1. Pharmaceutical exports may see a sharp decline: Crisil

Pharmaceutical exports may see a sharp decline: Crisil

The pharmaceutical formulation exports are likely to see a sharp decline of 10-12% annually over the next five years, compared to a growth of about 19% seen in the last decade.

By: | Hyderabad | Published: May 18, 2016 7:19 AM

The pharmaceutical formulation exports are likely to see a sharp decline of 10-12% annually over the next five years, compared to a growth of about 19% seen in the last decade.

Further, export of generics, which have been the growth engine of the industry for a long time, may also see a change because the value of drugs going off-patent is declining even as pricing pressures are increasing, says a Crisil Research report.

As game changes, companies need to redraw long-term strategies and focus on innovation, the report highlighted.

The annual sales growth of generic drugs in the US, the largest generics market, is seen slowing to 8-9% over the next five years and decelerate even more after that. Therefore, for growth to sustain beyond 2020, domestic companies will have to step up investments in new molecules and draw up a roadmap to deal with lower generics growth, the report said.

In the past decade and more, what came in handy was process chemistry skills – which helped companies clone drugs going off-patent by tweaking their molecules – and low-cost manufacturing.

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