India is the largest provider of generic drugs globally. Indian pharmaceutical sector industry supplies over 50 per cent of global demand for various vaccines, 40 per cent of generic demand in the US and 25 per cent of all medications in the UK. India enjoys an important position in the global pharmaceuticals sector. The country also has a large pool of scientists and engineers who have the potential to steer the industry ahead to an even higher level. Presently over 80 per cent of the antiretroviral drugs used globally to combat AIDS (Acquired Immune Deficiency Syndrome) is supplied by Indian pharmaceutical firms.

1. Indian pharmaceutical
industry

2. Submitted by
Dhruv sheth
Kushal Shah
Urvi shah
Submitted to
Professor Dr.himananshu barot

3. History of indian pharmaceutical industry
 In India allopathic medication was started in british rule but production of such medicines was not in
the country
 In 1930,in Calcutta the first pharmaceutical company called Bengal chemicals and pharmaceutical
works(acharya p c ray) which still is today as one of 5 government owned drug manufacturer started.
 The government started to encourage the growth of drug manufacturing by indian companies in the
early 1960s and with the patent act in 1970
 However, economic liberalization in 90s enabled the industry to become what it is today.
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4. Evolution of pharmaceutical industry
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1970-
1990
• Patent act 1970
• Domestic
companies
• Production and
export initiative
taken
1990-
2010
• Operations in
foreign
countries
• Liberalized
market
• Generic drug
2010
• Nppp-2012
• Patent filling by
pharma players
• Kam and cso
• (key account
management)
• (contract sales
organization)
2010-
2015
• Price reduce to
80%(2013)
• Fdi (100%)on
medical
devices
• 10,500
manufacturing
units and 3000
pharma
industry
2016
• In union
budget,2016,fdi
increased
74%in existing
pharmacy
companies.
• “pharma vision
2020”

5. Current scenario
 Important position in the global pharmaceutical sector.
 India pharmaceuticals market ranks third in the world in terms of volume and 14th in terms of value.
 It accounts for 20 percent in the volume terms and 1.4 percent in the value terms of the global
pharmaceutical industry.
 Labour costs are 50–55 per cent cheaper than in Western countries. The cost of setting up a production
plant in India is 40 per cent lower than in Western countries.
 Indian Pharmaceutical Industry has market size of $29.61 billion (as in 2016) is expected to reach a
mark of $55 billion by 2020 at a rate of around 15-16%
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Pharmaceuticals exports from India stood at US$ 16.64 billion in FY 2016-17.
Multinational companies are collaborating with Indian pharma firms to develop new drugs
Government of India is planning to set up an electronic platform to regulate online
pharmacies under a new policy
Indian pharmacy companies spend 8-13 per cent of their total turnover on R&D The Indian
pharmaceuticals market witnessed growth at a CAGR of 5.64 per cent, during FY11-16, with
the market increasing from US$ 20.95 billion in FY11 to US$ 27.57 billion in FY16. The
industry’s revenues are estimated to have grown by 7.4 per cent in FY17.
Medicine sales in India increased 8.1 per cent year-on-year in November 2017
The Pharmaceutical industry of India meets around 70% of the country’s demand

7. 7

8. Impact of gst in pharmaceutical india
 There are two key things that have changed are the manufacturing price- many raw materials
for API and products have moved from 5% vat backet to 12% GST bracket and a lot of medicine
salts/compounds have moved from 5% to 12% GST bracket.
 We need to understand the margins at which the supply chain operates. The C&F(carrying and
forwarding agents) agent operates at 4-6% margin on MRP, distributor wholesaler operates at
7-8% margin on MRP and retailers at 20% margin on medicines.
 To sum it up, pharmaceutical industry in India is over USD 100 billion and at any point of time
15-18% hold in the inventory section. So, even a 3-4% loss in overall value chain on 15 billion
dollars accumulates to USD 600 million losses for the industry, a lump sum amount. With time,
we will see the fullest impact of GST and take step accordingly
 The Government plans to incentivize bulk drug manufacturers, to encourage “Make in India”
programme and reduce dependence on imports of API, nearly 85% of which come form China
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9. GENERIC DRUGS FORM THE LARGEST SEGMENT OF INDIAN
PHARMA MARKET
 With 70 per cent of market share (in terms of revenues), generic drugs form the largest segment of the
Indian pharmaceutical sector
 India supplies 20 per cent of global generic medicines market exports, in terms of volume, making the
country the largest provider of generic medicines globally and expected to expand even further in
coming years
 Over the Counter (OTC) medicines and patented drugs constitute 21 per cent and 9 per cent,
respectively, of total market revenues of US$ 20 billion
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The share of generic drugs is expected to continue increasing; domestic generic
drug market is expected to reach US$ 27.9 billion in 2020
Due to their competence in generic drugs, growth in this market offers a great
opportunity for Indian firms
Generic drug market is expected to grow in the next few years, with many
drugs going off-patent in the US and other countries
Domestic generic drug market has reached US$ 26.1 billion in 2016

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12. PHARMA GIANTS RAISE THEIR R&D SPENDING
 In FY17, highest expenditure on research and development has been done by Sun Pharma, followed
by Lupin
 Sun Pharma’s R&D spending is 7.6 per cent of the total sales in the FY17 , which grew at a CAGR of
38.3 per cent from FY11 to FY17.
 Sun Pharma’s R&D plan includes developing more products through expanded R&D team for global
markets, focusing on more complex products across multiple dosage forms and investments in
specialty pipeline
 Lupin’s R&D spending was 13.5 per cent of sales in FY17, with major thrust on oral solids (45 per
cent of R&D spend)
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(P)Political
*Political uncertainty
*Stringent Price Control
*Irrespective cost of the
real costs
*Reverse-engineering route
implied
*Finished products costlier
(E)conomic Factors
*Small proportion of its
GDP on healthcare
*Non-standardized
medication.
*Taxes are very high
*Registered Medical
practitioners is low
*Cost of goods high
(S)ocio-cultural
Factors
*Malnutrition dramatically
exacerbate.
*Poor Sanitation and
polluted water
*Household treatments
pursue more
*Superstitious thinking
among people
(T)echnological
Factors
*Advanced automated
machines
*Computerization has
increased
*Newer drug delivery
systems are the
innovation
*Ayurveda is a well-

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16. (P)political Factors
 Political uncertainty
 Stringent Price Control
 Irrespective cost of the real
costs
 Reverse-engineering route
implied
 Finished products costlier
(E)conomic Factors
 Small proportion of its GDP on
healthcare
 Non-standardized medication.
 Taxes are very high
 Registered Medical
practitioners is low
 Cost of goods high
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Thanks!
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https://kushsshah.blogspot.com/