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Domestic sales to drive demand in next three to five years: UBM India survey

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The main risk factor recognised by the international respondents is the over-dependence on Chinese sourced APIs, particularly in India’s generics sector

Just over half of the respondents (53 per cent) to a UBM India survey believed that domestic sales within India would be stronger than exports in driving demand in the next three to five years, in contradiction to the usual perception that the Indian pharmaceutical industry is an export-led marketplace. The executives were split on which parts the supply chain will experience the strongest growth, with finished formulation (55 per cent) and API (48 per cent) identified as possessing excellent near term potential – emphasising the country’s diversity of drug manufacturers. The findings also showed that international companies are estimating 24 per cent growth in India over the next year, mirroring previously announced domestic manufacturers’ exceptional confidence in the market’s prospects.

The main risk factor recognised by the international respondents (63 per cent) – and shared by the domestic market in a separate survey – is the over-dependence on Chinese sourced APIs, particularly in India’s generics sector. Yet conversely, 73 per cent perceived that Indian APIs are of higher quality than those produced in China, which suggests there may be good potential for further international sales of Indian-made ingredients and exports.

The results of this survey were announced by UBM EMEA and UBM India, organisers of CPhI & P-MEC India 2016, following the closing of the first CPhI India Pharma Week in Mumbai. The seven-day event reportedly saw 42,206 visitors and 1,423 exhibitors attend the BEC/BKC Centres to celebrate 10 years of CPhI India.

“A strong domestic market does not only give confidence to local and regional manufacturers, but to the whole of the pharma industry. I think that the biggest opportunity for India to grow is to take back control of their API sourcing, instead of importing from China. The Indian industry needs to produce its own ingredients and intermediates, grow its manufacturing quality and exploit its expertise in regulated markets in order to keep growing,” noted one international respondent.

The reputation of the country across data integrity has also improved massively, as 96 per cent agree that the CDSCO certification programmes and initiatives are helping increase compliance. Even more impressive is the fact that 52 per cent of respondents believed the CDSCO is moving forwards to be comparable with regulatory standards of the EMA and FDA – with the remaining 48 per cent believing there is the intention to become so in the near future. Interestingly, 92 per cent of respondents stated that they would invest more in India if quality systems are improved further.

As a result of these positive market conditions, 55 per cent of international respondents are planning acquisitions or partnerships in India over the next few years. Chief reasons for this are: the desire of international companies to ‘lower the cost of manufacturing and export pharmaceuticals out of India’ (58 per cent), as well as overseas companies looking to sell ‘both domestically and internationally’ (33 per cent).

The complete findings of the UBM India survey will be published in the CPhI Pharma Insights India Report.

 

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