Some pointers about how Indian pharma can compete in the future
SHARE:
Pharma Sector - The road ahead for India
- The story: Since the early 2000s, India has steadily enjoyed an important position in the global pharmaceuticals sector. It made its mark in vaccines and generics, and the road ahead from here will be innovation! The pharma industry will need policy support by way of R&D tax breaks, patent law tweaks and research talent.
- State today: India is the largest provider of generic drugs globally, and supplies more than 50% of global demand for various vaccines, 40% of generic demand in the US and 25% of all medicine in the UK.
- The Indian pharmaceutical market is estimated at USD 40 billion and pharma companies export another USD 20 billion. This is a miniscule portion of the USD 1.27-trillion global pharmaceutical market.
- Globally, India ranks 3rd in terms of pharmaceutical production by volume and 14th by value. It has more than 30% share in the global generic market but less than 1% share in the new molecular entity space.
- The Economic Survey 2021 assessed that the domestic market is expected to grow three times in the next decade. India’s domestic pharmaceutical market is estimated at USD 42 billion in 2021 and likely to reach USD 65 billion by 2024 and further expand to reach ~USD 120-130 billion by 2030.
- Problems: There are many -
- Innovation is slow - India is rich in its manpower and talent but still lags in innovation infrastructure. The government needs to invest in research initiatives and talent to grow India’s innovation. The government should support the clinical trials and subjectivity in certain regulatory decision-making.
- Effect of global dynamics - India is heavily dependent on other countries for active pharmaceutical ingredients (API) and other intermediates. 80% of the APIs are imported from China. India is, therefore, at the mercy of supply disruptions and unpredictable price fluctuations. Implementation of infrastructure improvement in the field of internal facilities is necessary to stabilize supply.
- Quality compliance inquiries - India has undergone the highest number of Food and Drug Administration (FDA) inspections since 2009; so, continuous investment for upgrading quality standards will distract the capital away from other areas of development and growth is reduced. (many allege a US bias also)
- Lack of stable pricing environment - The challenge created by unexpected and frequent domestic pricing policy changes in India creates a vague environment for investments and innovations.
- Innovation is key: Changing the drug development perspective and increasing the use of cutting-edge technology is the need of the hour. India playing at scale in the innovation space will not just help the country but will create a source of sustainable revenues, bringing new solutions to unmet healthcare needs. This would lead to reduction in disease burden (development of drugs for India-specific concerns like tuberculosis and leprosy does not get global attention), creation of new high-skilled jobs, and probably around USD 10 billion of additional exports from 2030. Countries like China have jumped ahead, skipping the generic medicine based development.
- Challenges: For innovation to thrive in India, it needs to
- Simplify the complex and protracted approval processes (nod for development of new drugs in India takes 33-63 months versus 11-18 months in developed countries).
- Give robust process guidelines (Indian websites list 24 guidelines compared to over 600 at the USFDA)
- Be more transparent (the US has an established pre-submission process and a time bound stage-gate process)
- Build more capacity/capability (there are considerable enhancements needed across regulatory bodies in India)
- Offer robust funding support with government aid for industry investment through policies/incentives, direct government investment, and significant private investment.
- Summary: India offers an attractive set of benefits — weighted R&D deduction, additional patent box benefits, and progressive policies to increase innovation funding which can attract more investment. The US enacted the Bayh-Dole Act encouraging academics to set up independent companies. India also needs world-class centres of excellence to attract global talent and support cutting-edge research. India should look up to and invest in biotechnology. India’s biotechnology industry, comprising biopharmaceuticals, bio-services, bio agriculture, bio-industry and bioinformatics is expected to grow at an average rate of around 30% a year and reach USD 100 billion by 2025.
- EXAM QUESTIONS: (1) Explain the three core challenges Indian pharma sector faces, as it gears up for the next decade of global competition. (2) The world is witnessing the birth of cutting-edge techniques like the mRNA vaccines. Explain its potential impact.
#pharmaceuticals #drugs #mRNA
* Content sourced from free internet sources (publications, PIB site, international sites, etc.). Take your own subscriptions. Copyrights acknowledged.
COMMENTS