Background details of Pharma sector

Introduction
Pharmaceutical industry in India is one of the most important industry in India. It not
only provides employment but it also saves millions of lives with its medicines and
vaccinations. It is important as it is also vital to the healthcare industry in India.
Pharmaceutical Industry has been marked as most innovative industry in the past
and present for the world development.

India is the world’s fastest growing economy with its second largest population in the
world makes India a thrust for the development of the Indian Pharmaceutical sector.
India today has a unique demographic advantage and disadvantage at the same
time, owing to its tremendously large population. India is home to around 1.3 billion
people or about 1/7th of the world's population. The advantage remains that such a
huge population makes us a very large and attractive market as it is one of the
youngest in the world. The disadvantage certainly is that the per capita necessary
medication is also very high owing to the challenging economic conditions that exist.
Pharmaceutical Industry has travelled an elongated journey from mere recognition to
worlds third-largest pharmaceutical marketplace internationally in terms of size and
thirteen largest in terms of its worth.

The industry also plays a vital role in socio-demographic-economic wellbeing of the

country. The ‘UN Millennium Development Goals’ has identified pharmaceutical
industry as an economic contributor as it amongst of the most advanced and capital-
intensive industry. It is observed as the key industry in any economy due of the
health related products it produces, it plays a fundamental role in treating the agony
of ailing people. It is also a noteworthy benefactor in empowering economy by
generating jobs for masses and adding in earnings of foreign exchange by its
growing exports. India has one of the largest pharmaceutical sectors in the world.
India is the largest provider of generic drugs globally. Indian pharmaceutical sector
supplies over 50 per cent of global demand for various vaccines, 40 per cent of
generic demand in the US and 25 per cent of all medicine in the UK.

Indian pharmaceutical industry

India is a prominent and rapidly growing presence in global pharmaceuticals. It is the
largest provider of generic medicines globally, occupying a 20% share in global
supply by volume, and also supplies 62% of global demand for vaccines. India ranks
3rd worldwide for production by volume and 14th by value. India is the only country
with largest number of US-FDA compliant Pharma plants (more than 262 including
APIs) outside of USA. India has nearly 2000 WHO-GMP approved Pharma Plants,
253 European Directorate of Quality Medicines (EDQM) approved plants with
modern state of the art Technology.
India is the source of 60,000 generic brands across 60 therapeutic categories and
manufactures more than 500 different Active Pharmaceutical Ingredients (APIs). The
API industry is ranked third largest in the world contributing 57% of APIs to
prequalified list of the WHO.
The country is home to more than 3,000 pharma companies with a strong network of
over 10,500 manufacturing facilities. The domestic pharmaceuticals market turnover
reached $20.03 bn in 2019, up 9.3% from 2018, growing as penetration of health
insurance and pharmacies rise.
 From 2018-19, India’s pharmaceuticals exports were worth $19.3 bn with a
growth of 10.72% year on year
 India holds 12% of all global manufacturing sites catering to US market
 The cost of manufacturing in India is approximately 33% lower than that of the
US

Major segments of the pharma industry

1)   API- Active Pharmaceutical Ingredient

The main ingredient in Pharmaceutical is API [Active Pharmaceutical Ingredient]. It is
the main drug which cures the disease. There are many companies which produce
and are specialist in only producing APIs. In producing APIs the companies either
purchase intermediates from different players and mix them to produce a final API or
they themselves produce all the intermediates and mix at their own place. These are
the companies which deal only in API. They sell their produced APIs to different
formulation players who then further process it to make it a consumable drug.
The companies in this business do not attract high profit margins because there are
many players who produce a single chemical and even if they try to charge high
price from their customers then they can lose their revenue because of high
competition in the market. However, such business work in bulk deals as the
formulation players purchase finished API from them in bulk due to which even if
they lose a single customer a good amount of revenue is lost. Generally, the size of
the market of the API used in a formulation is 10% of the total formulation market

2) Formulations
Pharmaceutical formulation, in pharmaceutics, is the process in which different
chemical substances, including the active drug, are combined to produce a final
medicinal product. The word formulation is often used in a way that includes dosage
form.
The production of formulations in India increased at a CAGR of 17% during the
period FY1991-2001. The exports of formulations from India increased at a CAGR of
29% during FY1991-2000. The strong growth in formulation exports during the 1990s
can be attributed to exports made to the developing markets and the access gained
by Indian players to the generics markets of developed countries.
Formulations account for over 50% of the total pharmaceutical exports from India. A
series of mergers and acquisitions in the pharmaceutical industry has resulted in the
concentration of market share among the leading players in the formulations
segment. Also, over a period of time, the incumbent players in the formulations
market have been able to set up extensive distribution networks, thus driving sales of
their brands and increasing market share.

