Sansad TV: New India Debate- India: Pharmacy of World | Current Affairs & Hindu Analysis: Daily, Weekly & Monthly - UPSC PDF Download

Introduction

India holds a dominant position in the global pharmaceutical industry, serving as the largest supplier of generic drugs worldwide. The Indian pharmaceutical sector caters to over 50% of the global demand for various vaccines, provides 40% of generic medications to the US market, and contributes to 25% of the pharmaceutical supply in the UK. Additionally, India plays a significant role in UNESCO, accounting for more than 50-60% of its share.

India's Potential as the "Pharmacy of the World"

The Indian pharmaceutical industry, currently valued at $41 billion, is poised for remarkable growth, with projections estimating it to reach $65 billion by 2024 and an impressive $120-130 billion by 2030, as highlighted in the new Economic survey.

• Export Growth: From April to October 2020, India's pharmaceutical exports soared to $11.1 billion, marking an 18% growth compared to $9.4 billion during the same period in the previous year. Drug formulations and biologicals consistently demonstrated positive growth, resulting in their increased share in exports, rising from 5% in April-November 2019 to 7.1% in April-November 2020, making them the second-largest exported commodities among the top 10.
• Strategic Advantages: India's success in becoming a global manufacturing hub for generic medicines is underpinned by its abundant raw material resources and a highly skilled workforce. Furthermore, India boasts the largest number of USFDA-compliant pharmaceutical plants outside of the United States, with over 262, including Active Pharmaceutical Ingredients (APIs) facilities.
• Global Leadership: India plays a vital role in the global fight against AIDS, with over 80% of antiretroviral drugs used worldwide to combat Acquired Immune Deficiency Syndrome (AIDS) supplied by Indian pharmaceutical companies.

Challenges Faced by the Pharma Industry

• Overdependence on China for APIs: Indian pharmaceutical industries heavily rely on China for approximately 80% of their Active Pharmaceutical Ingredients (APIs), which are the foundation of drugs. Geopolitical tensions and uncertain bilateral relations pose a significant threat to the Indian pharmaceutical sector.
• Compliance and Regulatory Hurdles: The industry faces challenges in diversifying its global market due to the imposition of Sanitary and Phyto-Sanitary (SPS) barriers by countries like China and the USA. Selective targeting by US Food and Drug Administration and Chinese drug regulators continues to be a concern.
• Drug Price Control Order: Government-initiated reforms to lower drug prices, while beneficial for the public, have raised concerns among pharmaceutical companies about their profitability.
• Intellectual Property (IP) Regulations: Stringent IP regulations, particularly affecting foreign companies, have been a contentious issue, and industry stakeholders advocate for rule amendments.
• Competition and Pricing Pressure: The approval of multiple applications for generic drugs, resulting in market competition and lower global prices, presents a challenging landscape for the Indian pharmaceutical sector.
• Lack of Industry Assessment: The industry lacks comprehensive assessments of its performance, efficiency, and productivity, leading to the survival challenges of many pharmaceutical plants.
• Unregulated Online Pharmacies: The emergence of unregulated online pharmacies in India poses a significant threat to authorized pharmaceutical setups.
• Decline in Medical Representatives' Quality: The Indian pharmaceutical industry faces a decline in the quality of its medical representatives (MRs) due to inadequate training and support. Unlike other countries, India allows even non-graduates to work as MRs without proper guidance.

Conclusion

The affordability of healthcare remains a critical concern in India, necessitating clarity on fair pricing principles for medical products. It is essential for accused companies to receive a fair hearing. The Government of India has undertaken numerous initiatives to promote a conducive ecosystem for pharmaceutical manufacturing in the country.