Though the Indian pharmaceutical market (IPM) value has increased from Rs.65,654 crore in 2012 to Rs.72,069 crore today, the sector overall has experienced a slowdown with its growth going down to 9.8 per cent from 16.6 per cent in 2012. This slowdown can be attributed to the new drug pricing policy and the regulatory interventions over the last year, according to the CII–PwC report, ‘India Pharma Inc.; Changing Landscape of Indian Pharma Industry’.

The industry is witnessing additional challenges like delays in clinical trial approvals, uncertainties over the FDI policy, a uniform code for sales and marketing practices and compulsory licensing. The slowdown is also evident from the number of new product launches, which has gone down from approximately 1900 in year 2010 to 1700 in year 2012.

The contribution of chronic therapies to the IPM has gone up from 27 per cent in 2010 to 30 per cent in 2013. Chronic therapies (cardio, gastro, CNS and anti-diabetic) have outperformed the market for the past four years and are growing at a rate of 14 per cent, faster than the acute therapies (anti-infectives, respiratory, pain and gynaec) which grew at 9.6 per cent. This essentially translated in an overall slowdown in 2013, highlighted the report.

Says Dr Rajiv Modi, chairman, CII Pharma Summit 2013 & CII Gujarat State Council and chairman and managing director, Cadila Pharmaceuticals, “India has had an efficient pharmaceutical industry, which has been making affordable drugs not just for the Indian markets but has also been exporting them to the world. The sector is currently experiencing slow growth. Henceforth, both the Indian and foreign companies operating in India will have to device suitable strategies in order to be in the top 10 global markets by 2020.”

According to Sujay Shetty, leader – pharma and life sciences, PwC India “The economic environment in India is tougher now than ever before. While pharma companies focus their attention on measures to combat the growth slowdown, they will need to work with the government and other stakeholders to discuss and resolve regulatory challenges. Resolving the impasse with clinical trials is critical both for patients and India's ambition to innovate.”

According to the report, India is perceived as an attractive destination for clinical trials but has been marred with genuine concerns. Clinical trials are an inherent part of the drug development process and cannot be dispensed with. The continuing search for new therapies and cost-effective alternatives to existing therapies will be realised in practice only after comprehensive clinical trials.

The clinical research industry in India needs to work closely with the government to create a regulatory mechanism that allows scientifically sound and ethically correct trials to be conducted so that the benefits of  trials can be brought to patients in India.

The industry is also facing stricter regulations on manufacturing and quality practices in the domestic as well as he international markets. Indian companies will have to raise their compliance to US FDA regulations as they drive their major share of exports from the US market.

The implementation of the National Pharmaceutical Pricing Policy 2012 by the Government of India has resulted in margins erosion from 20 per cent and 10 per cent to 16 per cent and eight per cent for retailers and stockists, respectively. This decrease in the stockist margins led to a significant uncertainty among many stockists regarding the feasibility of staying in business due to lower profitability post the margin reduction.

Innovation facilitated by technological advancements is an integral part of the pharmaceutical industry and all the leading Indian companies are investing hugely in research and development (R&D). The report suggested a convergence of four key technologies called SMAC to drive innovation: Social Networking, Mobile Computing, Cloud Computing & Analytics.