DEFENSIVE PHARMA

Pharmaceuticals constitute India's second biggest exports to the US even after Trump administration's failed attempt at revoking Obamacare. One cannot ignore the fact that India offers a low-cost innovation and manufacturing hub and India-made generics sometimes cost almost one-tenth of branded drugs sold in the US. So, any material policy change will be counter-productive from the socio-economic point of view.

Of late, consolidation has become an important characteristic of the Indian pharmaceutical market as the industry is highly fragmented. The Indian pharmaceutical market is expected to grow exceptionally by 2025 on the back of increasing consumer spending, raising healthcare insurance and rapid urbanization. Government effort steps to reduce costs and bring down healthcare expenses too will help the sector in coming time. Moreover, government's steps to reduce India's dependence on large scale import of active pharmaceutical ingredients and increasing production of active ingredients used in drugs to meet the country's need also augurs well for the pharmaceutical companies. Significant increase in exports and well controlled imports will also provide strength to the sector, supported by government's several initiatives to boost exports and domestic production. Moreover, higher spending on research and development by pharmaceutical companies too will support the sector in coming time.