Even before, corona virus pandemic strike the world, India has been the global pharmaceutical hub and has been supplying vaccines and generic medicine to many developed and under developed countries.
As COVID 19 crisis took the world by surprise, many nations, even developed nations were looking towards India to meet their pharmaceutical requirements. India on its part did supply hydroxychloroquine, paracetamol, other drugs that was initially believed provide some relief to COVID patients.
When it was found that China did not inform the World Health Organisation (WHO) about the seriousness of this virus, countries like Japan, Australia and South Korea started looking for alternatives to reduce their trade dependence on China due to growing concerns of mistrust against Chinese administration on their role in handling COVID 19 in their own country and its spread across the globe.
Taking the cue of this, India has pitched itself as the global hub for meeting world’s pharmacy needs and there are many companies, like Cipla, Dr Reddy’s, Serum Institute of India, others that can be a anchor for foreign investors.
Indian pharmaceuticals sector is globally respected and is one of the most successful industries in India.
Indian pharmaceuticals market for first and branded generics accounts for 70% to 80% of the retail market. Second, local players have enjoyed a dominant position driven by formulation development capabilities and early investments. The industry will grow to USD $55 billion by 2020 driven by a steady increase in affordability and a step jump in market access, according to McKensiy report ‘India Pharma 2020 Propelling access and acceptance, realising true potential.’
According to PwC estimates, the industry is estimated to touch approximately US$30 billion by 2020, as compared to USD $11 billion recorded in March 2009.
PwC also said that the domestic market is very fragmented; more than 10,000 firms collectively control about 70% of the market. Many of the local players are generics producers specialising in anti-infectives.
Giving details on the investment made in the sector, PwC said that investors confidence has remained fairly stable and deals continue despite challenges. Private equity players and investment funds played an active role in the deal market. Citi Venture and Everest Capital invested US$23.6 million in Nectar Lifesciences; Kotak Private Equity Group, an arm of Kotak Mahindra Bank pumped US $10 million in Intas Biopharmaceuticals; Gujarat Biotech Venture Fund invested US $12.7 million in Century Pharmaceuticals; and SME Growth Fund invested US$7 million in Centaur Group.