Asia Pharmaleaders 2013



Odisha Congress fails to impress the people as Ruling BJD continues to Dominate in Odisha Civic Polls

 Odisha Congress fails to impress the people as Ruling BJD continues to Dominate in Odisha Civic Polls

 Naveen Patnaik’s charm captivates the peoples mind as BJD sets to win in most of the seats!

  The much anticipated & awaited results of the Odisha Civic polls seem to suggest that despite a strong anti incumbency mood in the state of Odisha, the charismatic leadership of Naveen Patnaik seems to capture the imagination of the p[people as 66 civic bodies, including 40 notified area councils, Image25 municipalities and one corporation results are coming as a huge blow to the opposition Congress which was expecting a tough fight.


As per the latest reports, BJD was winning in Nabrangpur, Bhanjanagar, Nilagiri, Boudh, Puri, Konark, Nimapara, Sorada, Bhuban, Raigada, Koraput, Bhubana,  Karanjia, Atgarah, Banki, Hinjili, Khalikote, Digpahandi, Umerkote, Nabarangpur, Bhadrak, Chikiti, Purusottampur, Jaipur, Talcher, Kamakhya Nagar, Jajpur, Choudar, Keonjhar, karanjia, Khandapada, Dhenkanal, Patamundai, Jaipur, Angul, Balesore, Malkangiri , Gudari, Gunapur, Khurda, Banapur, Balugaon, Berhampur Municipal Corporation, Joda and others. 

 It will be widely observed in the political circles that Congress will have to think much in the preparation of 2014 Elections.

 Odisha Congress fails to impress the people as Ruling BJD continues to Dominate in Odisha Civic Polls

Indian Healthcare Sector Is on Wait & Watch Mode as Economy in Robot Mode!

SMEs likely to play important role in pharma growth story: report

The small and medium enterprises (SMEs) are expected to play a significant role in the growth story of the country’s pharma sector as they contribute 35-40 per cent to the industry in terms of production with a turnover of about Rs 35,000 crore.

“Small and medium scale units have played a crucial role in the growth story of the Indian pharmaceutical industry and form an integral part of the sector,” India Micro, Small and Medium Enterprise Report 2013 said here.

It added: “The Indian pharmaceutical industry is highly fragmented and estimated to have 9,456 units in the SME segment, which account for around 87 per cent in production by volume and 40 per cent by value.”

Exports of pharmaceuticals products from India increased from USD 6.23 billion in 2006-07 to USD 8.7 billion in 2012-13, a combined annual growth rate of 21.25 per cent.

The Ministry of Commerce has targeted Indian pharma sector exports to reach USD 25 billion by 2014 at an annual growth rate of 25 per cent.

In terms of number of units and employment generation, the SME sector is at the forefront. They also support 48 per cent of the country’s pharma exports, the report said.

The country’s pharmaceutical sector derives its strength from the SME sector, as it forms an essential part of the supply chain for the larger players.

There are more than 24,000 registered units, which meet 70 per cent of the country’s needs. Clearly, MSMEs operating in the domestic pharma sector are recognised as the backbone of the industry.

By and large, they operate in the local market, and mainly manufacture formulations which relate to medicines of mass consumption and therefore have a huge market. To a great extent, survival of these units would depend on how well and quickly these companies are able to adapt to the changing business scenario, the report said.

In India, SMEs are mainly focusing on manufacturing and niche marketing. Contract Research and Manufacturing (CRAMs) and Biopharma have emerged as areas of high relevance to the MSME sector. It is recognised that the MSME units can effectively meet the two major public expectations viz. Cost effective and affordable medicines of given framework of excellent manufacturing process, technology, regulatory compliance, distribution system and prices.

On the export front, pharmaceutical SMEs in India have traditionally been less focussed on exports in comparison to large domestic firms. However, now they have become preferred partners for the supply of active pharmaceutical ingredients (APIs) and finished dosages for Indian as well as foreign pharmaceutical firms, the report said.

MSMEs are often ignored on many occasions. As a result, many of them are today facing a survival crisis. Stringent regulations, lack of financing options, little or no global exposure, poor public image and increasing competition from other low cost nations are some of the crippling factors facing this sector, said R B Smarta, Managing Director, Interlink Marketing Consultancy.

According to him, “there has been a lack of focus by development institutions and financial institutions. On the funding side, bankers seem to have lost focus due to globalisation and norms like the Non Performing Assets (NPA).

“There is going to be a big void of new entrepreneurs entering the sector. The want of focus also results in losing people to IT and non-specific marketing. Similarly, there is a need for establishing and sharing of common facilities like treatment plants and testing facilities.”

