India is rapidly becoming clinical research hub in the world which is evident by the opening up of the Indian market to multinational pharmaceutical companies for conducting clinical trials on new drugs which have passed through phase I studies in the country of origin.
Outsourcing of clinical trials to India is part of a larger globalisation and knowledge economy process which, along with its potential benefits, seems set to proceed as the dominant theme of global development over the near future.
According to McKinsey & Company, the Indian clinical trials industry is expected to be about $1-1.5 billion by 2010, while Confederation of Indian Industry projects the industry to be $200 million by 2007 and touch $1 billion mark by 2010. The global market for clinical research is estimated to be $10 billion in 2005 and predicted to grow at 12 percent/year.
Several US FDA New Drug Applications are now supported by India generated clinical trial data. Another advantage that India has is, the phase I, phase II and phase III can be conducted in India at a cost almost half of the cost incurred in the US.
Difficulty in recruiting patients is the most frequently cited cause for delay in clinical trials and is the largest contributor to days lost in the conduct of clinical trials study. India offers enormous advantage in the recruiting phase. For major products, delays are a direct cause of lost initial revenues, time compression of market exclusivity, and exposure to lost market exclusivity.
Well-trained medical community, large and growing private healthcare sector, awareness and control of good clinical practices, regulatory commitment to global standards of GCP, government's commitment to protect intellectual property, lower cost of clinical trials and drug development, English as the primary language place India in a key position to cater to world needs.
Global pharma R&D expenditure has seen a gradual increase in contrast with the reducing number of molecules globally. R&D spending in the pharmaceutical industry has more than doubled from 1996 to 2004. The number of new drugs approved by USFDA also has fallen by more than half since 1996.
Continuing pricing pressure, low and decreasing yield from pharmaceutical R&D have resulted in consolidation in big pharma and generic drugs and surge in biotech development to 25 per cent of global clinical trials. India has a key role to perform in outsourcing clinical trials services.