Pharma industry expected to clock in 12-15% growth this year: B R Sikri
NEW DELHI, July 21, 2021:
Shrugging off the Covid-19 challenges in its second wave through prudent planning and execution of manufacturing and distribution, the pharmaceutical industry in the country is expected to grow by 12-15 per cent this year, according to an industry expert. The availability and pricing of raw materials are also stabilising, thanks to the normalising supplies from China.
B R Sikri, chairman of Federation of Pharma Entrepreneurs (FOPE), chairman of CII Committee of Lifesciences and Biotech, Northern Region, and vice president (north zone) of Bulk Drug Manufacturers Association (BDMA), said that during the second wave of Covid-19, there was a sudden demand surge for lifesaving drugs, but the industry was able to cope with it unlike the first wave which was a little bit shaky for the industry because of some raw material shortage and higher demand.
During the second wave, the manufacturers were not only able to supply to the domestic market, but also to fulfill the export demand. During the first wave the government has banned certain products like paracetamol from being exported. But in the second wave, there was no such measures considering that the industry planned in advance to avoid any shortage in the domestic market. There was a price increase, but it was beyond the control of the industry considering the raw material prices from China went up and there was a shortage.
Industry performed better during the second wave of Covid-19 pandemic. The supplies were good, products were available in the market and the sales also increased.
"Overall it is a positive action taken by the industry," he said. The supply of raw material from China is now stable and the prices are also stablising now. It is improving day by day, price-wise and availability-wise.
"There is a potential of 12-15 per cent growth this year. Last year exports were stopped, which resulted in some adverse effects. We will be able to do better than last year," said Sikri.
The major challenge industry currently facing is the dependability on Chinese raw material. From a clearances and regulatory approvals point of view, the government is very serious and cooperating with the industry in reducing these imports. Environmental law has also been amended in favour of the industry. There is full support from the government and it is willing to give funding. Bulk drug parks are also expected to come up soon.
"We are confident that in four to five years the dependability on China will drastically come down. Not only will we be able to reduce Chinese imports, we will be able to export to other countries where China is exporting," he added. The production linked incentive (PLI) scheme will also support the industry to achieve this, including in terms of exports.
Currently China contributes to 68 per cent of the raw material requirement. The day it comes to 40 per cent, Indian industry will be in a commanding position, which will happen in next few years, he averred.
The industry is valued at $41.7 billion and is expected to reach $65 billion by 2024, according to the Government of India. This is expected to grow to $120-130 billion by 2030, it says. The market growth rate is expected at 10-12 percent, it says.
The API industry is ranked third largest in the world and it has 57 percent of APIs to prequalified list of the WHO. Incentives worth Rs. 21,940 crore (~$ 3 million) are approved for the sector. Pharmabiz