Indian Pharmaceutical Industry, The:

Summary

Indian pharmaceutical industry is undergoing fast paced changes. The Indian Generics market is witnessing rapid growth opening up immense opportunities for firms. This is further triggered by the fact that generics worth over $40 billion are going off patent in the coming few years which is close to 15% of the total prescription market of the US. The Indian pharmaceutical companies have been doing extremely well in developed markets such as US and Europe, notable among these being Ranbaxy, Dr. Reddy's Labs, Wockhardt, Cipla, Nicholas Piramal and Lupin. The companies have their strategies in place to leverage opportunities and appropriate values existing in formulations, bulk drugs, generics, Novel Drug Delivery Systems, New Chemical Entities, Biotechnology etc.

The industry ranks fourth globally in terms of volume and in terms of value, it is ranked thirteenth. The industry has thrived so far on reverse engineering skills exploiting the lack of process patent in the country. This has resulted in the Indian pharmaceutical players offering their products at some of the lowest prices in the world. The quality of the products is reflected in the fact that India has the highest number of manufacturing plants approved by US FDA (61 plants), which is next only to that in the US. Multinational companies have traditionally dominated the industry, which is another trend seeing a reversal. Currently, it is the Indian companies which are dominating the marketplace with the local players dominating a number of key therapeutic segments. The market is also very fragmented with about 30,000 entities and the organized sector consisting of about 300 entities. Consolidation is increasing in the industry with many local players building a global outlook and also growing inorganically through mergers and acquisitions.

Contents

Introduction
Projected Market Size
Break-Up Of The Market
Key Statistics Of The Indian Pharmaceutical Industry
Historical Background

Market Overview

Global Pharmaceutical Sector
Global Expenditure Patterns
Pharmaceutical Products As A Percentage Of Total Healthcare Spending
R&D Expenditures
Managed Care Spends
Generics Gaining Ground
Blockbuster Drugs
Structural Changes In The Industry

Characteristics Of The Indian Pharmaceutical Industry

Profitability
Location
Segmentation Of The Indian Pharmaceutical Industry
Major Therapeutic Segments
Strategic Groups

Key Emerging Trends

Organised Sector
Multinational Pharmaceutical Firms
Indian Pharmaceutical Firms
Unorganised Sector

Critical success Factors For The Industry Player

Research & Development
Production
Marketing, Sales And Distribution
Operational Efficiency
Alliances
Pre 2005 Critical Success Factors- Formulations
New Product Launches
Therapeutic Coverage
Sales And Distribution Network
Strong Brands
Exports
Critical Mass
Pre 2005 Critical Success Factors - Bulk Drugs
Low Cost Structure
Internationally Approved Manufacturing Facilities
Speedy Launches
Post 2005 Critical Success Factors

Research And Development

Marketing Alliances With International Players
Pre 2005 Critical Success Factors - Indian Companies
Pre 2005 Critical Success Factors - Mncs
Post 2005 Critical Success Factors - Indian Companies
Post 2005 Critical Success Factors - Mncs
Research And Development
Kinds Of Research
Basic R&D
Process Research Or Reverse Engineering
Analogue Or Discovery Research
Biotechnology Research
Bringing Out A Generic Drug
Ndds Research
How Does R&D Add Value In The Pharmaceutical Industry?
R&D In India
Changing Scenario Of Indian R&D
Significant Milestones In Local R&D

Industry Structure

Investments
Exports
Research And Development
Policies And Regulations
Indian Patents Act 1970
Dpco (Drug Price Control Order) - 1970
Gatt And Wto
Implications Of The Wto
On Prices Of Drugs
On R&D
Intellectual Property Rights (Ipr)
Changing Scenario Of Product Patent Regime
Critic's View
Price Escalation
Mnc Dominance
R&D Expenditure
Technology
Conclusion

Key Players In The Indian Pharmaceutical Industry

Key Mnc's

Glaxo Smithkline
Introduction
Business Model
Products And Services
Company Strategy
Revenue Break-Up
Pfizer
Introduction
Business Model
Products And Services
Company Strategy
Revenue Break-Up
Novartis
Introduction
Business Model
Products And Services
Aventis
Introduction
Business Model
Products And Services
Company Strategy
Revenue Break-Up
Wyeth
Introduction
Products And Services
Merck
Introduction
Products And Services
Company Strategy
Revenue Break-Up

Key Indian Firms In The Indian Pharmaceutical Industry

Ranbaxy
Introduction
Business Model
Products And Services
Company Strategy
Revenue Break-Up
Nicholas Piramal India
Introduction
Business Model
Products And Services
Company Strategy
Revenue Break-Up
Introduction
Business Model
Products And Services
Company Strategy
Revenue Break-Up
Cipla
Introduction
Business Model
Products And Services
Company Strategy
Revenue Break-Up
Lupin
Introduction
Business Model
Products And Services
Company Strategy
Revenue Break-Up
Wockhardt
Introduction
Business Model
Products And Services
Revenue Break-Up

