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India’s Pharma Market Grows At Fastest Pace In At Least Five Quarters

The year-on-year sales growth stood at 11.5 percent in July-September quarter, the highest since at least quarter ended June 2018.

Manufacturing capsules at a plant. (Photographer: Dhiraj Singh/Bloomberg)
Manufacturing capsules at a plant. (Photographer: Dhiraj Singh/Bloomberg)

India’s pharmaceutical market grew at its fastest pace in more than a year in the quarter ended September on higher volumes and prices even as new launches fell.

The year-on-year growth in sales stood at 11.5 percent in the three-month period, the highest since at least the quarter ended June 2018, according to data released by AIOCD-AWACS—a pharmaceutical market research organisation. That, according to Macquarie, compares with an annualised rate of 13-14 percent over the past 10 years. Sales stood at Rs 36,725.2 crore in the three months ended September.

Pharma sales, according to AIOCD-AWACS, may have revived due to a robust monsoon. Volumes grew at 3.2 percent during the quarter ended September, also the fastest pace since at least April-June 2018 period, the data showed. While growth in prices stood at 5.5 percent during the quarter, that of new products was at 2.8 percent—the lowest in at least a year.

In September alone, volume growth stood at 3.5 percent. Growth in prices and new products came at 5.6 percent and 2.9 percent, respectively, during the month.

This comes at a time India’s generic drugmakers have seen growth slow down as competition took away pricing power in the U.S., one of their biggest markets, shrinking margins. The U.S. and India, according to Fitch Ratings, are two key markets served by domestic generic drugmakers. Increased competition and pricing pressure in the U.S. have also forced Indian pharma companies to look at specialty and novel drugs to reduce their dependence on highly competitive generics, as well as turn to other markets such as China.

Sales of domestic pharma companies grew 11.9 percent over the last year to Rs 12,492 crore in September, the research firm said. Among the top 50 corporates, 33 witnessed double-digit growth. While MNCs reported a growth of 13.5 percent during the month, Indian companies posted 11.6 percent.

Among therapies, the acute segment, accounting for 47 percent of the Indian pharma market, exhibited a growth of 11.7 percent in September. Chronic therapies such as cardiovascular and central nervous system—constituting 31 percent market share—reported a growth of 13 percent and sub-chronic segment at 10.7 percent, the data showed.

Other Key Highlights

  • Torrent Pharmaceuticals Ltd, Lupin Ltd., Abbott Laboratories Ltd., Sun Pharmaceutical Industries Ltd. posted high growth momentum in September. Cipla Ltd., Mankind Pharma, Alkem Laboratories Ltd. slowed down, while Cadila Healthcare Ltd. and GlaxoSmithKline Pharmaceuticals Ltd. remained steady.
  • Among the top 10 corporates, GlaxoSmithKline reported the highest growth of 22.9 percent, followed by Lupin at 19.3 percent, and Torrent Pharma at 17.5 percent.
  • Among the corporates ranked 11-20, Dr. Reddy’s Laboratories Ltd. exhibited the highest growth of 24 percent, followed by Aristo Pharma at 21.3 percent. Emcure Pharmaceuticals Ltd. and Zuventus Healthcare Ltd. together reported growth at 17.9 percent.
  • Among the top MNCs, Boehringer Ingelheim reported the highest growth at 45.5 percent, followed by Danone S.A. at 28.8 percent, GlaxoSmithKline at 22.9 percent, AstraZeneca Plc. at 19.5 percent, Janssen Pharmaceutica at 17.8 percent and Sanofi India at 11.4 percent.