What are the broad global consumer health trends driving the global biopharma sector this decade?
We believe that global consumer health is moving towards a continuum of care in chronic disease pools. The continuum is increasingly being shaped by the lifestyle, pollution, and aging population as the key drivers. These pools are concentrated mainly across metabolic health, antiageing, skin and cosmetics, women’s health, gut health, sleep, immunity and preventive care. The scale is already material. We estimate the global wellness opportunity in Over-The-Counter (OTC) drugs at about $200 billion while dietary supplements another ~$210 billion.
The clinical backdrop is also supportive to this trend: we acknowledge that clinically it is estimated that globally every one in six adults is obese, and about one in eight has diabetes.
For Indian biopharma, we believe the key strategic pivot is that consumer health is becoming more science-led, with better opportunities in Rx-adjacent products where efficacy, trust and medical credibility matter. To simply put, it is pivoting from FMCG play to more a science/value play.
How are biopharma companies in India converting these trends into new revenue strategies?
Our report on India healthcare highlights that Indian biopharma is increasingly building higher-value franchises across chronic therapies, derma, nutrition, women’s health, metabolic adjacencies, complex dosage forms, biologics, sterile manufacturing and CDMO. We believe India’s domestic pharma market at about $25- 27 billion will nearly double to about $60 billion over the next decade and chronic therapies form the largest part of this growth story in our view.
India also supplies roughly 20 per cent of global generic medicines by volume. The revenue strategy is gradually shifting from adding more SKUs to owning patient conditions through HCP education, differentiated delivery, point of care diagnostic, adherence support, and regulatory simplification in new product/therapy launches.
How much impact will geopolitical disruptions like various US tariffs (e.g. USTR Section 301, Section 232) various conflicts etc. have on the long term profitability of India’s pharma companies?
We believe that geopolitics should be treated mainly as a margin, supply-chain and working-capital risk. In our view, global demand for prescription drugs, particularly in chronic therapies as well as in the OTC segment is relatively resilient, and India remains structurally important to global generics supply. The current pressure points in our view are reliable procurement channels, compliance to highest quality standards for these global supplier bases, and higher logistic costs.
We estimate that India’s pharma exports are around $30-31 billion, with regulated markets contributing roughly half of these exports. On the import front for the sector, we estimate that the API, bulk drug and intermediate imports are about $4.5- 5 billion in the last financial year with China continuing to dominate at nearly 74 per cent of this import basket. In our view, the recent geopolitical pressures from regional conflicts stretches this import burden while delaying realisation of exports in the short term. In the medium to long term we believe that the redrawn supply chains will increasingly put Indian biopharma in the global sweetspot and thus improve sector profitability. Furthermore, we estimate that the global sales prices realised (ASP) for majority drugs are nearly bottoming with early signs of reversal, and this in our view will boost industry margins and volumes materially.
In summary, we believe that in the short term the overhang on US tariffs, Section 232 or equivalent probes in regulated markets, China-linked supply disruptions and conflict-led freight volatility will pressurise margins. Longer term, we estimate Indian biopharma to be an integral part of redrawn supply chains in the global healthcare spend.
Specifically, what are the niche areas where India’s biopharma players are positioning themselves to transition from a volume to value, generics to innovation model?
We believe Indian biopharma is pivoting from quantity driven to quality led innovation. Our report suggests that the strongest value migration for Indian biopharma is in niche asset areas that require process and engineering depth and global market presence rather than pure patent expiries. We believe these include peptides, complex injectables, 505(B)(2) NDAs, orphan drugs, bio-betters and supplementary biologics, highpotency APIs, drug-device combinations. We also believe this is moving (from) a typical CDMO space towards Pharma as a Service (Paas). Our report suggests that this volume-value transition will potentially unlock additional $120-125 billion in revenues over the next decade and will be global in its reach.
We believe that the global regulatory and policy backdrop supports this shift. Biosimilars are also becoming mainstream, with the global market around $30–33 billion in 2024 and more than 75 biosimilars approved by the US FDA by late 2025. Similarly, 505(B)(2) and new drug development guidelines (are) increasingly conducive for the industry, and Indian policy makers (are) unlocking sectoral measures such as Bioshakti, PLI and PRIP schemes.
Will the GLP-1 opportunity turn out to be lower than initial forecasts, as the increasing competition reduces profit margins? How are the leading players planning to retain consumers/patients, given the CDSCO’s close watch on promotional vs educational content?
Our view on India’s overall GLP-1 market is modest and borderline neutral. We expect the India market to peak at about $2–2.5 billion with a high competitive intensity, despite the global excitement around the category. We acknowledge that the Indian population has a large addressable patient pool, with estimated ~100mn people living with diabetes and around 136mn with prediabetes. However, we believe that the monetisation and actually serviced market in India is limited due to affordability, India’s socio-cultural patterns on food habits and lifestyle, limited reimbursement and social perception.
Our research suggests that barring higher income strata and certain metropolitan markets, obesity is still not widely viewed as a disease in India, so awareness education will (be) required to precede treatment. Against the backdrop of regulatory watch on promotional versus educational content, patient retention will depend on compliant HCP-led initiation, nutrition counselling, titration support, side-effect management, refill reliability and affordability, rather than aggressive consumer-led promotion.
viveka.r@expressindia.com
viveka.roy3@gmail.com