Skip to main content

India Is Well-Poised to Lead the Global API Industry

Despite the uncertain global economic climate, the growth momentum for generic drug spending will continue says Catherine Tang, Biomedical industry practice leader for the Spire Research and Consulting. Its share of total drug spending is set to increase. Demand growth, primarily from emerging markets, is being accelerated by healthcare reforms in the major developed markets of USA and Europe; as well as impending patent cliffs, where some USD 75 billion worth of drugs go off patent between 2012 and 2015. This presents new potential for manufacturers of API and drug intermediates (active pharmaceutical ingredients and excipient components used in generic formulations) in India. 

India is well-poised in the global API industry, but headwinds from higher export barriers and increased pharma co-vigilance are major threats that will inevitably raise production costs and erode margins. To retain its pole position in the competitive generic market and claim blue sky space, API manufacturers need to relook business processes to operate more efficiently. And to keep Indian drugs on the world-stage amidst rising defaults on quality, India-based API manufacturers should invest in branding to make made-in-India drugs more acceptable globally.

What would make India the No1 producer of APIs?


Assurance of quality has to be the uppermost priority, given the new requirements from Europe. Indian drug manufacturers will need a quality assurance and branding strategy to complement its current low-cost value proposition. 

In light of increased FDA inspections, companies might adopt technology to automate process data collection such that the complex manufacturing processes can be better managed. Investing in information management systems will help optimize workflow, derive better quality metrics and ensure adequacy of audit trails.

The current physical infrastructure for inbound logistics has a direct impact on competitiveness. In this regard, India is out-competed by other global drug production hubs like Singapore, Ireland and Puerto Rico. The government has a role to play here in nurturing the industrial infrastructure for API production, taking a leaf from what Singapore has done with its Tuas biomedical park.

API manufacturers should also consider backward integration to reduce reliance on the import of raw materials from China and other countries. Product registration fees and other forms of levies applicable to Indian API exporters warrant concrete mitigation strategies in order for India to remain competitive on the world stage.

As the #3 exporter of generic drugs, Indian drug makers and pharma labs continue to receive strategic support from the government and industry councils. But new challenges on the blue-sky horizon call for the financial assistance provided by the government to expand so as to support upstream investment in process automation especially information management systems. 

Lastly, Indian exporters should reach out to emerging markets with messages not only on cost-effective medicines but also value co-creating initiatives that encourage collaborative strategies with destination countries and companies.

Where are we lagging behind? 

The growth of Indian companies in the pharma industry is handicapped by differential laws and regulation within India itself. The industry would benefit from a consolidation of the API manufacturers so that benefits of scale can be reaped. Lastly, more efforts are needed to raise the global customer confidence level associated with made-in-India drugs.


About Catherine Tang:

Catherine Tang is the biomedical industry practice leader for the Spire Research and Consulting group. She has over 18 years of experience in this sector, having previously worked for Boston Scientific and Medtronic, among other firms. Her career experience ranges across advanced wound therapeutics, heart valves and cardiothoracic devices to non-invasive therapies for gastroenterology, cardiology and urology. Catherine holds an MBA degree from the National University of Singapore and a BBA degree (Dean’s List) from Curtin University of Technology.


Links to coverage:











Comments

Popular posts from this blog

The race to invest in Vietnam – How FDI is changing Vietnam’s economy and society

Vietnam’s economy has been among the fastest growing in Southeast Asia. Today, it is a key destination for Foreign Direct Investment (FDI) in the region. In 2016, FDI climbed to USD24.4 billion, a 9 per cent growth compared to 2015. This is despite Vietnam suffering an epic drought in 2016 and a third of its vast population of 93 million people living in poverty. Vietnam has won a reputation as a cheaper manufacturing hub compared to China. Could FDI propel Vietnam to become Asia’s next Tiger economy? A growing economy With a USD200 billion Gross Domestic Product (GDP), Vietnam’s economy is tracking well since the start of deep economic reforms – known as Doi Moi – in 1986. Since 1990, its GDP per capita growth has been one of the fastest among emerging economies, at an average 6.4 per cent (yearly) growth in the 2000s. Vietnam has improved provision of basic services. In 2014, the part of the population living below poverty line fell to 13.5 per cent – down from approxim...

Raising a glass to India’s wine market

India is not famous for its wine, but the nation does have a viticultural industry that has been producing wine for centuries. This industry suffered a major setback only in the 19th century when phylloxera – a wild pest – destroyed countless vineyards. Nonetheless, a few entrepreneurs in India are now taking great pains to restore the Indian wine industry, setting their sights on the massive vineyard spreads across Nashik, Maharashtra. This is where Rajeev Samant founded Sula Vineyards in 2002 – making a noteworthy entry into the global wine market. Amongst the first in India to be featured in Wine Spectator – a renowned industry magazine – his company currently holds 65% of the country’s wine market, making him the top wine producer in India. Will India’s entrepreneurs succeed in placing India on the world wine map? https://www.spireresearch.com/newsroom/spirethoughts/raising-a-glass-to-indias-wine-market/

Shanghai catches the eye of global healthcare service providers

Shanghai is set to become the next hub for quality healthcare services as new hospitals collaborate with established industry players. Will Chinese medical tourists check in at home for medical treatment? Leon Perera, Chief Executive Officer of Spire Research and Consulting, shared his insights in the Asian version of Japan’s Nikkei newspaper. Home to a population of 23 million – where 53% of the population is middle class and above – the city of Shanghai continues to lure more foreign investors in the healthcare segment for the affluent. Raffles Medical Group, Singapore’s premium private healthcare provider, has set foot in Shanghai with its first overseas hospital, part of a wider trend of premium healthcare service providers setting up shop in the city. Perera highlighted that the growth in healthcare services has been fuelled by the government’s policy shift to allow more foreign ownership of hospitals. The intent behind this is perhaps to retain some of the 60,000 me...

Joint seminar held by Spire and YBC on India’s business landscape in 2017

On 15 June, Spire and Yamada Business Consulting (YBC) jointly held a seminar at The Japanese Association in Singapore to give insights on emerging trends for India’s economy. The seminar aimed to raise understanding of market opportunities in light of events such as the roll-out of GST in India and President Donald Trump’s victory in the U.S elections. Yasuyuki (Luke) Kita, General Manager at Yamada Business Consulting Singapore, addressed the session to discuss current business trends in India in light of developments such as Trump’s victory in the U.S. election. Kita-san highlighted the impact on India’s economy of the recent Rupee demonetization of high-value currency notes, the introduction of a single Goods and Services Tax (GST) along with the Make In India initiative launched by the government to attract more investors. He also highlighted the Digital India Program, which aims to transform the nation into a digitally empowered society, nurturing startups and c...

Spire speaks on growth prospects for VARs and SIs in India’s SME market

Spire Research and Consulting was honored to participate in the GATES India ICT Reseller Channel Summit 2017 as the official research partner. The event was held in Gurgaon from 12-14 September, 2017. The Summit is a business platform for consumer electronics, and mid-market segment vendors to understand market trends. Saurabh Sharma, Country Director for Spire Research and Consulting India, was honored to be a guest speaker at GATES India ICT Reseller Channel Summit 2017 on opportunities facing Value-added resellers (VARs) and System Integrators (SIs) in India’s mid-market segment. In his presentation, Saurabh shared his insights on Small and Medium Enterprise (SME) sector growth for VARs and SIs in India. His data was drawn from in-depth interviews with VARs and SIs in India. With SIs and VARs seeing consistent growth in India, total market revenue is expected to reach USD350 billion by 2025. On the other hand, India’s e-commerce and m-commerce sectors continue to e...