Pharma contract manufacturing on the rise in India

The past few decades have been very productive for India, as it took a major leap from pharmaceutical production, to include contract manufacturing.

According to the president of the Indian Drug Manufacturers' Association (IDMA), S V Veerramani, the overall pharma contract manufacturing industry is growing at 20%, providing a burgeoning opportunity for small and medium enterprises, reports Brand India Pharma. The current market value is estimated at 50% of the domestic production, which roughly translates to $5.3 billion. Multinationals hold a generous 20%-25% stake in the domestic pharmaceutical market.

For the basic manufacture of medical products and drugs, India has a far superior edge over nations such as China, Vietnam and Ireland, due to resources including manpower, technically knowledgeable work force, and World Health Organization-Good Manufacturing Practice- approved production premises. A substantial 40% lower cost of operation and production is clearly the highlight for multinationals to consider India for their outsourcing needs.

Waiver to Phase III studies of certain drugs in India an incentive

With the advent of multinational pharmaceutical organizations, and their rapidly growing presence in the country, the concept of contract manufacturing has steadily evolved and quickly adapted, so as to encompass services such as basic manufacturing of medicinal products, formulation development, stability studies, and various stages of clinical trials. In addition, scale-up of drug syntheses, and late clinical trial studies have also been profitable protocols in this sphere. The Drug Technical Advisory Board (DTAB) has agreed to grant a waiver to Phase III studies of certain drugs in India, which are from the regulated markets of the USA and European Union. This step is an incentive for many pharmaceutical organizations to focus on India, as the cost savings could be enormous.

Also it is estimated that patented drugs worth $85 billion in potential annual sales in the USA would be off patent during the period 2014-2020. Price competitiveness and manufacture of these generic drugs in the most cost efficient manner would be the key drivers boosting the prospects of the Indian players as India is known to have the world's best known low-cost manufacturing centers, with the highest number of US Food and Drug Administration (USFDA) approved manufacturing plants outside the US.

The government is also looking at incentivizing the upgradation of Schedule M facilities to WHO GMP complaint units with the help of soft loans, which would lead to additional 1000 units being certified WHO-GMP compliant, further corroborating the manufacturing processes.