Marketing & Distribution In The Pharmaceutical Industry

The Changing External Environment

Porters Five Forces Model

Threat Of New Entrants
Intensity Of Competition
Threat Of Substitutes
Bargaining Power Of Buyers
Bargaining Power Of Suppliers

Future Outlook For The Indian Pharmaceutical Industry

Product Patents
Industry Profitability
Alternative Medicine
Emerging Trends
Key Growth Barriers For The Industry
Consolidation
Share Of Generics
Cost Competitiiveness
Sourcing Base
Environmental Concerns
Bulk Drug Exports
External Competition
Manufacturing Certifications
Imports
Dumping
Profitability
Unorganised Sector
Patent Protection
R&D
Production Costs

Case Of A Leading Pharmaceutial Firm: Ranbaxy Laboratories

History
Ranbaxy's Successful Report Card
Why Has Ranbaxy Been This Successful?
Evolution Of Ranbaxy: Time Line Analysis
1970-Early 1980S
Early 1980S-1994
1994 - 1997
1997 Onwards
Leveraging Mergers & Alliances
Research And Development
Alliances For Entry Into Us And European Markets
Growth Of Market Share And Product Portfolio
Company Acquisitions
Brand Acquisitions
Creating Value Through Functional Strategies
Marketing
Relationship Marketing
Co-Marketing
Sales Strength
Brand Recognition
Ranbaxy's Product Strategy
Ranbaxy's R&D Strategy
Ranbaxy's Human Resources Strategy
Information Technology

Revenue Model For A Pharmaceutical Company

Strategic Options For Pharmaceutical Firms
Invest In Research And Development Capabilities
Grow A Wide Product Portfolio
Growth Through Mergers And Acquisitions
Growth Through Brand Acquisition
Growth Through Licensing Agreements
Co Marketing Agreement With Competitors
Remain A Generics Player
How To Build Sustainable Competitive Advantage
Product Portfolio Management
Integrated Healthcare Company
Distribution
Disease Management/ Service Provider
Clinical Test Centres
Healthcare Funding Systems
Re-Engineering
Outsourcing Services

List Of Tables

1: Pharmaceutical Companies In India
2: Leading Therapeutic Segments
3: Market Share Of Major Therapeutic Segments
4: Leading Brands In Major Therapeutic Segments
5: Brand Acquisitions In The Indian Pharmaceutical Industry
6: R&D Investment Of Indian Pharmaceutical Companies
7: Drugs Under Dpco And The Share Of The Industry
8: Where India Stands On Patents
9: Key Players And Their Characteristics
10: Key Brands Of Glaxo Smithkline In India
11: Key Brands Of Pfizer In India
12: Key Brands Of Novartis In India
13: Key Brands Of Aventis In India
14: Key Brands Of Wyeth In India
15: Key Brands Of Merck In India
16: Key Brands Of Ranbaxy
17: Key Brands Of Nicholas Piramal
18: Key Brands Of Dr Reddy's
19: Key Brands Of Cipla
20: Key Brands Of Lupin
21: Key Brands Of Wockhardt
22: Ranbaxy's It Initiatives
23: Typical Price Drops After A Drug Goes Off Patent

Table Of Figures

1: Projected Size Of Indian Pharmaceutical & Biotechnology Industry
2: Projected Break-Up Of Indian Pharmaceutical & Biotechnology Industry
3: Production Trends Of Pharmaceuticals In India
4: Strategic Group Mapping Of Indian Pharmaceutical Industry
5: Value Added By Pharmaceutical Products
6: Glaxo Smithkline India Product Portfolio
7: Glaxo Smithkline Revenue Break-Up
8: Pfizer India Product Portfolio
9: Merck India Revenue Break-Up Based On Business Segments
10: Ranbaxy Revenue Break-Up
11: Nicholas Piramal Break-Up Of Revenue From Formulations
12: Nicholas Piramal Revenue Break-Up
13: Drl Product Portfolio
14: Lupin Business Profile
15: Lupin Therapeutic Portfolio
16: Distribution Chain Of Pharmaceutical Companies In India
17: Porter's 5 Forces Model Applied
18: Ranbaxy's Focus During 1970-Early 1980S
19: Ranbaxy's Focus During Early 1980S-1994
20: Ranbaxy's Focus During 1994-1997
21: Ranbaxy's Focus From 1997 Onwards
22: Value Chain Of Ranbaxy
23: Strategic Options Available For Pharmaceutical Firms