The document presents an overview of the Indian pharmaceutical industry, highlighting its evolution from minimal presence in the 1970s to becoming a global leader in generic medicines today. Key points include significant growth in market size, government initiatives like 'Pharma Vision 2020', and a robust export market, with exports valued at $16.8 billion in FY17. Despite challenges such as high competition and regulatory constraints, the industry is projected to continue growing, reaching an expected market size of $55 billion by 2020.

1. Indian pharmaceutical
industry
Presented by:
Dhruv Seth
Kushal shah
Urvi shah

2. Flow of the presentation
• Evolution of the indian pharmaceutical industry
• Introduction
• Major player
• SWOT
• Indian scenario
• Global scenario
• Future outlook
• Conclusion

3. Evolution of Indian pharmaceutical
sector
1970-1990
• Patent act
1970
• Domestic
companies
• Production
and export
initiative
taken
1990-2010
• Operations in
foreign
countries
• Liberalized
market
• Generic drug
2010
• Nppp-2012
• Patent filling
by pharma
players
• Kam and cso
• (key account
management)
• (contract
sales
organization)
2010-2015
• Price reduce to
80%(2013)
• Fdi (100%)on
medical devices
• 10,500
manufacturing
units and 3000
pharma industry
2016
• In union
budget,2016,fdi
increased
74%in existing
pharmacy
companies.
• “pharma vision
2020”

4. Introduction
• In 1930,in Calcutta the first pharmaceutical company called Bengal
chemicals and pharmaceutical works which still is today as one of 5
government owned drug manufacturer started.
• The history of Indian pharmaceutical market in 1970’s was almost
non existant.today,india has gained immense importance and
carved a niche for itself in the pharmaceutical domain.
• India pharmaceuticals market ranks third in the world in terms of
volume and 14th in terms of value.
• The government of India unveiled “pharma vision 2020”aimed at
making india a global leader in end to end drug manufacturer.

5. • Pharmaceuticals exports from India stood at US$ 16.64 billion in FY
2016-17.
• Multinational companies are collaborating with Indian pharma firms
to develop new drugs
• Government of India is planning to set up an electronic platform to
regulate online pharmacies under a new policy
• Indian pharma companies spend 8-13 per cent of their total turnover
on R&D
• Under Union Budget 2017-18, new 5,000 postgraduate seats in
medical colleges were announced by the government, to ensure
availability of specialist doctors.
• In this sector ,100 percent FDI is allowed under automatic route.

6. INDIAN PHARMA MARKET
• The Indian pharmaceuticals market witnessed growth at a CAGR of
5.64 per cent, during FY11-16, with the market increasing from US$
20.95 billion in FY11 to US$ 27.57 billion in FY16. The industry’s
revenues are estimated to have grown by 7.4 per cent in FY17.
• India’s cost of production is significantly lower than that of the US
and almost half of that of Europe. It gives a competitive edge to India
over others.
• Medicine sales in India increased 8.1 per cent year-on-year in
November 2017

7. Market leaders
Top 9 Publicly Listed pharmaceutical companies in India by Market
Capitalization as of 2017.
RankCompany Market Capitalization 2017 (INR crores)
1 Sun Pharmaceutical Rs 1,55,716 Crore
2 Lupin Ltd Rs 68,031 Crore
3 Dr. Reddy's Laboratories Rs 49,293 Crore
4 Cipla Rs 47,319 Crore
5 Aurobindo Pharma Rs 41,283 Crore
6 Zydus Cadila Healthcare Rs 31,631 Crore
7 Piramal Enterprise Rs 30,975 Crore
8 Glenmark Pharmaceuticals25,302 Crore
9 Torrent Pharmaceuticals Rs 22,742 Crore

8. IMPACT OF GST IN INDIAN PHARMA
• There are two key things that have changed are the manufacturing price-
many raw materials for API and products have moved from 5% vat backet to
12% GST bracket and a lot of medicine salts/compounds have moved from
5% to 12% GST bracket.
• We need to understand the margins at which the supply chain operates. The
C&F(carrying and forwarding agents) agent operates at 4-6% margin on
MRP, distributor wholesaler operates at 7-8% margin on MRP and retailers
at 20% margin on medicines.
• To sum it up, pharmaceutical industry in India is over USD 100 billion and at
any point of time 15-18% hold in the inventory section. So, even a 3-4% loss
in overall value chain on 15 billion dollars accumulates to USD 600 million
losses for the industry, a lump sum amount. With time, we will see the fullest
impact of GST and take steps accordingly

