Pharmaceuticals - India Brand Equity Foundation
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Transcript Pharmaceuticals - India Brand Equity Foundation
Indian Pharmaceutical Industry
Riding a Growth Wave
March 2005
Pharmaceuticals
India - An Overview
Market and Growth Potential
Players
Opportunities
Why India?
Contact in India
March 2005
India - An Introduction
Population
Over 1 bn
States/UTs
35
Geographical Area
3.3 mn sq kms
Languages recognised
22
Business language
English
Per Capita Income**
US$ 534
GDP**
US$ 650 bn
**(at factor cost & at current prices)
1USD=43.54 INR (as on July 4, 2005)
Source:CSO Statistics
India - Fast pace Growth
Largest democracy
4th largest economy by PPP index
6th largest energy consumer
ForEx reserves skyrocket from US$ 42 bn (2001) to
US$ 133 bn (February, 2005)
GDP growth to continue between 6-8%
3rd largest economy by 2050: Goldman Sachs
Leading in IT & BPO
Oil & Gas and Biotechnology sunrise industries
March 2005
India - Leading the world
Hero Honda - largest manufacturer of motorcycles
Moser Baer - 3rd largest optical media
manufacturer in world
Pharmaceutical Industry - 4th largest in world
Walmart, GAP, Hilfiger sources more than
USD 1bn worth apparel from India
100 Fortune 500 have set R&D facilities in India
including GE, Delphi, Eli Lilly, HP, Heinz and Daimler
Chrysler
March 2005
Pharmaceuticals
India - An Overview
Market and Growth Potential
Players
Opportunities
Why India?
Contact in India
March 2005
Pharma Market
Size (2002-03)
US$ 7 bn
Size 2010 (estimated)
US$ 25 bn
CAGR(1995-2002)
16.6%
Exports
23%
CAGR(1995-2002)
Volume – wise
8% of global market
4th largest in the world
Share of formulations
March 2005
80%
Exports
India - Net exporter of pharmaceutical products
Exports (2002-2003)
US$ 2.8 bn
CAGR (over last decade )
26%
Rate of growth (2003)
21%
Export destinations
US, Germany,
Russia, UK and
China
March 2005
Increased R&D Focus
Shift from business-driven research
to research-driven business
March 2005
Increasing R&D Spend
1996 -2002
Annual recurring R&D expense growth rate
March 2005
32.3% yoy
Resurgence of FDI
Resurgence of FDI in the Pharma Sector
Source: CMIE
100% automatic FDI approvals
to aid increased investment in
R&D infrastructure by MNCs
March 2005
Quality Assurance in Manufacturing
India has the highest number of USFDA approved
plants outside the US
Manufacturing facilities
GMP compliant
Approved by international bodies - US FDA, UK MCA,
South African MCC
March 2005
Pharmaceuticals
India - An Overview
Market and Growth Potential
Players
Opportunities
Why India?
Contact in India
March 2005
Domestic Players
Ranbaxy
Laboratories
Largest pharma company in India;
Annual revenues of US$1bn
Dr Reddy’s
Laboratory
Indian company with presence in
more than 50 countries
Nicholas Piramal Aggressively investing in R & D
Cipla
One of the lowest cost manufacturer
of anti-HIV drugs in the world
Wockhardt
Largest Indian pharmaceutical
company in UK
March 2005
MNC Presence in India
GlaxoSmithKline Leads in 6 of the 10 therapeutic
categories
Pfizer
Owns the two largest selling
brands in India
Astra Zeneca
Involved in cardiovascular,
respiratory, maternal healthcare
& pain control and anasthesia
Aventis
Indian manufacturing sites identified
as potential global sourcing units
by global parent company
March 2005
MNC Presence in India
Merck
Leader in laboratory reagents
market in India
Novartis
Collaborations with
Dr Reddy’s and Torrent
Wyeth
Contract-manufacturing tie-up
with Indian major Bharat Biotech
Sanofi-Synthelabo Present in cardiology,
thrombosis & neuropsychiatry
Roche
March 2005
Already invested US$ 20 mn in
India and plans additional
US$ 7.35 mn in 2004-05
MNC Activity in India
Novartis AG seeking tie-ups with Indian companies
Bristol-Myers to enter India again
Aventis’s Goa unit to be sourcing hub
Pfizer India doubles research investment in India
AstraZeneca, Glaxo to make India R&D hub
Chiron to make India its Asian hub
Bayer AG to make India sourcing hub
Eli Lilly to make India sourcing hub
German major Boehringer Ingelheim to enter India
India to be Roche's global hub for bulk drugs
March 2005
Pharmaceuticals
India - An Overview
Market and Growth Potential
Players
Opportunities
Why India?
