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Pharma

Industry Summary

  • India is third in volume terms and fourteenth in value terms. Primarily due to being mostly a generics-dominated market.
  • Global spending of medicines is expected to surpass $1.1 trillion by 2024.
  • Domestic pharma market estimated at USD 42 billion in 2021. Likely to reach USD 65 billion by 2024 and USD 120-130 billion by 2030.
  • Despite being major exporters of certain drugs, major drug requirements are met from imports which is 25% of total Indian pharma industry
  • Drug and pharmaceutical exports of USD 24.44 billion in FY 21 with India being the 12th largest exporter of medical goods

Value Chain

Step 1

R&D

Formulation in case of new and modification/adjustment in case of old drugs

Step 2

Trials

Step 3

Approval

Patenting for new drugs/ modification

Step 4

Distribution

Pharmacies, Hospitals and Clinics

Step 5

Promotions

Pharma Rep-HCP interactions, speaker programs, online promotions

Cost Drivers

  • R&D
  • Patent filing
  • Manufacturing
  • Distribution
  • Promotional Activities

Revenue Drivers

  • Sales of drugs
  • Patent licensing
  • Exporting Drugs
  • Penetration
  • Insurance premiums

Growth Drivers

  • Specialty medicines
  • Telehealth (Tech-driven healthcare)
  • Rare diseases
  • Ayushman Bharat scheme
  • Outlay of INR 197,000 crores over 5 years for pharma PLI scheme
  • FDI inflow of US 18.12 billion between April 2000 to June 2021

Key Customers

  • HCPs
  • Households
  • Hospitals, Clinics and Nursing Homes

Key Players

  • Sun Pharma
  • Dr. Reddy's Labs
  • Divi Labs
  • Cipla
  • Aurobindo Pharma
  • Zydus Cadila

Channels

  • Direct sales
  • Online selling