By Karishma Atul Shah and Hari Natarajan
The Rs 5,000-crore Promotion of Research & Innovation in Pharma-MedTech (PRIP) scheme offers the pharma sector an opportunity to build IP-driven products and not just remain a generics powerhouse, explains Karishma Atul Shah and Hari Natarajan
What is the PRIP scheme?
Last week, the department of pharmaceuticals (DoP) invited applications for research and innovation projects under its 5,000-crore PRIP scheme which plans to support around 300 projects involving total R&D investment of about11,000 crore in new medicines, complex generics, biosimilars and novel medical devices. The scheme aims to transform India’s pharmaceutical ecosystem from being primarily generic-driven to a hub of innovation-led globally competitive entities.
By offering financial support for R&D infrastructure, technology development, and product commercialisation, the scheme will empower domestic players to undertake high-risk research. For early-stage projects, MSMEs and startups can receive assistance of up to 5 crore for projects costing up to 9 crore.
For later-stage projects costing up to 285 crore, the assistance can reach up to 35% of the project cost, subject to a maximum of 100 crore. By incentivizing patents, indigenous technologies, and product differentiation, PRIP will help firms build proprietary portfolios, reducing dependence on imported technologies.
Are these incentives enough for driving R&D?
The incentives under the PRIP scheme represent a strong policy push, but their success depends on the scale and sustainability of support. PRIP’s incentives are a commendable beginning that will energise emerging innovators and companies in a new innovation-driven direction. The financial assistance and research linked incentives will certainly bridge the funding gap for R&D, discovery research and biosimilar development that are capital intensive with long gestation periods. It will help companies take the first steps in developing complex generics, biosimilars, and new medical devices. But creating new chemical entities or breakthrough drugs needs large investments, advanced research facilities, and long timelines; and for this, India will need not just funding but also faster regulatory approvals, better protection for patents, skilled research talent, and more private funding.
Challenges for participating firms
Participating companies under PRIP may face several structural and operational challenges. Firstly, translating innovation from the laboratory to the market requires long timelines, regulatory clarity, and consistent funding. These are critical areas where India still has to do a lot of work. Smaller firms, despite keen interest, may struggle to meet eligibility criteria or sustain projects through the complex cycle. Managing collaborations between academia and industry can also be challenging due to differences in pace, priorities, and intellectual property management.
Furthermore, limited availability of high-end research talent, costly clinical trials, and inadequate testing infrastructure could hinder progress. Ensuring alignment with global quality standards, especially for biosimilars and medical devices, is critical.
Thus, while PRIP offers an enabling platform, success will depend on how efficiently companies can integrate innovation strategy, partnerships, and discipline within the scheme’s operational framework. It also hinges on continuous policy alignment with evolving global trends that are ever shaping the market dynamics.
What else is required?
Strengthening academia-industry linkages through shared research centers, technology incubators, and translational hubs is vital. A predictable and supportive regulatory environment with faster clinical trial approvals and well-defined pathways for biosimilars and novel drugs would accelerate commercialization. Enhancing intellectual property enforcement and offering tax benefits on R&D expenditure can further motivate innovators. Skill development programmes for scientists, data analysts, and regulatory professionals are equally essential to raise innovation capability. Moreover, fostering venture capital participation, public-private partnerships, and global research collaborations will ensure sustainability. Digital and AI-enabled research platforms can also enhance efficiency in drug discovery.
Likely outcomes
First, it will stimulate a surge in R&D investments, leading to the development of indigenous technologies, biosimilars, and complex generics. Over time, it should help establish a network of world-class research centres, strengthening India’s position as a global innovation partner. Second, the scheme will encourage startups and MSMEs to enter high-value segments. A stronger innovation pipeline will improve healthcare accessibility and enhance export competitiveness. Third, the collaborative framework between industry, academia, and government will build an ecosystem for continuous innovation. Ultimately, PRIP could help reposition India’s pharma identity from being primarily a volume-driven, generics powerhouse to a value-driven, discovery-led industry.
The writers are founders and managing partners of Pronto Consult