Indian pharma players are expanding to the US and European markets to get a strong foothold in the global generics market.

Indian pharma industry is at the center stage as MNCs have renewed their interest to enter the Indian market. With price pressures remaning strong in the global generics market, to remain competitive, MNCs have been looking at M&A to fuel their growth. Therefore, consolidation in the industry is heating up. On the other hand, Indian companies are increasingly focusing on the generics market in the US and Europe. At the same time, India and China are competing with each other to become offshoring destinations for pharmaceutical companies. Backed by the traditional competitive advantages and growing domestic market, the Indian players are gearing up to grab the opportunities.

The Indian pharma market is currently estimated at $8.7 bn and is expected to reach $10 bn by next fiscal, with the sector's contribution to GDP being 1.3%. R&D spending by the Indian pharma companies is 2-4% of sales, compared to 10-15% of sales for the global players. Pharma companies have posted 23% growth in their revenues and 38% growth in profits. Moreover, much of the profits were mostly generated by overseas operations rather than domestic sales. As the domestic pharma sector is highly fragmented, most of the Indian companies are emphasizing on exports.

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