India's CRDMO Sector: A Global Pharmaceutical Challenger

India's CRDMO sector is rapidly transforming, capturing global investor attention and achieving USD 3 billion in revenue with a 14% CAGR over five years. It is driven by shifting dependency away from China, increasing opportunities in weight-loss and diabetes drugs, and advanced therapy investments by Indian firms.

India's Contract Research, Development, and Manufacturing Organisation (CRDMO) sector represents a dynamic and burgeoning force within the global pharmaceutical industry, according to a recent Jefferies India report. The report reveals that the sector now boasts revenues nearing USD 3 billion and has sustained a compound annual growth rate (CAGR) of 14% over the past five years. With a market capitalization of USD 40-50 billion, India's CRDMO has attracted significant global investor interest.

Driven by a strategic shift away from Chinese CRDMOs amid rising geopolitical tensions, India's CRDMO firms are seizing new opportunities. The Jefferies report suggests that the 'China+1' strategy offers a USD 700 million annual opportunity for Indian firms, potentially escalating to USD 1.4 billion. This structural realignment is expected to continue for over a decade, although adherence to in-licensing deals in China may pose risks.

Indian pharmaceutical giants are leading the charge with diversified advanced therapies. Notable examples include Divi's Laboratories' involvement in the GLP-1 drug pipeline, Cohance's investment in antibody-drug conjugates (ADCs), and significant progress in weight-loss and diabetes drug markets. The Jefferies report also highlights Sai Life Sciences for its promising growth projections, alongside a cautious note on Syngene, Gland, and Laurus Labs due to challenges ahead.

(With inputs from agencies.)