Report on Indian Pharmaceutical Industry

Submitted by GROUP 6 Ankita Nirola 2013PGP054 Bhavya Gupta 2013 PGP102

K.Gopi 2013PGP173 Mohite Su it Shara! 203PGP225 "avi #inayak $hikka 2013PGP320 Sunit Ku ar Nair 2013PGP411

Executive Summary: %he &n!ian Phar a'euti'al &n!u(try )&P&* i( +lo,ally the 3r! lar+e(t in ter ( o- volu e an! 13th lar+e(t in ter ( o- value. %he total arket (i.e o- "(. 1/233 Bn in'lu!e( !o e(ti' 'on(u ption arket ,ein+ "(. 033 Bn arket o- "(.000 Bn )'ontri,utin+ 142.03* an! the e4port(

'ontri,utin+ 151.43*. %he in!u(try +re5 at a $AG" o- 112.53 !urin+ the pa(t -ive year( an! i( e4pe'te! to +ro5th at a ro,u(t $AG" o- 15.13 !urin+ 672012817 +iven hu+e e4port potential 'ouple! 5ith (tea!y +ro5th in the !o e(ti' -or ulation arket. anu-a'turin+ unit(. enterpri(e )SM:* (e+ ent.

&n!ian phar a'euti'al (e'tor i( -ra+ ent 5ith 'lo(e to a,out 10/000 Ma9ority o- the(e 10/000 'o panie( ,elon+ to the ( all an! SM:( 'ater only to the !o e(ti' 'o panie( in thi( (e'tor. Gro5th in the !o e(ti' phar a'euti'al e!iu

arket/ 5hile lar+e 'o panie( have a hi+h e4po(ure to e4port

arket(. "an,a4y ;a,(/ Sun Phar a'euti'al/ <o'khar!t/ ;upin an! $ipla are (o e o- the lar+e

arket 5ill ,e !riven ,y in'rea(e in the penetration o-

e!i'al -a'ilitie(/ in'rea(e in the prevalen'e o- 'hroni' !i(ea(e(/ ri(in+ per 'apita in'o e an! in'rea(e in the health in(uran'e 'overa+e. Althou+h the (e'tor i( open to private parti'ipation an! up to 1003 6=& i( allo5e! in !ru+ anu-a'turin+/ hi+h level o- +overn ent inter-eren'e 'ontinue(. Ne5 Phar a'euti'al Pri'in+ Poli'y an! 'o pul(ory li'en(in+ rulin+( re'ently announ'e! ,y the +overn ent are te(ti ony to +overn ent inter-eren'e in the (e'tor. Gro5th in the e4port( o- phar a'euti'al pro!u't( -ro the &n!ia 5ill ,e !riven ,y patent e4pirie( oarket. %he +ro5th in the >S

a9or ,ran!e! !ru+( a'ro(( the 5orl!/ parti'ularly in the >S

arket 5ill ,e le! ,y in'rea(in+ +eneri' penetration an! healthy AN=A )A,,reviate! Ne5 =ru+ Appli'ation* pipeline o- &n!ian phar a'euti'al player(. "e'ent a!ver(e rulin+ ,y the >S 6=A a+ain(t "an,a4y ;a,( an! <o'khar!t ? t5o lea!in+ 'o panie( in the (e'tor ? on @uality i((ue( i( e4pe'te! to i pa't thi( e4port oriente! (e'tor. &n li+ht o- the(e event( there i( a po((i,ility o-

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the >S 6=A a( 5ell a( !ru+ re+ulator( o- other !evelope! re+ulation( on &n!ian phar a'euti'al 'o panie(. &n the lon+ ter / +ro5th in the e4port(

arket( i po(in+ tou+her @uality

arket 5ill ,e (u(taine! ,y e er+in+

arket( like

"u((ia/ Bra.il/ S. A-ri'a et' alon+ 5ith the enhan'e! -o'u( on the ni'he an! 'o ple4 pro!u't (e+ ent( (u'h a( in9e'ta,le(/ inhaler(/ ophthal i'(/ !er atolo+y an! oral 'ontra'eptive(. %he(e are hi+h ri(k 8 hi+h return pro!u't (e+ ent(. %he(e o--er 'o paratively hu+e entry ,arrierA a( their 'lini'al trial(/ approval( an! li ite! 'o petition. %he in!u(try (tren+th lie( in !evelopin+ 'o(t e--e'tive te'hnolo+ie( in the (horte(t po((i,le ti e -or !ru+ inter e!iate( an! ,ulk a'tivitie(. %hi( i( reali(e! throu+h the 'ountryC( (tren+th in or+ani' 'he i'al(C (ynthe(i( an! pro'e(( en+ineerin+. anu-a'turin+ pro'e(( are 'o paratively ore 'o ple4 an! ti e 'on(u in+. Ben'e very li ite! nu ,er o- player( ha( entere! the(e (e+ ent( re(ultin+ in

