EXECUTIVE SUMMARY The Indian pharmaceutical Industry has

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    EXECUTIVESUMMARY

    TheIndianpharmaceuticalIndustryhaswitnessedarobustgrowthofaround14%since

    thebeginningofthe11thPlanin2007fromaboutRs71000crorestooverRs1laccrores

    in200910comprisingsomeRs62,055croresofdomesticmarketandexportsofoverRs

    42,154 crores. This also amounts to around 20% of total volume of global generics.

    However, the Industry is quite fragmented and comprises of nearly 10,500 unitswith

    majorityoftheminunorganizedsector.Ofthese,about300400unitsarecategorizedas

    belongingtomediumtolargeorganizedsectorwiththetop10manufacturersaccounting

    for36.5%ofthemarketshare.AsregardstheBulkdrugscomponentoftheindustry,the

    market isaroundRs42,000croresgiving itashareofaround50%ofthetotaldomestic

    market.Thisgivesthe IndianBulkDrug industryashareofabout9%oftheglobalbulk

    drugmarket.

    India is among the top 20 pharmaceutical exporting countries and the exports have

    grownverysignificantlyataCAGRofaround19% inthe11thplanperiod. Indiandrugs

    areexportedtoaround200countriesintheworldwithhighlyregulatedmarketsofUSA,

    UKetc.Themajortherapeuticcategoriesofexportareantiinfective,antiasthmaticand

    antihypertensive.

    The Department of Pharmaceuticals has a Vision for the development of the Indian

    PharmaceuticalIndustry.ThisVisionis

    TomakeIndiatheLargestGlobalProviderofQualityMedicinesatReasonablePrices.

    TheVisionistobeachievedasperthefollowingMission:

    Develop Human Resources for Pharmaceutical Industry and Drug Research and

    Development

    PromotePublicPrivatePartnershipfordevelopmentofpharmaceuticalsIndustry

    PromotePharmaBrandIndiathroughInternationalCooperation

    PromoteenvironmentallysustainabledevelopmentofPharmaceuticalIndustry

    Enableavailability,accessibilityandaffordabilityofdrugs

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    InordertorealisetheMission,theDepartmenthassetthefollowingGoalsfor12thplan:

    ProductionsizeofUS$60bnandexportsizeofoverUS$25bn.

    UpgradationofSMEstoWHOGMPandtrainingofprofessionalstherein.

    EstablishmentofPharmaGrowthClusters.

    FacilitategrowthofCentralpharmaPSUs.

    DevelopPharmaInfrastructureandCatalyzeDrugDiscoveryandInnovation

    Develop Pharma Human Resources through increased M.Pharma and Ph.D

    programsinNIPERS

    ProvideInfrastructureandstafffornewNIPERsandstrengthenNIPERMohali

    Open10newNIPERs

    JanAushadiCampaignandimplementationofBusinessPlanforsettingupof3000

    JanAushadhiStores(uptoSubdivisionlevelinthecountry)

    IncentivizingPrivateSector fordevelopmentofnewDrugs fordiseasesendemic

    toIndia

    FortheachievementoftheseGoals,itisnecessaryfortheIndianPharmaceuticalIndustry

    to become globally competitive through world class manufacturing capabilities with

    qualityandcostefficiencyofproductioncapacityandradicalupgradationofresearchand

    development capabilities fornewdrugs and associated activities like clinical trialsand

    contractmanufacturing. There is need to developworld class support infrastructure

    bothforproductionandresearch.

    Withthisapproach,thepreparationofthe12thPlaninvolvedadetailedSWOTanalysisof

    theIndianPharmaceuticalsIndustry. Thisanalysishasrevealedthefollowingstrengths:

    (a)Strong Lowcostmanufacturing sector (b)Significantbreadthanddepthofproduct

    expertise (c) Low cost of growingHuman resources in the Pharma sector. Themajor

    weaknesses are (a)High emphasis on generics both for domestic and international

    marketswherefilingandapprovalofANDAsandDMFshave left littleroomforR&Don

    drugs development (b) Inadequate R&D Infrastructure (c) Poor IndustryAcademia

    linkage(d)Lackofrequiredhighendproductdevelopmentcapablehumanresources(e)

    Lackoftimedrivenregulatoryinfrastructure(f)PoorSMEbaseforhighendmanufacture.

    Themajoropportunitiesavailableare(a)GlobalopportunityforincreasingGenericsand

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    biogenerics market both in developed and emerging countries due to pressure on

    budgetary limitations of these countries aswell as emergent patent cliff due to off

    patenting ofmajor highvalue drugs (c) Low cost good skill destination for contract

    research andmanufacturing and resultant opportunities in drug discovery as well as

    clinical trials (d) High growth of domesticmarket attractingmultinationals both for

    brownfieldandgreenfieldinvestmentsinproductionandcapacitybuilding.Thethreats

    totheindustryarefrom(a)EvergreeningstrategyofMNCsfordenyingandlimitingthe

    patent cliff opportunitieswith debatable recourse to TRIPs and FTAs (b) Increasingly

    stringentregulatoryandnontariffbarrierstogenericsmarketsindevelopedcountries(c)

    Increasedcompetitionforgenericsandbiogenericsproductionintermsofhighcapacity

    andproductioncosts (d)Highentrybarriers toenablemarketshare indevelopmentof

    newdrugs.

