Today, when the whole western world is running pillar to post to cut down pharmaceutical manufacturing costs, the engineering entrepreneurial strengths and technological innovation has enabled India to excel in the pharmaceutical machine manufacturing industry. Moreover affordable costs with world class quality standards have helped the Indian pharmaceutical industry to withstand the cost escalations especially in the areas of processing, packaging and research & development.
If not for the initiatives of the Indian engineering entrepreneurs, today India wouldn’t have seen the present day flourishing of low cost manufacturing units in the country. Unlike the western countries like Europe and the US, the low cost Indian pharmaceutical machine manufacturing industry has enabled huge savings on capital investment of plant and machinery, besides the cheap technical manpower costs. However despite world class quality, we are lagging grossly in R&D investments which is a sine qua non for future growth, opine industry veterans.
The pharmaceutical machinery markets in India are witnessing a transition. Having realized the future potential the manufacturing facilities in India are being upgraded to the standards of the regulated markets. As India has the highest number of FDA approved facilities outside USA, an entire range of manufacturing facilities have been catered by the Indian pharmaceutical machinery industry including processing tablets, capsules, liquids, injectables, ointments, dry syrups and packaging (filling, sealing, labelling, cartoning, etc).
By 2020, the world pharmaceutical market is anticipated to grow more than double to US$1.3 trillion with the contributions of countries like Brazil, China, India, Indonesia, Mexico, Russia and Turkey accounting around for one fifth of global pharmaceutical sales. Today India is the fourth largest manufacturer of medicines in the world. Although in terms of turnover, the contribution of the Indian pharmaceutical Industry is less than two per cent of the global total, it is a clear indication that the prices of medicines in India are the lowest in the world.
“India is still in an industrial transition stage, in every aspect we are moving from the basic to the advanced level of industrial development. As more pharmaceutical and food processing industries are coming up, the growth potential for various industrial machinery like reactors and heat exchanger, industrial process equipments, processing equipment, condensers, storage equipment, vacuum chambers, pressure vessels, brewery equipments and chemical plant reactors is expected to grow in the near future,” said Sethuraman, Managing Director, Enfab Industries private Ltd.
Today India houses more than one third of USFDA approved pharmaceutical manufacturing facilities in the world. This speaks
volumes for the fact India holds the best standard and quality manufacturing facilities that provide standard drugs at affordable costs. “Our standards are world class, but we have to move a long way in terms of research and development in the advanced technology. We are lacking grossly in R&D research investment. The state and central governments should encourage entrepreneurs to take up innovative research in advanced and future technologies,” said Ramaraju, MD, Surya Industrial Equipments.
If we look at the historical past, during the 1960s and early 70s, the pharmaceutical industry in India was heavily dependent on imported machines from Europe for its processing and packaging. The major players that supplied machinery to the India pharma industry at that time were Aeromatic, Fete, Glatt, Hassia, Hofliger & Karg, Kilian, Manesty, Sparkler, Stunk and Zanasi etc. All these companies have excelled in technological innovation in their own respective fields. However, the mid-70s saw the country going through a severe shortage of foreign exchange and, therefore, the Indian government introduced high import duties and restrictive import licensing policies, resulting in steep rise in prices of imported machinery.
Pharmaceutical companies, therefore, were compelled to look elsewhere for their machine requirements. This encouraged Indian engineering enterprises to manufacture machines locally. This was perhaps the only route for the pharmaceutical industry to enhance production and cater to the growing demands of the domestic market. And, needless to say, this was a great and challenging opportunity for the Indian small-scale engineering companies. This led to a mushrooming of hundreds of machinery manufacturers catering to the needs of numerous pharmaceutical companies.
Today, Indian pharmaceutical machineries are being installed at FDA-approved manufacturing facilities in the US, Australia, Africa etc. meeting international standards and parameters. As these countries mandate proper validation of the products, the importance of machinery that incorporate advanced technologies are also increasing.
The credit for the high credentials goes to the strict quality standards adopted by pharmaceutical machinery manufacturers in India. This has helped many Indian companies to enter into technical tie-ups joint ventures with American, European and Southeast Asian companies for the manufacture of their products in India, which are being marketed in all Asian and CIS countries.
Currently the machinery manufacturers in India are upgrading themselves by investing in knowledge and innovation. Many pharmaceutical machinery manufacturers are visiting many other nations to learn about the latest developments in technology. In addition to this, there are other visible trends that further reflect the commitment to excellence of Indian machinery manufacturers.
