Indian pharma industry is currently registering a nine per cent growth compared to global sales growth of seven per cent. India is constantly increasing its exports to key overseas markets such as North America, Europe and Japan, which account for about 87 per cent of the total global pharma sales.

Global pharma market as of 2005 is estimated to be about $ 534 billion, of which Indian pharma market accounts to $ 4.5 billion. Global pharma market is estimated to touch $ 767 billion by 2010, whereas India is likely to grow up to $ 25 billion by that time, according to Dr DR. Tatke, director, Synthone Laboratories and Consultants.

India has a cost advantage which makes it an attractive destination for outsourcing. Global pharma is experiencing increased cost of drug development in the last one decade compared to previous years. For instance, the drug development cost was estimated to be about $ 231 million in 1987 and it increased to $ 1.4 billion by 2003.

Indian pharma industry currently ranks fourth in volume and 13th in value. As per estimates, about eight per cent of the world's drugs are manufactured in India. The country has over 300 large and medium scale pharma companies and about 10,000 small companies. About 70 per cent of the production is met by top 100 large companies. The country's pharma industry manufactures about 400 bulk drugs, Dr Tatke informed.

The Indian pharma exports are registering a healthy growth year after year. One-third of production is meant for exports. India has a tremendous opportunity to supply generic drugs to developed markets. Many pharma companies are looking for licensing deals with MNCs for new chemical entities (NCEs) and new drug delivery systems (NDDS), marketing alliances with MNCs to market their products in domestic markets, contract manufacturing and clinical trials.

At the same time Indian pharma industry has few challenges too. Low cost countries such as China and Israel pose tough competition to India and restrictions on animal testing is still a hindrance, he opined.

Indian pharma companies have the choice to compete or cooperate to meet future growth. The companies need to increase exports to regulated markets, move up the product value chain, achieve cost reduction in existing processes, explore scope for acquisitions, manufacture herbal medicine and collaborate for in licensing for MNCs.

India can become an outsourcing capital if it provides IPR protection and does not cuts corners on GMP and GLP. By 2020, India can be in a position to develop blockbusters. Indian industry should obtain patents on herbal medicines, Dr Tatke added.