With growing pharmaceutical sector and ever-increasing standards in quality, there is a huge demand for lab chemicals and reagents, according to industry experts.
The Indian lab chemical sector which had a growth rate of 12 to 18 per cent in 2012-13, is now growing at 19-20 per cent. And with more industries to be set up in the near future, this sector is poised for a growth rate of more than 25-30 per cent. At present, the lab chemicals sector is a more than Rs1500 crore market in India.
In fact lab chemicals or chemical reagents are nothing but substances or compounds that are used in a chemical reaction to detect, examine, measure or produce other chemical substance. In most cases, the laboratory chemicals are used in research for analytical measurement and testing of vital chemicals for their quality.
“The China menace is one of the biggest hurdles for our domestic growth of API segment. Once this is overcome, the lab chemical industry growth will multiply 10 times. However, even now the Indian laboratory chemicals industry is mature and has the potential to manufacture its own reagents and lab chemicals without depending on imports,” opined Krishna Prasad , Managing Director and CEO of Cito Healthcare.
Not just the pharmaceutical and biotechnology industry, the widely spread use in academic and other research institutions too are adding to the growth of this sector. “Pharmaceuticals sector is a dynamic and highly regulated industry. Its products need to be constantly checked and analysed in the labs to verify their purity and quality and thus the laboratory chemicals are a must for sustaining the growth of the pharma industry. As long as research and new manufacturing is there, the lab chemicals and reagents industry will continue to flourish,” said Irshad Ali, Managing Director, Kelvin Scientific Lab Instruments and Chemic, Hyderabad.
In addition to hospitals, diagnostic centres and clinical research organizations (CROs), research and development organizations, bulk drug and API industries, the laboratory chemicals are widely used in academic institution laboratories for experiments. “Innovative drug development requires continuous testing of chemicals and this testing is done only using lab reagents and lab chemicals. If there is more innovation in pharmaceutical segment , then of course the lab chemical sector will also see growth,” he observed .
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.
Lab chem sector in AP and TS
With the Andhra Pradesh and Telangana governments giving highest priority for the expansion of pharma industry, the laboratory chemicals segment, which is though an ancillary industry, has a great growth potential in these states.
“We can expect a better growth for the laboratory chemicals markets this year especially in the academic sector, because the state and central governments have announced the establishment of a pharma city in Hyderabad, new pharma university and pharma clusters in Andhra Pradesh. About 6500 junior colleges are expected to come up in AP and TS in the coming year. This is definitely a great opportunity for the lab chemical traders to tap the market in the state,”said Nishant, Manager of Prime Laboratories.
According to Krishna Prasad,Vizag in Andhra Pradesh is poised to give a big boost to the laboratory chemical industry, as the state government is planning to come up with another pharmaceutical cluster of over 2000 acres, in addition to its already existing Jawaharlal Pharma city.
“Vizag and Nellor are two upcoming hotspots which are going to give further boost to the pharmaceutical sector in Andhra Pradesh. And this will definitely require the ancillary support of laboratory chemicals industry. In fact lab chemicals play a vital role in deciding the quality of products and for developing new chemicals and new drugs which constitute various components of chemical compounds,” informed Krishna Prasad.
“It is true that at the state level as well as at the central levels, highest priority is given for the growth and expansion of pharmaceutical sector. However, entry of more players is impacting the prospects of the market. The growing competition will have both advantages and disadvantages. On the one hand it may cripple the market as many leading players may pull back unable to bear the market pressure, while on the other it will be beneficial for those who are innovative and can sustain for a longer time,” opined Vinit Rana, Manager , Marketing , Themid Lab , Hyderabad.
The global outlook
The global lab chemicals market too is expected to perform better in the coming three years. According to experts, the global market for laboratory chemical reagents is expected to witness a significant growth due to increased usage of chemical reagents in the large scale commercial applications and basic research activities. Additionally, continuous technological advancements in the field of bio-therapeutics, recombinant DNA and cell culture have enhanced the scientific ability to identify and produce human therapeutics for ages. Hence, this has also contributed to a robust growth of the market.
