India’s pharmaceutical sector is ranked 4th in volume and 13th in value in the global pharmaceutical market. The Indian drug exports are growing at a rate of 30% percent annually according to Indian Government National Pharmaceutical Policy, 2006.

1. IIHMR NEWS VIEWS
The following article is in response to the article titled ‘Indian pharma sector still attractive for foreign
investors’published in pcquest on 23/04/14
India’s pharmaceutical sector is ranked 4th in volume and 13th in value in the global pharmaceutical
market. The Indian drug exports are growing at a rate of 30% percent annually according to Indian
Government National Pharmaceutical Policy, 2006.
Cost effective production of generic drugs is a major factor which makes India an attractive
destination for investment in the pharmaceutical sector. India’s export of generic drugs have been
growing at a rate of 24 percent over the past four years and in 2012 the country was recognized by
supply annual report of UNICEF as the global leader in supply of generic drugs. India has almost 200
United States Food & Drug Administration (US FDA) approved drug manufacturing facilities which
makes India the biggest foreign supplier of medicines to United states (US). Apart from
manufacturing India also has a cost advantage in terms of conducting clinical trials, and as a result
the clinical trial market is estimated to grow at 17 percent CAGR over 2009-15.
The introduction of product patent in India in 2005 has attracted the attention of many multinational
organizations who wants to invest exclusively in the new drug discovery area. India is opening its
avenues in the field of joint ventures and the same is welcomed by the multinationals also. Pfizer
signed an agreement with Aurobindo Pharmaceuticals (India) in March 2009 for multiple generic oral
solid and injectable drugs and extended the agreement in June 2009.

2. As an initiative to attract more foreign investors in India the Government of India has allowed 100
percent FDI through automatic approval route in the new pharma projects but the foreign investment
in the existing pharma companies needs approval from the foreign investment promotion Board
(FIPB). In view of the current initiatives taken by the government Glaxo Smithkline plans to invest Rs
864 crore (US$ 140.86 million) to setup a new plant in India. The plant is expected to be operational
by 2017.
Appropriate strategic planning taking into consideration the interests of the international and the
domestic pharmaceutical market is the need of the hour if the Indian pharma industry desires to
make its mark in the global pharmaceutical market.
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