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Indian Pharmaceutical

Industry By P.Shyam M.Pharm(Pharmaceutics ),

Asst.Professor, Pharmacy ManagementSt.John College of Pharmacy

Yellapur,Warangal

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Indian Pharmaceutical IndustryEvolution

Phase IIGovernment Control

Indian Patent Act 1970

Drug prices capped

Local companies beginto make an impact

Phase IIIDevelopment Phase

Processdevelopment

Productioninfrastructurecreation

Export initiatives

Phase IV

Growth Phase

Rapid expansion of domestic market

International marketdevelopment

Research orientation

Phase V

Innovation and Research

New IP law

Discovery Research

Convergence

1970 1980 1990 2000 2010

Phase I

Early Years

Market sharedomination byforeign companies

Relative absence of organized Indiancompanies

1900

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Moving up the Value Chain

SpecialtyProducts

Innovative Products

TIME

Generic exportsto under-

developed &developing

countries

Generic exportsto developed

countries

APIExports

VALUE

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4

Population Growth

Significant population growth between 1970 -

2000

With a billion plus population the needfor healthcare is universal for bothUrban and Rural India.

With an increasing incidence of life

style diseases (approx. 33 percent of the total pie) and a growing geriatricand pediatric population, there is anemphasis on the need for specialtycare

India is the worlds second most populous

country

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5

Public Healthcare

There has been a significantincrease in public infrastructureover the years.

While in 1947 the number of hospital beds was 3.2 per 10,000,the present number of 9 per10,000 is commendable, but stillfar behind that of otherdeveloping countries

The governments share in thehealthcare delivery market is only20 percent.

The current NHP aims to increasethe government contribution tohealthcare to touch 2 percent of the GDP by the end of the fiveyear tenure, an increase from thepresent contribution of 0.9

percent.Government Initiatives like NRHM,

Country Beds/10000

Japan 141France 73Switzerland 57

Australia 40UnitedStates of America

32

Thailand 29Malaysia 18

India 9

Head BudgetFY10

INR Cr

National Rural HealthMission

14,127

Institutes like AIIMS in TierII cities

1,448

AYUSH 734Rashtriya Swasthya Bima

Yojana (RSBY)350

Medical education for OBC 100

National Programme for

Prevention and Control of Deafness (NPPCD)

10

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6

Private Healthcare

India has one of the highest privatespending in healthcare as compared toother countries. Nearly 80% of the totalspend.

In India, Out of pocket spending is one of the highest, constituting 94% of the

total spend in the private healthindustry.

Extensive landscape of private playerswith multi & super specialty hospitals,innovative rural models, andMediCities.

Increasing Private Equity investment intothe sector, with an affinity towardsinnovative rural models and superspecialty care.

With Infrastructure status, 100% FDIunder the automatic route, Service Taxexemption and Rural and Tier II hospitalsexem t from Income Tax for 5 rs,

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Healthcare Services Associated Industries

Medical Equipment & DevicesDiagnostics & Pathology

Medical Tourism Private Health Insurance

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Growth Drivers

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Consistently growing GDP (%)Consistently growing GDP (%)

Growth of Healthcare IndustryGrowth of Healthcare Industry

Indian economy in aresilient mode in

terms of GDPgrowth

The HealthcareIndustry has grownfrom USD 18.7 blnin 2000 to USD 35

bln in 2008.

Indian Economy on a Growth Path

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The Healthcare Industry In India: 2012

INDIAN HEALTHCARE SERVICES INDUSTRY TO REACH USD 77 BILLION BY 2012

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Challenges & Recommendations

Challenges

Low Government funding & lack of efficient execution of schemes & initiatives

Shortfall in Health care infrastructure and Workforce

Inadequate accessibility to affordable quality services

Financial constraints with respect to infrastructural needs

Recommendations

Step-up in Government funding and initiatives via a special task force

Implementation of REITs and increased use of Private-Private Partnership Models

Addressing geographic accessibility through PPP and harnessing local resources

Creating a Global Source of Skill

Efficient dissemination of healthcare related information

Establishment of Industry Body with adequate representation from all stakeholders

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Emerging Trends &Opportunities

Geographic ConvergenceEstablished and growing destination for Genericproduct development and manufacturing

Leading Indian companies seeking overseas marketsand global scale

Generic Innovator ConvergenceLeading Indian companies trying to climb the valuechain into innovative research

India developing into a Drug Discovery servicesoutsourcing destination

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Generic Product Development &Manufacturing Destination

