1. AFFORDABLE EFFICACIOUS MEDICINES ALL ROADS LEAD TO INDIA
DAARA B PATEL
SECRETARY - GENERAL
INDIAN DRUG MANUFACTURERS’ ASSOCIATION (IDMA)
4TH SINO-INDIA FORUM: FINISHED DRUGS EXPORT
China, 14th November 2013

2. 80 % Pharma Corporate Office are located
MUMBAI
IDMA’s HQ
80 % Pharma Corporate Office are located

3. INDIAN DRUG MANUFACTURERS’ ASSOCIATION
Founded in 1961 – now in 52nd year of service as premier Association of the Indian Pharma Industry
Regarded in Government, Media & Industry Circles as the ‘Voice of the National Sector’
6 Region-wise State Boards
19 Sub-Committees, headed by Experts
Membership Strength – over 700 Members
Publications: IDMA Bulletin (Weekly), Indian Drugs (Monthly) & Annual Publication
Awards presented on Annual Day for Quality Excellence, Best Patents, Quality Research,
At IDMA- PAC Awards for Eminent Analyst, Outstanding Analyst,
Young Analyst
Seminars/ Workshops on Regulatory, Technical, Medical affairs, Harmonization projects with US FDA, IP, USP, EDQM, ANVISA

4. IDMA GOING GLOBAL
IDMA is in talks with leading Associations and Organisations globally for closer Co-operation and Networking on International issues concerning the Pharmaceutical Industry and has signed MOUs with :
IDMA-CPIA (China Pharmaceutical Industry Association)
IDMA-KPMA (Korean Pharmaceutical Manufacturers Assn)
IDMA-Dubiotech (Dubai Biotechnology Park)
IDMA-ABLE (Assn. of Biotechnology Led Enterprises)
IDMA- Pro Genericos - Brazil (in discussion) 4

5. IDMA GOING GLOBAL (contd…)
Active participation in International Fora:
IGPA Conference, Canada
USP Convention, Washington
API China Spring, Harbin
Propak Asia, Bangkok
2nd Annual Pharma Manufacturing China Summit, Shanghai
Generics R&D & Partnering Asia, Shanghai
India-Japan Pharma Industry Seminar, Osaka
International Pharmaceutical Ingredients
Expo & Conference, Japan
Sino-India Forums 5

6. Epidemiological Factors
DEMAND DRIVERS
Accessibility
Over USD 200 Billion to be spent on
medical infrastructure in the next
decade
New business models expected
to penetrate tier-2 and tier-3 cities
Over 160,000 hospital beds expected
to be added each year in the next
Increasing access to lower-income
segments due to Government
initiatives that increase access and
affordability (e.g. RSBY)
Acceptability
Rising levels of education to increase the
acceptability of pharmaceuticals
Patients to show greater propensity to self-
medicate, boosting the OTC market
Acceptable of biologics and preventive
medicines to rise
Vaccine market could grow 20 per cent per year
in the next decade
Surge in medical tourism due to increased
patient inflow from other countries
Affordability
Rising income could drive 73 millions households
to the middle class over the next 10 years
Over 650 million people expected to be covered
by Health Insurance by 2020
Government-sponsored programmes set to
provide health benefits to over 380 million BPL
people by 2017
By 2017, the Government plans to provide free
generic medicines to half the population at an
estimated cost of USD 5.4 billion
Epidemiological Factors
Patient pool expected to increase over 20% in the
next 10 years, mainly due to rise in population
New diseases and lifestyle changes to boost
demand
Increasing prevalence of lifestyle diseases

7. EVOLUTION OF INDIAN PHARMA INDUSTRY

8. GROWTH IN PURCHASING POWER

9. INDIAN PHARMA INC
Knowledge based Industry and one of the world's largest and most developed.
Current turnover estimated at US$ 25 bln. growing @ 12%
About 300 Large & over 10,000 SMEs
About 77% units make Formulations and about 23% units make APIs
Over 64,000 formulations in market covering almost every therapeutic segment with about 10 to 200 brands per molecule
For example, Ciprofloxacin has over 180 brands and Atorvastatin has about 96 brands competing in the market.