Contact in India
March 2005
Invest in India
Contract Research
Clinical research
USD 70 mn market (2001-02)
Growing at 20% per annum
Outsourcing - fastest growing
area for new investment
US$ 1 bn opportunity by 2010
March 2005
Invest in India
Custom synthesis
Largest pool of trained analytical
and development chemists
Excellent track record of innovation
US FDA approved manufacturing
facilities
30-50% cost savings
March 2005
Invest in India
API sourcing and
contract
Global Outsourcing opportunity
worth US$ 15 bn by 2010
manufacturing
Global majors to outsource
manufacturing from India
March 2005
Invest in India
Collaborative R&D
Pre clinical testing
Superior and low cost chemical synthesis
skills advantages
Clinical trials
India to be an outsourcing centre for conducting
low cost clinical trials
GlaxoSmithKline has R&D alliance with
Ranbaxy Laboratories
March 2005
Export from India
Source: SSKI
Exports drive growth for Indian pharmaceutical majors
March 2005
Export from India
Source: SSKI
Generics - The key driver for export growth
March 2005
Partner with India
Marketing alliances - A win-win strategy
Increased market penetration
Zydus Cadila has strategic agreement with Schering AG
Nicholas Piramal has 5 year strategic alliance with
Biogen Idec
March 2005
Partner with India
New Drug Delivery System (NDDS)
Process reengineering expertise
Low-cost scientific manpower available
Low capital requirement for NDDS research
Fast clearances from regulatory authorities
March 2005
Pharmaceuticals
India - An Overview
Market and Growth Potential
Players
Opportunities
Why India?
Contact in India
March 2005
Advantage India
Excellent chemical synthesis skills
Successful scaling up of laboratory processes to plant-size
Cost-effective and commercially viable non-infringing
processes
Pool of low-cost and highly skilled medical professionals
Manufacturing facilities of international standards
Quick absorption of new technology
March 2005
Indian Pharmaceutical Act
Reduction in number of drugs under price control to 28 as
against 74
100% foreign investment automatically permitted
Abolishment of industrial licensing for bulk drugs,
intermediates and formulations
Automatic approval for Foreign Technology Agreements
March 2005
Regulatory Scenario
IPR/Patent regulations
Product patent regime to be implemented by Jan 1 2005
in compliance with TRIPS
No. of Drugs under Price contro l
Price regulations
Price controls decline substantively
370
143
74
28
(E)
1979
1987
1995
Product and quality regulations
March 2005
2005
Policy Incentives
Tax exemptions at par with IT
Reduction in peak custom duties from 30% to 25%
Increase on rate of depreciation on life saving
equipment from 25% to 40%
Income from royalty on drugs licensed to foreign
companies exempted from tax
Tax holiday for R&D companies
March 2005
Union Budget 2005-06
Key Features
• 22% increase in allocation under the National Rural Health
Mission
• Formation of a SME Growth Fund to provide equity support to
small & medium units in the pharmaceutical & biotechnology
sectors.
• Import duty on select equipments used in pharmaceutical &
biotech research reduced from 20% to 5%.
• 150% weighted deduction on R&D expenditure
Fillip to R&D initiatives
March 2005
Pharmaceuticals
India - An Overview
Market and Growth Potential
Players
Opportunities
Why India?
Contact in India
March 2005
Contact in India
Confederation of Indian Industry (CII)
23, Institutional Area
Lodi Road
New Delhi – 110003
Tel 0091 11 24629994-97
Fax 0091 11 24626149/24615693
Email [email protected]
March 2005