Leader in API DMF filings in the US

Jan-Jun 2006 175 of the 601 DMFs filed were by Indian companies

2005 - 313 of the 946 DMFs filed were by Indian companies

Leader in capital investments - largest number of US FDA approvedmanufacturing facilities (outside the US)

Almost 20% of ANDA filings in the US

No place like India for generics R&D and manufacturing of APIs &formulations

Indias biggest assets cost, speed & scientists churning out genericsfaster than you can say copyIn 5 years, 30-35% of the global demand for generic products isexpected to be met by India

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Generic Innovator convergence

Increasing number of Indian companies moving up the value chain from generic to NDDS/NCEresearch

Low cost development/manufacturing to Low cost innovation

Some examples:

Ranbaxy

1 project in Phase II

1 project in Phase I

7 projects in Pre-Clinical 2 with GSK

Dr. Reddys

3 projects in Phase II

2 projects in Phase I

4 projects in Pre-Clinical

Glenmark

2 projects in Phase II deals with US$ 190 million signed 4 projects in Pre-Clinical

Opportunities for in-licensing & out-licensing

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Drug Discovery ServicesOutsourcing

Global outsourcing market:

US$ 15-20 billion Manufacturing

US$ 3-4 billion Research (informatics, chemistry services &chemical custom synthesis)

Big pharma is entering into deals with Indian companies to lower their cost of R&D

Collaborative R&D GSK - Ranbaxy

Service outsourcing - Wyeth GVK, Jubilant, Lilly Suven

Global discovery services companies are looking at India to retain their costadvantages

Albany Molecular & Nektar have already established a presenceIndian industry hoping to see 3-4 global discovery services companiesemerging out of India

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Drug Discovery ServicesOutsourcing

Leading Indian Service Providers:

Contract Manufacturing Jubilant, Shasun, Divis

Clinical Research Syngene (Biocon), Aurigene(Reddys), SynchronBio-informatics & other IT services TCS, Satyam,Infosys, GVK Bio, Jubilant

Drug Discovery/Medicinal Chemistry Aurigene, Divis,Syngene, Suven, GVK Bio

Pre-clinicals Vimta, Lambda

Central laboratory services SRL Ranbaxy, Vimta

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Considerations

Supplier/Partner mapping/selection

Capability / Keenness / Reliability / Competitiveness

Key team members development, regulatory & commercial

Optimal Number of Partners

Strategic markets/product lines

Opportunistic product specific

Relationship management

Relationship oriented culture

Contract negotiation

Clear distribution of responsibilities and timelines

Demand performance - penalties for not meeting deliverablesProject management

Regular visits and video/teleconferences a must

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Role of Pharmaceutical Industry in India GDP-FactsRole of Pharmaceutical Industry in India GDP-Facts

The Pharmaceutical Industry in India is one of thelargest in the world

It ranks 4th in the world, pertaining to the volume of sales

The estimated worth of the Indian Pharmaceutical

Industry is US$ 6 billion

The growth rate of the industry is 13% per year

Almost most 70% of the domestic demand for bulkdrugs is catered by the Indian Pharma Industry

The Pharma Industry in India produces around 20%to 24% of the global generic drugs

The Indian Pharmaceutical Industry is one of thebiggest producers of the active pharmaceuticalingredients (API) in the international arena

The Pharmaceutical Industry in India is one of thelargest in the world

It ranks 4th in the world, pertaining to the volume of sales

The estimated worth of the Indian Pharmaceutical

Industry is US$ 6 billion

The growth rate of the industry is 13% per year

Almost most 70% of the domestic demand for bulkdrugs is catered by the Indian Pharma Industry

The Pharma Industry in India produces around 20%to 24% of the global generic drugs

The Indian Pharmaceutical Industry is one of thebiggest producers of the active pharmaceuticalingredients (API) in the international arena

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The Indian Pharma sector leads the science-basedindustries in the country

The pharmaceutical sector has the capacity andtechnology pertaining to complex drug manufacturing

Around 40% of the total pharmaceutical produce isexported

55% of the total exports constitute of formulationsand the other 45% comprises of bulk drugs

The Indian Pharma Industry includes small scaled,medium scaled, large scaled players, which totalsnearly 300 different companies

There are several other small units operating in thedomestic sector

The Indian Pharma sector leads the science-basedindustries in the country

The pharmaceutical sector has the capacity andtechnology pertaining to complex drug manufacturing

Around 40% of the total pharmaceutical produce isexported

55% of the total exports constitute of formulationsand the other 45% comprises of bulk drugs

