BMI View: The shift in the pharmaceutical landscape due to the Trans-Pacific Partnership (TPP) will be negative for the Indian generic drug industry. Collectively accounting for 40% of medicine exports from India, the 12 member markets of the TPP will see stronger patent protection and longer regulatory data protection. This coupled with the introduction of a patent linkage system will serve to deter the introduction of Indian generic drugs and curtail their overall growth.
Headline Expenditure Projections
Pharmaceuticals: INR1,066bn (USD16bn) in 2015 to INR1,191bn (17bn) by 2016; +11.7% in local currency terms and 6.4% in US dollar terms.
Healthcare: INR5,716bn (USD88bn) in 2015 to INR6,395bn (USD94bn) by 2016; +11.9% in local currency terms and 6.6% in US dollar terms.
India's pharmaceutical market ranks as the tenth most attractive amongst 19 other countries in the Asia Pacific region. Scoring 51.8 out of 100.0 for our BMI Pharmaceutical Risk/Reward Index in Q216, the country's high market expenditure (scoring 16.0 out of 20.0) is weighed down by the low spending per capita (scoring 1.2 out of 12) as well as the high risks involved including low patent respect (scoring 2.1 out of 7.0).
|f = BMI forecast. Source: National Sources, BMI|
|Pharmaceutical sales, USDbn||15.627||16.395||17.447||19.143||21.194||23.600||26.294|
|Pharmaceutical sales, % of GDP||0.76||0.78||0.78||0.78||0.79||0.79||0.80|
|Pharmaceutical sales, % of health expenditure||18.8||18.6||18.6||18.7||18.8||19.1||19.4|
|Health spending, USDbn||83.317||87.941||93.701||102.442||112.484||123.661||135.430|
In November 2015, the Delhi high Court turned down an injunction petition filed by Bayer against Dr Reddy's Laboratories. Local news sources note this lawsuit was due to an infringement of Bayer's patent for rivaroxaban.
In December 2015, the Union Fertilisers Minister Ananth Kumar noted that there will be a separate ministry for pharmaceuticals and medical device sector in 2016.
In January 2016, Roche and Glenmark Pharmaceutical have settled out of court a litigation over the lung cancer erlotinib.
BMI Economic View
India's real GDP growth slowed to 7.0% y-o-y in the first quarter of FY2015/16 (April-March) from 7.5% y-o-y in the previous quarter, and we are downgrading our full-year forecast to 7.3% (versus 7.6% previously). We expect weakening agricultural growth and slowing reform momentum to weigh on overall economic growth.
BMI Political View
The Modi government will focus on reforming the Indian economy in a gradual manner, with a greater emphasis on improving policy implementation. The BJP will face difficulties in passing big bang structural reforms due to its lack of majority in the 245-seat upper house. State elections, which will continue to take place over the coming years, will determine whether the BJP will attain an upper house majority, and in the upcoming Bihar state elections, we expect the party to face an uphill battle to defeat the alliance formed by the JDU, RJD, and the INC.
The India Pharmaceuticals & Healthcare Report features BMI Research's forecasts for drugs and healthcare expenditure and imports and exports, focusing on the growth outlook for the prescription, OTC, patented drugs and generics market segments.
BMI's India Pharmaceuticals & Healthcare Report provides industry professionals, strategists, company executives, investors, analysts and sales/marketing heads with independent forecasts and competitive intelligence on the India pharmaceutical and healthcare industry.
- Benchmark BMI's pharmaceutical and healthcare market forecasts for India, to test other views - a key input for successful budgeting and strategic business planning in the Indian pharmaceutical and healthcare market.
- Target business opportunities and risks in the Indian pharmaceutical and healthcare sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in India.
- Assess the activities, strategy and market position of your competitors using our company profiles (including SWOTs, KPIs and latest activity) and competitive landscape tables.
BMI Industry View
An at-a-glance perspective on the latest regulatory developments, key forecast indicators and major corporate developments, covering the prescription, OTC and generics markets. The pharmaceuticals and healthcare SWOT outlines strategic factors that affect the basic assumptions underpinning BMI’s forecast analysis, and taken together with BMI’s political, economic and business environment SWOTs, it gives a complete overview of market climate.
BMI Industry Forecast Scenario
Industry forecasts to end-2019 for all key indicators, supported by explicit assumptions, plus analysis of key downside risks to the main forecasts:
- Healthcare: Total healthcare expenditure (USDbn), healthcare expenditure (% of GDP), healthcare expenditure per capita (USD), hospital beds, doctors, and birth & mortality rates (all per ‘000 population).
- Pharmaceutical Market: Drug expenditure in USDbn, % of GDP and per capita (USD).
- Patented Drug Market: Prescription drug sales (USDbn & % of total sales).
- Generic Drug Market: Generic product sales (USDbn), generic sales (% of total sales).
- OTC Drug Market: OTC sales (USDbn & % of total sales).
- Macroeconomic Forecasts: Nominal and real GDP, % real GDP growth, % private consumption growth, % industrial output growth, % consumer price index, % GDP price deflator, exports, imports, trade balance, current account balance, foreign direct investment, exchange rate against USD, government expenditure and external debt.
BMI’s Pharmaceuticals and Healthcare Risk Reward Index
BMI’s Risk Reward Index provides investors (both national and multinational) looking for opportunities in the region with a clear country-comparative assessment of the market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors, with each position explained.
A snapshot of key market characteristics, including total size of the pharmaceuticals and healthcare segments, growth drivers, leading therapeutic areas and the competitive landscape
A focus on government healthcare reforms, epidemiological trends, mergers and acquisitions, product launches, market entries, FDI activity, R&D, biotechnology, clinical trials and supply chain issues.
Details of the industry regulatory framework and key legislation covering the licensing of new products/services, pricing and reimbursements, intellectual property, taxation and advertising, as well as analysis of the overall regulatory burden.
The competitive landscape section provides comparative company analyses and index by USD sales and % share of total sales – for the total pharmaceutical sector, as well as the OTC, generics and distribution sub-sectors.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate Company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.