One of the most important sectors in any country-the pharmaceutical sector plays a crucial role in the growth story of an economy. Indian pharmaceutical sector is estimated to account for 3.1-3.6 percent of the total pharmaceutical industry in terms of value and 10 percent in terms of volume. The sector is expected to grow to $100 billion by the end of 2025 and to US $55 billion by 2020, it would thus emerge as the sixth largest pharmaceutical market in the world.
The market remains dominated by branded generics which constitute about 80 percent of the market share and it is expected to generate 58,000 jobs by 2025. India’s exports stood at US $16.8 in 2016-17 and will grow to US $20 billion by 2020. India accounts for 30 percent of the US generics market in terms of volume and 10 percent in terms of value. India’s industry consists of bio pharmaceuticals, bio agriculture, bio services, bioinformatics and bio industry which is expected to grow at an average growth rate of 30 percent in a year and could reach US $100 billion by 2025.
Pharmaceutical intermediates are the chemical compounds which are used in the production of active pharmaceutical ingredients. The intermediates are produced during the process of manufacturing of active pharmaceutical ingredients. They further undergo changes and processing before becoming an active pharmaceutical ingredient. The pharmaceutical intermediates is a very dynamic market are the building blocks of API. Hence, with the growth of the industry, the intermediates market is also expected to grow. The global market of intermediates can be divided according to the basis of structure building block, region and end users. Based on the structure building blocks, the global market can be segmented into chiral building blocks and achiral building blocks. Based on the end users, the market can be divided into research labs, pharmaceutical companies and contract manufacturing organizations and other industries. It is expected that greater production of API will enhance the demand of pharmaceutical intermediates and the market will show significant growth over the forecast period. Due to increasing lifestyle diseases, the population is falling prey to sickness and the requirement of drug has increased.
Geographically, the intermediates market can be divided into Latin America, North America, Eastern Europe, Western Europe and Asia Pacific. North America is the largest and most attracBy Vandita Jadeja tive market for the ingredients due to better infrastructure and the presence of major companies. It is expected that Asia Pacific will be the fastest growing market due to the presence of a large number of manufacturing organizations in the region. The market is dominated by China and Japan. In India, there are a few major players that dominate the market. The top three players include Sun Pharma, Cipla and Abott.
The key players with regard to the global intermediates market include Aceto Corporation, BASF SE, Easter Chemical Corporation, A.R.Life Sciences Private Limited, Midas Pharma GmbH, Dishman Group, Cycle Pharma Chem, Codexis, Lianhetech, Sanofi Winthrop Industries, Chemcon Specialty Chemical Pvt Ltd., Dextra Laboratories Limited, Vertellus Holdings LLC and ZCL Chemical Ltd. In order to increase their market share, these companies focus on collaboration and mergers and acquisition strategies. Most companies are focusing on the outsourcing the intermediates from contract manufacturing companies in order to bring down their cost.
Indian government has taken initiatives to promote the sector. In March 2018, a single window facility was announced in order to provide consents, approvals and other information. The government is also planning to set up an electronic platform in order to regulate the online pharmacies under a new policy to reduce the misuse due to easy availability. Further, the government unveiled ‘Pharma Vision 2020’ which is aimed at making India a global leader in drug manufacture and the government has introduced mechanisms like National Pharmaceutical Pricing Authority and Drug Price Control Order to deal with the issue of affordable medicines.
The future of pharmaceutical industries
It is expected that the market size will grow to US $100 billion by 2025 which will be driven by an increase in consumer spending, raising healthcare insurance and rapid urbanization. The revenues of the sector will grow by 9 percent through 2020. A growth in domestic sales would also depend on the ability of the companies to align their product portfolio for chronic illnesses like anti-depressants, anti-cancer, anti-diabetes and cardiovascular which are on a rise. The government has taken many steps to bring down the cost of healthcare. It has focused on the speedy introduction of generic drugs into the market and the companies are benefitting from the same. However, there is a long road for the companies to walk on. With the growing demand of Indian drugs globally, Indian pharmaceutical companies can grab this opportunity and encash the same. India requires better infrastructure and manufacturing facilities sin order to meet the International standards. Indian companies may soon find a way to the lucrative Chinese market. There is a rush in Chinese companies to acquire US FDA compliant manufacturing sites and India has the highest amongst them outside US. India should take advantage of this opportunity. With India and China ready to deepen their ties, the industry will benefit most out of the same.