The Indian pharmaceutical industry, aptly hailed as the “pharmacy of the world,” stands as a cornerstone of global healthcare. It supplies over 20% of the world’s generic medicines and meets nearly 60% of global vaccine requirements. With ambitious goals to reach a market size of $130 billion by 2030 and $450 billion by 2047, the sector is transforming rapidly. Innovation, production-linked incentives (PLI), and seamless integration with global supply chains are driving this evolution. Notably, the domestic market has grown by 10%, while exports have expanded at a mid-teen rate, fueled by approvals for niche drugs in the U.S. and stabilized raw material costs.
Yet, challenges remain. Ensuring stringent manufacturing standards and reducing reliance on imported active pharmaceutical ingredients (APIs) are critical hurdles. To address these issues, India must enhance domestic API production and refine its regulatory framework. By prioritizing talent development and fostering innovation, the industry can not only secure its global leadership in healthcare but also strengthen the nation’s economic fabric.
In an exclusive conversation with The Interview World at NBHC 2024, Dr. Kalhan Bazaz, President, and Dr. Neeraj Kumar, Hon. Secretary of the Indian Pharmaceutical Association – Delhi State Branch, delved into these pressing challenges. They outlined how the association is tackling the limited global acceptance of Ayurvedic products as medicines, particularly in Western markets. They also explored how Indian pharmaceutical companies are leveraging artificial intelligence and emerging technologies to accelerate drug discovery and reduce time-to-market. Moreover, they shared their compelling vision for the growth of India’s pharmaceutical industry over the next decade.
Here are the key insights from their illuminating conversation.
Q: What are the key challenges facing the Indian pharma industry today, and how is the Indian Pharma Association addressing them?
A: The pharmaceutical industry is currently navigating significant challenges due to the introduction of new regulations under Schedule M2. These mandates demand substantial upgrades to GMP (Good Manufacturing Practices) facilities, including cleanroom requirements and air quality standards. Complying with these updates necessitates considerable investment, which poses a notable challenge for many companies.
Pharma companies across the sector have voiced their concerns to the Indian Pharmaceutical Association (IPA). In response, the IPA has been actively gathering feedback from both the pharmaceutical and medical device industries regarding the implementation of these new standards. This includes inputs on medical device regulations, Schedule M-related GMP updates, and the integration of Quality Control Management Systems (QCMS) aligned with international standards.
We compile this feedback and submit it directly to the regulatory authority, the Drugs Controller General of India (DCGI). Regular meetings with the regulatory body allow us to provide actionable suggestions to streamline implementation and achieve tangible results. Furthermore, we are aligning our efforts with international benchmarks, such as the European Union Medical Device Regulations (EUMDR), to ensure full compliance and global competitiveness.
To support this transition, we are conducting targeted training programs focused on Schedule M, QCMS, and other regulatory requirements. These initiatives aim to bridge the gap between the pharmaceutical industry, the association, and the government, facilitating smoother adoption of new rules. Our goal is to enable the industry to meet both national and international standards effectively and efficiently. Through collaboration, training, and advocacy, we strive to ensure the industry’s readiness for this new regulatory landscape.
Q: How is your organization working to address the limited acceptance of Ayurvedic products as medicines in Western countries?
A: In India, the Ministry of AYUSH oversees Ayurvedic products, ensuring they are regulated and licensed effectively. This robust framework supports the growth of Ayurvedic solutions, including innovative products like Ayurvedic bandages. For example, the Velvet bandage, known for its effectiveness in wound healing, has gained significant acceptance. Currently marketed under the Ayurvedic category, it is on track to receive CE certification, enabling its sale in European markets.
Interestingly, western countries show increasing acceptance of herbal and Ayurvedic medicines as they shift toward natural remedies over allopathic treatments. This trend offers a tremendous opportunity for India, given its rich Ayurvedic heritage and the wealth of medications capable of addressing a variety of ailments. However, the key to unlocking international markets lies in adhering to global regulatory standards, including conducting phase trials for Ayurvedic products.
At present, the lack of clinical phase trials remains a significant barrier for many Ayurvedic products in gaining wider international approval. Companies conducting these trials, however, face no issues marketing their products overseas. To ensure broader global acceptance, the Indian Ayurvedic industry must prioritize phase trials, aligning with the requirements of international regulatory bodies over time.