10. INDIAN PHARMA INC (contd…)
Medicines constitute only about 15% of total healthcare spend in India
About 90% of India’s pharmaceutical market is made up of branded generics and has the potential to grow at an accelerated 15 to 20% CAGR in the next five years.
Patented drugs account for 1% of $12 bln. market, set to grow to 5% of est. $ bln. market by 2020
Globally ranks 4th largest in volume and 12th in value
10% of World’s Production but 1.5% of Value (Extremely Competitive Prices)

11. SHARE OF GENERIC AND PATENTED DRUGS IN INDIAN MARKET
By 2016, share of generics may be about 90% of Indian pharma market, as patented drugs increase to about 10%

12. FORMULATION EXPORTS
($ bio)

13. INDIAN PHARMA INC (contd…)
Exports at $12 bln. with formulations at $ 7.5 bln. and APIs at $ 4.5 bln.
Exports estimated to cross $16 bln. by
Exports to almost all countries, with major share in regulated markets
Rated world’s single largest producer and top exporter of generic drugs
Every Third Tablet consumed in the World is ‘Made in India’

14. INDIAN PHARMA INC (contd…)
India’s five of the largest export markets are USA, UK, Germany, Russia and South Africa
Three out of Global Top 10 fastest growing generic companies are Indian - Glenmark, Dr Reddy’s and Sun Pharma
The Indian pharma market is expected to grow at 12–15 % over next two years
The Indian drugs and pharma sector attracted FDI worth US$ 9.6 bln. between April 2000 to May 2012

15. INDIAN PHARMA INC (contd…)
India is now among the top five pharma emerging markets globally
Front runner in a wide range of specialties involving complex drugs' manufacture, development and technology
Expected to touch $36 bln. by 2016
India has about 40% of all ANDA approvals from US FDA during January-July 2013.
USFDA approvals speak about the stringent norms followed by the Indian companies

16. INDIA’S API INDUSTRY
The Indian API Industry services the Domestic and International Market
The Indian API manufacturing industry is the third largest in the world, to grow at CAGR 17% over
Producing over 400 APIs
Growth in Generic Industry spurred API demand worldwide
Increased emphasis of contract manufacturing increases scope of captive API demand
High percentage of API exports are high value, servicing Highly regulated markets with complex APIs
Globally Indian companies hold more than 90% of APIs approvals for ARVs, Anti-TBs and Anti-malarials

17. RECENT COLLABORATIONS WITH INDIAN COs
MNC
INDIAN
THE DEAL
FROM
RATIONALE
Mylan Labs, USA
Matrix labs
71.5%
August 2006
Expand mfgr platform, Access to key markets
Daiichi Sankyo, Japan
Ranbaxy
Acquired
June 2008
Access to low cost manufacturing
Pfizer, USA
Aurobindo
Contract Manufacturing
March 2009
60 products for regulated markets
Fresenius Kabi, Germany
Dabur
April 2009
Access to oncology manufacturing
Claris Lifesciences
May 2009
Access to sterile injectable drugs
GSK, UK
Dr Reddy’s
Partnership
June 2009
Develop & market select products for emerging markets

18. RECENT COLLABORATIONS WITH INDIAN COs
MNC
INDIAN
THE DEAL
FROM
RATIONALE
Mylan Labs, US
Biocon
Contract mfgr & dev.
June 2009
Develop monoclonal antibody
Mylan Labs,USA
Famy Care
15% stake
August 2009
Access to oral contraceptive mfg.
Sanofi Pasteur, France
Shantha Biotech.
Controlling stake
Access to vaccine manufacturing
Hospira
Orchid Chem.
Buyout of injectable antibiotics
Dec 2009
Access to low cost manufacturing
Pfizer, USA
Strides
Collaboration
Jan 2010 & May 2010
Access to 78 oncology products & sterile injectables
Reckitt Benckister, UK
Paras Pharma
Takeover
March 2010
Access to OTC market
Abbott Labs, USA
Nicholas Piramal
Takeover of healthcare business
May 2010
Access to generic products

19. RECENT COLLABORATIONS WITH INDIAN COs
MNC
INDIAN
THE DEAL
FROM
RATIONALE
Pfizer , USA
Vetnex Animal Health
Controlling stake
June 2009
Access to animal health business
Vetoquinol,
France
Wockhardt (vet division)
Buyout
Access to Indian market
Abbott Lab., USA
Wockhardt (nutrition Div)
buyout
July 2009
Access to Indian nutrition market
Reckitt Benckister, UK
Paras Pharma
Takeover
March 2010
Access to OTC market
Litha ealth-care,South Africa
Natco Pharma
Marketing of products
Sept 2011
Access to multitude of dossiers
B. Braun Singapore
Ahlcon Parenterals(I)
March 2012
Iv Fluid and medical disposals
Mylan Inc, USA
Strides Arcolab (Agila Specilaities)
Sept 2013
Injectables catering to oncology