High Product Registration fee in other developing economies is one of the deterrents to export by SMEs. The industry representatives suggest that the pharma policy on export should provide for a transaction subsidy for the registration fee.

The industry recognises the problems faced by the SMEs, but believes that they have to equip themselves without waiting for external assistance though it suggests that Government initiatives can only be supportive.

“In spite of the stiff competition by thousands of local and national level companies, there are still many opportunities to earn huge profits, the report said.

At present, the government is providing tax deduction to promote R&D, but according to industry experts, this is not sufficient.

Gaurav Khungar of KPMG said, “SMEs can play a strong role in the R&D area. The sector has been asking for various kinds of fiscal incentives and tax sops in order to stimulate investments in innovations and R&D beyond the current tax deduction.

“The tax reduction demands of SMEs are to the tune of 150 per cent on R&D spend, as the current percentage is not enough to stimulate investments in this arena.”

“The Government has initiated multiple reforms such as the cluster development programme, technology upgradation fund, credit link capital scheme, amongst others, which have rendered success.

“However, the huge unorganised sector of Micro Small Medium Enterprises (MSME) seeks scaling up of intervention from the Government.

“There’s a pressing need for the state governments, local governments to join hand with the Central government and work towards increasing the presence of MSME’s in the eco system”, Ministry of Micro, Small and Medium Enterprises, Secretary Madhav Lal said.

Drugmakers delay launches in India as rupee depreciates

india flag
MUMBAI — The Indian rupee’s fall against the dollar appears to be finally hitting the pharmaceutical industry, considered a defensive sector as its earnings remain relatively unaffected by economic downturns.

The drop in the value of the Indian currency has prompted drug makers, especially the local units of foreign drug companies, to delay the introduction of imported medicines. The depreciation of the currency has eroded profitability of several imported drugs, according to analysts, corporate advisers and industry experts.

To make matters worse, drug makers are unable to raise prices because of the drug price control regime that came into force on 1 July. In fact, some of them had to cut prices under a new drug price control order (DPCO).

Most foreign drugmakers, which sell high-value products — especially biological drugs, vaccines and cancer and diabetes medicines — currently import them from their parents under pre-fixed internal pricing contracts. But the unexpected 12.49% drop in the rupee’s value against the dollar since January has upset their margin calculations.

Last week, Novo Nordisk, the world’s largest insulin maker, postponed the launch of its new insulin brand Tresiba by two months, citing the rupee’s depreciation as one of the reasons. The company has a 61% share of the Indian insulin market.

“We are figuring out logistics before the commercial launch and besides that the rupee depreciation is one of the major concerns.” said Melvin Oscar D’souza, managing director, Novo Nordisk India. Among emerging markets, Novo chose Mexico to first launch Tresiba three months ago.

Exchange rate fluctuation is the biggest financial risk that the company faces and that risk has grown in tandem with the increasing size of international markets and share of sales in different currencies, according to Novo Nordisk’s 2012 annual report. Novo Nordisk doesn’t have any manufacturing facility in India and it imports all diabetes products, including insulin crystals that it supplies to Torrent Pharma.

“Currency fluctuation is a cause of concern and we are watching the situation closely,” said Mads Bo Larsen, vice- president for business area Africa, Gulf and India, Novo Nordisk.

“Profitability of multinational pharmaceutical companies will be significantly impacted in the coming quarters due to fluctuation in the Indian rupee, if they are not making any loss,” said Hitesh Mahida, an analyst with Fortune Equity Brokers (India) Ltd.

Internal transfer pricing between the parent company and their Indian subsidiaries for many of the drugs that have already been launched would have been fixed on the basis of the earlier valuation of rupee and dollar. These valuations went haywire with the unexpectedly large fluctuations in the rupee, said a corporate adviser with a foreign consulting firm.

“Pricing of imported drugs currently sold in India must have been fixed earlier when rupee was strong. A drastic change in exchange rate would lead to renegotiation with the exporter (the foreign parent in this case),” said the adviser, who did not wish to be identified. “In most cases, the transfer pricing terms between the parent and the subsidiaries are similar to those between a manufacturer and supplier. In certain cases, the transfer deals may even involve advance cheque payment or a credit period guarantee.”

Analysts say more foreign companies, including some of the world’s top drug makers with a direct presence in the Indian market, have delayed introducing new drugs from their parents’ product portfolio. “Rupee volatility is serious issue faced by drug companies, which depend on imported products. The transfer pricing agreement between the parent and the subsidiaries can’t be easily changed,” said Sujay Shetty, head (pharma and life sciences) at consulting firm PWC India.

The Indian units of GlaxoSmithKline Plc and Pfizer Inc. appear to be among the most affected by the weakening rupee.

