(Commonwealth_India) India’s pharmaceutical industry is poised for significant growth, with projections indicating that its exports could reach an impressive $350 billion by 2047. This ambitious target represents an estimated 10 to 15 times increase from the current levels. India, which already holds a leadership position in global generic drug supply, is expected to shift focus and move up the value chain. This will involve concentrating on specialty generics, biosimilars, and innovative pharmaceutical products.
A new report by Bain & Company, in collaboration with Indian pharmaceutical organizations, ranks India 11th in terms of pharmaceutical export value. However, the country has the potential to rise to among the top five nations in the industry by 2047. The pharmaceutical export market in India is forecasted to grow substantially, from about $27 billion in 2023 to $65 billion by 2030, with a dramatic leap to the $350 billion target by the time India celebrates its 100th year of independence.
A significant part of this growth will depend on India transitioning from a volume-based strategy to a more value-driven approach. The report identifies three primary sectors that will drive this transformation. First, the export of Active Pharmaceutical Ingredients (APIs) is expected to increase from its current valuation of $5 billion to between $80 and $90 billion by 2047. While China currently dominates around 35% of the global outsourced API market, India stands to benefit from global supply chain diversification efforts, such as the U.S. Biosecure Act, which provides an opportunity to ramp up API production. Strengthening domestic API production, making investments in bulk drug parks, and achieving self-sufficiency in critical raw materials will be pivotal steps for India.
Second, Indian biosimilar exports, valued at approximately $0.8 billion at present, are projected to grow fivefold, reaching $4.2 billion by 2030 and potentially hitting $30 to $35 billion by 2047. This growth will be fueled by increased investment in research and development, regulatory simplifications in key international markets such as the U.S., and capacity expansion in the biosimilar sector. These changes will bolster India’s position as a global leader in biosimilars.
The third major area of focus will be in generic formulations, which currently make up the largest portion of India’s pharmaceutical exports, valued at $19 billion and representing about 70% of total pharmaceutical exports. These are expected to grow to between $180 billion and $190 billion by 2047. However, to achieve this growth, India must enhance its capabilities in producing specialty generics, which have higher profit margins and offer more substantial potential in global markets.
Viranchi Shah, National President of the Indian Drug Manufacturers’ Association (IDMA), emphasized that targeted policy measures will be necessary to unlock India’s full pharmaceutical potential. He pointed out the need to scale up efforts in strengthening the API industry, addressing non-tariff barriers to exports, and developing country-specific export strategies to help facilitate the growth of the sector.
India’s role in the global vaccine market is another important aspect of its pharmaceutical strength. Currently, the country supplies between 55% and 60% of UNICEF’s vaccines. However, to continue strengthening its position, India must focus more on high-value markets by investing in clinical trials and manufacturing. Additionally, the development of over 40 new chemical and biological entities suggests that India could see its pharmaceutical exports in innovation reach between $13 billion and $15 billion by 2047.
Indian contract development and manufacturing organizations (CDMOs) and contract research organizations (CROs) are also poised for significant growth in the coming years. This is largely driven by efforts from developed economies to diversify their supply chains, opening up new opportunities for Indian companies.
Experts within the pharmaceutical industry underscore the importance of collaboration between the government and the private sector in realizing India’s export potential. Sudarshan Jain, Secretary General of the Indian Pharmaceutical Alliance (IPA), noted that the pharmaceutical sector is a major contributor to the Indian economy, providing livelihoods for over 2.7 million people and generating a trade surplus of $19 billion. He stressed that doubling down on pharmaceutical exports will be critical in achieving India’s vision for 2047.
There is also a growing interest from private equity and venture capital investors in the Indian pharmaceutical sector. Healthcare’s share of private equity and venture capital investments has surged, from 6% in 2021 to 17% in early 2024. These investments are expected to play a crucial role in boosting India’s pharmaceutical industry. Also, making rules consistent, increasing production-linked incentives (PLIs), and offering incentives for research and development will be important for the growth of the sector.
Raja Bhanu, Director General of the Pharmaceuticals Export Promotion Council of India (Pharmexcil), has outlined an ambitious vision for India’s pharmaceutical sector by 2047. He stated that India’s generics are recognized worldwide for their quality, affordability, and scalability. By making bold investments in areas such as specialty generics, biosimilars, vaccines, and advanced therapies, India aims to meet its $350 billion export goal.
In conclusion, India’s pharmaceutical sector is set for transformative growth over the next two decades. With a strategic shift toward higher-value markets and greater innovation, coupled with strong investments in key areas like APIs, biosimilars, and specialty generics, the country is well on track to becoming a global pharmaceutical powerhouse by 2047.
