India wooing American investment in pharma

Seeking to strengthen India’s position globally in terms of pharmaceuticals, India has reached out to top American pharmaceutical companies seeking investment in the country's pharma and medical devices sector. With investments of about $5 billion in Indian companies, American private investment firm Bain Capital says it is looking forward to investing 'even more' in India, post government officials wooing investors, reports The Pharma Letter’s India correspondent.

Underscoring how the country is a safe destination for investments, Chemicals and Fertilizers Minister Mansukh Mandaviya has urged the domestic pharma industry to make India a huge manufacturing base, especially for generics.

Addressing an Investor Summit on October 27, the minister spoke about the government's pro-industry reforms and efforts to make India the best investment destination in the world.

Noting that the government has been taking constant steps to enhance investments in the country, the minister said the global pharma industry should take benefit from the wide ranging measures that are already in place.

Discussing opportunities in manufacturing of innovative products in bio-pharmaceuticals, including biologics, biosimilar, cell and gene therapy and enhancing vaccine manufacturing capabilities, the minister exhorted investors looking to build global champions in India in these products.

Earlier in the month, India's Finance Minister Nirmala Sitharaman pitched for investments across sectors, including pharma, when she arrived in the USA to attend the annual meet of the World Bank and IMF in Washington, as well as G20 Finance Ministers and Central Bank Governors meeting.

Discussing investment opportunities and reforms in India during her meeting with leaders of global corporations, who said they were upbeat about investing in the country, Ms Sitharaman highlighted government incentives and initiatives towards promoting innovation in life sciences and research and development in the pharma sector.

India, she said, has recently launched a production linked incentive (PLI) scheme that will provide the US companies new opportunities for investment.

Bain Capital co-managing partner John Connaughton noted that the firm has been in India for over a dozen years and "whenever you see the kinds of reforms that we are seeing in India...it really allows us to accelerate our investment activity, particularly across the broader sectors that we participate in," such as banking, outsourcing and pharmaceuticals."

Pharma 'a religion'

Minister Mandaviya said the pharma sector is like a religion in the country, and that is why India is the leading supplier of generic medicines in the world. "We see to it that the world gets affordable medicines," he stated, at the Investor Summit organized by the Department of Pharmaceuticals.
The COVID-19 pandemic is expected to help the Indian pharma sector surpass $60 billion by 2024 and $120 billion by 2030 from around $45 billion in FY21. Generic drugs, with 71% market share, form the largest segment of the pharmaceutical industry in India, and is set to grow as exports of generics to the USA rise, with branded drugs worth $55 billion coming off-patent.

India's focus on generics has the domestic industry enjoying significant cost advantages in terms of production, R&D, and clinical trials over the developed market to the tune of 50%, 87%, and 90%, respectively, investors were told. The country's share in total ANDA approvals has increased from around 40% in 2020 to around 44% as of June 2021.

The minister further said that India strives to become the best investment destination in the world for the pharmaceutical sector, which has witnessed a substantial increase in investments. FDI increased 98% year on year in 2020 and pharma exports from India grew by 18% in the last financial year.

Enlisting the various policies, schemes and initiatives of the government to encourage pharma, he also said that the PLI scheme for the pharma sector will give a boost to the industry and has the potential to make India a pharma hub. He underlined the fact that India is going to become a huge market for medicines and medical devices and added that under Ayushman Bharat-PMJAY, 100 million families will benefit, which will create demand for more drugs and which will benefit the pharma industries in India.