3)  CRAMS-Contract Research and Manufacturing

Pharmaceutical companies are increasingly outsourcing research activities to
academic and private contract research organizations (CROs) as a strategy to stay
competitive and flexible in a world of exponentially growing knowledge, increasingly
sophisticated technologies and an unstable economic environment. It has been
widely recognized that the global pharmaceutical industry is currently experiencing
dynamic change. Under high pressure to contain fixed costs, all drug companies are
currently reducing their internal capacities in R&D, manufacturing, and even
marketing and, instead, increasing their outsourcing. To a significant extent, the drug
companies, large or small, now rely on outsourcing service providers more than ever
to fulfil their tasks, solve their problems, and improve their efficiency and productivity .

4)  Biosimilars
Biosimilar are medicines made from living cells through highly complex
manufacturing processes and must be handled and administered under carefully
monitored conditions. Biosimilar are used to prevent, treat, diagnose, or cure a
variety of diseases including cancer, chronic kidney disease, autoimmune disorders,
and infectious diseases. A biosimilar is exactly what its name implies — it is a
biologic that is “similar” to another biologic drug already approved by the FDA. The
clinical trials carried out on a potential biosimilar are designed differently to those for
approval of a novel biologic. When assessing a potential biosimilar, the aim is to
confirm that there are no clinically meaningful differences in its efficacy and safety
compared to the reference product.
Evolution of the Indian Pharmaceutical industry

These are some of the major milestones in the Indian Pharmaceutical Industry in
India.

Major Pharmaceutical hubs in India

Hyderabad, Mumbai, Pune, Baddi, Chennai, Bangalore, Ahmedabad, Vadodara,
Ankleshwar , Vapi, Sikkim and Kolkata are the major pharmaceutical manufacturing
hubs of India.

Indian companies carved a niche in both the Indian and world markets with their
expertise in reverse-engineering new processes for manufacturing drugs at low costs
which became the advantage for industry. India has also large clusters for captive
R&D units and formulation clusters especially in the western and southern region of
the country
2)Various organizations involved in the pharma sector in India and
the size and capacity of these organizations

 1) Sun Pharmaceutical Industries Limited

Sun Pharmaceutical Industries Limited is a multinational company and was
established by Mr. Dilip Shanghvi in 1983 offering products to treat psychiatry
ailments. Today the company offers formulations in various therapeutic areas, such
as cardiology, psychiatry, neurology, gastroenterology and diabetology.

Revenue: Sun Pharmaceutical is India's largest pharmaceuticals company based on

overall revenue. In FY 2018 the company's revenue was INR 273.28 billion which
was 15.13% less than the revenue in FY 2017.
Manufacturing capabilities: Sun Pharma have over 40 ( API & finished dose)
state-of-the-art manufacturing sites spanning 6 continents. These manufacturing
units are located in India, the US, Brazil, Canada, Egypt, Hungary, Israel,
Bangladesh, Mexico, Romania, Ireland, Morocco, Nigeria, South Africa and
Malaysia. Our units ensure that we are able to provide best-in-class products to
patients across 150 countries worldwide.

Their manufacturing operations are focused on producing generics, branded

generics, speciality, over-the-counter (OTC) products, anti-retrovirals (ARVs), Active
Pharmaceutical Ingredients (APIs) and intermediates in the full range of dosage
forms, including tablets, capsules, injectables, ointments, creams and liquids. We
also manufacture speciality APIs, including controlled substances, steroids, peptides
and anti-cancers.