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Table of Contents

:4e'utive Su

ary

1. &n!u(try Pro-ile 1.1 Dvervie5 o- the in!u(tryEEEEEEEEEEEEEEEEEEEEEEEE...05 1.1.1 Gro5th over la(t 20 year(EEEEEEEEEEEEEEEEEEE..05 1.1.2 Pre(ent an! -uture tren!(EEEEEEEEEEEEEEEEEEE...05 1.1.3 Ma9or event( relate! to the in!u(try in the la(t 20 year(EEEEEEE...00 1.1.4 & portan'e to the e'ono yEEEEEEEEEEEEEEEEEE...00 1.2 %e'hnolo+i'al tren!( an! a9or innovation(EEEEEEEEEEEEEEEEE00 1.2.1 Key !river( o- innovation(F+ro5thFpro-ita,ilityEEEEEEEEEE...00 1.3 Mer+er 8 A'@ui(ition a'tivity in the in!u(try EEEEEEEEEEEEEEEE..07 1.4 Analy(tC( vie5( a,out the in!u(tryEEEEEEEEEEEEEEEEEEEE..0G 2. PlayerC( Pro-ile 2.1 Ma9or PlayerC( Pro-ile )=o e(ti' an! &nternational*EEEEEEEEEEEEE...10 2.1.1 Market Share(EEEEEEEEEEEEEEEEEEEEEEE...10 2.1.2 Key Pro!u't(EEEEEEEEEEEEEEEEEEEEEEEE.12 2.1.3 Pro-ita,ilityEEEEEEEEEEEEEEEEEEEEEEEE....12 2.1.4 Pro!u'tion 6a'ilitie(EEEEEEEEEEEEEEEEEEEEE..12 2.2 ;i(te!/ >nli(te!/ Market $apEEEEEEEEEEEEEEEEEEEEEE...13 2.3 6inan'ial Per-or an'e &n!i'ator(EEEEEEEEEEEEEEEEEEEEE13 2.4 Pro-ile( o- $hair anEEEEEEEEEEEEEEEEEEEEEEEEEE13 3. Ma'roe'ono i' %ren!( 3.1 Govern ent "e+ulation( an! Poli'y $han+e(EEEEEEEEEEEEEEEE14 3.2 & pa't o- >nion Bu!+et )201382014*EEEEEEEEEEEEEEEEEEE.10 3.3 & pli'ation o- international treatie( (u'h a( <%DF6%AEEEEEEEEEEEE.10 3.4 $o petition -ro -orei+n -ir (/ 6=&/ i port(/ opportunitie( in over(ea( arket(EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE...17 4. Appen!i4EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE.....12 5. Bi,lio+raphyEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE...1G

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1 !"#USTR$ PRO%!&E 1 1Overvie' of t(e !ndustry 1 1 1Gro't( over &ast )* $ears Be-ore 1G70 1G7081GG0 1GG082005 200582010 &n!ian arket 5a( !o inate! ,y -orei+n 'o panie( an! very little parti'ipation

-ro !o e(ti' arket( 5a( there &n!ian Patent A't 5a( pa((e! in 1G70 an! (o (everal !o e(ti' 'o panie( (tarte! operation(/ !evelop ent o- pro!u'tion -a'ilitie( an! e4port( al(o (tarte! Market 5a( li,erali.e! an! !o e(ti' arket( e4pan!e! very -a(t an! "H= 5a( al(o in'rea(e! &n!ian 'o panie( in'rea(e! their laun'h operation( in -orei+n 'ountrie(/ &n!ia ha! ,e'o e a a9or !e(tination -or +eneri' !ru+ anu-a'ture an! hi+her (pen!in+ on "H= in'rea(e! !ue to intro!u'tion o- pro!u't patent( Patent -ilin+ ,y phar a'euti'al player( have ,een in'rea(e! an! ne5er (ale( o!el( like 'hannel ana+e ent KAM/ $SD et'.

2010 on5ar!(

1 1 ) Current Trends + %uture Trends &n!ia i( the lea!in+ phar a'euti'al pro!u'er. &t i( a,out 1.4 per'ent o- the +lo,al phar a'euti'al in!u(try in value ter ( an! 10 per'ent in volu e ter (. &n!ia i( a on+ the -a(te(t +ro5in+ in!u(trie( an! i( havin+ arket (i.e o- I10,illion in 2002 an! 5hi'h i( in'rea(in+ at a rapi! rate. April/ 2000 to Mar'h/ 2013. &n!u(try i( arket i( e4pe'te! to +ro5 at 138143 in 2013. <e are arket( in the 5orl!. Greater penetration in rural 2000 to &n!ia attra'te! 5 per'ent total 6=& into &n!ia -ro e4pe'te! to +ro5 at 1G3 in 2013 an! the a on+ the top -ive phar a'euti'al e er+in+

arket(/ ne5 !ru+ laun'he(/ ne5 !ru+ -ilin+(/ pha(e2 'lini' trial( 5ere (tarte!. 1003 6=& i( allo5e! in the phar a'euti'al (e'tor. 6=& in-lo5( have ,een 5orth I10.3,illion -ro 2013.

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%he

arket (i.e 5ill ,e I30 ,illion in 2010 an! e4pan! at a $AG" o- 17.2 per'ent. Generi' arket

arket o- &n!ia i( e4pe'te! to +ro5 at I20.1 ,illion ,y 2010. Generi'( 5ill !o inate the -ra+ ente! a'ro(( the 'ountry. &n!ian 'o panie( 'ontrol 703 o- the $o

till 2015 an! likely to 'on(titute 103 o- the pie till 2015. More than 20/000 re+i(tere! unit( are arket. %he Mini(try oer'e tar+et( to e4port I25 ,illion 5orth o- phar a'euti'al( in 2010. &n!ia 5ill over'o e

&taly in 'o in+ !ay( in AP& )a'tive phar a'euti'al in+re!ient(* an! 5ill e er+e a( (e'on! lar+e(t pro!u'er. 1 1 , -a.or events related to industry in t(e last )/, years %he lar+e(t (e+ ent o- &n!ian phar a'euti'al arket 5a( Generi' !ru+( 5ith 723 oarket

(hare in ter ( o- revenue Anti in-e'tive !ru+( 'o 2010/ the

an! the lar+e(t (hare an! 'ar!io va('ular

e!i'ine( are ri(in+. &#= )in vitro !ia+no(ti'(* (e'tor i( +ro5in+ rapi!ly -or the la(t 2 year(. &n e!i'ine( that 5ere !evelope! -or !i--erent !i(ea(e( areJ $an'er8272 $ar!iova('ular !i(ea(e(8237 =ia,ete(81G3 A&=S821 "are !i(ea(e(8303