20. TOP INDIAN M&A SECTORS

21. INTERNATIONAL REGULATORY APPROVALS
No. of manufacturing sites (APIs + formulations) registered / approved by US FDA (as on )
550 / 323
Total no. of DMFs filed from India as on
> 3000
No. of ANDAs final / tentative approvals received from USFDA in Year 2012
178 / 42
No. of ANDAs final / tentative approved by US FDA between Jan-June 2013
87 / 25
No. of CEPs (certificates of suitability) from EDQM received by 130 companies
902
No. of sites approved by PDMA (Japan) – 20% of all PDMA aprrovals
>190
WHO GMP certified plants
> 800
Australian TGA approvals
845

22. R&D Investment in India
R&D investments overall is approx 18% of revenue
Spending on R&D by 30 leading Indian pharma companies up significantly by 19.7% during the year ended March 2013 over the previous year.
Focus of R&D by these companies is on new cost effective generic products in key therapeutic areas
With higher spending on R&D, Indian Pharma Inc. is set to tap upcoming opportunities from loss of patent exclusivity in the coming years.
(Improve / Add Value to generics / patented products)

23. R&D Investment in India
Net outcome of this trend is higher approvals for ANDAs and DMFs from highly regulated authorities like US, Europe and Japan.
Major companies like Shasun Pharma, Unichem Lab., Biocon, Natco Pharma etc have pushed their R&D expenses over 50% during
For example, R&D expenditure of Shasun Pharma went up by 179%

24. FOCUSSED APPROACH Designing products specifically for low income group
Identifying and servicing completely new needs
Focusing on New Drug Delivery Systems
Greater focus on prevention rather than treatment, including increasing use of information and communication technologies

25. INDIAN BIOTECHNOLOGY MARKET
Global Biotech Revenue
$262 billion
Indian Biotech Market at $ 4.3 bln. expected to touch $ 11.6 bln. by 2017

26. INDIAN BIOTECH SET-UP
World's largest producer of vaccines: 60% of the world’s vaccines are manufactured in India – exported to over 150 countries - accounts for 60–80% of annual UN vaccine purchases
Over 300 companies in operation
Among the five rising biotech industries in Asia-Pacific
Annual revenue generated is over $4 bln at a growth rate of 21.5%
Revenue from biotech exports at $ 2.2 bln in 2013 accounting for 51% of total industry revenues
Genome Valley project at Hyderabad is the largest single cluster for biotech research, training and manufacturing, earns foreign exchange of over $ 1 bln per year

27. THE INDIAN SCENARIO
India's growing respect and legal / regulatory framework for IPR, favourable economic policies and availability of huge talent pool for sustaining and growing operations is making India an attractive choice for global pharma companies for investment, tie-ups, mergers, acquisitions.

28. THE INDIAN SCENARIO
Because of patent expirations of blockbuster drugs, Indian firms are expected to actively participate in the production of generic version of these products. Indian companies are also ready with generic version of biotech drugs. Therefore, India will be able to maintain a large basket of qualitty affordable generics with assured safety and efficacy.

29. GLOBAL HEALTHCARE COSTS
Rapid hike in prices
Overall economic slowdown
Rising Govt. deficit
Reduction in Healthcare budgets
High priced prescription drugs
Aging population
Administrative costs
Spending on chronic diseases etc
Companies forced to reduce prices

30. INDUSTRY’S CHALLENGES
Declining Productivity
Competitive Pressure
Reducing drug approvals
Stringent regulations
Implementation of cost control measures by Governments
Increasing development costs
Increase in Clinical trial period due to tightened drug safety regulations
- thereby Leading to higher development costs and increased time-to-market

