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Present Scenario of Pharmaceutical Sector

Pharmaceuticals are medicinally effective chemicals, which are converted to doses forms
suitable for patients in the basic chemical form. Pharmaceuticals are called bulk drugs and final
doses forms are known as formulations. Bulk drugs are derived from four types of intermediates
i.e., raw materials viz., (i) plant derivatives or herbal products, (ii) animal derivatives e.g., insulin
extracted from bovine pancreas, (iii) synthetic chemicals, and (iv) biogenetic or human
derivatives e.g., human insulin. These are substances known as medicines and used in preventing
and curing illness and diseases. Usage of pharmaceutical is governed by underlying science of
illness and disease.
Branches of medical sciences have been divided into four categories, where allopathy system of
medicine is known as modern medicine and world over pharmaceutical industry is focused upon
it. Ayurvedic system of medicine is ancient Indian medicine science and mainly uses herbal
remedies and gaining importance in pharmaceutical market particularly in United States of
America. Unani system of medicine has its origin in China and is prevalent in South East Asia
region. Homeopathy system of medicine is found by German physician and was fairly popular in
19th century and still prevalent in third world countries.
Indian Pharmaceutical Industry: Indian pharmaceutical sector has come a long way, almost nonexistent before 1970 to a prominent provider of healthcare products, meeting almost 95 percent
of pharmaceutical needs of the country. In the present scenario, the industry is in front rank of
science based industries with wide ranging capabilities in the complex field of drug manufacture
and technology. It ranks very high in third world, in terms of technology, quality and range of
medicines manufactured. Range of medicines manufactured in India cover simple headache pills
to sophisticated antibiotics and complex cardiac compounds, almost every type of medicine is
made indigenously. Playing a key role in promoting and sustaining development in the vital field
of medicines, Indian pharma industry boasts of quality producers and many units approved by
regulatory authorities in United States of America and United Kingdom. International companies
associated with this sector have stimulated, assisted and spearheaded dynamic development in
past 60 years and helped to put India on the pharmaceutical map of the world. Following the
delicensing of pharmaceutical industry, industrial licensing for most of drugs and pharmaceutical
products has been done away with. Manufacturers are free to produce any drug duly approved by
the Drug Control Authority. Technologically, strong and totally self-reliant, the pharmaceutical
industry in India has low costs of production, low research and development expenses,
innovative scientific manpower, strength of national laboratories and increasing balance of trade.
Total Indian production constitutes about 13 percent of the world market in value terms and eight
percent in volume terms.
Indian pharmaceutical industry is mounting up the value chain from pure reverse engineering
industry focused on domestic market, the industry is moving towards basic research driven,
export oriented global presence, providing wide range of value added quality product and

service, innovation, product life cycle management and enlarging their market reach. The old and
mature categories like anti-infectives, vitamins, analgesics etc are de-growing, while new
lifestyle categories like cardiovascular, central nervous system, anti-diabetic are expanding in
double digit growth rate.
Despite price regulations, which restrict margins and limit the investible funds available for
research, Indian companies have been able to develop cost competitive technologies, which
enables them to compete internationally. The industry has achieved global recognition as a "low
cost producer of quality bulk drugs and formulations".
Several factors make the Indian pharmaceuticals an industry to reckon with, namely
Low cost of production
Low research and development costs
Innovative Scientific manpower
Strength of National Laboratories

Self-reliance - displayed by the production of 70 per cent of bulk drugs and almost the
entire requirement of formulations within the country

The pharmaceutical industry, including drug companies and contract


manufacturers, is under pressure to bring down costs, particularly in manufacturing,
due to an increased focus on emerging markets, genericization of pharmaceutical
products, and indirect consequences of the global economic downturn, industry
experts say. Companies are introducing green technologies and processes, and
expanding the outsourcing of production, as part of the cost-cutting effort.
Pharmaceutical companies around the world are pressured to lower costs, not only
due to the current global economic slowdown, but also due to continuing pricing
pressure, the pro-generic agenda, and the drying research and development
pipeline, says Supratim Majumdar, industry analyst/healthcare practice,
The Challenge The global pharmaceutical industry has been evolving in the last few
decades. Patent expiries, weak pipelines, regulatory changes and product
withdrawals combined with competition from generics, challenge the development
and sustainability of this market. Nonetheless, external demographics and
consumer market trends mean the growth prospects for the industry remain
healthy. In China, the pharmaceutical market is a fast growing market with
abundant opportunities. According to IMS figures, China is expected to maintain a
growth rate of 15% to 16%, reaching 15 to 16 billion USD in 2007. The Economist
Intelligence Unit estimates that by the middle of the century, drug sales in China
will outstrip those in every other region, and China is expected to become the
worlds fifth-largest pharmaceuticals market by 2010. Both domestic and

multinational pharmaceutical companies in China face multiple challenges, but if


approached the right way, these challenges can be turned into opportunities that
can expand their business and result in sustainable growth in China.
Key Benefits PwCs Pharmaceutical team will help organisations increase
performance by improving the efficiency and effectiveness of their operational
processes.
Increase ability to enter foreign markets faster and more efficient
Reduce fixed costs (inventories and waste)
Build efficient supply chain Increase cost control
Increase knowledge of legal and regulatory compliance controls of field sales
operations
Maximize drug safety and increase public trust
Improve efficiency of R&D, supply chain and sales & marketing
Reduce time to market