One of the major reasons which had stunted the growth of the laboratory chemical and equipment markets in India is the low R&D investment compared to the western nations like USA and EU which are spending substantial amounts for research in these specialized segments.
Despite the fact green shoots are witnessed in lab chemicals and lab equipment markets of late due to the arrival of large scale academic institutions, clinical research organizations and diagnostic centres, the Indian market can advance to higher orbits of growth only when our share of R&D increases on par with the advanced nations.
Lab chemicals and lab equipment play a vital role in enhancing the research and development segment of an industry. In particular, pharmaceutical, biotechnology, diagnostic centres, educational institutions and various other scientific research institutes need different kinds of lab chemicals and reagents for performing tests to evidently prove and reconfirm a particular result.
In the pharma and biotechnology segments where the medicinal drugs and vaccines are tested for their efficiency and quality require different set of laboratory chemicals and scientific laboratory equipment to gauge their purity. Educational institutions like schools and colleges, research institutes dealing with chemical and biological research have a great demand for lab chemicals.
In fact one can judge a country’s advancement based on the intensity of its research and development segment.
If the R&D sector is highly active, it means the demand for the lab chemicals and lab equipment is high. According to a study, out of a total global R&D spend of $1143 billion, the percentage claimed by the US is 33.6, Europe 24.5, and Japan and China 12.6 each, while India’s share is a meagre 2.1.
Thus with a meagre investment of two per cent GDP in R&D we are nowhere in comparison with western nations like USA and EU. No wonder India’s lab chemicals and laboratory equipment markets are still at a nascent stage.
However, of late things are changing. As the central and state governments are coming up with liberal Foreign Direct Investment (FDI) policies in biotechnology, pharmaceuticals and other related industry areas, more and more foreign as well as domestic investors are looking at India to invest in clinical research, diagnostics, food processing and other related R&D for drug development in the country.
If all goes well then the lab chemical market in India is expected to grow at around 20 to 25 per cent in 2013-14. In the year 2011-12 lab chemical industry is said to have achieved a growth rate of 12-18 per cent.
“The demand for lab chemicals is steadily growing in India. This segment is fast growing in Andhra Pradesh. Since the city of Hyderabad is a pharma hub, and is home to a large number of educational institutions and scientific research centres, the future prospects for lab chemicals is quite high. Of late Hyderabad is witnessing the rise in diagnostic centres and clinical research organizations which needs huge quantities of lab chemicals and various lab equipment,” said Narayana, a lab chemical distributor from Sun Life Sciences Optimistic Chromatography at Kukatpally in Hyderabad.
According to industry experts, if the lab chemical markets grow at the expected rate of 20-25 per cent, it will add another Rs. 250 crores to its earlier value of Rs.1000 crores, which will top Rs 1250 crores by the end of 2013.
“Though the market size is small compared to other bulk drugs, the demand is high and markets are progressively growing. But we are witnessing cut- throat competition. Many are adopting unhealthy and unethical practices and supplying dubious chemicals. This is sullying the reputation of Indian lab chemical industry. Because of this not many overseas clients are willing to import lab chemicals from India,” said Mansoor, Manager at Unique Traders in Hyderabad.
Giving his views on the Lab chemicals and its growing demand, Ali, sales in charge from G.R enterprise said, “Lab chemicals are specialized chemicals, they are totally different from bulk chemicals of pharma industry. They are mainly used for laboratories research labs, to check and reconfirm the purity, efficiency and quality of a product. Going by the orders we get every day, the demand from schools, colleges, hospitals and diagnostic centres is increasing. We supply laboratory chemicals, laboratory reagents, organic reagents, diagnostics reagents, pH indicators, redox indicators, biological stains for microscopy etc.”
As the coming days are expected to have more investments in R&D for life sciences and chemical sciences, it requires more tests and analysis laboratories which will enhance the growth of lab chemicals and the lab equipment market in India. At present the main contributors to the growth of lab chemicals market are the academic institutions and pharmaceutical related testing and research laboratories in the country.
This is apart from the already existent clinical research organizations (CROs), research and development organizations, bulk drug and API industries. All these organizations and institutions need lab chemicals for testing quality of the products or for analysing or for doing any kind of innovative development in the food industry, chemical industry and biological areas of research and development.
Irshad Ali, MD Kelvin Science Lab instruments and Chemic Hyderabad said, “With the emergence of more and more junior colleges and pharma colleges, the demand is definitely growing for lab chemicals and lab equipment. Even as Hyderabad is becoming a medical hub with multi-specialty hospitals and a large number of diagnostic centres coming up, we hope to see a better future for the lab chemicals and equipment markets in Andhra Pradesh.”
Laboratory equipment
Laboratory equipment are required for processing and analysing lab chemicals appropriately.
The laboratory equipment may include the simplest of the simple goggles to sophisticated electronic spectrum analyzer and magnetic spectrum analyzers which are the latest and costliest equipment available for testing the various drugs and vaccines.
“USP Hyderabad is one the most advanced testing laboratories in Hyderabad. We have world class infrastructure and all the required laboratory equipment available at one place. Many pharma, chemical institutes and drug department from the government come here to get the drugs and food supplements get tested for quality and efficiency. We have sophisticated lab equipment like spectrum analysers, chromatographic instruments and various other electronic chemical analysers at USP centre,” said Ashok Dang, Marketing & Technical Services at USP Hyderabad.
The laboratory analytical equipment market in India has been growing leaps and bounds in the last five years mainly due to the burgeoning pharmaceutical sector. India has emerged as the favoured destination for global pharma giants owing to the benefits of skilled labour and low costs.