31. GLOBAL PHARMA MARKET

32. GLOBAL PHARMA TRENDS
Spending on medicines will reach $1.2 trn. by 2016
Rising influence of healthcare access and funding World over is driving demand towards low cost generic options from India
Anti-Diabetic Drugs and those for cardiovascular diseases are expected to see the fastest growth.
Cardiovascular patients estimated globally at over 250 million, mainly due to changes in demographics and lifestyle
Pharmaceutical industry's R&D programs will need to adjust to broad availability of low-cost generics from India
Demand for generics will also increase in oncology, diabetes, multiple sclerosis and HIV therapy areas

33. WHAT IS THE SOLUTION? In-Licencing Arrangements
Globally, Governments and pharma companies are looking at opportunities to procure medicines at affordable prices, reduce costs, improve pipeline and reduce the time-to-market
To reduce healthcare costs, they are adopting strategies like:
SOURCING FROM INDIA
Outsourcing (manufacturing, research, Clinical Trials etc) to India
Restructuring their R&D models to consider generics
Adopting efficient sales & marketing functions to promote ‘value-added’ generics as alternatives
In-Licencing Arrangements

34. ADVANTAGE INDIA

35. ADVANTAGE INDIA
While clinical trials cost approximately $300 to 350 million in US, they cost only about $25 million in India
India has the 2nd highest number of qualified doctors in the world. Of every six medical doctors in the US, one is Indian
Investigational New Drug stage costs about $100 to 150 million in US, but costs only around $10 to 15 million in India
700,000 science and engineering graduates & 1500 PhDs qualify annually. Over 15,000 scientists
India’s huge population and the prevalence of a wide spectrum of disease conditions offer a wide patient-resource for clinical trials

36. ADVANTAGE INDIA On demand
India manufactures and exports medicines from all therapeutics groups.
Many original innovator companies source their discovered drugs from Indian companies.
India is a world leader in anti-AIDS and anti-TB segments and for some of the latest medicines like Glitazones, Celecoxib, Statins, Montelukast and many anti-cancer drugs
On demand

37. US PATENT EXPIRIES Year No. of Patents 2010 70 2020 171 2011 130 2021
133
2012
165
2022 88
2013
207
2023 95
2014
253
2024 64
2015
235
2025 45
2016
162
2026 37
2017
203
2027 42
2018
209
2028 21
2019
2029 22
(Source: USFDA Orange Book, Oct 2011)

38. GLOBAL RECOGNITION
Bill Clinton's foundation, Clinton Health Access Initiative (CHAI) got further discounts from Indian generic manufacturers that reduced the cost of combination drug treatments for AIDS, which can reach thousands of dollars per year in the West, to as low as $120 a year per patient.
Many Indian companies are part of this agreement where Lamivudine, Stavudine, Zidovudine, Nevirapine will be supplied to a few African countries.
India has highest number of approvals from the US President's Emergency Plan for AIDS Relief (PEPFAR).

40. INDIA AS PHARMACY OF DEVELOPING WORLD – Examples
Main procurement agencies for developing countries depend overwhelmingly on India
70-90% of essential medicines of developing countries comes from India
50% of medicines procured by UNICEF for developing countries are from India
75-80% of medicines distributed by Dutch-based International Dispensary Association (IDA) Foundation, the chief medical supplier to developing countries is sourced from India

41. INDIA AS PHARMACY OF DEVELOPING WORLD – Examples (contd….)
80% of medicines for AIDS issued by MSF (Doctors Without Borders) come from India and are distributed in treatment projects in over 30 countries
Globally, 70% of treatment for 87 countries provided by UNICEF, The Global Fund to Fight AIDS, Tuberculosis and Malaria, the Clinton Foundation, etc. come from India
91% of the generic ARVs approved by the US FDA for PEPFAR, the US President’s AIDS initiative for distribution in developing countries are from India, resulting in cost-savings up to 90%.

42. INDIA AS PHARMACY OF DEVELOPING WORLD – Examples (contd….)
In Zimbabwe, 75% of all tenders for medical expenditure come from India
In Lesotho, it is 95%
90% of the ARVs used in Zimbabwe’s national treatment programme come from India
In addition, raw materials are exported from India to other countries for local production of affordable medicines
This has been crucial to enable national AIDS programmes, such as those in Brazil or Thailand, to provide universal free access to ARVs.
Thailand gets 90% of its raw materials for ARV production from India

