Health insurance penetration to drive India’s pharma formulations market upto 17% growth in FY2010: RNCOS report

The domestic pharmaceutical formulations market in India will grow at an annual rate of around 17% in FY 2010, owing to increasing middle class population and rapid urbanization, says a report by RNCOS, an industry research firm.

The growth of the formulations industry will mainly be driven by the increasing penetration of the health insurance in India and the rising incidences of lifestyle diseases in the country, which has been possible due to growing working class population in the country.

The consolidation in the industry triggered by product patent regime has improved the pricing power in the industry.

Increase in drug prices in India account for 3-4% growth in the domestic formulation industry, according to RNCOS study titled “Booming Pharma Sector in India” .

The Indian pharmaceutical industry has been witnessing prodigious growth over the last few years. The industry is projected to continue growing further at a CAGR of around 13% during FY 2011-FY 2013.

The Indian pharmaceutical market shows immense growth potential due to the growth of the pharma outsourcing industry and the bioinformatics industry.

Further, various factors such as growing healthcare spending and growth in the obligatory and voluntary insurance schemes have been resulting into the increasing usage of high-priced drugs in the country.

Infectious diseases are on the rise and India has transformed itself as a conducive environment for clinical trials, which will further pave the way for the growth of its pharmaceutical industry.

“Booming Pharma Sector in India” provides a statistical and analytical overview on the Indian pharmaceutical market.

The report also discusses the opportunities and challenges that are expected to arise within and from the pharmaceutical market.

The report also elaborates the emerging sectors and regulatory environment and presents prudent analysis of the distribution system in the pharmaceutical industry.

The report evaluates various potentials of the formulations industry, both in terms of domestic turnover and exports, for the coming years.

The generic drugs market in the world’s biggest pharmaceuticals market US is anticipated to grow at a CAGR of around 9% during 2010-2012 even as India companies line up to grab a considerable share of the business.

According to a recent RNCOS research called “Booming US Generic Drug Market” , the generic drugs market in the US is anticipated to grow at a CAGR of around 9% during 2010-2012.

The US generics market is the biggest in the world, comprising more than half of the share of the global generics market. The huge potential of this market can be interpreted from its vast pharmaceutical market, which is again the largest in the world.

It is expected that a huge proportion of branded drugs in this market will lose patent protection in coming three years, and thus will open doors for generic substitution.

RNCOS has identified various decisive factors molding the US generic drugs market towards an exponential growth track.

Generics had an estimated share of around 78% in the US pharmaceuticals market and growth of generics has outpaced the growth of overall pharmaceutical market.

The report also discusses the potential of generic drugs in various therapeutics segments of the pharmaceutical industry, which will give a clear idea about the type of products available in the market.

Indian companies including Sun pharma, Aurobindo Pharma, Glenmark, Cadila Healthcare, Wockhardt, Ranbaxy etc have major stakes in US generics market.

RNCOS is an industry research firm which provides industry insights and analysis.