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Industry Overview

Global Pharmaceuticals Market

In 2007, the size of the global pharmaceutical market was US$ 959 bn. The market has since grown at a CAGR of nearly 30% during 2007-2012.

Leading therapeutic segments in the Global Pharmaceutical Market

Oncologics and Analgesics were the top selling therapeutic classes in 2012.

Indian Pharmaceutical Industry

• Indian pharmaceutical market is among the top five emerging pharmaceutical markets in the world
• According to McKinsey & Company report (“India Pharma 2015”), the following trends influence the growth of the Indian pharmaceuticals market:
  • Doubling of disposable incomes and the number of middle-class households
  • Expansion of medical infrastructure
  • Greater penetration of health insurance
  • Rising prevalence of chronic diseases
  • Adoption of product patents
  • Aggressive market penetration driven by the relatively smaller companies
• The revenue CAGR from 2009-2012 has been 12.4%, and is expected to increase to 14-17% between 2012-2016
• This growth is expected to be due to new product launches and favorable pricing environment
• Increasing sales of generic medicines, continuing growth of chronic therapies, and greater penetration in rural markets also contribute to the increase in revenue sales
• Indian pharma companies have taken advantage of the generics expiries and the increasing demand for low-cost drugs, which has been conducive for the growth in the industry
• 4-5 Indian companies are listed in the top 20 generics in 2011 (IMS data)

Business Strategies followed by Indian Pharmaceutical Companies

Domestic Market

• Indian domestic pharmaceutical retail market registered a growth rate of 15% in 2011, with annual sales of US$ 10.8 bn
• The Indian pharmaceutical market ranks 14th in the world in terms of volume
• The market size is expected to grow to about US$ 35.9 bn by 2016

Exports

• The pharmaceutical exports increased from US$ 13.2 bn in 2011-12 to US$ 14.6 bn in 2012-13
• By 2016, the estimated value of Indian pharma exports is going to be US$ 25 bn
• The Indian pharma companies are expected to focus on the US generics market for the next two years

Generics Market

• Generics dominate the market, and this trend is expected to continue, with patent-protected products expected to constitute 10% of the total share until 2015 (McKinsey report - India Pharma 2015)
• Global demand for Indian generics is increasing due to rise in healthcare costs in developed countries
• Indian generics companies are set to focus on under-penetrated markets like France, Italy and Spain and branded generic markets in East Europe, including complex generics, OTCs, etc.

Research & Development