1 1 0 !m1ortance to t(e economy %he in!u(try i( e4pe'te! to +ro5 at an annual rate o- 28G3 till 2015. &t 'ontri,ute( to the Govern ent e4'he@uer in ter ( o- (ale( ta4A e4'i(e !uty an! i port !utyA an! 'orporate ta4 on pro-it an! !ivi!en!(. &t i( e(ti ate! to provi!e !ire't an! in!ire't e ploy ent to aroun! 3 illion people. By i provin+ in!i'ator( (u'h a( li-e e4pe'tan'y/ re!u'tion in !i(ea(e ,ur!en an! 'hil! ortality/ the (e'tor 'an !rive the a'roe'ono i' +ro5th/ 5hi'h 5ill re(ult in +reater in'o e/ 'on(u ption an! inve(t ent an! enhan'e the @uality o- li-e in &n!ia. &n!ia i( one a on+ the lea!er( in 'lini'al trial arket. Share o- +eneri' !ru+( are in'rea(in+ !ay ,y !ay an! it i( a

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+oo! (i+n -or &n!ian -ir (.703 o- the !o e(ti' !e an! -or ,ulk !ru+( i( 'atere! ,y &n!ian phar a'euti'al in!u(try.

1 ) Tec(nolo2ical trends and ma.or innovations 1 ) 1 #emand #rivers of t(e !ndustry Both !o e(ti' 'on(u ption an! e4port !e an! play a (i+ni-i'ant role in the +ro5th o- &n!ian phar a'euti'al in!u(try. =o e(ti' 'on(u ption i( !riven ,y in'rea(e in ol! a+e population/ +ro5th in li-e(tyle !i(ea(e(/ (upportive poli'ie( ,y the +overn ent an! penetration o- health in(uran'e. Mean5hile lo5er 'o(t o- pro!u'tion alon+ 5ith international @uality (tan!ar!( i( !rivin+ the e4port !e an!. #omestic Consum1tion Su11ortive s(ift in demo2ra1(ic 1rofileJ Population in the a+e +roup a,ove 50 )50 to 20K* i( prone to !i(ea(e( 5hen 'o pare! to population ,elo5 the a+e o- 50. Gro5th in thi( population ,a(e 5oul! in'rea(e the !e an! -or !ru+(. Gro'in2 incidence of lifestyle diseasesJ $han+e( in 'on(u ption pattern/ in'rea(e! pa'e oli-e(tyle an! a (e!entary 5ork 'ulture ha( 'reate! a 'la(( o- people 5ho are hi+hly prone to li-e(tyle !i(ea(e(. Ma9ority o- the !ru+( treatin+ the(e li-e(tyle !i(ea(e( are hi+hly pri'e! an! an in'rea(e in patient ,a(e 5oul! i Su11ortive 2overnment 1oliciesJ Com1ulsory &icensin2J Allo5( +eneri' -ir ( to !ru+(. %he !ru+( anu-a'ture patente! an! e4pen(ive li-e(avin+ en(ely help phar a'euti'al 'o panie(.

anu-a'ture! (houl! ,e only -or !o e(ti' 'on(u ption an! (houl! ,e pri'e!

'on(i!era,ly lo5er than the patente! !ru+. $o pul(ory ;i'en(in+ ha( ena,le! +eneri' phar a 'o panie( like $ipla to 'o e up lo5 'o(t +eneri' ver(ion o- patente! H e4pen(ive 'an'er !ru+(.

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3an 4us(ad(i Pro2ramJ %hi( pro+ra +eneri' e!i'ine(.

al(o ai ( to pro ote the a5arene(( o- +eneri' !ru+(

a on+ patient( a( 5ell a( en'oura+e !o'tor(/ e(pe'ially in +overn ent ho(pital( to pre('ri,e

1 , -er2er and 4c5uisition Mer+er an! a'@ui(ition ha( ,e'o e i portant tool -or inor+ani' +ro5th in &n!ian phar a in!u(try. A-ter 1GG1 re-or ( &n!ian -ir ( ha! +ot a ne5 arket to e4pan!. %hey (tarte! to arket +eneri' !ru+( to >nite! State( an! other 5e(tern 'ountrie(. %he &n!ian Phar a'euti'al in!u(try ha( ranke! thir! in the 5orl! in ter ( o- pro!u'tion volu e(. A''or!in+ to M'kin(ey the phar a'euti'al -ro arket i( ranke! 14th in the 5orl!. Bo5ever / &n!ian 'o panie( -a'e (o e arket/ 'o petitive threat 'hallen+e( (u'h a( non tari-- ,arrier(/ !e'rea(in+ pro-it( in the +eneri'

,i+ phar a'euti'al MN:(. &n!ian 'o panie( have reali.e! that to 'o pete 5ith +lo,al o(t &n!ian phar a'euti'al 'o panie( are ai in+ at e4pan!in+ their o(tly ,y ean( oer+er an! a'@ui(ition)MHA*. to in'rea(e pro-it ar+in( 5hi'h in turn 'an

phar a'euti'al 'o panie( 5ill involve ne5 (trate+ie( an! innovation(. &!enti-yin+ !o e(ti' an! -orei+n !e an! anu-a'turin+ 'apa'itie(

&n!ian phar a'euti'al in!u(try i( hi+hly 'o petitive an! ha( re+ulate! pro!u't pri'in+/ there-ore e--i'ien'y +ain( +enerate! -ro lar+e (i.e help -ir in!u'e MHA inve(t ent. %he i pa't o- MHA on -inan'ial per-or an'e o- phar a'euti'al -ir ( o- &n!ia an! pro-ita,ility o- the -ir So e i( !ire'tly relate! to (i.e.

er+er( an! a'@ui(ition in the pa(t ten year( in &n!ian phar a'euti'al in!u(try Tar2et Para( Pira al "an,a4y =a,ur 4c5uirer "e'kitt Ben'ki(er A,,ot =ai'hii Sankyo 6re(eniu( Ka,i #eal value 3200$r. &N" 10/000'r &N" 1G/720$r &N" 1125$r. &N"

So e a'@ui(ition ,y &n!ian 'o panie(J Tar2et A4i'orp ) Ger an*

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4c5uirer Bio'on

#eal value I30 Mn.