“Pfizer (local unit Pfizer Ltd) imports 47% of its raw material which increases the cost of material consumed for manufacturing drugs. Also it has not launched any new product in the past 5-6 months in India,” said a senior sector analyst with a domestic brokerage.

Pfizer did not respond to a query seeking comment.

In the past three years, new launches contributed only 6% of GlaxoSmithKline Pharmaceuticals’ pharma revenue. In 2013, it plans to introduce a couple of vaccines, dermatology, respiratory and oncology products in India.

“But we are yet to see most of the launches as rupee depreciation has made the launches expensive for MNC pharma companies,” said the analyst, who declined to be identified.

“The rupee erosion has impacted the cost of our imports,” said GSK spokesperson in an email statement.

In the past three years GSK India has launched new products such as Votrient, Revolade and XGEVA in oncology, Lamictal and Icacetam in neurology, Physiogel in dermatology, Avamys in respiratory and Synflorix in vaccines. ___

Government Alone Can’t Solve Society’s Biggest Problems

Rising obesity. Human Trafficking. Re-skilling the workforce. A lack of quality education and safe water for the poor in the developing world. Whose job is it to solve these problems?

For decades, the answer to that question has been simple: government. Until relatively recently, governments provided for the public good, while the private sector largely stuck with Milton Friedman’s admonition that the social responsibility of business was to increase its profits. Thinking beyond the bottom line was considered unfocused or, even worse, a disservice to shareholders.

Today, the landscape has changed dramatically.

A new economy has emerged at the borderlands where traditional sectors overlap. This economy trades in social outcomes; its currencies include public data, reputation, and social impact. Previously untapped markets drive financial returns. The business models are unusual. The motivations range from moral obligation to new notions of public accountability, or even shareholder value. This “solution economy” represents not just an economic opportunity, but a new manner of solving entrenched societal problems.

New problem-solving innovators and investors power this solution economy. These “wavemakers” assume many forms, including edgy social enterprises with the mentality of a Silicon Valley start-up, megafoundations, and Fortune 500 companies that now deliver social good on the path to profit. They range from Ashoka, which deploys 3,000 citizen changemakers in 70 countries, to the global pharmaceutical giants that annually give away billions of dollars in medicine to low-income citizens.

Consider just a few data points. In 2009, private US philanthropy to developing countries exceeded official US government aid by almost $9 billion. In one survey of 184 global companies, the average company contributed about $22 million to philanthropy, with the group total exceeding $15 billion in just one year. Even institutional investors have directed funds to organizations that create public value. Socially responsible investing has grown into a $1 trillion industry.

The solutions designed by today’s wavemakers depend less on whether a problem is public or private, social or commercial, economic or political. Rather, designs consider the ability to reach the previously unreachable, raise funds from untapped sources, and leverage social networks — all conditions that fuel new markets for solving entrenched societal problems.

These multi-billion-dollar markets are forming around some of the world’s toughest problems — from fighting malaria to providing low-cost housing to educating the poorest of the poor. In these solution markets, businesses, social entrepreneurs, nonprofits, and multinational companies compete, coordinate, and collaborate to solve megaproblems. Instead of trying to patch a market failure, they create a market for the solution. Foundations, venture philanthropists, governments — and, often, private businesses themselves — act as funders, investors, and market makers.

Unlike most government-driven programs that check their ambition at political borders, these emerging solutions spread nimbly across the globe. In less than a decade, Unilever’s Project Shakti microloan program for women in rural Indian villages expanded from 17 saleswomen to 43,000, serving 3 million Indian households; it is now spreading to Sri Lanka and Bangladesh.

This all might inspire a touch of skepticism. You might be thinking something like this: We have markets in shoes, in homes, and in automobiles, but markets in societal outcomes? It seems illogical. Weren’t these big, wicked problems the very areas where we’ve experienced market failure in the first place — where government was forced to step in? Take something like human trafficking. It’s easy to see how there can be a market in engaging in this awful practice, but can a market be constructed to help stop it?

We assert that yes, you can create markets — or at least market mechanisms — around problems like environmental cleanup, transitioning from welfare to work, and even human trafficking. In fact, markets and economic ecosystems are developing around all manner of societal problems. The buyers in these markets purchase impacts or outcomes: healthier communities, kids who can read, reduced recidivism. The sellers provide outcomes: they design cheap, solar-powered lights; write the code that tracks salmonella outbreaks using government data; and build the cross-sector networks to fight scourges like human trafficking.

What about government? Its role has now shifted. Sometimes it is a funder; sometimes it integrates all the players; sometimes it’s the market maker; sometimes it’s just one of many contributors to the solution. Sometimes all it has to do is provide a space for these solution markets to work.

