The Indian pharmaceutical industry continued to exhibit strong operating performance during 2013-14 as pharma companies continued to take advantage of patent expiration wave in the US, steady demand from emerging markets and favourable foreign exchange scenario, according to ICRA, credit rating agency.
''With most of the leading players now generating a sizeable proportion of their revenues from international markets, especially U.S., the adverse impact of new pricing policy in India and evolving healthcare reforms in Europe didn't have much impact on the industry's aggregate performance. Accordingly aggregate revenues of 22 leading players in our sample grew by 16% during the year. From profitability perspective, the trends were however somewhat mixed,'' it said.
ICRA believes Indian pharma companies would continue to experience strong growth in the U.S. over the medium-term. "This would be driven by the sizeable generic opportunity over the next 2-3 years and strong product pipeline of pending ANDAs with high increasing proportion of complex generics that compares favorably with generic majors such as Teva, Mylan and Actavis.''
The key take away from the recent policy also suggest that the government is likely to look at drugs not just from the perspective of 'essentiality' but also 'affordability' ICRA opined. Besides lowering prices of branded drugs, the Indian Pharmaceutical industry is also gradually witnessing a trend towards acceptance of lower-cost un-branded generics.
''Over the years, this shift has been prompted by various states governments with the objective to improve access of affordable medicines reduce healthcare cost. As many states implement model of distributing 'free medicines' and promote generics, we expect growth in 'pure generics' segment to grow at a strong pace over the medium-term,'' it said.
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