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Indian Pharmaceutical Industry Evolution, Trends


Local companies begin to make an impact. Phase III Development Phase. Process development ... Teva acquired an Indian co in 2003, setting up new development centre ... – PowerPoint PPT presentation

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Title: Indian Pharmaceutical Industry Evolution, Trends

Indian Pharmaceutical Industry Evolution, Trends
  • CHLA
  • September 21, 2006
  • Akshay Lal
  • Vice President, Strategic Licensing Sourcing
  • Pharmascience Inc.

Presentation Structure
  • Indian Pharmaceutical Evolution
  • India Advantage
  • Emerging Trends Opportunities
  • Key Partnership Considerations

Indian Pharmaceutical Evolution
  • Phase V
  • Innovation and Research
  • New IP law
  • Discovery Research
  • Convergence
  • Phase IV
  • Growth Phase
  • Rapid expansion of domestic market
  • International market development
  • Research orientation
  • Phase III Development Phase
  • Process development
  • Production infrastructure creation
  • Export initiatives
  • Phase II
  • Government Control
  • Indian Patent Act 1970
  • Drug prices capped
  • Local companies begin to make an impact
  • Phase I
  • Early Years
  • Market share domination by foreign companies
  • Relative absence of organized Indian companies

Moving up the Value Chain
Innovative Products
Specialty Products
Generic exports to developed countries
Generic exports to under-developed developing
API Exports
India Advantage
  • Large skill base
  • Experts in process chemistry
  • Long history of reverse engineering
  • Vast talent pool
  • Sheer number of scientists
  • Motivated English speaking
  • Large number of trained Indians returning home
    from North America and Europe
  • Unmatched cost competitiveness
  • Lower cost of infrastructure and skilled manpower
  • Vertical integration

India Advantage cont.
  • Strong local industry
  • Growing expertise with international regulatory
  • High quality manufacturing with abundant
  • Speed
  • Very strong entrepreneurial spirit
  • Hungry for growth and recognition
  • Quick learners and fast movers
  • Availability of capital
  • Stock market has seen unprecedented growth in the
    last decade
  • Continues to be bullish on the pharma industry

Emerging Trends Opportunities
  • Geographic Convergence
  • Established and growing destination for Generic
    product development and manufacturing
  • Leading Indian companies seeking overseas markets
    and global scale
  • Generic Innovator Convergence
  • Leading Indian companies trying to climb the
    value chain into innovative research
  • India developing into a Drug Discovery services
    outsourcing destination

Generic Product Development Manufacturing
  • Leader in API DMF filings in the US
  • Jan-Jun 2006 175 of the 601 DMFs filed were by
    Indian companies
  • 2005 - 313 of the 946 DMFs filed were by Indian
  • Leader in capital investments - largest number of
    US FDA approved manufacturing facilities (outside
    the US)
  • Almost 20 of ANDA filings in the US
  • No place like India for generics RD and
    manufacturing of APIs formulations
  • Indias biggest assets cost, speed scientists
    churning out generics faster than you can say
  • In 5 years, 30-35 of the global demand for
    generic products is expected to be met by India

Generic Product Development Manufacturing
Destination cont.
  • Leading global/regional generic players
    establishing a presence
  • Teva acquired an Indian co in 2003, setting up
    new development centre another manufacturing
  • Sandoz development centre, 3 manufacturing
    facilities, more than 1000 employees
  • Actavis - development centre, acquired CRO
  • Mylan acquired controlling stake in Matrix last
    month for US 736 mn
  • Ratiopharm development centre, manufacturing

Indian companies seeking overseas marketsand
global scale
  • Aggressive Growth Strategies
  • For building a global scale Ranbaxy aims to be
    one of the Top 5
  • For market entry acquiring local co or setting
    up subsidiaries
  • Recent MA activity size of deals growing
  • Ranbaxy going after acquisitions in US Europe
  • Acquired 3 companies in Europe in March/April
  • Terapia (Romania) for US 324 million
  • Raising 1.5 billion to fund further acquisitions
  • Dr. Reddys
  • Acquired Betapharm (Germany) for US 570 million
    in March 2006
  • Matrix (now part of Mylan)
  • Acquired Docpharma (Belgium) for US 263 million
    in 2005.

Indian companies seeking overseas markets
  • Partnership opportunities
  • Large number of large and mid-sized Indian
    companies with world-class generic product
    development and manufacturing capabilities and
  • Lot of under-utilized manufacturing capacities
  • These companies prefer focusing attention
    resources on some key markets (US/EU) and look
    for partners in other markets
  • Opportunities for supplementing pipelines,
    filling pipeline gaps and reducing/optimizing
    cost of development and cost of goods
  • In-licensing products
  • Dossier and API development
  • Contract Manufacturing
  • Contract Research pilot pivotal
    bio-equivalence studies
  • Opportunities for out-licensing and supplying
    products to leading Indian companies for other

Generic Innovator convergence
  • Increasing number of Indian companies moving up
    the value chain from generic to NDDS/NCE research
  • Low cost development/manufacturing to Low cost
  • Some examples
  • Ranbaxy
  • 1 project in Phase II
  • 1 project in Phase I
  • 7 projects in Pre-Clinical 2 with GSK
  • Dr. Reddys
  • 3 projects in Phase II
  • 2 projects in Phase I
  • 4 projects in Pre-Clinical
  • Glenmark
  • 2 projects in Phase II deals with US 190
    million signed
  • 4 projects in Pre-Clinical
  • Opportunities for in-licensing out-licensing

Drug Discovery Services Outsourcing
  • Global outsourcing market
  • US 15-20 billion Manufacturing
  • US 3-4 billion Research (informatics,
    chemistry services chemical custom synthesis)
  • Big pharma is entering into deals with Indian
    companies to lower their cost of RD
  • Collaborative RD GSK - Ranbaxy
  • Service outsourcing - Wyeth GVK, Jubilant,
    Lilly Suven
  • Global discovery services companies are looking
    at India to retain their cost advantages
  • Albany Molecular Nektar have already
    established a presence
  • Indian industry hoping to see 3-4 global
    discovery services companies emerging out of India

Drug Discovery Services Outsourcing
  • Leading Indian Service Providers
  • Contract Manufacturing Jubilant, Shasun, Divis
  • Clinical Research Syngene (Biocon), Aurigene
    (Reddys), Synchron
  • Bio-informatics other IT services TCS,
    Satyam, Infosys, GVK Bio, Jubilant
  • Drug Discovery/Medicinal Chemistry Aurigene,
    Divis, Syngene, Suven, GVK Bio
  • Pre-clinicals Vimta, Lambda
  • Central laboratory services SRL Ranbaxy, Vimta

Key Partnership Considerations
  • Supplier/Partner mapping/selection
  • Capability / Keenness / Reliability /
  • Key team members development, regulatory
  • Optimal Number of Partners
  • Strategic markets/product lines
  • Opportunistic product specific
  • Relationship management
  • Relationship oriented culture
  • Contract negotiation
  • Clear distribution of responsibilities and
  • Demand performance - penalties for not meeting
  • Project management
  • Regular visits and video/teleconferences a must

Closing Comment
  • India is an acquired taste
  • Give it some time it will grow on you

  • Thank you!
  • Merci!