The Indian Active Pharmaceutical Ingredients (APIs) players are going full throttle to cash in on the upcoming opportunities in the international markets with expiration of patents for several blockbusters in coming years.
With number of international standard facilities, talent pool, CRAMS opportunities and backup of R&D activities, India has emerged as major hub for API sourcing. Traditionally, APIs and intermediates outsourcing has been more prevalent in India, where around 64 per cent of total outsourcing is in this segment. With globalization, the scenario is changing rapidly.
The factors like rising focus on generics globally, cost cutting measures in highly regulated markets in respect of healthcare are the driving forces that are changing API environment fast in last few years. The major pharma companies in highly regulated markets like the US, Europe and Japan are looking out for high quality bulk drug products from international approved facilities in India. With easy availability of talent pool and resources, Indian players are able to meet the rising demand for API products in international market and giving a tough time to countries like China and Italy in API business.
Over the years major listed APIs players have established strong presence in the international market.
The Indian players have undertaken major expansion plans to offer new quality products at affordable costs in the international market. The filings of Drug Master Files (DMFs) in the US and Certificates of Suitability (CEPs) in Europe have increased significantly during last few year. Both listed and unlisted Indian pharma companies filed 404 number of DMFs with US FDA in 2011 and the submission of DMFs continued in the first quarter of 2012 also. During the first quarter, these companies filed 97 DMFs. The Indian pharma companies filed a total of 311 DMFs with US FDA during 2010 and 271 DMFs in 2009.
Hetro Group, based in Hyderabad, consisting of Hetero Drugs Ltd and Hetero Labs Ltd, submitted 42 DMFs in the US followed by Dr Reddy's Laboratories with 20 DMFs, Alembic Pharmaceuticals 17 DMFs and Emcure Pharmaceuticals Ltd 14 DMFs, Jubilant Life Sciences Ltd and Mylan Laboratories Ltd (formerly known as Matrix Laboratories Ltd) filed 11 DMFs each and Cadila Healthcare Ltd and Lupin filed 10 DMFs during 2011.
Other pharma majors like Macleods Pharmaceuticals submitted nine DMFs with US FDA in 2011. Apotex Pharmachem India Pvt Ltd, Orchid Chemicals Ltd, Parabolic Drugs also filed eight DMFs each followed by Symbiotec Pharmalab ltd and Ipca Laboratories with seven DMFs each.
Lupin, a Rs 6,950 crore pharma major, has increased its API output significantly in both volume and value during FY 2011 and 2012 on account of creating operational efficiencies. The company's API net sales declined to Rs 850 crore during the year ended March 2012 from Rs 859 crore and contributed 12 per cent to its consolidated revenues. Its API business helped to pushed its formulation business with higher captive consumption. Lupin continues to enjoy global market leadership in rifampicin, pyrazinamide and ethambutol, as well as in cephalosporins such as cephalexin, cefaclor and their intermediates.
Dr Reddy's Laboratories (DRL), the second largest pharma company in India with a consolidated net sales of Rs 9,675 crore, has filed 68 DMFs globally during 2011-12, with 14 each in the US and Europe. The cumulative DMF filings as at the end of March 2012 reached 543. The growth in API business was led by sales to generic customers for supporting their generic product launches in line with patent expiration in the near term.
Alembic Pharmaceuticals' API exports improved by 55 per cent to Rs 279.22 crore from Rs 179.90 crore during the year ended March 2012. The company is the market leader in Macrolides segment of anti-infective drugs in India. Its Panelav facility houses the API and formulation manufacturing plants. Its cumulative DMF filings worked out to 62 as at the end of 2011-12.
Jubilant Lifesciences has maintained its global leadership in five APIs products viz., valsartan, carbamazepine, oxcarbazepine, lamotrigine and pinaverium bromide. It has established seven manufacturing locations in India and three in North America. The company's API revenues increased smartly by 33 per cent to Rs 449 crore on account of new launches of sartans, donepezil in US and olanzapine in Europe. It has 58 DMF filings in the US, 29 CEPs in Europe, 29 in Canada and six in Japan besides over 65 filings in ROW which indicate a strong pipeline for future launches.
In order to augment the capacities in Life Science ingredients business and further strengthening the products portfolio of API and generics business, Jubilant invested Rs 515 core during FY12. It is well recognized as a 'Partner of Choice' by leading pharma and life sciences companies globally.
Ranbaxy Laboratories, a subsidiary of Daiichi Sankyo of Japan, has four API manufacturing facilities across India. It is providing top-of-the-line APIs to leading innovator and generic pharmaceutical companies in more than 65 countries covering a wide range of therapeutic segments. Its API business grew by 26 per cent to US$ 144 million during the year ended December 2011.
Ranbaxy commenced supply of API to launch generic Atorvastatin, the world's larges selling drug in the US. Its Toansa facility caters to the entire API demand for the US and other markets. Currently, Ranabxy is one of the largest suppliers of API for Atorvastatin in the regulated markets. The Toansa plant was upgraded for the expected US
launch of Valsartan in September 2012. It has established global scale capacities for various APIs to cater to international demand.
Thus, the Indian API freemasonry is putting their acts together to tap future opportunities. The new investments in facilities, R&D, new technologies and the talented manpower will give a necessary push to business operations in the coming years. This will also help in facing competition from other countries.