The COVID-19 pandemic has made many countries realise that the pharma sector is a crucial pillar of the economy, and everything must be done to make it self-resilient. There’s a growing need for modernisation and increased investments. The case of India is no different despite the fact that we have a strong pharma industry.
The challenges are research and innovations, and these need massive funding. The government has been realising this recently under the leadership of Prime Minister Narendra Modi. With the budget session coming up, scaled-up funding is the only way for our growing pharma sector to emerge as a worldwide leader. India cannot afford to lose this opportunity.
Strengthening India’s hold as the biggest pharmacy market
Valued at $41.7 billion, India’s pharmaceutical sector is currently the third largest globally (by volume), and is expected to reach a valuation of $65 billion by 2024 and $120 billion by 2030, with vaccine supplies and generic drugs expected to accelerate further growth.
The first post-pandemic budget prioritised healthcare by a good proportion. With an allocation of Rs 124 crores, the budget set the tone for scaled-up investments and saw key initiatives being announced, including lifting certain caps on foreign investments to allow for greater stake and expenditure, imposition of duties and bankrolling COVID-19 vaccination (estimated at $1.8 billion).
What was also appreciable were plans of setting up of medical parks and making as many as 53 bulk drugs eligible for Production Linked Initiatives (PLIs). With the sector’s growth trajectory constantly on the surge, now is the onus to not just maximise the supply volume and production facilities, but also empower industry experts into developing newer, more adaptive and smarter drugs by augmenting the powers of R&D. These have all been observed to be significant in intensifying India’s position and role in the global pharma market.
Innovating and banking on our strengths will also be significant in tracking developmental and growth prospects, match global standards and harness the benefits of the ‘Make in India’ and ‘Discover in India’ initiatives, and set us through on a path towards becoming truly self-reliant and sufficient.
Investments can bolster pharma sector’s ‘Make in India’ dream
Prime Minister Narendra Modi’s clarion call last year, signalling the need for self-reliance and adequacy has brought along considerable benefits for industries and empowered economic gains. The pharma sector is just as much the beneficiary here. Increased emphasis on harnessing local resources, enlarging production facilities and stress on PLIs have paved the way for the sector to offset challenges and disruptions. Rallying towards atmanirbharta has also been quite the step forward in reducing our dependency on China for raw materials and requisite resources.
There’s a need for the upcoming budget to further build on these initiatives and supplement strategic funding. Timely and scaled-up investments will also be instrumental in carving the roadmap for modernisation and global acceptance, and becoming a medical leader in all ways.
Post-pandemic budget requires emphasis on R&D
The pharma and healthcare sectors are on the cusp of transformation. We are also likely to see more advancements in biotechnology, medical devices, biopharma and API production. Undoubtedly, both the government and the pharma sector must work in absolute synergy to accelerate the output. R&D has played a major role in undoing COVID damages and to continue our stride as a big market leader, we must bolster R&D and supplement it with necessary funding and investments.
‘Make in India’ has made India a leading tech marketplace and investment opportunity, with several foreign players establishing units here. The same approach is what we need for our pharma sector to emerge to greater heights. Higher funding, scaling-up of resources, allowing ease of access of doing business and foreign investments will also peg India as a great alternative for foreign pharma players who are slowly pulling out of China. It is time that the government considers tax incentives to attract innovation and consider substantial tax deductions. Strategising exports, harnessing local resources, job creation and maintaining high-quality manufacturing standards also require financial assistance, and should be prioritised in the budget allocation.
The pharma sector can also benefit with restored tax benefits offered on R&D expenditure, which would promote companies to infuse additional investments. Increased collaboration among stakeholders from the industry, academia, government and NGOs can also promote a robust research framework and reward innovation.
The pharma sector continues to be at the centre stage of the ongoing challenges and increased investments. To truly transform and occupy bigger market share requires consistent efforts over a long period of time. Transformation and changes appealing to this scale and size cannot be expected with a single budget or happen overnight. We should be truly cognizant of the fact, and, in our aim to become self-sufficient, maximise trade, both the private and public players need to work in tandem, showcase grit and determination to take Indian pharmaceutical world to greater heights, and most of all, ensure a better and healthier future for the world.