The Indian Pharma Industry includes small scaled,medium scaled, large scaled players, which totalsnearly 300 different companies

There are several other small units operating in thedomestic sector

Role of Pharmaceutical Industry in India GDP-FactsRole of Pharmaceutical Industry in India GDP-Facts

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Pharmaceutical Industry in India-GrowthPharmaceutical Industry in India-Growth

As per the present growth rate, the IndianPharma Industry is expected to be a US$ 20billion industry by the year 2015

The Indian Pharmaceutical sector is alsoexpected to be among the top ten Pharmabased markets in the world in the next tenyears

The national Pharma market wouldexperience the rise in the sales of the patent

drugs

The sales of the Indian Pharma Industry wouldworth US$ 43 billion within the next decade

As per the present growth rate, the IndianPharma Industry is expected to be a US$ 20billion industry by the year 2015

The Indian Pharmaceutical sector is alsoexpected to be among the top ten Pharma

based markets in the world in the next tenyears

The national Pharma market wouldexperience the rise in the sales of the patent

drugs

The sales of the Indian Pharma Industry wouldworth US$ 43 billion within the next decade

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With the increase in the medical infrastructure, the healthservices would be transformed and it would help the growth of the Pharma industry further

With the large concentration of multi national pharmaceuticalcompanies in India, it becomes easier to attract foreign directinvestments

The Pharma industry in India is one of the major foreign directinvestments encouraging sectors

With the increase in the medical infrastructure, the healthservices would be transformed and it would help the growth of the Pharma industry further

With the large concentration of multi national pharmaceuticalcompanies in India, it becomes easier to attract foreign directinvestments

The Pharma industry in India is one of the major foreign directinvestments encouraging sectors

Pharmaceutical Industry in India-GrowthPharmaceutical Industry in India-Growth

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The Indian Pharmaceutical Industry is one of fastest emerging international center for contractresearch and manufacturing services or CRAMS

The main factors for the growth of the CRAMS is

due to the international standard quality and lowcost

The estimated value of the CRAMS market in 2006was US$ 895 million

Indian already has the biggest number of US Foodand Drug Administration (USFDA)

standardized manufacturing units outside theterritory of United States

The Indian Pharmaceutical Industry is one of fastest emerging international center for contractresearch and manufacturing services or CRAMS

The main factors for the growth of the CRAMS is

due to the international standard quality and lowcost

The estimated value of the CRAMS market in 2006was US$ 895 million

Indian already has the biggest number of US Foodand Drug Administration (USFDA)

standardized manufacturing units outside theterritory of United States

Role of Pharmaceutical Industry in India GDP-CRAMSRole of Pharmaceutical Industry in India GDP-CRAMS

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Role of Pharmaceutical Industry in India GDP-CRAMSRole of Pharmaceutical Industry in India GDP-CRAMS

Around 50 more new manufacturing units are to be setup in accordance to the USFDA and UK Medicines andHealthcare Regulatory Agency (MHRA) standards

With all these development India is posed to becomethe biggest producer of drugs in the world

Some of the major domestic players in this sector areParas Pharma, Bal Pharma, Unijules Life Sciences,Flamingo Pharma, Venus Remedies, Surya Organics and

Chemicals, Centaur Pharma, Kemwell, Coral Labs

The contract manufacturing market in India pertainingto the multinational companies is expected to worth US$900 million by the year 2010

Around 50 more new manufacturing units are to be setup in accordance to the USFDA and UK Medicines andHealthcare Regulatory Agency (MHRA) standards

With all these development India is posed to becomethe biggest producer of drugs in the world

Some of the major domestic players in this sector areParas Pharma, Bal Pharma, Unijules Life Sciences,Flamingo Pharma, Venus Remedies, Surya Organics and

Chemicals, Centaur Pharma, Kemwell, Coral Labs

The contract manufacturing market in India pertainingto the multinational companies is expected to worth US$900 million by the year 2010

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India s Advantage

Large skill baseExperts in process chemistry

Long history of reverse engineering

Vast talent pool

Sheer number of scientistsMotivated & English speaking

Large number of trained Indians returning home from NorthAmerica and Europe

Unmatched cost competitiveness

Lower cost of infrastructure and skilled manpower

Vertical integration

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Strong local industry

Growing expertise with international regulatory compliance

High quality manufacturing with abundant capacities

Speed

Very strong entrepreneurial spirit

Hungry for growth and recognition

Quick learners and fast movers

Availability of capital

Stock market has seen unprecedented growth in the last decade

Continues to be bullish on the pharma industry

India s Advantage

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THANK YOU