Indian

Pharmaceutical
Industry 2023
In depth Analysis

By: Sumit Laha

Indian Pharmaceutical Market
India's pharmaceutical market is one of the largest in the world, driven by
a robust manufacturing base, diverse product portfolio, and expanding
consumer demand. This sector plays a crucial role in providing
affordable and accessible healthcare solutions to millions across the
country.
 India ranks as the 3rd largest pharmaceutical market in the world by
volume.
 Provides affordable generic medicines to over 200 countries.
 Major exporter of pharmaceuticals to developed markets like the US,
Europe, and Africa.
 Significant player in global supply of generic drugs and APIs
Market Size and Growth
● The Indian pharmaceutical market was valued
at $42 billion in 2021, making it the 3rd largest
in the world by volume.

● 10% CAGR
● The market is projected to grow at a
compounded annual growth rate (CAGR) of
10% to reach $65 billion by 2024.

● Key Drivers
● Increasing healthcare awareness, rising chronic
disease prevalence, and expanding insurance
coverage are driving the market's robust
growth.
Growth of the Indian
Pharmaceutical Market by 2030
● The Indian pharmaceutical market is expected to reach $130
billion by 2030, reflecting significant growth and expansion.

● Growth Drivers: Key factors include increasing healthcare

expenditure, rising population, and higher prevalence of chronic
diseases.

● Digital Transformation: Growth in digital health

technologies and e-pharmacies driving market expansion.

● Regulatory Support: Favorable government policies and

regulatory reforms supporting market growth and innovation.

● R&D Expansion: Enhanced investment in research and

development, focusing on innovative drugs and biosimilars.
Market Segmentation
● Dominance of Generic Drugs: Generic drugs
constitute the largest segment at 55%, highlighting India's
global leadership in generic medicine production.

● Branded Drugs: Branded drugs make up 15% of the

market, reflecting a significant but smaller share compared to
generics.

● OTC Drugs: Over-the-counter (OTC) drugs account for

10%, indicating a substantial consumer market for non-
prescription medications.

● Active Pharmaceutical Ingredients (APIs): APIs

also represent 15% of the market, showcasing India's role as a
major supplier of essential drug components.

● The segmentation illustrates a diverse market with significant

contributions from generics, branded drugs, OTC products,
APIs, and biosimilars.
Key players IN Market
 Sun Pharma: Holds the largest market share at 10%, leading the Indian pharmaceutical industry. Sun
Pharma is renowned for its vast portfolio, including key products like Brivaracetam (for epilepsy) and
Ilumya (for psoriasis).

 Aurobindo Pharma & Dr. Reddy's Laboratories: Both companies each command an 8% market share,
reflecting their strong positions. Dr. Reddy’s is known for its wide range of pharmaceutical services,
including key products like Nise (pain management) and Omez (proton pump inhibitor).

 Cipla: With a 7% share, Cipla is a significant player known for its extensive product range. Cipla’s major
products include Salmeterol (asthma), Tenofovir (HIV/AIDS), and Escitalopram (depression).

 Lupin & Zydus Cadila: Each holds 6% of the market, contributing to both domestic and international
pharmaceutical needs. Lupin has a significant impact in the areas of cardiovascular, diabetology.

 Torrent Pharmaceuticals: Has a 5% market share, emphasizing quality and efficiency in its operations.
Torrent Pharmaceuticals is recognized for its therapeutic areas like cardiovascular and central nervous
system, with key products like Shelcal (calcium supplement) and Losar (hypertension).
 Government and Regulatory
Bodies
CDSCO IP Protection
The Central Drugs Standard Control India's intellectual property laws provide
Organization (CDSCO) is the national regulatory data exclusivity and patent protection to
body responsible for approving new drugs and incentivize innovation and investment in
clinical trials. the sector.

Quality Standards
Price Control
Manufacturers must adhere to stringent
The National Pharmaceutical Pricing Authority
(NPPA) regulates the prices of essential medicines
Good Manufacturing Practices (GMP) to
to ensure affordability. ensure the quality and safety of
pharmaceutical products.
 Domestic Indian Pharmaceutical
Market Dynamics
 Increasing Healthcare Expenditure: Rising income levels and growing awareness about
health have led to increased spending on healthcare, driving demand for pharmaceutical
products.

 High Prevalence of Chronic Diseases: The increasing incidence of chronic diseases such
as diabetes, cardiovascular diseases, and cancer has boosted the demand for a wide range of
medications and treatments.

 Government Initiatives and Policies: Supportive government initiatives like the

Ayushman Bharat scheme and the Pradhan Mantri Jan Aushadhi Yojana aim to improve
healthcare access and affordability, enhancing market growth.