%ri+ene(i( )>SA* :(par a )Ger an* Ne+ a ;a,. )6ran'e* Morton Grove )>SA* %aro )&(real * Lui i'a 6ar a'euti'a

=r. "e!!yC( la, <o'khar!t <o'khar!t <o'khar!t Sun phar a $a!ila

I11 Mn. I11Mn. I205 Mn. I32 Mn I500 Mn. 8

-er2er and ac5uisition in t(e !ndian 1(armaceutical industry from )**1 to )*1* 1 0 4nalyst6s vie' on !ndian 1(arma industry: A''or!in+ to a re'ent report pu,li(he! ,y M'kin(ey/ (pen!in+ on health'are 5ith in'rea(e a on+ all (pen!in+ 'ate+orie( over ne4t t5o !e'a!e(. Bealth'are +re5 -ro -our per'enta+e oavera+e in'o e to 73 in 2005 an! i( e4pe'te! to +ro5 to 133 ,y 2025. %hi( vie5 o- the health'are (e'tor ha( re(ulte! in +ro5in+ intere(te! in +ro5in+ intere(t a on+ ,u(ine(( lea!er( an! poli'y aker( in phar a'euti'al in!u(try. 7et u'h re ain( unkno5n a,out the lon+ ter arket. <ith the 'urrent +ro5in+ rate oarket( in potential an! evolution o- the &n!ian phar a'euti'al phar a'euti'al in!u(try in &n!ia that the 5orl!. A 'lo(e e4a ination o- +ro5th !river( in!i'ate( that ri(in+ !i(po(a,le in'o e( an! up5ar! (hi-t in the in'o e !e o+raphi'( 5ill ,e the !o inant +ro5th -a'tor an! 5ill a''ount -or nearly 403 o- the pro9e'te! arket +ro5th. & prove ent in the e!i'al in-ra(tru'ture 'o e ne4t/ arket. Dver the ne4t -e5 year(/ a lot oa''ountin+ -or 203. Generi' pro!u't 5ill 'ontinue to !o inate the &n!ian !ru+( are +oin+ o--8patent. &tC( i en(e opportunity -or &n!ian +eneri' ,ulk !ru+ player(. A

arket 5ill triple it(el- an! 5ill ,e in the top 10

$"&S&; re(ear'h e4pe't( &n!ian phar a'euti'al in!u(try to re+i(ter $AG" o- 103 ,y 2017.
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&n!ian ha( ,a++e! (u,(tantial (hare o- AN=A )A,,reviate! Ne5 =ru+ Appli'ation* approval ne4t to >S. &t ha( +ro5n -ro +ro5 at 123. 1G3 in 2000 to 403 in 2012. Bulk !ru+ e4port i( al(o e4pe'te! to

) -4R7ET P&4$ERS6 PRO%!&ES ) 1-a.or Player6s Profile 8#omestic and !nternational9 ) 1 1 -ar:et S(ares &n!ian phar a'euti'al (e'tor i( -ra+ ente! 'o pri(in+ o- lar+e +eneri' phar a'euti'al 'o panie( to ( all !ra5in+ anu-a'turin+ unit(. Appro4i ately 703 o- the unit( in the (e'tor -all in the arket have (u,(tantial e4po(ure to e4port arket(/ e4port(. "an,a4y/ -ollo5e! ,y =r."e!!yC( ;a,(/ arket in 67 2013. SM: 'ate+ory. All the lar+er player( in the ore than 503 o- total revenue -ro

$ipla/ ;upin an! Sun Phar a are the top -ive phar a'euti'al 'o panie( in the (e'tor. %o+ether the(e 'o panie( a''ount -or 1273 o- total

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) 1 ) 7ey Products of t(e Com1anies Ci1la &td: $ipla i( the 5orl!M( lar+e(t B&#FA&=S/ a( anu-a'turer o- antiretroviral !ru+( N4O )A"#(* to -i+ht anu-a'ture( a

ea(ure! ,y unit( pro!u'e! an! !i(tri,ute!. "ou+hly 40 per'ent o- B&#FA&=S

patient( un!er+oin+ antiretroviral therapy 5orl!5i!e take $ipla !ru+(. 6urther/ it

'heaper +eneri' ver(ion o- %a i-lu/ 5hi'h i( li'en'e! to prevent or (lo5 the (prea! o- in-luen.a/ un!er the $ipla tra!ena e Anti-lu. Anti-lu i( a( e--e'tive a( %a i-lu a( approve! ,y <BD. $ipla al(o ha( a pro!u't ran+e 'o pri(in+ anti 'an'er/ anti,ioti'(/ anti8,a'terial(/ anti8 a(th ati'(/ anthel inti'(/ anti8ul'erant(/ on'olo+y/ 'orti'o(teroi!(/ nutritional (upple ent( an! 'ar!iova('ular !ru+(. #r Reddy;s &aboratories &td : =r. "e!!yC( ;a,oratorie( ;t!. )N7S:J "=7* i( an inte+rate! +lo,al phar a'euti'al 'o pany/ 'o itte! to provi!in+ a--or!a,le an! innovative e!i'ine( -or healthier live(. %hrou+h it( three ,u(ine((e( 8 Phar a'euti'al Servi'e( an! A'tive &n+re!ient(/ Glo,al Generi'( an! Proprietary Pro!u't( ? =r. "e!!yC( o--er( a port-olio o- pro!u't( an! (ervi'e( in'lu!in+ AP&(/ 'u(to on'olo+y/ pain phar a'euti'al (ervi'e(/ +eneri'(/ ,io(i ilar( an! !i--erentiate! arket( in'lu!e &n!ia/ >SA/ "u((ia8$&S -or ulation(. Ma9or therapeuti' -o'u( i( on +a(tro8inte(tinal/ 'ar!iova('ular/ !ia,etolo+y/ ana+e ent an! anti8in-e'tive. Ma9or an! :urope apart -ro other (ele't +eo+raphie( 5ithin : er+in+ Market(.

