Bangalore, April 14, 2008: The Indian drug market will grow at eight percent, much higher than the rest of the world, says a new study commissioned by Germany’s Deutsche Bank.

 

According to the bank, growths driving Indian drug sales are rising population, increasing number of old people and increasing incomes.

 

By 2015, Deutsche Bank says, India will see drug sales worth €20 billion.  “As a production location, the country is benefiting from its wage cost advantages over western competitors also when it comes to producing medicines,” the bank said.

 

Since the end of the 1980s India has been exporting more pharmaceuticals than it imports. Over the last ten years the export surplus has widened from €370 million to €2 billion. At 32% in 2006, the export ratio was about twice as high as in 1996 and will likely rise further in the coming years (Germany: 55% at present).

 

In its report, the bank also said “legal changes in India in 2005 made it considerably more difficult  to produce “new” generics. Foreign pharmaceuticals, which enjoy 20 years of patent protection, can no longer be copied by means of alternative production procedures and sold in the domestic market. Hence, a reorientation was required in India’s pharmaceutical industry. It now focuses on drugs developed in-house and contract research or contract production for western drug makers.”

 

 The report said India is becoming a "major pharmaceutical location" on account of low costs, qualified staff and extensive production and research units.

 

The report— India's Pharmaceutical Industry on Course for Globalization— said that Indian pharmaceutical companies would expand their presence in international markets, especially American and European countries, while traditional importing countries like Russia, South East Asia, Africa and Latin America lose out in importance.

 

The report however added India will lose out to China in Asia as Chinese companies tread cautiously in increasing their market share.