The Indian Active Pharmaceutical Ingredients (API) sector has established a strong presence in world market and is forging ahead with investments in R&D, expansion and new approvals from the US and European authorities for their Drug Master Files (DMFs).
With increased investments in R&D and focus on quality as well as cost, Indian companies have been able to achieve a place in the sun in the international arena. These APIs players are well ahead of other countries in DMFs filing in the US and Certificates of Suitability (CoS) in Europe. India ranks third in the world producing about 500 different APIs and largest number of US FDA approved plants outside US.
The cost -cutting measures by the US and highly regulated countries in healthcare segment has pushed up the demand for low cost generics. Many multinational players have adopted cost- cutting measures such as sourcing bulk drugs from cost competitive destinations during last few years. Such a shift has provided India with immense opportunity for growth , leveraging its existing capabilities.
Moreover several blockbuster brands had lost exclusivity during last couple of years and more are losing in the coming years. While this has helped in the overall growth in API operations , Indian players could successfully cash in on this opportunity.
Indian major players like Dr Reddy's Laboratories, Aurobindo Pharma, Glenmark Pharmaceutical, Cipla, Lupin, Jubilant Life Sciences, Orchid Chemicals, Divi's Laboratories, Ranbaxy Laboratories, Ind-Swift etc. and several other manufacturers received higher approvals for DMFs in the US as well as CoS in Europe. Indian players have been able to meet the domestic demand and could export huge quantities to several emerging pharma markets as well as regulated markets. With a number of international standard facilities, talent pool, CRAMS opportunities and backup of R&D activities, India has emerged as a major hub for API sourcing.
Aurobindo Pharma, a Rs 4,381 crore Hyderabad -based company has filed total 154 DMFs upto the end of March 2011 and its sales from APIs went up by 12.5 per cent to Rs 1,802 crore from Rs 1,602 crore in the previous year. The APIs sales contributed over 41 per cent to its total sales during 2010-11.
Glenmark Pharma's continued its market leadership in Perindopril, Lercanidipine, Telmisartan and Amiodarone combined with launches of four new products during the year. It received Perindopril annual tender in Malaysia and also received first product registration in Russia. Glenmark recorded APIs revenue of Rs 1,263 crore during the year ended March 2011 as against Rs 1,050 crore in the previous year, contributing over 43 per cent of its total net sales. The company filed 6 DMFs during 2010-11.
Ind-Swift Laboratories is positioning itself as a primary supplier of APIs to generic players in regulated markets. It already has good presence in unregulated/soft regulated markets. It also sells specialized APIs and speciality intermediates to several leading Indian and global pharma companies. With 19 US FDA compliant plants and robust product basket of 40 molecules (20 more in the pipeline), Ind-Swift Laboratories is well set to reap the rewards of its initiatives over the next few years, the time when over US$ 99 billion drugs goes off patent.
In the API space, Orchid Chemicals' cumulative US DMFs filed stood at 81as at the end of March 2011. The break-up of the total filings is 26 in the cephalosporin space, 41 in NPNCC space, 2 in the Betalactam segment and 11 in the Cabapenems segments. The cumulative filings of CoS for the European market stood at 21. With concerted efforts on product development, Orchid's filing and approval count is poised to increase in the coming months. Orchid is the largest manufacturer-exporter of cephalosporin bulk actives in India and is ranked amongst the top five cephalosporin producers in the world.
Dr Reddy's Laboratories' pharmaceutical services and API revenues during 2010-11 declined by four per cent to Rs 1960 crore from Rs 2040 crore in the previous year. Modest growth in API business led by new product launches was offset by decline in pharmaceutical services due to lower customer orders. The company filed 56 DMFs globally with 19 in the US, seven in Europe and 30 in rest of the markets. The cumulative DMF filings reached 486 as at the end of 2010-11.
Ranbaxy Laboratories, a subsidiary of Daiichi Sankyo of Japan, posted APIs sales of Rs 115 crore during the first quarter ended March 2011. It filed 57 DMFs and received 31 approvals during quarter ended March 2011. Its API sites remained fully compliant with applicable Environment, Health and Safety (EHS) regulations. It is focusing on developing novel (non-infringing/patentable) process know-how and development of new polymorphic forms of APIs. Consequently, technology transfer was completed for 10 new APIs and key intermediates and scale-up studies were completed for seven other new APIs. It filed 142 DMFs comprising 39 APIs across various countries and 42 patents in India in 2010.
Lupin, a Rs 5,700 crore pharma company, has achieved net sales of APIs of Rs 859 crore with contribution of 15 per cent to its consolidated revenues as against Rs 777 crore in the previous year. It has established global leadership position for its APIs and holds a firm grip in the cephalosporins, cardiovascular and anti-TB space. Its revenue expenditure on R&D amounted to Rs 483 crore and worked out to 8.5 per cent of its net sales as against Rs 357 crore. Lupin filed 21 ANDA’s and 7 DMF’s with the US FDA during FY 2010-11 and received eight approvals. It also filed 33 MAA’s with European authorities.
The year also saw Lupin extending its license arrangement with Salix Pharmaceuticals for its proprietary bioadhesive drug delivery technology for Rifaximin. Under the extended agreement, Lupin granted Salix exclusive worldwide rights (except for India and some select geographies) to use Lupin technology and technology jointly developed by Lupin and Salix for all rifaximin products for human use. This agreement expands the collaboration that Salix and Lupin entered into as of September 30, 2009. The agreement covers the development and commercialization of rifaximin products and provides for Lupin to supply Salix with rifaximin API and certain finished rifaximin products.
Thus, the Indian players are all set to beef up their presence in API segment in coming years despite stiff competition from China and other countries. Considering the upcoming opportunities in world API market, recently China has decided to to invest $750 million in expansion and upgradation. In the meanwhile with the increasing use of biologic ingredients in drugs, the global market for APIs is witnessing a sea change.