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Ranbaxy &aboratories &td : "an,a4yC( pro!u't port-olio i( !iver(e an! in'lu!e( !ru+( that 'ater to nutrition/ in-e'titiou( !i(ea(e(/ +a(tro8entriti(/ pain ali ent(/ !er atolo+y an! 'entral nervou( (y(te ana+e ent/ 'ar!io va('ular relate! ail ent(.

Sun P(armaceutical !nds &td J $ar!iolo+y pro!u't( 5ere intro!u'e! in 1G27 -ollo5e! ,y +a(troenterolo+y pro!u't( in 1G2G. %o!ay it i( the lar+e(t 'hroni' pre('ription 'o pany in &n!ia an! a arket lea!er in p(y'hiatry/ neurolo+y/ 'ar!iolo+y/ orthope!i'(/ ophthal olo+y/ +a(troenterolo+y an! nephrolo+y. So e o- the top ,ran!( o- the 'o pany in'lu!e panto'i!/ (u(ten/ a.tor/ +e er/ repa'e/ +lu'ore!/ (tro'it/ 'lopilet an! 'ar!iva(. ) 1 , Profitability Com1any "ame Sun P(arma )Stan!alone* Ci1la )Stan!alone* #r Reddys &abs Ranbaxy &abs "et Profit / )*1, 8Rs cr9 1/G27.G2 1/507.11 1/205.50 8102.34 "et Profit / )*1) 8Rs cr9 1/323.20 1123.G0 G12.40 83/052.05

) 1 0 Production %acilities Ci1la $ipla ha( 34 anu-a'turin+ -a'ilitie( a'ro(( &n!ia. %hey have !e!i'ate! plant( -or the

te'hnolo+i'ally8'hallen+in+ -or ulation( (u'h a( Dn'olo+y pro!u't(/ Bor one(/ Metere!8=o(e &nhaler( )M=&(*/ Beta8;a'ta (/ $ytoto4i'/ &n9e'ta,le( an! $ephalo(porin(. %he (tate8o-8the8art anu-a'turin+ -a'ilitie( are 'GMP 'o pliant )'urrent Goo! Manu-a'turin+

Pra'ti'e(* in 'on-or ity 5ith national an! international (tan!ar!(. Ranbaxy %hey have 10 (tate8o-8the8art anu-a'turin+ -a'ilitie( (prea! a'ro(( 2 'ountrie( %he(e -a'ilitie(

anu-a'ture Generi'(/ =i--erentiate! Pro!u't(/ Dver8the8$ounter pro!u't(/ Anti8retroviral( )A"#(*/ A'tive Phar a'euti'al &n+re!ient( )AP&(* an! inter e!iate(. %he(e plant( 'ater to a variety o- !o(a+e -or (/ in'lu!in+ ta,let(/ 'ap(ule(/ in9e'ta,le(/ oint ent(/ 'rea ( an! li@ui!(.
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) ) Performance !ndicators Mkt Total Cap(Rs Income( Cr) Rs Cr) 1 9461 18$8 8 35136 38842 2668 6561 8432 8512 PAT (Rs Cr) 517 (162 15 7 1266 EPS (Rs Cr) 4.99 (3.84 18.77 74.51

Player Name !un Pharma Ran&a' y )ipla *r. Reddy+s

P/E 2 7.43 ( 272. 3 22.39 33.45

EBIT (Rs Cr) 663 514 2 45 1815

Liste "!#$% !# "!#$% !# "!#$% !# "!#$% !#

) , Profiles of C(airman C!P&4< #r $usuf 7 =amied Be 5a( the -or er hea! o- Pohn(on an! Pohn(on. Be hol!( a Ph.=. in 'he i(try -ro $olle+e/ $a ,ri!+e. #r Reddy6s &aboratories &td < G> Prasad Pra(a! (erve( on the ,oar!( o- the &n!ian S'hool o- Bu(ine((/ &n(titute o- ;i-e S'ien'e(/ &n-ote'h :nterpri(e(/ an! A'u en 6un!. A $he i'al :n+ineer -ro >niver(ity/ >S. Ranbaxy< #r Tsutomu Une =r. %(uto u >ne 5a( in!u'te! a( a =ire'tor on the Boar! o- the $o pany on =e'e ,er 1G/ 2002 an! appointe! $hair an on May 24/ 200G. =r. >ne i( a +ra!uate -ro >niver(ity S'hool o- #eterinary Me!i'ine an! ha( a Ph= in Mi'ro,iolo+y. the Bokkai!o the &llinoi( &n(titute o- %e'hnolo+y in Pur!ue $hi'a+o/ Pra(a! a!!itionally hol!( a Ma(terC( !e+ree in &n!u(trial A! ini(tration -ro $hri(tM(