2) Aurobindo Pharma Limited

Aurobindo Pharma was established in 1986 limited is a Hyderabad based
manufacturing company established in 1986 and it's key business segments are
APIs, Formulations and Packaging. This company started way back in 1988 in
Puducherry.It also exports its productions to other countries. Aurobindo Pharma sells
over 300 products in over 125 countries. About 35% sales are generated through
APIs, and About 65% of the company’s revenue is generated from formulations
business, of which 63% of formulation sales comes from United States.
Revenue: Aurobindo Pharma is India's second largest pharmaceuticals company
based on overall revenue. In FY 2018 the company's revenue was INR 164.99
billion which saw an increase of 9.34% over the revenue in FY 2017.
Manufacturing capabilities: Aurobindo have 15 state-of-the-art formulation
manufacturing facilities located in India, USA, Portugal and Brazil. Starting with a
small SSP manufacturing unit in 1988, Aurobindo has grown to become the market
leader in SSPs, non penicillins, cephalosporins, and non cephalosporins. In the
global market, we believe in retaining our leadership in SSPs, cephalosporins, new
anti-infectives and lifestyle disease drugs.

3. Lupin Limited
Lupin was established in 1968 and it's key business segments are APIs and
Formulations, and the company manufactures and markets pharmaceutical products
in all major markets across the globe. Lupin has a presence in key growth therapies
such as Cardiology, Central Nervous System, Diabetology, Respiratory, Gynecology,
Anti-Infective, Gastro-Intestinal and Oncology.
Revenue: Lupin is India's third-largest pharmaceuticals company based on overall
revenue. In FY 2018 the company's revenue was INR 159.55 billion which declined
by 9.35% compared to revenue in FY 2017.
Manufacturing capabilities: It has 12 manufacturing plants and 2
Research plants in India, as Jammu(J&K), Mandideep & Indore (Madhya pradesh),
Ankaleswar & Dabasa (Gujarat), Tarapur, Aurangabad and Nagpur (Maharashtra),
Goa, Visakhapatnam (Andhra Pradesh) and Sikkim; where research centre at Pune
and Aurangabad.

4. Cipla Limited
Chemical, Industrial & Pharmaceutical Laboratories, now known as Cipla, was
incorporated in 1935. Cipla Limited was founded by Dr. K.A. Hamied. Cipla is a
therapy leader in India for anti-malarial with a market share of over 34%.
Revenue: Cipla is India's fourth largest pharmaceuticals company based on overall
revenue. In FY 2018 the company's revenue was INR 155.77 billion which saw an
increase of 4.83% over the revenue in FY 2017.
Manufacturing capabilities: Cipla has four sites with dedicated facilities for high
potent APIs, corticosteroids, polypeptides, hormones, steroids and oncology with a
total capacity of over 1,000 MT across. The Company has three API R&D Centres,
two pilot plant and two process safety screening labs.

5. Dr. Reddy’s Laboratories

Dr. Reddy’s Laboratories is headquartered in Hyderabad and was founded in 1984.
The company manufactures and markets a wide range of pharmaceuticals in India
and overseas. The company has over 190 medications, 60 active pharmaceutical
ingredients (APIs) for drug manufacture, diagnostic kits, critical care, and
biotechnology products.
Revenue: Dr. Reddy’s Laboratories is India's fifth largest pharmaceuticals company
based on overall revenue. In FY 2018 the company's revenue was INR 144.36
billion which saw an increase of 0.48% over the revenue in FY 2017.
Manufacturing capabilities: It has 6 manufacturing units in India manufacturing
HPAPI, oncology, and other synthetic molecules. It also has manufacturing units in
Mexico and United Kingdom

6. Cadila Healthcare Limited

Cadila Healthcare Limited was founded in 1952. Zydus Cadila provides total
healthcare solutions ranging from formulations, active pharmaceutical ingredients
and animal healthcare products to wellness products.
Revenue: Cadila Healthcare Limited is India's sixth largest pharmaceuticals
company based on overall revenue. In FY 2018 the company's revenue was INR
120.50 billion which saw an increase of 24.21% over the revenue in FY 2017.
Manufacturing capabilities: Zydus Cadila develops and manufactures a large
range of pharmaceuticals as well as diagnostics, herbal products, skin care products
and other OTC products. Starting from late 2015, having concluded a voluntary
license agreement with Gilead, the company also produces the generics for hepatitis
C treatment (i.e. sofosbuvir, distributed under the brand name SoviHep).
The company makes active pharmaceutical ingredients at three sites in India,
Ankleshwar plants, Vadodara plant, and Patalganga plant.

