Indian Research Notes: F – Forecast, CAGR –

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Last updated: April 20, 2019

Indianpharma sector is estimated to account for 3.

1- 3.6 %of the global pharma industry in terms of value and 10 % in value terms. It isestimated to grow to 100US$ billion by 2025. India accounts for 20 per cent of global exports ingenerics. India’spharmaceutical exports stood at US$ 16.84 billion in 2016-17 and are expected to reach US$ 20billion by 2020.

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During April – September 2017, India exported pharmaceutical products worth Rs.411.3 billion (US$ 6.4 billion). During April – October 2017, India exported pharmaceutical products worth Rs.478.3 billion (US$ 7.

4 billion).     Figure 1: Revenue of Indian pharmaceuticalsector ($ billion)Source:Department of Pharmaceuticals, PwC, McKinsey, TechSci Research      Notes: F – Forecast, CAGR – CompoundAnnual Growth Rate  The market size isexpected to grow to US$ 55 billion by 2020 and become the 6thlargest pharmaceutical market globally by absolute size. Branded generics withnearly 80% of market share will dominate the pharmaceuticals market (in termsof revenues).  According to datafrom the Ministry of Commerce and Industry, India has out- performed China inpharmaceutical exports with a YoY growth of 11.44% to US$ 12.91 billion in FY2015-16, on other hand imports rose marginally by 0.

80 % YoY to US$ 1,641.15 Million. Figure 2:Projected size of Indian Pharma market in $ billion       Source: Mckinsey Analysis, secondaryResearch Figure 3:Formulation and Bulk Drugs Export Outlook:  Source:CRISIL research; KPMG in India analysis The US Food and DrugAdministration (USFDA) approved 201 in FY 2015-16 drugs of Indian companies,nearly doubled from 109 in FY 2014-15. India accounts for around 30% (byvolume) and about 10% (value) of US generics market which stood at US$ 70-80billion in 2015-16.  India’s biotechnology industry made ofbio-agriculture, bio-pharmaceuticals, bio-services, bio-informatics andbio-industry is expected grow at an average growth rate of 30% a year andexpected to reach $100 billion by 2025.  Figure 4:Percentage Distribution of Biotech Companies in Various Segments Biopharma, therapeutics, comprising vaccines anddiagnostics, is the largest sub-sector of biotech contributing nearly 62% ofthe total revenues at Rs 12,600 crore ($ 1.88-billion).

  Geographical Clusters: Most of the pharmaceutical manufacturing units areconcentrated in Maharashtra and Gujarat. These two states are home for 44% ofthe pharmaceutical manufacturing units. Source:Ministry of Skill Development & Entrepreneurship  Table 1: GeographicalDistribution of the Pharmaceutical Companies In India  State No.

of Manufacturing units Total Formulation Bulk Drugs Maharashtra 1928 1211 3139 Gujarat 1129 397 1526 West Bengal 694 62 756 Andhra Pradesh 528 199 727 Tamil Nadu 427 98 570 Others 3423 422 3845 Total 8174 2389 10563 Sources:Department of Pharmaceuticals; KPMG in India analysis, ASSOCHAM The data clearly suggests that due to better infrastructurefacilities, enhanced support from small-scale companies, conductive industrialatmosphere and skills in chemistry, Maharashtra remains an attractivedestination for Pharma companies. The Maharashtra government promotes the”Centres of Excellence” working on cutting-edge R&D in emerging areas oftechnology and life sciences. Figure: PercentageDistribution of Pharmaceutical Companies in Various RegionsSources:Department of Pharmaceuticals; KPMG in India analysis, ASSOCHAMOn other hand Gujaratalways encourages new investments in the state and employs approximately 52,000people in this sector.  The 5 tax-free states namely Himachal Pradesh, Uttaranchal,Jammu & Kashmir, Jharkhand and Sikkim are emerging as hot destinations forPharma companies.

Uttarakhandand Himachal Pradesh (HP) is considered to beamong the fastest growing Pharma hubs in India. Baddi and some other areas inHP have over 300 manufacturing units. Haridwar, Roorkee, Dehradun and Rudrapurof Uttarakhand have 200 pharma manufacturing units.  

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