PHARMACEUTICAL SECTOR OVERVIEW

The Indian pharmaceutical industry is the world's fourth-largest by volume and is likely to lead the manufacturing sector of India. The Indian pharmaceutical market is highly competitive and remains dominated by low priced, domestically-produced generics. Despite having the second largest population in the world and a growing middle class with high healthcare expectations, India accounts for less than 2% of the world pharmaceutical market in value terms.

In the financial year 2010-11, the Indian pharmaceutical industry grew more than 14 per cent, according to ORG IMS and this growth was mainly driven by the top 50 companies.

During the year, the industry also witnessed Indian pharma companies selling out to the multinationals.

As per newspaper reports, it appears that the Government of India is planning to bring under price control all the drugs which are listed in the National List of Essential Medicines. More than 350 drugs are expected to be covered. This will have an adverse impact on the Indian Pharmaceutical Industry which is already reeling under high inflationary pressures.

During the financial year, the following are some of the companies were acquired as subsidiaries: Cipla (Mauritius) Limited, Cipla (UK) Limited, Cipla-Oz Pty Limited, Four M Propack Private Limited, Goldencross Pharma Private Limited, Medispray Laboratories Private Limited, Meditab Holdings Limited, Meditab Pharmaceuticals South Africa (Pty) Limited, Meditab Specialities New Zealand Limited, Meditab Specialities Private Limited, Sitec Labs Private Limited and STD Chemicals Limited.

The Companies introduced many new drugs and formulations during the year. Some of them are Entavir , Febucip , Flosoft , Foracort

The Indian pharmaceutical industry is the world's fourth-largest by volume and is likely to lead the manufacturing sector of India.

The Pharmaceutical industry in India meets around 70% of the countrys demand for bulk drugs,chemical tablets, capsules, orals and injectibles.

The Indian pharmacy market is expected to reach US 55$ billion in 2020.The market has potential to reach US 70$ billion in an aggressive growth scenario.

According to the German Chemicals Association, in 2005, India's top 10 pharmaceutical companies were Ranbaxy, Cipla, Dr. Reddy's Laboratories, Lupin, Nicolas Piramal, Aurobindo Pharma, Cadila Pharmaceuticals, Sun Pharma, Wockhardt Ltd. and Aventis Pharma.5 Indian-owned firms currently account for 70 percent of the domestic market, up from less than 20 percent in 1970. In 2005, nine of the top 10 companies in India were domestically owned, compared with just four in 1994. India's potential to further boost its already-leading role in global generics production, as well as an offshore location of choice for multinational drug manufacturers seeking to curb the increasing costs of their manufacturing, R&D and other support services, presents an opportunity worth an estimated $48 billion in 2007.

Government Initiative 100 percent FDI is allowed under the automatic route in the drugs and pharmaceutical sector. The government plans to set up US 640$ million Venture Capital (VC) to give a boost to drug discovery and growth in pharma infrastructure in the country. The Department of Pharmaceuticals has prepared a Pharma vision 2020 for making India one of the leading destination for end-to-end discovery and innovation. The govt plans to open 3000 Jan Aushadhi stores which sell unbranded generic drugs at heavy discounts to branded drugs in next two years.