 Expansion in Rural Markets: Improved healthcare infrastructure and increased penetration

of healthcare services in rural areas are opening up new growth opportunities for pharmaceutical
companies.
Export Market  India plays an important role in the global
pharmaceuticals and vaccine industry. It is the
largest provider of generic medicines globally.
 Key segments of the Indian pharmaceutical
industry are OTC medicines, Generics, APIs,
Vaccines, Biosimilars, and Custom Research
Manufacturing (CRM).
 India is the world leader in supplying vaccines
like DPT, BCG, and Measles.

 The total annual turnover of the industry was

US$ 49.78 billion in FY23 and US$ 41.68
billion in 2021-22.

 India majorly exports drug formulations &

biologicals, and these products contribute to
about 75% of the total pharmaceutical exports
out of India.
Export Destination India exports pharmaceutical products to North America,
Africa, the EU, ASEAN, Latin America & Caribbean
(LAC), the Middle East, Asia, CIS, and other European
regions.

 The top five export destinations for Indian Pharma

Industry in 2022-23 were the USA, Belgium, South
Africa, the UK, and Brazil.

 The US, Belgium, and South Africa were among the

largest importers from India at a share of 29.72%,
2.82%, and 2.59%, respectively during 2022-23.
 India’s exports of pharma products to these countries in
FY23 were USA with US$ 7.54 billion, Belgium with
US$ 714.92 million, South Africa with US$ 657.0
million, the UK with US$ 647.68 million.

 As per the latest industry data of the USFDA, market

authorizations granted to Indian formulations companies
with USFDA approvals stood at 6,316, which is highest
in comparison to any other country as of April 2023.
Research and ● Dr. Reddy's Laboratories: Leading in
R&D investment with approximately 1200
Development crore INR, demonstrating a strong
commitment to innovation and new drug
development.

● Sun Pharma: Significant R&D

expenditure of around 1000 crore INR,
highlighting its focus on expanding its
product portfolio and improving existing
formulations.

● Lupin Pharma: Invests heavily in R&D

with about 900 crore INR, emphasizing its
dedication to developing new therapies
and maintaining a competitive edge.

● Piramal Enterprises: Allocates around 500

crore INR to R&D, reflecting its efforts to
enhance its research capabilities and
product pipeline.
Impact of COVID-19 on the Indian
Pharmaceutical Market
 Increased Demand for Medications: Surge in antiviral and immunity-boosting drugs.
(Hydroxychloroquine demand +60%)
 Supply Chain Disruptions: Lockdowns and restrictions led to interruptions in the
supply chain, affecting the availability of raw materials and finished products.
Approximately 70% of India's active pharmaceutical ingredients (APIs) are imported
from China, and supply disruptions caused shortages.
 Boost in API Manufacturing: India announced a production-linked incentive (PLI)
scheme worth INR 6,940 crore to boost domestic API manufacturing.
 Growth in Telemedicine: Adoption of telemedicine and online pharmacies saw a
significant rise as patients avoided hospital visits. Online pharmacy market grew by
45% during the pandemic.
 Regulatory Changes: Fast-tracking of drug approvals and emergency use
authorizations to meet the urgent demand.
Policies and Government Schemes
 In the Interim Budget 2024-25: The government earmarked Rs. 1,000 crore (US$ 120 million)
for the promotion of bulk drug parks for FY25, a significant increase from the previous year. Jan
Aushadhi scheme budget increased to ₹284.5 crore for FY25.
 As per the Union Budget 2023-24: Mission to eliminate sickle cell anaemia by 2047 through
screening and counselling.
 Union Cabinet approves National Medical Devices Policy 2023 to enhance access, affordability,
quality, and innovation.
 Ayushman Bharat Digital Mission (ABDM): ABDM enables creation of ABHA numbers, linking
digital health records for better clinical decision-making.
 ABDM pilot completed in six Union Territories, successfully demonstrating the technology
platform developed by the National Health Authority.
 In March 2022, under the Strengthening of Pharmaceutical Industry (SPI) Scheme, a total
financial outlay of Rs. 500 crore (US$ 665.5 million) for the period FY22 to FY26 were
announced.
 The Department of Pharmaceuticals launched a ₹6,940 crore PLI scheme to boost domestic bulk
drug manufacturing from FY21 to FY30.
Role of Technology in the Indian
Pharmaceutical Market
 Digital Transformation: Telemedicine and E-
Pharmacies increased access to healthcare through
online consultations and digital prescriptions.
 Artificial Intelligence (AI) and Machine Learning
(ML): Accelerating the process of identifying
potential drug candidates. Enhancing clinical trials
and patient monitoring.
 Blockchain Technology:
 Supply Chain Management: Ensuring transparency
and traceability of pharmaceuticals.
 Counterfeit Prevention: Reducing the risk of
counterfeit drugs through secure transaction records.
INVESTMENTS AND RECENT
DEVELOPMENTS
The Indian Pharmaceuticals industry plays a prominent role in the global
pharmaceuticals industry. India ranks third worldwide for production by
volume and 14th by value.