According to a report from Global Industry Analysis, the laboratory chemical reagents market will reach US$20 billion by 2018 mainly due to the increased use of laboratory chemical reagents in basic research coupled with large-scale commercial applications. Moreover the growing interest of world scientific community in laboratory chemical reagents also will contribute to market growth.
In addition to this, there is a continuous refinement and advances in technologies such as cell culture, recombinant DNA and bio-therapeutics which has enhanced the scientific community’s ability to identify and produce important human therapeutic agents over the years. This is also another significant factor that had fuelled the robust growth of laboratory chemical reagents market during the past several years. Further the large-scale commercial applications and increasing application in basic research are also spurring the demand for laboratory chemical reagents. The emerging disciplines such as neurosciences and proteomics are also expected to help drive the market growth.
As the healthcare sector is growing, more and more diagnostic centres are emerging across the world. Especially in countries like India, China, Central Asia and other African and European countries, the lab chemical markets are poised to have a positive growth. Antibodies are becoming increasingly significant, both as diagnostic as well as therapeutic tools for targeting the diseased cells and cell compounds. A wide variety of new antibodies that could offer effective treatment for a range of diseases are being released into the market, owing to technological advances in the field.
The market for antibodies, especially for monoclonal antibodies that offer effective treatment for diseases including infectious and cardiovascular, inflammatory diseases and cancer and autoimmune diseases, is rapidly expanding the world over. Physicians are turning more and more towards monoclonal antibodies, as a method of treating various diseases, since the effectiveness of traditional medicines is found to be limited and could even cause dangerous side effects. The market indicators point to the growing importance of antibodies and particularly the monoclonal antibodies, as effective therapy for several diseases, due to its negligible and low toxicity level and potential to serve as a catalyst to deliver a drug.
With the increasing launch of new monoclonal antibody therapeutic products and rising indications for current products, the market for antibodies is expected to rise in the forecast period. The global market for antibodies is projected to expand significantly in the coming years. Laboratory chemical reagents market will benefit from such growth in the antibodies sector.
The United States represents the largest regional market for laboratory chemical reagents in the world according to a new market research report on laboratory chemical reagents. The US laboratory chemical reagents market is being driven by technological developments and innovations in the nucleic acid testing procedures, advancements in molecular pathology assays and improvements in cell/tissue culture technology among others.
Asia-Pacific represents the fastest growing market, with sales of laboratory chemical reagents projected to grow at a compounded annual rate of 5.7 per cent through 2015. Molecular biology constitutes the largest application area of laboratory chemical reagents. Molecular biology, the study of interaction of macromolecules present in living cells, utilizes reagents of classes such as monoclonal & polyclonal antibodies; gene expression, vectors, cloning & sequencing; and gene synthesis among others. Cytokine & Chemokine Testing represents the fastest growing application area with consumption projected to grow at a compounded annual rate of 6.2 per cent over the analysis period.
A plethora of new opportunities in molecular biology were unveiled with the conclusion of the human genome project, consequently expanding the versatility of Polymerase Chain Reaction (PCR). Currently, PCR technologies are extensively used in numerous molecular biology applications including gene expression, paternity testing, forensic finger printing and DNA sequencing, apart from the conventional drug discovery segment. Increasing sales of thermal cyclers are driving the market sales of PCR reagents as well.
The market for PCR reagents is growing on account of the increased awareness and acceptance of real-time PCR concept. Real-time PCR reagents score over standard PCR reagents by offering capabilities to instantly quantify improved DNA sequences. Predicted substantial increase in real-time PCR reagents’ sale is expected to concurrently improve the value of the PCR reagents market. The reagents are now user friendly and sophisticated on account of premixes, which are also gaining momentum.