7. Intas Pharmaceuticals Limited

Intas was founded in 1984. Intas has 13 commercialized biosimilars including
Docetaxel & Paclitaxel. As on date, Intas continues its R&D efforts in chronic disease
areas such as oncology (cancer), rheumatology, auto-immune, nephrology,
ophthalmology and plasma-derived product-based therapies. Intas has 14
formulation manufacturing facilities, of which seven are located in India, and the rest
in the U.K. and Mexico.
Revenue: Intas Pharmaceuticals is India's seventh largest pharmaceuticals
company based on overall revenue. In FY 2018 the company's revenue was INR
108.86 billion which saw an increase of 29.84% over the revenue in FY 2017.
Manufacturing capabilities: In India, they have R&D and manufacturing facilities in
Ahmedabad. They also have plants in UK, Spain, Australia and Canada. They
produce biosimiliar products in these facilities

8. Glenmark Pharma Limited

Glenmark Pharma Limited was founded in 1977. Glenmark is a research-driven
organization which is focused on discovering novel molecules and developing high-
quality generics for people all around the globe. With a focus towards innovation and
a robust growth framework, the company's drug discovery endeavours continue to
play a vital role in the therapeutic areas of dermatology, respiratory and oncology.
Revenue: Glenmark Pharma Limited is India's eighth largest pharmaceuticals
company based on overall revenue. In FY 2018 the company's revenue was INR
91.86 billion which saw a decrease of 0.21% over the revenue in FY 2017.
Manufacturing capabilities: Globally Glenmark has 16 manufacturing facilities
across the globe. Glenmark has 5 state-of-the-art manufacturing facilities situated in
Ankleshwar & Dahej in Gujarat; and Aurangabad, Kurkumbh & Mohol in Maharashtra
which collectively manufacture over 100 APIs.

9. Torrent Pharmaceuticals Limited

Torrent Pharmaceuticals Limited was founded in 1959. The company is engaged in
manufacturing and marketing of branded and unbranded generic formulations.
Currently, the company consumes most of the APIs manufactured in its facility, and
only a fraction is sold to the external consumers. Also, the company is engaged in
contract manufacturing of formulations for pharmaceutical majors. For the last fifteen
years, Torrent Pharmaceuticals has been manufacturing Insulin for Novo Nordisk
Indian operations
Revenue: Torrent Pharmaceuticals is India's ninth largest pharmaceuticals company
based on overall revenue. In FY 2018 the company's revenue was INR 63.01
billion which saw an increase of 3.63% over the revenue in FY 2017.
Manufacturing capabilities Torrent Pharmaceuticals operates in more than 40
countries with over 2000 product registrations globally. The company's key areas are
Formulations, API, Drug Discovery, Marketing and Sales of Drugs. Its operations
locations are: Manufacturing plant at Dahej, Gujarat, Madhya Pradesh, Indrad,
Mehsana, Gujarat, Baddi, Himachal Pradesh, Manufacturing plant at Rang-Po,
(Sikkim) Manufacturing plant at Visakhapatnam (Andhra Pradesh).

10. ManKind Pharma Limited

ManKind Pharma Limited was founded in 1995. The company is engaged in
manufacturing of a wide range of products – Antibiotic, Antifungal, NSAIDs,
Gastrointestinal, Anthelmintic, Cardiovascular, Dermal, Erectile Dysfunction, and
several other categories.
Revenue: ManKind Pharma is India's tenth largest pharmaceuticals company based
on overall revenue. In FY 2018 the company's revenue was INR 52.00 billion which
saw an increase of 16.67% over the revenue in FY 2017.
Manufacturing capabilities: Mankind Pharma has 21 state-of-the-art manufacturing
facilities in various areas like Paonta Sahib, Himachal Pradesh, Sikkim, Vizag &
Rajasthan. The company has products in therapeutic areas.