Innovation key to growth for Indian pharma firms: experts
By Soumonty Kanungo Sep 17 2013 , m
Tags: News
Although known as the pharmacy to the world, India should focus on discovering new molecular entities rather than concentrating largely on generic medicines to move up the value chain, according to pharma industry officials .

“As far generics are concerned, we have arrived. Around 40 per cent of abbreviated new drug applications (ANDAs) in the US are from India alone. Generic business is cost effective but we must move up the value chain. We have to innovate, differentiate and add value to the system,” Ajit Dangi, president and CEO, Danssen Consulting, said.

Dangi also said that India should take advantage of the opportunities lying in the super-generics segment.

According to a Glenmark spokesperson, innovation leading to new drugs is critical to meeting unmet medical needs. Manufacturing innovative products are not easy since a lot of risk is involved as a molecule might fail in the process,” the spokesperson said. Glenmark has its focus on both innovation and generics and its in–licensed molecule Crofelemer has received US-FDA approval for HIV associated diarrhoea. The pharma firm is working on six other molecules (including three new chemical entities and three new biological entities) which are in different stages of development.

They were speaking at the launch of UBM Pharma Awards in Mumbai on Tuesday.

While generics are bread and butter of any pharma firm, over the years the pipeline of generic drugs may dry out, feel industry insiders. This makes it more important for the pharma firms to remain competitive both in domestic and global markets by developing innovative products so as to have more patented and blockbuster drugs.

“Ranbaxy has innovated new drug for the treatment of uncomplicated malaria in adults. Zydus Group just launched its patented drug Lipaglyn for treatment of diabetes. We need more innovations like these,” Dangi said

Murali Nair, partner, Ernst & Young, said, “There is a need to have a fundamental change in the way the industry performs. More innovations are required and there is huge opportunity lying in the super-generics segment which the Indian pharma companies should look at.”

According to Ajit Singh, chairman, ACG Worldwide, the pharma industry will see shift in power to the hands of the pharmacies. “A lot of future pharma industry’s sales are going to shift away from doctors and will go into the hands of the pharmacies. While doctors prescribed medicines which are mostly patented medicines, once the patent is lost the product becomes generic. Since the prices of the generic medicines are comparatively low, the pharmacy will eventually decide on which generic medicine to be given to the customers,” Singh said. His company, which he claims to be the largest privately-owned capsules manufacturer in the world, is looking at capacity expansion for which the company is likely to invest around Rs 1,000 crore over the next three years.

“We are manufacturing 70 billion capsules at the moment which we will take up to 100 billion next year. Around 55 per cent of our production is for our exports market,” Singh said, adding that his company is investing Rs 500 crore to develop its Indore unit. ACG Worldwide has six manufacturing facilities with five in India and one in Europe. It is also setting up three additional facilities, though the locations were not disclosed, for which the company would invest Rs 250-350 crore on each unit depending on its size. The company will fund its investments through debt and internal accruals.

On the FDA regulatory issue with the Indian companies, both Dangi and Singh said that these are not only the case with Indian companies, but across the globe many multinationals are under the FDA scanner over quality control issues. Nair, on the other hand, said that raising the regulatory standards by Drug Controller General of India is also required. “We cannot have two different standards as one for the international market and the other for India. The Indian regulator should scale up its regulatory standards to make it at par with the international regulators,” Nair added.


The State of Affairs with Satya Brahma

Satya Brahma
Satya Brahma




In an era where politics dominate economic reforms, nothing can be expected from the country where greed for power & aggression to get it is the key & not building Indian brands, Indian economy. I am deeply disappointed the way country is progressing against the massive grandeur economic fabric of china, Japan & other European countries. I think the key to key their success lies in investing in resources & utilizing 80 % of the funds allocated to them, though they are less corrupt compared tio Indian fabrics, where funds don’t reach to the people. Forget those reforms, the audacity has gone to put the files into fire, so files are missing! India, Indian People & Indian Economy can grow only when Politicians devote more time in Nation Building rather than political witch-hunting & blame-game. The disgusting approach of the leaders are sometimes dangerous as they openly loot Indian economy’s pride! Satya Brahma, Chairman & Editor-In-Chief, Network 7 Media Group.

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The number of deaths in India resulting from clinical trials has increased to an unendurable figure of 2,868 during the period 2005-20121.