Sun P(arma< !srael -a:ov

13 | P a g e

Mr. &(rael Makov hol!( a B.S'. in A+ri'ulture an! M.S'. in :'ono i'( -ro

the Be,re5

>niver(ity/ Peru(ale . Mr. &(rael Makov i( the -or er Pre(i!ent an! $:D o- %eva Phar a'euti'al &n!u(trie( ;t!. $urrently/ Mr. &(rael Makov i( $hair an o- Given & a+in+/ a pioneer !eveloper an! the 5orl!M( lea!in+ provi!er o- 'ap(ule en!o('opyA $hair an o- Bioli+ht/ a li-e ('ien'e( inve(t ent 'o panyA $hair an o- Mi'ro e!i' %e'hnolo+ie( ;t!./ a 'lu(ter o'o panie( en+a+e! in 'an'er !ia+no(ti'(/ an! $hair an o- :ltav/ a pioneer o- 5irele(( onitorin+ o- in!u(trial valve(. , -4CROECO"O-!CS TRE"#S , 1 Government Re2ulation and Policy C(an2es G#U%4 )*10 %ee =i:e %he >S 6=A re'ently announ'e! the G=>6A )Generi' =ru+ >(er 6ee A't* -ee( -or -i('al year 2014 )D'to,er 1/ 2013 to Septe ,er 30/ 2014*. %he hike in ,oth the appli'ation an! -a'ility -ee( )-or -or ulation an! ,ulk !ru+(* ha( ,een in the ran+e o- 1G847 per 'ent )See %a,le 1 in appen!i4 -or 'o plete li(t*. %he >S i( one o- the key e4port !e(tination( -or the &n!ian phar a'euti'al pro!u't( an! a''ount( -or "e2li2ible im1act of fees (i:e %he hike in -ee( i( e4pe'te! to have a ne+li+i,le i pa't on the pro-ita,ility o- &n!ian 'o panie(. %he 'o(t o- !evelop ent o- a +eneri' pro!u't i( typi'ally I182 illion/ o- 5hi'h the appli'ation an! -a'ility -ee( a''ount -or le(( than 5 per 'ent. Ma9or !o e(ti' player( (u'h a( Auro,in!o/ $a!ila/ =r "e!!yM(/ Glen ark/ ;upin/ Sun Phar a/ <o'khar!t -ile aroun! 15820 +eneri' !ru+ appli'ation( in the >S annually )'alle! a,,reviate! ne5 !ru+ appli'ation( or AN=A(*/ an! (pen! 082 per 'ent o- their net (ale( on "H=. %he up5ar! revi(ion in -ee( i( not e4pe'te! to aterially i pa't the "H= (pen! o- 'o panie(. Ben'e/ the overall i pa't i( e4pe'te! to ,e ne+li+i,le. ore than 30 per 'ent o- &n!iaM( -or ulation e4port(.

#ru2 Price Control Order 8#PCO< )*1,9

14 | P a g e

<ith the noti-i'ation o- thi( or!er/ %he National Phar a'euti'al Pri'in+ Poli'y82012 'o e( into e--e't an! all the !ru+( un!er N;:M82011. %he(e 'urrently 'ontri,ute "( 13/033 'rore to the total annual (ale( o- "( 72/702 'rore. %he or!er ,rin+( 342 ,ulk !ru+( or 052 -or ulation( o- variou( !o(a+e( an! (tren+th( un!er !ire't pri'e 'ontrol/ a( a+ain(t 74 ,ulk !ru+( earlier. %he 2013 or!er allo5( phar a'euti'al 'o panie( to 5ith!ra5 e4i(tin+ pro!u't( -ro !ru+( in line 5ith the ne5 pri'in+ re+i e. A( per the provi(ion( o- NPPP82012/ all the the anu-a'turer(Fi porter( anu-a'turin+Fi portin+ the arket 5ithin 45 !ay( an! intro!u'e the (a e

e!i'ine( a( (pe'i-ie! un!er N;:M82011 (hall ,e un!er the purvie5 o- pri'e 'ontrol. Su'h e!i'ine(.

e!i'ine( (hall have an M"P e@ual to or lo5er than the 'eilin+ pri'e )plu( lo'al ta4e( a( appli'a,le* a( noti-ie! ,y the Govern ent -or re(pe'tive

>n!er the poli'y/ the 'eilin+ pri'e -or ea'h !ru+ un!er 'ontrol 5oul! ,e -i4e! a( the (i ple avera+e pri'e o- ,ran!( havin+ ore than 1 per 'ent arket (hare ),y value* in the (ale( )MA% 8 Movin+ Annual %urnover* o- that parti'ular ole'ule. %hu(/ pri'e( o- ,ran!( 5hi'h are hi+her

than thi( 'eilin+ 5ill nee! to ,e ,rou+ht !o5n. %he 'eilin+ pri'e( 5ill ,e allo5e! an annual in'rea(e a( per the <hole(ale Pri'e &n!e4 )<P&*. Pri'e( 5ill ,e re'al'ulate! u(in+ MA% only on'e in 5 year( or 5hen the N;:M i( up!ate!. %he o,9e'tive o- National Phar a'euti'al Pri'in+ Poli'y82012 i( to put in pla'e a re+ulatory -ra e5ork -or pri'in+ o- !ru+( (o a( to en(ure availa,ility o- re@uire! 'o petition to (upport the +ro5th o- in!u(try/ there,y (hare! e'ono i' 5ell8,ein+ -or all. %he pri'e 'ontrol poli'y i( e4pe'te! to re(ult in a one8ti e re!u'tion )o- a,out 385 per 'ent* in arket (i.e/ ,ut the overall +ro5th pri'e( have o entu i( likely to re ain lar+ely una--e'te!. Gro5th in thi( in!u(try ha( +enerally ,een !riven ,y in'rea(e in volu e( an! ne5 !ru+ intro!u'tion(/ 5hile ove! up in the ran+e o- 183 per 'ent )5ell 5ithin <P& in'rea(e(*. Barrin+ the one8 ove to re+ulate pri'e(/ 5e e4pe't the in!u(tryM( +ro5th o entu to ti e i pa't o- the e!i'ine( ? Qe((ential e!i'ine(R ? at rea(ona,le pri'e( even 5hile provi!in+ (u--i'ient opportunity -or innovation an! eetin+ the +oal( o- e ploy ent an!

'ontinue. Dur outlook -or the in!u(try re ain( po(itive.