11. Biocon Limited

Biocon Limited was founded in 1978. From being an enzyme venture, Biocon
successfully emerged as a biotechnology company in less than two decades time
and now is a fully-integrated Biopharmaceutical company. The parent company’s key
subsidiaries are Syngene International Limited, Biocon Biopharmaceuticals Private
Limited, Biocon Research Limited, Switzerland-based Biocon SA and Malaysia-
based Biocon SDN.BHD. Also, The Company owns 50% stake in Abu Dhabi-based
NeoBiocon FZ.
Revenue: Biocon Limited is India's eleventh largest pharmaceuticals company
based on overall revenue. In FY 2018 the company's revenue was INR 43.36
billion which saw an increase of 6.33% over the revenue in FY 2017.
Manufacturing capabilities: The Company manufactures generic active
pharmaceutical ingredients (APIs) that are sold in over 120 countries across the
globe, including the developed markets of the United States and Europe.It has
manufacturing units in Bangalore and Vishakhapatnam.

12. Piramal Enterprises Limited

Piramal Enterprises Limited was founded in 1988.The Company is in the pharma,
critical care, consumer products, phytomedicine and imaging. For this ranking only
the pharmaceuticals division's revenue was considered.
Revenue: Piramal is India's twelfth largest pharmaceuticals company based on
overall revenue. In FY 2018 the company's revenue was INR 43.22 billion which saw
an increase of 11.03% over the revenue in FY 2017.
Manufacturing capabilities: It has its major manufacturing unit at Digwal producing
API units for meeting India requirements

13. Wockhardt Limited

Wockhardt Limited was founded in 1960s. Wockhardt has 3 research centres and 12
manufacturing plants, with businesses ranging from the manufacture and marketing
of Pharmaceutical and Bio-pharmaceutical formulations, Active Pharmaceutical
Ingredients (APIs) and Vaccines.
Revenue: Wockhardt Limited is India's thirteenth largest pharmaceuticals company
based on overall revenue. In FY 2018 the company's revenue was INR 40.57
billion which saw a decrease of 1.74% over the revenue in FY 2017.
Manufacturing capabilities: It has 3 research centres and 12 manufacturing plants,
with businesses ranging from the manufacture and marketing of Pharmaceutical and
Bio-pharmaceutical formulations, Active Pharmaceutical Ingredients (APIs) and
Vaccines.

14. Divis Laboratories Limited

Divis Laboratories Limited was founded in 1990. Divis Laboratories business
segments are Active Pharma Ingredients, Nutraceuticals and intermediates. The
company exports over 90% of manufactured products to foreign countries and only
8%-10% is consumed in India yearly. The company derives nearly 90% of revenues
from developed economies such as Europe and US.
Revenue: Divis Laboratories is India's fourteenth largest pharmaceuticals company
based on overall revenue. In FY 2018 the company's revenue was INR 40.26
billion which saw a decrease of 3.70% over the revenue in FY 2017.

Manufacturing capabilities: Divi’s currently operates two manufacturing sites near

Hyderabad and Visakhapatnam in India. Both the manufacturing units have more
than 35 production buildings and 50 pharma suits with a total reaction capacity of
more than ~12000m3, making it one of the largest API manufacturing facilities in the
world. The pilot plants at Divi’s are capable of handling high potent products
(Products with exposure level up to 10mcg/m3) and several low dose products under
cGMP.Divis is Commercial-scale manufacturer of non-potent & highly potent APIs to
deliver from gram scale to 1000’s of tons under cGMP.

15. Abbott India Limited

Abbott India Limited was founded in 1944. Abbott India Limited is public listed
company and a subsidiary of Abbott Laboratories USA. Abbott India has
headquarters in Mumbai, Maharashtra. The company manufactures pharmaceutical
drugs and enjoys strong brand equity multiple therapeutic categories such as
Women's Health, Gastroenterology, Neurology, Thyroid, Diabetes, Urology, Pain
Management, Vitamins, Anti-Infectives & other therapy areas.
Revenue: Abbott India Limited is India's fifteenth largest pharmaceuticals company
based on overall revenue. In FY 2018 the company's revenue was INR 34.24
billion which saw an increase of 14.29% over the revenue in FY 2017.
Manufacturing capabilities: Its pharmaceuticals business fulfills most of its product
requirements in India through two local plants—Baddi in Himachal Pradesh and
Verna in Goa. Abbott is the manufacturer of many popular products in the
formulation sector including therapeutic areas of cardiovascular, diabetes,
diagnostics, neuromodulation, nutrition and pharmaceuticals. Some of its well-known
brands include Similac, PediaSure, Pedialyte, Brufen, Klacid, Alinity, Ensure,
FreeStyle, iStat and MitraClip.