Despite challenges like drug price control, poor healthcare infrastructure, quality management and meeting global standards, Indian pharmaceutical sector will see sales rising 14.4 per cent to $27 billion in 2016, according to a report.
According to ‘2014 Global life sciences outlook’ published by Deloitte, sales in India’s pharmaceutical industry was $22.6 billion in 2012.
“They (sales) are expected to rise to $23.6 billion in 2013 and reach $27.0 billion in 2016. As a percentage of health care expenditures, pharmaceutical sales were 22.6 per cent in 2012; they are expected to reach 23.6 per cent in 2013 and 27 per cent by 2016,” the report said.
The report pointed out that the industry has been facing challenges like poor drug price control, inadequate regulatory enforcement, poor health care infrastructure, shortage of skilled workforce and conformance to global standards which would act as critical barriers for the industry to grow.
Further, even as the industry is reeling under these challenges, it is reporting double digital growth due to socio-economic factors like increasing sales of generic medicines, growth in chronic therapies and greater penetration in rural markets among others.
The Indian pharmaceutical sector, which is rising as a hub of manufacturing cost-effective generic medicine, accounts for over 10 per cent of global pharmaceutical production. The sector which manufactures over 400 active pharmaceutical ingredients (APIs) is also a forerunner in a wide range of specialities involving manufacturing of complex drugs.
“The main focus of the Indian companies is on countries with aging populations such as Japan, Africa, and Latin America, which need cheaper drugs. It is estimated that Indian companies will benefit by about $40 billion as 46 US drug patents expire in 2012-15,” the report said.
According to the report, for the sector to grow, Indian companies need to focus on accelerating drug discovery, advancing clinical trial efficiencies, actualising end-to-end medical products, enhance supply chain visibility and improve sales and marketing effectiveness among others.
Indian companies, on their part have already increased their IT investments and are collaborating with IT companies to facilitate communication and visibility between R&D and marketing sectors and channel their sales and marketing initiatives, the report added.
(Edited by Joby Puthuparampil Johnson)