To facilitate this shift, industry and regulatory leaders are engaging in meaningful dialogue. For instance, during the quality conference held on September 28th, representatives from regulatory bodies, including the DCGI, interacted directly with pharmaceutical industry stakeholders. They addressed pressing concerns and offered practical solutions to current challenges.
The bottom line is clear: conducting rigorous phase trials for Ayurvedic drugs will not only strengthen their credibility but also ensure seamless entry into international markets. By aligning with global standards, the Indian Ayurvedic industry can solidify its position as a leader in natural and herbal medicine on the world stage.
Q: How are Indian pharmaceutical companies leveraging AI and emerging technologies to accelerate drug discovery and shorten time-to-market?
A: Currently, Indian pharmaceutical companies are increasingly integrating artificial intelligence (AI) into their operations, particularly in preclinical studies. AI tools play a crucial role in product development and design by enabling comprehensive analysis of outcomes. This integration allows for streamlined in vitro and in vivo studies while offering insights to optimize formulations effectively. Once the AI-optimized formulation aligns with laboratory results, the industry adopts it with greater confidence.
By leveraging AI, the chances of failure diminish significantly. AI technology provides detailed insights into the standards being followed, appropriate concentrations, and other critical parameters. This not only minimizes the risk of failure but also ensures the development of high-quality products within shorter timelines. Furthermore, these products meet stringent international standards, enhancing global competitiveness.
However, a clear distinction exists between the Indian pharmaceutical market and global trends. While AI is predominantly used for product development worldwide, the Indian market remains focused on process development. Despite having access to advanced AI tools, Indian companies have yet to fully embrace AI-driven product innovation.
This divergence highlights a significant gap. For the Indian pharmaceutical sector to fully leverage AI’s potential, a shift toward product development is essential. Only then can the industry bridge this gap and compete more effectively on the global stage.
Q: What advice do you have for Indian pharma companies facing rejection of medicines, like recent cases with Western countries?
A: The rejection in question stemmed from logistical challenges, particularly related to storage conditions. This issue arose in South Africa, where the Gambian foundation faced difficulties. However, upon thorough analysis by regulatory bodies such as the DCGI and CDSCO, the findings were reported to the WHO. Importantly, this concern was not tied to the manufacturing process. An independent inquiry is ongoing in that regard.
The product failed due to improper storage conditions, not because of quality issues. This distinction is crucial. Even if we consider all potential challenges, such incidents are rare exceptions.
To put it in perspective, the pharmaceutical industry, valued at over a hundred billion dollars, sees only a handful of such occurrences. These isolated cases are aberrations and should not overshadow the industry’s overall reliability.
It is important to note that minor quality issues can occur with almost any product, even when purchased from the market. Such rare occurrences, while understandably alarming when they affect patients, do not reflect the industry as a whole. Public concern and panic are natural in these situations, but it is essential to view them as anomalies rather than the norm.
Q: As the leader of a prominent pharmaceutical association, how do you envision the Indian pharma industry’s future over the next decade?
A: The Indian pharmaceutical industry consistently delivers annual returns exceeding 14%, a figure unmatched by most other sectors. It is crucial to remember that this industry operates around the clock, 24/7, due to its role in producing essential medicines. The future outlook for Indian pharma is promising, yet regulatory standards are set to become increasingly stringent. Only companies that adhere strictly to Good Manufacturing Practice (GMP) guidelines and Schedule M regulations will be able to thrive. Companies failing to meet these compliance standards are likely to be phased out.
The primary concern is not growth—growth prospects are immense. However, to sustain this growth, companies must enhance their compliance systems. Indian pharmaceutical companies already excel in compliance, outperforming many other nations. This is one reason why India has solidified its position as the global pharmacy hub. More than 700 Indian manufacturing plants hold accreditation from the WHO and approval from the U.S. FDA.
In comparison with other countries, India leads in the number of manufacturing approvals granted by the U.S. FDA and WHO. Additionally, Indian manufacturers supply over 60% of the world’s medicines and vaccines required by the WHO.
When it comes to global health, one in every three people relies on Indian-made medicines. The quality and standards of these medicines align with international benchmarks and are widely accepted in developed countries. Recent data shows that Indian pharmaceuticals are increasingly popular in the U.S. and European markets, with their acceptability growing exponentially over time.
