The Indian active pharmaceutical industry is the largest component of the Indian pharmaceuticals sector in terms of both value and volume according to report by IBEF published in January 2016.
The growth drivers for the Indian API have been two- fold. The primary demand for is catering to the domestic market where the same are used for the manufacture of cost effective generic medicines for local population consumption and the second area which is related to the outsourcing aspect of the market.
According to ICRA reports till the year 2012, there has been a rise in DMF fillings by domestic pharmaceutical and bulk drug companies reflect the growing presence of Indian manufacturers in the regulated markets. The growth is supported by heightened regulatory compliance amongst Indian companies with numerous US FDA approved manufacturing facilities, large talent pool and low cost of manufacturing.
According data sources on the USFDA website, since the year 1950, nearly 30,000 DMF’s have been filed by under the five following ongoing upgraded classification of the USFDA:
1. Type I Manufacturing Site, Facilities, Operating Procedures, and Personnel (no longer applicable)
2. Type II Drug Substance, Drug Substance Intermediate, and Material Used in Their Preparation, or Drug Product
3. Type III Packaging Material
4. Type IV Excipient, Colorant, Flavor, Essence, or Material Used in Their Preparation
5. Type V FDA Accepted Reference Information
The USFDA updates this list every quarter and the last one was done in Q2 2016. The USFDA also classifies the DMF /API DMF under active (given the capital letter A) and Inactive (given the capital letter I). The meanings and rationale for both A and I are as follows:
“A” = Active. This means that the DMF was found acceptable for filing, administratively, and has not been closed.
“I” = Inactive. This means a DMF that has been closed, either by the holder or by the FDA.
(Source: http://www.fda.gov/)
Based on research at the http://www.fda.gov/, it was found that out of the 29416 DMF’s filed since 1950, 9811 filings were in the Type II and active category.
On analysis of the data sheet of DMF for API, it was found that Indian manufacturers have a DMF for PAI filing history which dates back to 1961. In 1961 and 1964, Dr. Reddy laboratories were the first to file DMF for API which were fluocinolone acetonide and fluocinolone acetonide acetate.
Based on a research conducted on the USFDA website on trends in API for DMF filings for the year 2004-2016, it was found that the top 20 holders have filed nearly 1500 API for DMF.
Trends in filing API for DMF filings at the USFDA have been encouraging for Indian pharmaceutical companies with each of the mentioned companies emerging with a total crossing 20 from the years 2004-2016. 20004-2016 are the years where there has been market swings across the pharmaceutical sector. However there had been an upsurge in the number of API for DMF filings in the years 2004-2016 and these trends re expected to continue.
Hetero has filed products under two names because of the nature of the ingredients in the products filed.
Aurobindo pharma managed to file an average of 10 APIs per year. Dr Reddy has managed to file the maximum API for DMF in the for the entire 12 year span from 20014-2016 in major acute and chronic therapy areas. A total of 212 API for DMF have been filed by Dr. Reddy Labs out of which 167 have been filed in the years 2004-2016
Players like Cadila Healthcare, Cipla, Glenmark, Alembic , Emcure and Jubilant lead the standings in the API For DMF filings at the USFDA in the years 2004-2016.
Current scenario
A news clip on Live Mint in Feb 2016 saying that the US was planning to ban Indian API imports to their country sent shock waves across the industry.
The US government’s move has raised eyebrows as it is expected to impact major Indian exporters. Industry experts said that Indian companies are not allowed to quote for government contracts in the US as India has not signed the World Trade Organisation’s (WTO) government procurement agreement. However, the move will affect companies that have subsidiaries in the US and which source APIs from their parent companies in India. In a move that will further inflate prices of drugs in the United States — already a burning issue in the US. The U.S. government has made it mandatory for Active Pharmaceutical Ingredients (APIs) to be manufactured locally. At present, nearly 80 per cent of drug raw material requirement is met by India or China. Dr P.V. Appaji. Director General of Pharmexcil has assured the Indian pharma manufacturers that there is no need to panic and they have approached the commerce ministry to alert them on the development.
Government's stance on API
According to a latest KPMG report on Union Budget 2016 post-Budget sectoral point of view on pharmaceuticals, the government had declared ‘2015 as the Year of Active Pharmaceutical Ingredients’ and is now planning to announce the new bulk drug policy soon, which aims to bring down imports of bulk drugs from China and increase the domestic output. It also aims to make India self-reliant on bulk drugs by 2020.
(The author is an expert in market research and the owner of HOW TO)