15 | P a g e

, ) !m1act of Union ?ud2et )*1,/10 on t(e sector &n the Bu!+et 2013814/ , 37/330 'rore ha( ,een allo'ate! to the Mini(try o- Bealth an! 6a ily <el-are. D- thi(/ the ne5 National Bealth Mi((ion that 'o ,ine( the rural propo(e! ur,an e(ti ate. Moreover/ another , 4/727 'rore that ha( ,een provi!e! to5ar!( trainin+ an! re(ear'h 5ill in!ire'tly ,ene-it the (e'tor. &n'rea(e in rate o- ta4 on royalty pay ent( to -orei+n parent 'o panie( -ro 103 to 253.A i((ion an! the e!i'al e!u'ation/ i((ion 5ill +et , 21/23G 'rore/ an in'rea(e o- 24.3 per 'ent over the revi(e!

ar+inally ne+ative i pa't -or a -e5 phar a MN$( likely. :4a't i pa't 5oul! !epen! upon the (pe'i-i' =ou,le %a4 Avoi!an'e A+ree ent( 5ith the 'ountry in 5hi'h the -orei+n parent re(i!e(.

, , !m1lications of @TO &n!ia ,e'a e a <%D e ,er in 1GG5 an! 5ill have to apply the ne5 %"&PS rule( -or ultinational( -ro e!i'al

!ru+( in it( national patent le+i(lation ,y 1 Panuary 2005. %he ne5 rule( o- the <orl! %ra!e Dr+ani.ation )<%D* ,ene-it the phar a'euti'al prote'tion oe!i'al !ru+(. 'ountrie( (u'h a( the >SA/ Great Britain an! S5it.erlan!, an! threaten &n!iaM( a'hieve ent( happen 5ith a,(en'e o- patent

%ree Trade 42reements =ru+ aker( an! health'are a'tivi(t( are 5orrie! that the &n!ia8:uropean >nion 6ree %ra!e ay 'ontain a provi(ion that 'oul! i peril lo'al

A+ree ent )6%A*/ 5hi'h i( in the 5ork(/

16 | P a g e

in!u(try an! have ur+e! the +overn ent to keep patent in-rin+e ent i((ue( out o- 6%A(. %hey are apprehen(ive that &n!ia ,ank a''ount( an! i ay a+ree to a 'lau(e in the -inal a+ree ent/ (tipulatin+ that ere (u(pi'ion o- patent in-rin+e ent ,y an &n!ian !ru+ aker 'oul! lea! to (ei.ure o- the 'o panyM( e!i'al pro'ure ent a+en'ie( -or

ova,le property. &n9un'tion( 'oul! al(o ,e i((ue! a+ain(t inter e!iarie(

an! thir! partie( (u'h a( (upplier(/ !ru+ !i(tri,utor( an! in-rin+e ent o- intelle'tual property ri+ht(.

, 0 Com1etition from forei2n firms< %#!< im1orts< o11ortunities in overseas mar:ets %#! A''or!in+ to "e(erve Bank o- &n!ia !ata/ 6=& 5orth I2.02 ,illion 'a e into phar a pro9e't( ,et5een April 2012 an! April 2013/ 5hile +reen -iel! pro9e't( 'oul! attra't only I27.35 illion. Glo,al phar a 'o panie( inve(t a ne+li+i,le a ount on re(ear'h an! !evelop ent/ 5hi'h i( le(( than the !o e(ti' phar a 'o panie(/ an! even lo5er than the pu,li' (e'tor -ir ( in &n!ia. Overseas O11ortunities <ith a (tron+ +eneri' opportunity openin+ up over the ne4t 5 year( an! the nee! to e4pan! arket (hare(/ &n!ian player( 5ill look at option( (u'h a( 'ontra't venture( )P#(* an! over(ea( a'@ui(ition(. %he(e (trate+ie( 5ill ,e anu-a'turin+ !eal(/ 9oint ainly +eare! to5ar!( anu-a'turin+ !eal (i+ne! arket(.

e4pan!in+ pro!u't port-olio(/ ,ran! ,uil!in+ an! havin+ a 5ell8e(ta,li(he! !i(tri,ution net5ork. Su'h (trate+ie( are alrea!y +atherin+ pa'e a( 5itne((e! in the 'ontra't ,et5een P-i.er an! Auro,in!o Phar a -or (ale o- +eneri' !ru+( in the e er+in+ Phar aM( +eneri'( in the e er+in+

"e'ently/ Mer'k an! Sun Phar a have (i+ne! a !i(tri,ution a+ree ent -or the (ale o- Sun arket(/ 5hile $a!ila Bealth'are an! Bayer AG have (et8up a 9oint venture -or !i(tri,ution o- their !ru+( in &n!ia an! a,roa! !m1orts %he >S ha( (o e o- the hi+he(t !ru+ pri'e( in the 5orl! an! ha( attra'te! i port( o- +eneri' !ru+( -ro &n!ia an! a nu ,er o- lo5 'o(t 'ountrie(. Bo5ever/ (evere pri'e 'o pre((ion an! other lo5 'o(t 'ountrie( i( -or'in+ &n!ian a9or( to o--(et their lo((e( a!e +ro5in+ 'o petition -ro

,y (hi-tin+ their attention to <e(tern :urope. Nonethele((/ &n!ian 'o panie( have
17 | P a g e

tre en!ou( (tri!e( in the >.S.

arket an! 'o panie( like "an,a4y are

a9or (our'e( o- +eneri'

!ru+(. &n!ian 'o panie( al(o en9oy 'o parative a!vanta+e( in 'o(t/ (tren+th in rever(e en+ineerin+ (kill(/ an! nu ,er o- >.S. 6=A approve! plant( lo'ate! in &n!ia. &n!ian 'o panie( have (pent ri+ht( -or illion( o- !ollar( -ilin+ AN=A( 5ith the >.S. 6=A to +ain e4'lu(ive pro!u'tion any !ru+( lo(in+ their patent prote'tion in the >S.

