Pharma Companies in India

Agis Pharma Chem accredited facility in Non solid oral Dosage forms providing consistent and unmatched service by supplying hi-end pharmaceutical formulations to Regulated Market of India.

Gujarat (I-Newswire) November 9, 2012 - Indian pharmaceutical Industry has been witnessing a robust growth of around 14% since the 11th Plan in 2007 from about Rs 71,000 crores to over Rs1 lakh crores in 2009�10 comprising some Rs 62,055 crores of domestic market and exports of over Rs 42,154 crores. This also amounts to around 20% of total volume of global generics. Till the 1990s the pharma industry had largely remained cocooned from external competition. Given the process patent regime in India, companies found it easier to reverse engineer products and sell them at a low cost. However, the 1990s witnessed multiple crises hitting the industry.

Liberalization of the Indian economy in 1991 exposed the industry to increased competition from multinational corporations (MNCs). Further, India's signing of the TRIPS (Trade Related Aspects of Intellectual Property Rights) agreement compelled the domestic firms to look at growth driven by product innovation and not reverse engineering.

How did the Indian pharmaceutical industry cope with these crises? What impact did the crises have on the overall health of the Indian pharmaceutical industry? According to experts, businesses were more open to adopting new ideas and technologies. Liberalization and signing of the TRIPS agreement in 1995 were watershed events for the Indian pharmaceutical industry

Technological change and relative efficiency

Technological improvements and improvements in relative efficiencies rose significantly after the New Industrial Policy (NIP) of 1991. Those who initially embraced technology were in minority. So even though the industry witnessed productivity improvements the efficiency gap between the performers and those lagging behind pulled down the average relative efficiency of the industry.

Investments in R&D

R&D investments before the 1990s were rather poor. Most in pre-liberalization India focused on process innovation rather than product innovation. Further, 85% of these investments were publicly funded. The 1990s saw a marked departure with firms began investing in new product development like Novel Drug Delivery Systems (NDDS) which had a positive impact on the productivity levels of the industry.

Role of multinational companies

India signed the TRIPS agreement in 1995. This coupled with the grant of Exclusive Marketing Rights (EMR) to product patent holders and liberalization of FDI regulations in the pharma industry, influenced the nature of MNCs' participation in India. Post the reforms the domestic as well as multinational companies increased R&D activities with many MNCs setting up R&D facilities for research activities for their global operations, outsourcing drug production, leading to operational efficiencies.

As competition opened up post 1991, many Indian firms entered the prescription drugs market or drug formulations market. Prescription drugs offer higher margins compared to bulk drugs, but require high levels of technological investment and innovation. Unlike bulk drugs manufacturer, who focus on efficiency, cost control and price wars, prescription drug manufacturers need to focus on innovation and quality which typically comes at a high cost. Some of the improvements in productivity levels in the industry are likely to have come due to the shift of many domestic firms towards formulation drugs. This might also explain some of the decline in relative efficiencies witnessed post 1991. Even the bulk drugs market is around Rs 42,000 crores giving it a share of around 50% of the total domestic market. This gives the Indian Bulk Drug industry a share of about 9% of the global bulk drug market.

India is among the top 20 pharmaceutical exporting countries and the exports have grown very significantly at a CAGR of around 19. Indian drugs are exported to around 200 countries in the world with highly regulated markets of USA, UK etc. The major therapeutic categories of export are anti-infective, anti-asthmatic and anti-hypertensive.

The present market size of Medical Devices and Equipments is around Rs 15,000 crores. The medical device industry is at a nascent stage and is largely import dependent. More than 65% of India's requirement of medical devices and equipments are met through imports with domestic production being largely restricted to low technology disposable equipments.

In conclusion it can said that Indian pharma industry has benefited immensely from the liberalization reforms carried out in the 1990s. Increased R&D investments by domestic firms, larger role played by MNCs in response to liberalization and movement to a product patent regime, have resulted in technological changes, and consequent productivity improvements. Domestic firms have responded to the increased competition by moving into higher margin products like formulation drugs, and increasing investments in R&D. Though MNCs have experienced higher productivity growth compared to the domestic firms, pharma industry is better-off post liberalization. Domestic firms now need to build on the success of the past two decades, through sustained R&D investments and effective management of their operations.

About Agis Pharma Chem (APC)

Agis pharma chem (APC) Ahmedabad, India based company is one of the leading organization of producer   More.. and suppliers of Pharmaceuticals, Food and Agro derivatives products to domestic and overseas market to many countries across the world.Less..

Contact Information

Agis Pharma Chem (APC)
Agis Pharma Chem, 304/B, Kala, Radio Mirchi Tower Road, Near Times of India press, Satellite, Ahmeda
Phone : 91 79 40092552

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Health & Fitness

Published On:

November 9, 2012

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