“It is important to promote innovation for growth in the pharmaceutical sector”

NEW DELHI: Innovation will be the next driver of growth in the pharmaceutical sector, while upskilling, leveraging technology and building a strong supply chain will be key drivers of growth.

“R&D spend in the Indian pharmaceuticals and pharmaceuticals sector averaged around 5% of sales in FY20 and FY21,” the study said. “As we move towards realizing the vision of Viksit Bharat, it is crucial to promote innovation.”

India’s strength in the pharmaceutical sector is that it is a cost-effective and efficient producer of existing off-patent drugs, also known as generics. Yet research and development is key to producing those same drugs, once they go off-patent, at a fraction of the price of the original drug.

“The world needs both innovators and those who can deliver medicines at a reasonable price, with the latter playing a key role in maximizing societal benefits. Hence, the industry’s strength lies in a diverse mix of innovators and generics.”

Developing new medicines to address unsolved health problems will improve the scope and quality of society’s access to health care while also delivering a better return on investment.

Moreover, the sector’s share in India’s exports increased from 5.8% in FY19 to 6.4% in FY2024 and the export value increased from $19.1 billion in FY19 to $27.9 billion in FY2024.

The study discussed the success of the PLI programme and concluded that PLI programmes for wholesale medicines and pharmaceutical products have helped stabilise imports of wholesale medicines and made our supply chain more resilient.

The pharmaceutical industry in India has traditionally relied on importing active ingredients from one country (China).

Under the programme, fermentation-based manufacturing capabilities were strengthened through the production of antibiotics such as penicillin G and clavulanic acid. The CAGR of imports of bulk drugs between FY22 and FY24 was 2.3%, compared to a CAGR of 5.9% in its exports. India has now emerged as a net exporter of bulk drugs. In FY24, the export and import value of bulk drugs stood at ₹39,632 crore and ₹37,722 crore, respectively.