    BasedontheaboveSWOTanalysis,recommendationshavebeenmadeinthe12thPlan

    Documentfor

    1) DevelopmentandgrowthoftheIndustry

    2) StrengtheningofR&DCapabilities

    3) StrengtheningofhumanresourcebaseforIndustry

    4) AffordabilityandAccesstoQualityDrugs

    ThemajorrecommendationsconcerningsupportforIndustrygrowthare(a)Schemes

    for Upgradation of SMEs to WHOGMP, USFDA/EDQM/TGA and other International

    Standards (b) Support for new generics and biogenerics through setting up of

    Formulation Development Centers andManufacturing Standards Training Centers (c)

    RegionalclusterbasedIndustrydevelopmentthroughestablishmentandupgradationof

    10 Pharma Growth Area Clusters (d) Industry support to Internationalmarket access

    through capacity building and intergovernmental cooperation. The Medical Device

    IndustryisalsoproposedtobesupportedthroughthedevelopmentofaMedicalDevices

    ParkinAhmedabad,Gujarat.

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    In the area of R&D and human resource development themajor recommendations

    concern(a)settingupofNationalExcellenceCentrescomprisingthreeforResearchand

    DevelopmentinPhytopharmaceuticals,NanoPharmaceuticalsandBioSimilars,onefor

    settingupofNationalfacilitiesforNewDrugsDevelopmentalongwithanotherforEnd

    ToEndLargeScaleAnimalHouseandsettingupofaNationalCentreforR&DinAPIs(b)

    Schemes for supporting R&D in Industry through assistance for setting up of

    GLP/GCP/AnimalHouseLabSchemes(c)Settingupof PharmaVentureCapitalFundto

    fund innovations indrugdiscovery including incubatordriven translational research (d)

    Pharma Innovation and Infrastructure Development Initiative for R&D infrastructure

    development including fundingofprivate sector initiatives inPPPmode. Emphasison

    supportingextramuralresearchindevelopmentofnewdrugsanddosageformsformass

    afflictiondiseaseslikeJE,Chikungunya,TB(resistantstrains),leishmeinasis,malaria,and

    therecentlifestylediseaseslikediabetesandCVD,etc.

    As regards strengthening of Human Resource base, it is estimated that direct

    employment in Pharmaceuticals Industry has increased from about 6.9 lacs people in

    2006to8lacspeoplein2008with20%ofthismanpowerbeingengagedinresearchand

    testing.Theprojectedhumanresourcerequirementisaroundanestimated21.5lacsby

    2020.BasedonthisitisproposedtofilltheHRrequirementsthroughSchemessuchas

    (a)ExpandingthestudentoutputatNIPERMohali(b)Developmentof6NewNIPERS

    alreadysanctionedinthe11thPlanand(c)Settingupof10NewNIPERsetc.

    The12thPlanDocumenthighlights the vital roleDrugpriceplay in access toessential

    medicinesacross theworld.While it isa fact that thedrugsmanufactured in Indiaare

    consideredtobeamongstthelowestpricedinternationally,still,avastsectionofIndian

    populationisnotinapositiontoaccesstheneededhealthcareaswellasthemedicines

    due tovariousreasonsofaccessandaffordability. Accordingly, therecommendations

    madeby theTaskForceunderDr.PronabSenmadehavebeenconsideredandadraft

    NationalPharmaceuticalsPricingPolicyhasbeenformulatedwhichseekstocontrolthe

    prices of essential drugs as per theNational List of EssentialMedicines 2011 (NLEM

    2011).Further to this, theDepartmentwould takeup issuespertaining toprescription

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    and promotion of unbranded generic drugs with the Department of Health. Issues

    relatedtopricingofpatentedmedicineswouldalsobesuitablyconsideredinthelightof

    needforpromoting industrygrowthandresearchaswellasdevelopmentofnewdrugs

    alongwithaffordabilityofnewpatentedmedicines forbetter therapeutictreatmentof

    themasses, especially in diseases pertaining to cancer and HIV. Accordingly, it is

    proposedtocontinueschemesforstrengtheningoftheNPPA,forsuchfunctionsas(a)

    Strengthen Monitoring and Enforcement Work, (b) Building Consumer Awareness

    aboutpricingandavailabilityand(c)CreationofNPPACellsinStates,etc.

    ThepresentmarketsizeofMedicalDevicesandEquipments isaroundRs15,000crores.

    ThemedicaldeviceIndustryinIndiaisverynascentandislargelyimportdependent.More

    than 65% of Indias requirement ofmedical devices and equipments aremet through

    importswith domestic production being largely restricted to low technology disposable

    equipments.TheSWOTanalysisofMedicalDeviceIndustryshowsthatitsmajorstrengths

    are (a)Well developedMicroelectronic, Telecommunication, Software and Precision

    EngineeringIndustry,(b)Abilitytoattractforeigninvestmentsand(c)Abilitytohandlelow

    valuelargevolumeproductionasperglobalqualitystandards.Themajorweaknessesare

    (a)Lowpercapitaexpenditureonhealthcare&lowhealthinsurance,(b)Lackofadequate

    and trained manpower, (c) Lack of incubation and suitable ecosystem, (d) Lack of

    regulation/standards etc. The major opportunities are (a) Huge market potential ,(b)

    Growing opportunities in exportmarket, (c)