43. INDIA’S SUPPORT TO USA Over 40% of generics prescribed are from India
To ensure continued supply of the low cost quality generics from India, the US FDA has opened India office
1 out of 5 US FDA inspections for approvals are in India
Indian firms have over 40% of total ANDA approvals in USA
80% of all retail prescriptions filled in USA are for generic drugs
Based on their marketing and distribution networks and manufacturing capacities, Indian firms could see as much as % annual growth from the US, predict experts.
To overcome the recent shortage of cancer drugs J & J’s Doxil in USA, the US FDA sought Sun Pharma’s help in providing their chemotherapeutic drug Lipodox drugs from India 43

44. LARGEST SUPPLIER TO UNICEF
India has consistently been the largest supplier to UNICEF since 2007.
India was the largest supplier country in 2012, with $558 million worth of supplies such as vaccines, pharmaceuticals, nutrition, medical supplies
Of the 2.14 bln. purchases by UNICEF in 2012, more than 25% were from India
Serum Institute of India Ltd., an IDMA Member supplied vaccines / biologicals worth $254 mio dollars, making it the largest supplier in India
Other significant suppliers include Hetero Labs, Ranbaxy Labs, Aurobindo Pharma, Haffkine Bio-Pharma Corp., Micro Labs etc, all Members of IDMA.

45. LARGEST SUPPLIER TO UNICEF
UNICEF has recognised India's contribution to glocal aid, and international groups have lauded India's role in increasing access to medicines in the developing world.
Anti RetroViral (ARV) treatment in Europe was $10,000 per patient a year, until Indian manufactured drugs brought it down to $95 patient a year.
India is not only the largest supplier to UN groups, but also to the MSF and International Dispensary Association.

46. Affordable Efficacious Medicines – All Roads Lead
India happens to be the largest supplier of generic ARVs to low and middle income countries.
Paul Cawthome (MSF Access Campaign Coordinator-Asia) highlighted the worldwide dependency on India as a drug supplier best, when he said : 'It comes as a great relief to millions around the world who depend on a continuous supply of Indian generic medicines that the Indian Supreme Court has ruled against Novartis.‘
To meet increasing global requirements, the Government of India has set a target of $25 bln. for pharmaceutical exports by 2016.

47. Affordable Efficacious Medicines – All Roads Lead to India
Over 100 countries, mostly in the developing world, depend on India for affordable and quality essential medicines, vaccines and medical supplies
Every fifth generic drug and every third HIV drug consumed anywhere in the world, mostly in the developing world, home to over 80 % of the world's population, is manufactured in India

48. CHINDIA BILATERAL TRADE
China’s Premier Li Keqiang chose India for his first foreign trip
Premier Li was confident that “we are not a threat to each other, nor do we seek to contain each other”
Prime Minister Manmohan Singh had earlier assured China that “the world is big enough for both countries and each is too big to be contained by the other“
China has emerged as India’s largest trading partner as it replaced the US (in March 2008)
Premier Li has assured that China’s markets will be opened to Indian products to address the trade imbalance and boost commerce to $100 billion a year

49. CHINDIA BILATERAL TRADE
Despite a clear value proposition, Indian companies find it difficult to win government procurement contracts due to regulations that favour Chinese companies.
Again, China accounts for nearly 73% of Indian imports of APIs and other organic compounds.

50. CHINDIA - PARTNERSHIP IN GLOBAL TENDERING
As a reciprocal measure, China should import drug formulations from India to offset the trade deficit against API imports and set a timeline for review and approval of drug dossiers
India’s closer engagement with China in the global production network could be a possible way to improve its technology-intensive exports.
Our trade must focus on ‘trade creation’ and ‘trade diversion’

51. IN CONCLUSION A Win-Win situation!!
IDMA has always promoted access to quality affordable medicines, as our Annual themes confirm:
Affordable Medicines for All (2003)
Indian Pharmaceutical Industry – Going Global (2004)
People First… Patents Next (2005)
Global Pharma, India has Arrived (2006)
Contract Research and Manufacturing Services -Destination India (2007)
Indian Pharmaceutical Industry – Exciting Times Ahead (2008)
India’s Quality Affordable Generics: For Global Healthcare (2009)
India- The Generics Pharma Capital of the World (2010)
Healthcare Of People – Always In All Ways (2011)
INDIAN PHARMA INC. CREATING A GLOBAL IMPACT (2012)
AFFORDABLE EFFICACIOUS MEDICINES – ALL ROADS LEAD TO INDIA (2013)

52. Thank You
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