  • There is huge potential for the clinical research industry in India, which offers attractive opportunities for contract research organisations. The clinical trials industry in India was estimated at $485 million in 2010 by Frost & Sullivan and is anticipated to grow at 17 per cent CAGR from 2009-15, remaining the largest clinical trial market in Asia after Japan. The growth is accelerated not only by the global majors but also the domestic companies that have seen a rapid growth over the past three years.  
    • India has a varied genetic pool and a significant number of Indians suffer from acute chronic diseases. This can be win-win situation: for patients who don’t get or can’t afford good treatment and pharma companies who need patients to conduct clinical trials to develop new medicines. The cost of a phase I trial is estimated to be 50 per cent cheaper in India, while that of phase II is 60 per cent less in terms of direct cost and estimated time savings. The vast healthcare system makes it easier for international clinical research organisations to conduct studies in the country. 
    • Moreover, India has about 600,000 doctors, 45,000 hospitals and around 900,000 beds in both private and public hospitals, with most having electronic medical record facilities. All this makes it easier for international clinical research organisations to conduct studies in the country. The Indian clinical research industry grew to about Rs 8,000 crore in 2010-2011. According to ASSOCHAM, it is expected to employ 50,000 professionals in the next five years. Indian companies are expected to conduct over 15 per cent of global trials, which can increase the employment opportunities for life science and medical graduates four-fold.  But the industry faces a few challenges for these targets to be met.   There have been inadequacies in the clinical trials publication practices wherein trials with only positive results are published while the failures or ineffectiveness of drugs are not publicised.  
    • “Clinical Trials” and debates associated with it have been in headlines since past few months pursuant to the strict view taken by the apex court on the matter. The number of deaths in India resulting from clinical trials has increased to an unendurable figure of 2,868 during the period 2005-20121. If on the one hand this figure relating to number of deaths resulting from clinical trials is fearful, on the other hand the decline in the number of clinical trials and approval given for conducting such trials in last few months is equally shocking. Till April 2013, only 12 (twelve) clinical trials have been approved by the authority as compared to almost a three digit figure in last year2. This certainly raises a concern for the future of clinical trials in India- country which once was perceived as a fertile place for growth of clinical trials by most of the multi-national corporations. Currently estimated at USD 500 million, India’s clinical research market was projected to more than double. Image
  • Pharmaleaderstv*

Breakfastnewstv attempt to raise burning issues in Indian Affairs




Breakfast news is a division of Network 7 Media Group based in United States having operations in worldwide media news distribution. Breakfast news in partnership with several leading media houses & its own battery of journalists specializing in various fields such as politics, economics, entertainment, social issues attempt to create a vibrant platform of interactive journalism in an independent & fair practices. The guiding spirit of Breakfast news that distinguishes itself from others are that its reporters, anchors & special correspondents are not induced to lucrative compliments offered from political parties & corporate houses. Breakfast news voices its opinions in a powerful format to target the corporate lobbyists & political parties who attempt to shut the independent opinions & truth based on hard & factual evidences. All stories filed by the Staff Reporters are telecast with great degree of responsibilities backed by hard evidences & necessary fact files. Over the last few years, Media has played a bigger role in exposing the misdeeds of the corrupt political set-up & those in power who defy no orders & try to subvert the free flow of information & independent of media expressions.Breakfastnews believe that the prosperity of a nation or a polity or a economy set up can be best balanced with the proper vigilance of the happenings by a aggressive Media & Breakfastnews is committed to reach out to the millions of people around the world of depicting the try story, rather than presenting a dramatic presentation of misleading informations. Breakfast news is a part of an illustrious media conglometer which has some of the best media titles such as Indian Affairs, Pharmaleaders, Pharmanewsprwire & other forms of blogging. It also to its credit organizing over the last one decade some of the best known & eagerly awaited annual events such as Pharmaceutical Leadership Summit & Business Leadership Awards, India Leadership Conclave, Global CSR Leadership Summit & Awards. Breakfastnews does not believe in theories that are outdated & irrelevant & has been at the forefront of highest degree of journalism ethics & fair reporting free from any influences & inducements. Breakfastnews verifies each news before being made to public domain & are brought to the notice of the statutory authorities to seek for justice to the aggrieved parties through its print, TV & Digital medium. It is the world’s leading news agency & press information point to its various channel partners. Driven by an analytical & investigative frame of mind, Breakfastnews covers the news that are hidden or suppressed by the rest of the media. It acts as a voice of countless Indians & masses who are denied of their basic rights, The Right To Speak.



Sam Pitroda

The Indian healthcare industry, which comprises hospitals, medical infrastructure, medical devices, clinical trials, outsourcing, telemedicine, health insurance and medical equipment, was valued at US$ 79 billion in 2012, and is expected to reach US $160 billion by 2017. The Indian healthcare sector is expected to grow at about 15 percent year-on-year (y-o-y), on account of factors such as rapid growth in infrastructure development, creation of demand for higher levels of healthcare, rising awareness of end users, and launch of innovative insurance, reimbursement, and financing policies.

The growth of the Indian healthcare sector is further driven by the 300 million strong middle class population with significant disposable income, which is likely to demand superior healthcare services.