Indian pharmaceutical machines, which have already made a dent on the domestic soil, have also started making considerable inroads into the international market. The growing acceptance of Indian machines in foreign countries is illustrative of this trend.
At present in India there are more than 800 units manufacturing pharmaceutical machinery, comprising small, medium and large-scale enterprises, with an estimated turnover of Rs. 2,000 crore, of which around 40 per cent is being exported to more than 80 countries around the world, including the US, UK and other European countries. The Indian pharmaceutical machinery manufacturing sector constitutes around 5-7 per cent of the global market in value terms.
Future scope and opportunities
With more and more drugs going off patent, the scope for the Indian pharmaceutical machinery manufactures is quite high. Moreover the rise in joint ventures between foreign and Indian pharmaceutical companies proves that India’s capability to manufacture world-class products at affordable prices.
There are also significant opportunities for pharmaceutical plant design consultancy and related services, especially for large companies adopting USFDA and UKMCC standards. The growth in advancement and upgradation of technology in machinery has been faster in India.
Various international companies have found it cost-effective to work with Indian partners in collaborative ventures. The number of joint ventures between foreign and Indian machinery manufacturers is a testimony to the fact that the Indian machinery industry understands the stringent need of pharmaceutical industry and that it can produce international quality at affordable prices.
As India and China are making machinery which are 10-20 times less expensive than that of those made in the US and Europe, both the nations are competing each other in low cost pharmaceutical machine manufacturing segment.
In future, it will not be surprising to find managers of pharmaceutical companies waging an all-out war in the market slashing their production costs to gain competitive advantage and increase their bottom lines. Like information technology, the Indian machinery industry is also set to make in-roads to various markets of the world leading to a manufacturing revolution.
Packaging industry
The packaging industry in India is currently estimated to grow at 15-20 per cent. Many packaging entrepreneurs are adopting most advanced and innovative technologies and have been moving extensively to grab the world packaging markets in the pharma sector.
“With about 20,000 small and big pharmaceutical companies in India and about $ 150 billion medicinal drugs going off patent in the coming days, one can easily forecast the amount of potential that India holds for pharmaceutical manufacturing industry in the country. In fact, the pharmaceutical packing industry in going through a transition from traditional to advanced and automated technologies. Indian entrepreneurs are increasingly adopting high speed modern and large-scale manufacturing technologies in areas like packaging and processing.
While the western countries spend almost 20 per cent of their returns in R&D investments, the R&D investment in India is very less. If proper designs and investment capital is ensured the potential to exploit the pharmaceutical markets especially in the machinery segment is huge,” said AVPS Chakravarthi, Managing Director, Ecobliss India private Ltd.
For instance, recently Ecobliss won international awards for excellence in innovative packaging. The company has been offering various innovative packaging solutions including cold seal blister packs, heat seal blister packs, pharmaceutical wallets, fold over trap blister cards, clam shell blisters, transparent boxes and range of cold and heat sealing machines.
The costs associated with pharmaceutical packaging represents up to 70 per cent of the cost of the finished product. In addition, industry experts estimate that between 35 to 40 per cent of all pharmaceutical product recalls are attributed to packaging and labelling errors and omissions.
In general, the pharma industry has always been on the lookout for innovative packaging in terms of convenience, customer friendliness and more importantly hygiene and compatibility with the products. In view of these aspects, there have been enormous developments in packaging especially to restrict counterfeiting.
Today pharmaceutical packaging has gone a long way with the introduction of new kinds of speciality packs with single dose, multi-dose as well as multi-purpose packaging. New kinds of innovative techniques like bar coding, Radio Frequency Identification Drivers (RFID) are being introduced to solve the problems of anti-counterfeiting. In addition, many more developments, especially in the caps and closures sector have also evolved where child resistant closures, senior citizen customer-friendly closures have being introduced by the packaging industry in order to meet the requirements of convenient and economic packaging.
Going by the aggressive growth strategies by the small and medium pharma enterprises in the country, there is a huge demand for affordable, alluring and attractive packaging solutions. Companies are coming up with innovative ways to lure their customers. The demand for pharma packaging globally and particularly in the emerging markets of Brazil, Russia,
India, China and Africa has increased, particularly in the wake of patent expiries generic drugs and contract manufacturing.
Today as India is a global hub for bulk drugs and is poised to scale new peaks in the near future, there is an urgent need to upgrade the standards of packaging along with the quality of the pharma products, aver experts.