Indian Pharma Industry: Bridging Global Performance Gaps
Indian pharmaceutical companies lag behind global peers in R&D intensity, PhD employee ratio, and patents and publications per revenue, according to a FAST India report. Despite these disparities, some Indian firms excel in patents-to-revenue metrics, showcasing potential in innovation and manufacturing capabilities.
- Country:
- India
According to a recent report by the Foundation for Advancing Science and Technology (FAST India) in collaboration with IIFL Securities, Indian pharmaceutical companies are struggling to keep up with their global counterparts across critical performance indicators. These include research and development (R&D) intensity, the ratio of PhD employees, and the number of patents and publications generated per billion USD of revenue.
The report uncovered significant disparities, especially in the number of publications per billion USD revenue, where global firms are producing 8.4 times more publications than Indian firms. Additionally, global companies generate 5.6 times more patents and have an R&D intensity factor three times higher than that of Indian firms.
However, the report also shone a spotlight on areas where Indian companies excel. Notably, Indian firms are performing better in the patents-to-revenue metric, with four firms making it into the top ten for patents by revenue. American multinational Eli Lilly leads in R&D intensity and ranks third for PhD employee proportion, while among Indian firms, Dr. Reddy's Laboratories and Biocon have shown impressive figures in specific categories. Sun Pharmaceuticals boasts 636 patents per billion USD, placing it at the top among Indian companies and surpassing many global competitors.
Contributing 1.72 percent to India's GDP, the pharmaceutical sector, comprising around 3,000 companies and over 10,563 industrial units as of 2021, has benefitted from policy reforms such as amendments to the Patents Act and Production Linked Incentives (PLIs). Despite current challenges, these reforms have reinforced India's position as a leading player in drug manufacturing globally.
India has become the third-largest drug producer by volume, supplying 20 percent of the world's generic drugs. In the 2022 financial year, Indian pharmaceutical exports, including bulk drugs, intermediates, formulations, and biologicals, reached USD 23.5 billion, further cementing its critical role in the global pharmaceutical landscape.
(With inputs from agencies.)