Market Size

The healthcare equipment sector attracted 8.8 per cent of the total investments in terms of deal value with an aggregate of US$ 249.01 million (20 deals), according to data released by VCCEdge.

The hospital and diagnostics centre in India received foreign direct investment (FDI) worth US$ 1,597.33 million, while drugs & pharmaceutical and medical & surgical appliances industry registered FDI worth US$ 10,318.17 million and US$ 622.99 million, respectively during April 2000 to March 2013, according to data provided by Department of Industrial Policy and Promotion (DIPP).

The diagnostics sector in India has been witnessing immense progress in innovative competencies and credibility. In addition, the emerging sectors, such as bio-generics and pharma packaging are also paving way for the pharmaceutical market to continue its upward trend during FY 2012- FY 2014.

Trends and Investments

The favourable demographic virtues offer an attractive market for healthcare providers and investors in India. An increase in foreign investment inflows and private equity (PE) deals in the industry’s various segments have also been noted, in addition to the increased focus received from the Government.

The Indian healthcare providers plan to spend Rs 5,700 crore (US$ 986.16 million) on IT products and services in 2013, a 7 per cent rise over 2012 revenues of Rs 5,300 crore (US$ 916.96 million), as per a report by Gartner.

India and the United Kingdom (UK) have signed a memorandum of understanding (MoU) on cooperation in the field of health sector. The latter is eager to assist and partner India in achieving low-cost, high quality care, said Mr Kenneth Clarke, British Cabinet Minister and Prime Minister’s Trade Envoy.

Some of the major investments in the sector include:

  • Smith & Nephew Plc, a global medical technology provider, has acquired Sushrut Surgicals Pvt Ltd, along with its brands and assets, for Rs 380 crore (US$ 65.74 million). With this acquisition, Smith & Nephew has entered into India’s US$ 50 billion healthcare industry, growing at a CAGR of 15 to 20 per cent
  • Kirloskar Group, along with Toyota Tsusho Corporation (TTC) and Secom Hospitals, will launch a multi-specialty hospital in Bengaluru. The joint venture (JV) has invested Rs 200 crore (US$ 34.60 million) and is expected to be operational in July 2013
  • Abu Dhabi-based New Medical Centre Group plans to invest Rs 500 crore (US$ 85.51 million) in healthcare sector in India, as per Mr B R Shetty, the company’s Chief Executive Officer. The Group aims to help in taking latter’s healthcare facilities to international standards
  • General Electric (GE) is planning to invest US$ 2 billion over the next five years, to accelerate the development of innovative software for healthcare systems and applications
  • Oil and Natural Gas Corporation Ltd (ONGC) plans to invest Rs 100 crore (US$ 17.54 million) for bringing super specialty hospital in Sivasagar district, Assam
  • Manipal Health Enterprises (MHE) has entered the andrology and reproductive medicine services by acquiring Ankur Healthcare

Medical Tourism

The medical tourism industry in India is pegged at US$ 1 billion per annum, growing at around 18 per cent and is expected to touch US$ 2 billion by 2015.

India has witnessed an influx of patients from Africa, CIS countries, Gulf and SAARC nations, Pakistan, Bangladesh and Myanmar, who mainly come for organ transplant, orthopedic, cardiac and oncology problems.

India will remain on top in medical tourism for at least a decade on back of skilled and english language speaking manpower. “India’s biggest advantage is the language and human technology which cannot be easily replaced”, Dr K M Cherian.

The inflow of medical tourists to India has increased by 23 per cent, with Chennai emerging to be the favourite hotspot. The city attracted about 40 per cent of the country’s medical tourists, in addition to more than 600,000 tourists visit the state every year, according to a study by Confederation of Indian Industries (CII).

Government Initiatives

The Government of India has decided to increase health expenditure to 2.5 per cent of gross domestic product (GDP) by the end of the Twelfth Five Year Plan (2012-17). Dr Manmohan Singh, the Prime Minister of India, also emphasised the need for increased outlay to health sector during the Twelfth Five Year Plan.

Moreover, 100 per cent FDI is permitted for health and medical services under the automatic route.

In a recent initiative, 348 essential medicines will now come under price control in India. These currently contribute Rs 13,033 crore (US$ 2.25 billion) to the total annual sales of Rs 72,762 crore (US$ 12.59 billion), according to market research firm IMS Health’s analysis.