 Cipla received CDSCO approval to market plazomicin in India for complicated urinary
tract infections (cUTI), impacting around 150 million patients annually.
 The cumulative FDI equity inflow in the Drugs and Pharmaceuticals industry is US$
22.52 billion during the period April 2000-March 2024.
 In October 2023, Glenmark Pharmaceuticals introduced Zita, a cost-effective triple
combination drug for Type 2 diabetes treatment, enhancing glycaemic control in
diabetic patients.
 On March 6, 2023, Sun Pharma completed its acquisition of Concert Pharmaceuticals,
gaining deuruxolitinib, a novel JAK1/2 inhibitor for treating moderate to severe
alopecia areata.
 Glenmark launched Akynzeo I.V. in India for CINV prevention, the first unique I.V.
formulation, under an exclusive deal with Swiss Helsinn.
Major development in 2023
● Key Trends in the Pharmaceutical
Manufacturing Market (2022-2032)
● The pharmaceutical manufacturing market is projected to
experience substantial growth over the next decade.2022:
Market size at $454.00 billion.2023: Growth to $508.48
billion.2032: Expected to reach $1,467.70 billion.
● Consistent Growth: The market is projected to grow
consistently each year, with significant increases
especially noticeable after 2026.
● Compound Annual Growth Rate (CAGR): High CAGR
indicating robust market expansion and potential
opportunities for stakeholders.

● Implications for Stakeholders:

● Investors: Significant opportunities for investment due to
the strong projected growth.
● Pharmaceutical Companies: Need to scale operations
and innovate to capture market share.
New Drug Approval in 2023
● The year 2023 has seen remarkable advancements in the Indian pharmaceutical sector, with several new drug
approvals and groundbreaking innovations.
● Key Drug Approvals:
● Niraparib (Therapeutic Area: Oncology)

○ Company: Dr. Reddy's Laboratories

○ Description: A novel cancer therapy for ovarian cancer, targeting specific tumor cells.

● Dapagliflozin (Therapeutic Area: Cardiology)

● Company: Sun Pharmaceuticals
● Description: An innovative medication for heart failure and type 2 diabetes with improved efficacy and
fewer side effects.

● Zolgensma (Therapeutic Area: Neurology)

● Company: Novartis India
● Description: A breakthrough gene therapy for spinal muscular atrophy.
Innovations in Indian
Pharmaceutical ●Market
AI-Powered Drugin 2023
Discovery
● Description: Use of artificial intelligence by Cipla to
accelerate the drug discovery process, leading to faster
development of effective medications.
● Impact: Reduced time and cost in bringing new drugs to
market.

● Personalized MedicineDescription:
● Development of treatments tailored to individual genetic
profiles by Biocon.
● Impact: Improved patient outcomes and reduced adverse
reactions.

● Nanotechnology
● Description: Utilization of nanotechnology for targeted
drug delivery systems by Lupin.
● Impact: Increased drug efficacy and reduced side effects.
Challenges and Risk
Regulatory
Compliance:
Navigating complex
and evolving
regulations can delay
approvals and increase
costs.

Supply Chain
Disruptions Market Competition
Reliance on global Intense competition
suppliers exposes the from both domestic and
industry to supply chain international market
vulnerabilities players can squeeze
the market profit

Intellectual Property
Issues
Protecting patent and
avoiding infringement in
a competitive market is
challenging
Road Ahead The pharmaceutical industry in India is a significant part of the
nation's foreign trade and offers lucrative potential for investors.
Millions of people around the world receive affordable and
inexpensive generic medications from India, which also runs a
sizable number of plants that adhere to Good Manufacturing
Practices (GMP) standards set by the World Health Organization
(WHO) and the United States Food and Drug Administration
(USFDA).
Among nations that produce pharmaceuticals, India has long
held the top spot. Medicine spending in India is projected to
grow 912% over the next five years, leading India to become one
of the top 10 countries in terms of medicine spending.
The Indian Government has taken many steps to reduce costs
and bring down healthcare expenses. The National Health
Protection Scheme, which aims to offer universal healthcare, the
ageing population, the rise in chronic diseases, and other
government programmes, including the opening of pharmacies
that offer inexpensive generic medications, should all contribute
to boost the Indian pharmaceutical industry.
Major States for Pharmaceuticals
 Delhi NCR
 Uttar Pradesh
 Gujarat
 Karnataka
 Tamil Nadu
 Maharashtra
 Telangana
 References and Sources
● https://www.ibef.org/industry/pharmaceutical-india
● https://
www.business-standard.com/industry/news/domestic-pharmaceutical-market-g
rew-by-6-8-in-2023-shows-data-124011100758_1.html
● https://
www.visionresearchreports.com/india-active-pharmaceutical-ingredients-mark
et/41301
● https://globalindiannetwork.com/indian-pharmaceutical-industry/
● https://www.precedenceresearch.com
● https://www.drreddys.com
● https://pharmexcil.com
● https://www.ipa-india.org

● Industry Reports, Company Press Releases