9. GENERIC DRUGS FORM THE LARGEST
SEGMENT OF INDIAN PHARMA MARKET
• With 70 per cent of market share (in terms of revenues), generic
drugs form the largest segment of the Indian pharmaceutical sector
• India supplies 20 per cent of global generic medicines market
exports, in terms of volume, making the country the largest provider
of generic medicines globally and expected to expand even further
in coming years
• Over the Counter (OTC) medicines and patented drugs constitute
21 per cent and 9 per cent, respectively, of total market revenues of
US$ 20 billion

10. • The share of generic drugs is expected to continue increasing;
domestic generic drug market is expected to reach US$ 27.9 billion
in 2020
• Due to their competence in generic drugs, growth in this market
offers a great opportunity for Indian firms
• Generic drug market is expected to grow in the next few years, with
many drugs going off-patent in the US and other countries
• Domestic generic drug market has reached US$ 26.1 billion in 2016

11. PHARMA EXPORT TO CONTINUE
WITNESSING HIGH GROWTH
• Indian pharma companies are capitalizing on export opportunities in
regulated and semi-regulated markets
• In FY17, India exported pharmaceutical products worth US$ 16.8
billion, with the number expected to reach US$ 40 billion by 2020.
During April – November 2017, India exported pharmaceutical
products worth Rs. 549.56 billion (US$ 8.49 billion).
• Indian drugs are exported to more than 200 countries in the world,
with the US as the key market

12. • India is the world’s largest provider of generic medicines; the
country’s generic drugs account for 20 per cent of global generic
drug exports (in terms of volumes)
• Around 40.6 per cent of India’s US$ 16.8 billion pharmaceutical
exports in 2016-17 were to the American continent, followed by a
19.7 per cent to Europe, 19.1 per cent to Africa and 18.8 per cent to
Asian countries.

13. PHARMA GIANTS RAISE THEIR R&D
SPENDING
• In FY17, highest expenditure on research and development has
been done by Sun Pharma, followed by Lupin
• Sun Pharma’s R&D spending is 7.6 per cent of the total sales in the
FY17 , which grew at a CAGR of 38.3 per cent from FY11 to FY17.
• Sun Pharma’s R&D plan includes developing more products
through expanded R&D team for global markets, focusing on more
complex products across multiple dosage forms and investments in
specialty pipeline
• Lupin’s R&D spending was 13.5 per cent of sales in FY17, with
major thrust on oral solids (45 per cent of R&D spend)

15. (P)political Factors
*Political uncertainty
*Stringent Price Control
*Irrespective cost of the real costs
*Reverse-engineering route implied
*Finished products costlier
(E)conomic Factors
*Small proportion of its GDP on healthcare
*Non-standardized medication.
*Taxes are very high
*Registered Medical practitioners is low
*Cost of goods high
(S)ocio-cultural Factors
*Malnutrition dramatically exacerbate.
*Poor Sanitation and polluted water
*Household treatments pursue more
*Superstitious thinking among people
*Healthcare problem
(T)echnological Factors
*Advanced automated machines
*Computerization has increased
*Newer drug delivery systems are the
innovation
*Ayurveda is a well-recognized
science in india.

16. Strength
• Strong manufacturing base
• Cost effective
• Availability of high quality skilled workforce
• Excellent marketing and distribution network
• Diverse ecosystem

17. Weakness
• Low investments in innovative R&D
• The ability to compete with MNCs for New Drug Discovery, Research and
commercialization of molecules on a worldwide basis due to lack of
resources.
• Diffused nature of the Indian pharmaceutical industry means that only
about 20 to 30 companies are large enough to bear the transactions
costs associated with sustained exports to and compliance with entry
regulations of the developed markets
• Strong linkages between industry and academia which are essential for
growth of the industry is lacking in India.
• Manufacturer of fake and low quality medicines.

18. Opportunity
• Increased export potential
• Marketing tie ups with multinational companies to sell their products
in domestic market.
• Immense scope to position india as a centre for international clinical
trials.
• Key player in global pharmaceutical r&d.
• Exports of generic drugs to developed markets.

19. Threats
• The new MRP based excise duty regime threatens the business of
smaller pharmaceutical companies.
• Lowering of tariff protection has increased competition in domestic
markets resulting in erosion of profitability
• Drug Price Control Order puts unrealistic ceilings on product prices
and profitability.

20. Conclusion
• The Indian pharmaceutical company is the fastest growing
industries in the world competing with the global pharmaceutical
industries.
• It is in the front rank of India's science based industries.in the post
independence era that is post 1947 the Indian pharmaceutical
company was completely dominated by multinational
companies(mncs)and drug price in India was among the highest in
the world.
• The India pharma market is expected to grow usd 55 billion by
2020,therby emerging as the sixth largest pharmaceutical market by
absolute size.

21. Thank
you