Some highlights of the Union Budget 2013-14 presented by Mr P Chidambaram, Minister of Finance, Government of India, for the healthcare are as follows:

  • Health for all remains one of the priority sectors for the Government
  • The Ministry of Health & Family Welfare has been allocated Rs 37,330 crore (US$ 6.46 billion). Of this, the new National Health Mission that combines the rural mission and the proposed urban mission will get Rs 21,239 crore (US$ 3.67 billion), an increase of 24.3 per cent over the RE
  • Rs 4,727 crore (US$ 817.82 million) for medical education, training and research
  • The National Programme for the Health Care of Elderly is being implemented in 100 selected districts of 21 States. Eight regional geriatric centres are being funded for the development of dedicated geriatric departments. Rs 150 crore (US$ 25.95 million) has been provided for National Programme for the Health Care of Elderly
  • Ayurveda, Unani, Siddha and Homoeopathy are being mainstreamed through the National Health Mission and Rs 1,069 crore (US$ 184.95 million) has been allocated to the Department of AYUSH
  • Moreover, Rs 1,650 crore (US$ 285.47 million) was allocated for six AIIMS-like institutions

In addition, contributions made to schemes of Central and State Governments similar to Central Government Health Scheme, eligible for section 80D of the Income tax Act.

Road Ahead

Private healthcare sector is expanding on back of increasing demand from the growing middle-class in India’s larger cities. Hospital information systems, picture archiving and communications systems, electronic health records and mobile technologies will be high on the agenda. We expect to see providers benefit by offering cost effective business models, said Mr Anurag Gupta, Research Director, Gartner.

In addition, there is a substantial demand for high-quality and specialty healthcare services in tier-II and tier-III cities. All these factors are creating a bigger market for better healthcare services in the country.

Exchange Rate : INR 1 = US$ 0.01730 as on June 12, 2013

References: Department of Industrial Policy and Promotion (DIPP), Union Budget 2012-13, RNCOS Reports, Media Reports, Press Information Bureau (PIB)

India is now among the top five pharmaceutical emerging markets globally and is a front runner in a wide range of specialties involving complex drugs’ manufacture, development, and technology. The Indian pharmaceutical industry is a highly knowledge based industry which is growing steadily and plays a major role in the Indian economy. As a highly organised sector, the number of pharmaceutical companies are increasing their operations in India. The industry is expected to touch US$ 35.9 billion by 2016.

The Department of Pharmaceuticals has prepared a ‘Pharma Vision 2020’ document for making India one of the leading destinations for end-to-end drug discovery and innovation. The department provides requisite support by way of world class infrastructure, internationally competitive scientific manpower for pharma research and development (R&D), venture fund for research in the public and private domain and such other measures.

Sector Structure/ Market Size

The domestic pharma market has reported total sales of Rs 6,370 crore (US$ 1.03 billion) in the month of May 2013, registering a growth of 6.8 per cent, as per IMS Health. The major factors responsible are increasing sales of generic medicines, continued growth in chronic therapies and a greater penetration in rural markets.

The cumulative drugs and pharmaceuticals sector has attracted foreign direct investments (FDI) worth US$ 11,304.91 million during April 2000 to April 2013, according to the latest data published by Department of Industrial Policy and Promotion (DIPP).


The Indian pharmaceutical industry would continue to experience strong growth as structural growth drivers continue to remain impervious. The industry is expected to revert a growth of 10-12 percent in 2013-14, according to a study by ICRA. It is also expected that in-organic investments will gain momentum in the medium-term as companies plan to create stronger presence in emerging markets and build expertise in select therapy areas.

Among the top 10 companies, Cipla with total sales of Rs 302 crore (US$ 49.13 million), Sun Rs 297 crore (US$ 48.32 miliion), Alkem Rs 222 crore (US$ 36.12 million) and Sanofi Rs 186 crore (US$ 30.26 million) were the fastest growing corporations for the month of May 2013.


Pharmaceutical exports from the country during 2012-13 stood at US$14.6 billion, up from US$13.2 billion the previous year, as per P V Appaji, Director General, Pharmexcil.

The Ministry of Commerce has targeted Indian pharma sector exports at US$ 25 billion by 2016. The Government has also planned a ‘Pharma India’ brand promotion action plan spanning over a three-year period to give an impetus to generic exports.

In order to boost the export capability, Export-Import Bank of India (Exim Bank), has decided to expand the scope of its finance to pharmaceutical companies for extended repayment periods. Eligible export oriented companies can avail finance from Exim Bank for a maximum repayment period of 10 years with a moratorium of up to 36 months.

“Of the export markets, Indian pharma will focus on the US market which presents significant opportunities for the next two years for generics, due to patent cliffs and recent changes in healthcare policies,” said the India Ratings report on outlook for Indian pharmaceuticals for 2013.


Generics will continue to dominate the market while patent-protected products are likely to constitute 10 per cent of the pie till 2015, according to McKinsey report ‘India Pharma 2015- Unlocking the potential of Indian Pharmaceuticals market’.

