Team Pharma Sees Many Medals Along The Way

New Delhi, Aug 24 | Updated: Aug 25 2004, 05:57am hrs
Indian pharma players see themselves capturing a bigger chunk of the $40 billion global sweepstakes opening up over the next few years. They believe they can rake in revenues of $3.2 billion by December 2005 and $5 billion by 2008.

Expanding on this optimism, a survey by the Federation of Indian Chambers of Commerce and Industry (FICCI) said there has been a marked shift among Indian players. They have moved from investment in re-engineering of molecules to investment in new chemical entities (NCE) and novel drug delivery systems.

The survey was conducted with 12 of India’s top domestic pharma companies with revenues ranging between Rs 200 crore and Rs 4,000 crore. This includes Ranbaxy, Dr Reddy’s Labs, Jubilant Organosys, Lupin Labs, Cadila Healthcare and Wockhardt.

The survey said more and more Indian companies are now focusing on their core competencies. These include low-cost manufacturing, world-class quality products and low cost drug discovery. While the manufacturing cost of Indian companies is almost 50 per cent below that of multinationals in the US and Europe, the cost of drug discovery in India is almost one-tenth that of the western world.

The respondents saw these as building blocks of an attractive destination for contract manufacturing and research.

Among the 12 respondents, nine are already engaged in contract manufacturing and three in contract research.

Apart from that, Indian companies have been aggressive in having a global presence. This includes forays into regulated markets like the US and European Union. These markets have been included in their future growth plans. Further, eight of the 12 respondents already have a presence in the US and six have subsidiaries.

While the focus for many years has been on anti-infectives, it is now shifting decisively in favour of lifestyle drugs. These include therapeutic segments like cardiovascular, anti-diabetic and central nervous system (CNS), says the survey.

The respondents have also suggested a few steps that need to be taken by the government to maintain and improve the competitiveness of the domestic industry. These include customs duty on R&D consumables to be abolished, higher expenditure by the government on healthcare which will help local industry to scale up for competitiveness, income-tax exemptions on clinical trials done outside the company and abroad, and generic-friendly data exclusivity rules for India.

The survey said out of the $40 billion worth of drugs going off-patent, a $6 billion opportunity will open during 2006. Some of the major drugs going off-patent include pravastatin, simvastatin, lovastatin and pioglitazone. The companies that hope to explore these opportunities include Ranbaxy, Lupin, Micro Labs, Cadila Healthcare, Torrent Pharma and Jubilant Organosys.