18 | P a g e

0 411endix
-a&le 1

19 | P a g e

A ?iblio2ra1(y:
1. %he :'ono i' ti e( )2013* QBu!+et 2013 'oul! have !elivere!

ore -or health'are/ phar a

(e'tor(R 6e, 22/ 2013A http/00articles.economictimes.indiatimes.com02 13( 2(

280ne1s03735294 212ta'(incenti3es(4ortis(healthcare(pri3ate(sector )a( on Sep 10/

2013*.
2. $"&S&; "e(ear'h "eport Pu,li(h =ateJ 1G8Mar82013

http(JFF555.'ri(ilre(ear'h.'o Fin!u(trya(yn'.9(p4S (ervi'e&!T30HStateTnullU(tory&!U24200U(e'tion&!U400GUne5(6ee!&!Uun!e-ine! )a( on Sep 10/ 2013*. 3* Pre(( &n-or ation Bureau/ Govern ent o- &n!ia QMini(try o- $he i'al an! 6ertili.er(R httpJFF555.pi,.ni'.inFne5(iteF,a'k+roun!er(.a(p4Sreli!TG4324 )a( on Sep 10/ 2013*.
4. Piyu(ha $hatter9ee/ #ipul Murarka/ Mana(i. Q&n!ian ,u!+et -ail( to a!!re(( phar a/ ,iote'h

'on'ernR 22 6e,ruary 2013 httpJFF555.,io(pe'tru a(ia.'o F,io(pe'tru Fanaly(i(F175472Fin!ian8,u!+et8-ail(8a!!re((8 phar a8,iote'h8'on'ern(U.>i28DM79405 )a( on Sep 10/ 2013*. 5* $A": "atin+( QANA;7S&S D6 %B: >N&DN B>=G:% 2013814R httpJFF555. oney'ontrol.'o Fne5(Vht lV-ile(Fne5(Vatta'h entF2013FBu!+etV20138 14VAnaly(i(V$A":.p!0* Q"eport on phar a'euti'al &n!u(tryR a( on 10 Septe ,er 2013 httpJFF555.i-p a.or+F-ilea! inF'ontentFPu,li'ationF2011F2011V%heVPhar a'euti'alV&n!u(tr yVan!VGlo,alVBealthVlo5Vver2.p!7* %i e( o- &n!ia )2013* QPhar a 'o panie( -ortune( tie! to G=PR 12 Pune 2013 httpJFFti e(o-in!ia.in!iati e(.'o F,u(ine((Fin!ia8,u(ine((FPhar a8'o panie(8-ortune(8tie!8 to8G=PFarti'le(ho5F1G07133G.' ( a( on 10 Septe ,er 2013

2 |Page

2* Q%e'hnolo+y tren!( (hapin+ the phar a'euti'al in!u(try an! an!8 e!i'al8!evi'e8innovationF

e!i'al !evi'e innovationR

httpJFF555. e!i'al(ale('r .'o F58te'hnolo+y8tren!(8(hapin+8the8phar a'euti'al8in!u(try8

G* "an,a4y ;a,oratorie( J httpJFFe'ono i'ti e(.in!iati e(.'o Fran,a4y8la,oratorie(8 lt!F(to'k(F'o panyi!813212.' ( a( on 10th Septe ,er/ 2013 10* $ipla J httpJFFe'ono i'ti e(.in!iati e(.'o F'ipla8lt!F(to'k(F'o panyi!813G17.' ( a( on 10th Septe ,er 11* Sun Phar aJ httpJFFe'ono i'ti e(.in!iati e(.'o F(un8phar a'euti'al8in!u(trie(8 lt!F(to'k(F'o panyi!8G134.' ( a( on 10th Septe ,er/ 2013 12* =r. "e!!yC(J httpJFFe'ono i'ti e(.in!iati e(.'o F!r8re!!yM(8la,oratorie(8 lt!F(to'k(F'o panyi!813241.' ( a( on 10th Septe ,er 13* $ipla Analy(i(J httpJFF555.'ipla.'o F$iplaSiteFMe!iaF& a+e(FBannerF>nau!ite!8 Stan!alone86inan'ial8"e(ult(830th8Pune82013V1.p!-Se4tT.p!- a( on 10th Septe ,er/ 2013 14* Karel !e Gu'ht/ Anan! Shar a 9oint op8e!/ Bu(ine(( Stan!ar!/ 13 =e'e ,er 2011 httpJFF555.,u(ine((8(tan!ar!.'o Fin!iaFne5(Fanan!8(har akarel8!e8+u'htpartner(8in8tra!e8 partner(8-or8+ro5thF417G50 a( on Septe ,er 01 2013 15* QBu(ine(( ;ineR pu,li(he! a( on Septe ,er 01 2013 10* Q100 6=& ,a! -or phar a (e'torJ Parl $o 1035703.ht l a( on Septe ,er 01 2013 17* M.=. Nair Q%"&PS/ <%D an! &P"R Pournal o- intelle'tual property ri+ht(R/ vol 15/ nove ,er 2010/pp 4748470 a( on Septe ,er 01 2013 12* "an,a4y ,oar! o- =ire'tor( httpJFF555.ran,a4y.'o Fa,out8u(F,oar!8o-8!ire'tor(F!r8 t(uto u8uneF a( on Septe ,er 01 2013 1G* =r. "e!!y ,oar! o- !ire'tor( a( on Septe ,er 01 2013 httpJFF555.!rre!!y(.'o Fa,outu(Fpro-ile(F,io+raphyV+vp.ht 20* Sun phar a ,oar! o- !ire'tor( a( on Septe ,er 01 2013 httpJFF555.(unphar a.'o F,oar!
21 | P a g e

itteeR 12th Au+u(t 2013 ittee8

555.-ir(tpo(t.'o Fe'ono yF1008-!i8in8phar a8(e'tor8,a!8-or8'ountry8parl8'o

21* "an,a4y ,oar! o- !ire'tor( a( on Septe ,er 01 2013 httpJFF555.ran,a4y.'o F,u(ine((8 operation(F anu-a'turin+F 22* $ipla ,oar! o- !ire'tor( httpJFF555.'ipla.'o FBo eF6a'ilitie(FLuality.a(p4

22 | P a g e