Global demand for generic drugs from Indian companies is booming as developed nations battle rising healthcare costs. As a result, generics companies are increasingly focusing on expanding presence in relatively under-penetrated markets (i.e. France, Spain & Italy), branded generic markets of East Europe and niche areas like complex generics, OTCs etc.

Diagnostics Outsourcing/ Clinical Trials

India is fast becoming the preferred destination for high-end pathology and diagnostic services. The highly fragmented diagnostics and pathology labs market in India is pegged at US$ 3.4 billion, according to a report by PricewaterhouseCoopers.

An increasing number of hospitals from the UK, US, Middle East and neighbouring countries are tying up with Indian diagnostic centres to conduct laboratory tests. The Indian diagnostic services market is expected to grow at a compound annual growth rate (CAGR) of around 26 per cent during 2012-2015 on back of huge investments, fast expansion into tier II & III cities, and strong government support strengthening the healthcare infrastructure in the country.

According to RNCOs research report “Booming Clinical Trials Market in India”, the number of clinical studies by domestic and global players has sharply risen. India, over the last decade, has developed significant capabilities in clinical trials, along with certain capabilities in project management and data management.According to RNCOs research report “Booming Clinical Trials Market in India”, the number of clinical studies by domestic and global players has sharply risen. India, over the last decade, has developed significant capabilities in clinical trials, along with certain capabilities in project management and data management.


Some of the investments in the sector are:

  • Piramal’s healthcare vertical plans to invest US$ 2.5 million to upgrade their antibody drug conjugate (ADC) manufacturing suites. The upgrade will give Piramal two commercial grade ADC suites at the Grangemouth facility, while retaining clinical phase manufacturing capacity in other suites on-site
  • Dr Reddy’s Laboratories (DRL) has launched Donepezil Hydrochloride tablets in the US market following the approval by the United States Food and Drug Administration (USFDA)
  • US-based drug maker MSD has tied up with Mumbai-based Lupin to market MSD’s 23-valent Pneumococcal Polysaccharide Vaccine in India. Lupin would have a non-exclusive licence to market, promote and distribute the vaccine under a different brand name
  • Aurobindo Pharma, Natco Pharma and Glenmark have received approvals from the US Food and Drug Administration (USFDA) to launch their migraine drugs in the US market
  • Elder Pharmaceuticals has acquired UK-based Max Healthcare. The acquisition is through Elder’s fully-owned UK subsidiary, NutraHealth, and will mark the re-entry of Elder Pharma into the over-the-counter (OTC) pharmaceutical category
  • Zydus Group has launched LipaglynTM (Saroglitazar), a novel drug targeted for treating diabetic dyslipidemia or hypertriglyceridemia in Type II diabetes. The drug has been approved for launch in India by the Drug Controller General of India (DCGI)

Government Initiatives

The Foreign Investment Promotion Board (FIPB) has cleared seven FDI proposals for investment in the Indian pharmaceutical companies. Currently, 100 per cent FDI in pharma sector is permitted through automatic approval route in the new projects but the foreign investment in the existing pharma companies requires FIPB approval.

In the Union Budget 2013-14, investment allowance of 15 per cent on new plant and machinery has been allowed. The allowance is expected to increase investments in new projects while simultaneously providing tax benefit to the industry.

In order to provide relief to the common man in the area of healthcare, a countrywide campaign in the name of ‘Jan Aushadhi Campaign’ has been initiated by the Department of Pharmaceuticals, Government of India, in collaboration with the State Governments, by way of opening up of Jan Aushadhi Generic Stores in the Government Hospitals by way of supply of generic medicines through Central Pharma Public Sector Undertakings, to make available quality generic medicines at affordable prices to all.

Road Ahead

In spite of some recent adverse developments, with the support of Pharmexcil and the Government in the form of Brand India Pharma project iPHEX, the sector would continue to grow and meet the healthcare requirements of the developing world.

The country will see the largest number of merger and acquisitions (M&A) in the pharmaceutical and healthcare sector, according to consulting firm Grant Thornton. A survey conducted across 100 companies has revealed that one-fourth of the respondents were optimistic about acquisitions in the pharmaceutical sector.

The pharma companies such as Cipla, Ranbaxy, Dr Reddy’s Labs and Lupin might soon be part of the government’s ambitious ‘Jan Aushadhi’ project. In an attempt to commercialise the project, the Government is likely to rope in the private sector to bulk-procure generic drugs from them.

Exchange rate used INR 1= US$ 0.01627 as on August 14, 2013

References: Consolidated FDI Policy, Department of Industrial Policy & Promotion (DIPP), Press Information Bureau (PIB), Media Reports, Pharmaceuticals Export Promotion Council