIIT

26
 Opportunities

OPPORTUNITIES

27
Opportunities abound in clinical trials and high-end drugs

2. HIGH-END DRUGS 3. PENETRATION IN RURAL

▪ Due to increasing population and MARKET
income levels, demand for high-
end drugs is expected to rise. ▪ With 70% of India’s population residing in rural
▪ Growing demand could open up areas, pharma companies have immense
the market for production of high- opportunities to tap this market.
end drugs in India. ▪ Demand for generic medicines in rural markets
has seen a sharp growth. Various companies are
investing in the distribution network in rural areas.
1. CLINICAL
TRIALS MARKET
• India is among the leaders in the
clinical trial market.
• Due to a genetically diverse
population and availability of skilled
doctors, India has the potential to 4. CRAMS
attract huge investments to its ▪ The Contract Research and
clinical trial market. Manufacturing Services industry
• In October 2021, AstraZeneca India
launched a Clinical Data and 2 3 (CRAMS) is expected to reach
US$ 20 billion by 2024 and is
Insights (CDI) division to further expected to grow at a CAGR of
strengthen its global presence and 12%.
manage data-related aspects of its ▪ The market has >1,000 players.
clinical trials.
• In November 2021, US-based
Akston Biosciences announced that
it will start the clinical trial of its
1 4
second-generation COVID-19
vaccine ‘AKS-452’ in India soon.

Source: BMI, Drug Controller General of India

28
Key Industry Contacts

29
Key industry contacts

Agency Contact Information

Kalina, Santacruz (E),

Mumbai - 400 098
Phone: 91-22-2667 1072
The Indian Pharmaceutical Association Fax: 91 22 2667 0744
E-mail: ipacentre@ipapharma.org
Website: www.ipapharma.org

Peninsula Chambers, Ground Floor,

Ganpatrao Kadam Marg, Lower Parel,
Mumbai - 400 013
Organisation of Pharmaceutical Producers of
Phone: 9122 24918123, 24912486, 66627007
India
Fax: 9122 24915168
E-mail: admin@indiaoppi.com
Website: www.indiaoppi.com

102-B, Poonam Chambers, Dr A.B. Road

Worli, Mumbai - 400 018
Phone: 91-22-2494 4624/2497 4308
Indian Drug Manufacturers' Association Fax: 9122 24950723
E-mail: admin@idmaindia.com | accounts@idmaindia.com
Website: www.idma-assn.org

C-25, Industrial Estate, Sanath Nagar

Hyderabad - 500018
Phone: 91 40 23703910/23706718
Bulk Drug Manufacturers Association
Fax: 91 40 23704804
E-mail: info@bdmai.org, bdma.hyd@gmail.com
Website: www.bdmai.org

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Appendix

31
Glossary

▪ CRAMS: Contract Research and Manufacturing Services

▪ API: Active Pharmaceutical Ingredients

▪ FDI: Foreign Direct Investment

▪ GOI: Government of India

▪ Rs.: Indian Rupee

▪ US$ : US Dollar

▪ BPL: Below Poverty Line

▪ RSBY: Rashtriya Swastha Bima Yojna

▪ ESIC: Employees State Insurance Corporation

▪ Wherever applicable, numbers have been rounded off to the nearest whole number

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Exchange rates

Exchange Rates (Fiscal Year) Exchange Rates (Calendar Year)

Year Rs. Equivalent of one US$ Year Rs. Equivalent of one US$
2004-05 44.95 2005 44.11
2005-06 44.28 2006 45.33
2006-07 45.29 2007 41.29
2007-08 40.24 2008 43.42
2008-09 45.91 2009 48.35
2009-10 47.42 2010 45.74
2010-11 45.58 2011 46.67
2011-12 47.95 2012 53.49
2012-13 54.45 2013 58.63
2013-14 60.50 2014 61.03
2014-15 61.15 2015 64.15
2015-16 65.46 2016 67.21
2016-17 67.09 2017 65.12
2017-18 64.45 2018 68.36
2018-19 69.89 2019 69.89
2019-20 70.49 2020 74.18
2020-21 73.20 2021 73.93
2021-22 74.42 2022* 76.73
Note: *- As on August 2022
Source: Foreign Exchange Dealers’ Association of India

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