India, the ‘Pharmacy of the World,’ is one of the largest suppliers of generic medicines. The growth of the Indian Pharma industry depends on Active Pharmaceutical Ingredients (APIs). In recent years, the government of India has focused on supporting the Indian API market. India has become a global API hub by capturing 8% of the global API market. But what triggered this growth? Let’s discuss the factors contributing to the growth of the Indian API market.
The history and future of the Indian API market
Active Pharmaceutical Ingredient (API) is the building block of any medicine. The biochemical component adds a therapeutic effect to the drug used for any treatment.
Throughout history, India has depended on China for major APIs. Despite being the hub for generic medicines, we have relied on China for the API essential to creating the generic drug. India imports 70% of its API requirements from China (source). However, throughout the decades, the rocky relationship with China has become a looming threat to the thriving Indian Pharma Industry.
The final trigger came during COVID-19 when there was no way of importing APIs or other pharma products. It was a jarring reminder of the Indian pharma industry’s reliance on another country. Additionally, the geopolitical scenario between the two countries isn’t painting a good picture. Therefore, various schemes and policies were created to support the domestic production of APIs.
Launching the Production-Linked Incentive (PLI) Scheme played a crucial role in supporting the local production of APIs. Under the PLI scheme, the government and API manufacturers are creating policies to promote the production of 54 critical APIs in Indian pharma companies. By mid-2023, India had developed 38 of these APIs for in-house production of drugs and export (source).
The future of the Indian API market appears to be resilient and promising. India has become a reliable partner that caters to API demand worldwide. Now, 8% of the global API demand is met by the pharma exports of India. With investment in infrastructure and relaxed export and investment policies, India has become an API hub.
The advanced R&D facilities adhering to global standards and easy investment policies lead to an increase in API production and CDMO deals. According to sources, the Indian API market is expected to reach US$18.76 billion by 2028 with a CAGR of 8.31% (source)!
What contributes to India becoming a growing API Hub?
Many factors contribute to India’s exceptional growth of API manufacturing capacity.
Advanced infrastructure
The Indian pharma industry is one of the most rapidly growing industries. The growth potential and significance make it one of India’s most promising investment industries. In recent years, there has been a surge in government-backed and private R&D and API manufacturing capacities. The availability of resources and advanced infrastructure is vital in making India the global API hub.
Cost-effective production
One thing that makes India stand out as a reliable global API supplier is its lower production cost. While it might not be as low as China’s, it’s lower than most other countries. Plenty of cheap resources and labor significantly reduce the production cost.
Availability of skilled workforce
India is the land of scholars and one of the most skilled technical workforces in the world. India is home to some of the most competent scientists, chemical engineers, and pharmacists creating advanced APIs. These experts manage all the technical intricacies of the API manufacturing process, from chemical synthesis to documentation and quality control. The top API manufacturers in India, such as Chemox Pharma, employ these experts to create the high-quality APIs meeting international standards.
Favorable policies
The government plays a vital role in the growth of the Indian API market. Establishing the PLI has significantly contributed to India’s growth as the API hub. The following are a few notable policies that lay a strong foundation for API production and export in India.
- Draft Pharmaceutical Policy 2017 by the Department of Pharmaceuticals focused on providing a guide to improve the quality of APIs during 2017-18 for export and domestic use.
- The Umbrella Scheme for the Development of the Pharmaceutical Industry aims to promote the efficiency of pharma products and make them accessible and affordable in the global market.
- The Promotion of Bulk Drug Parks 2020 scheme focused on facilitating three bulk drug parks to decrease the cost of bulk drugs production in India.
- Production Linked Incentive (PLI) Scheme 2020 supports domestic production of APIs, KMS, and Intermediates.
Partner with the best API manufacturer in India!
If you’re looking for affordable and high-quality APIs, India is the best place for you! Chemox Pharma is one of India’s best API manufacturing companies, following the WHO-GMP standards. We have developed 18 APIs that meet global standards and export them to over 20+ countries. The team of skilled scientists at our R&D and manufacturing unit at Dahej, Gujarat, helps us create high-quality APIs and consistently file DMFs. We provide custom packaging solutions developed at our production facility. Contact us with your queries.
Conclusion
India’s growth as the global API hub is credited to strategic government policies, advanced infrastructure, affordable resources, and a skilled workforce. We have been able to create domestic APIs to reduce our reliance on other countries and export the APIs to the global market. Chemox Pharma has one of India’s best leading API manufacturing facilities, exporting to over 20+ countries. Contact us now with your API queries; we are eager to help you!
FAQ
What is the future of the API industry in India?
The future of the API industry in India is bright and profitable. The establishment of advanced R&D facilities, the availability of a workforce, and facilitating policies make production easier and affordable. With relaxed investment policies, India can attract FDI and CDMO deals, solidifying its position as a global API hub.
How do you choose the best API manufacturing company in India?
When choosing an API manufacturing company in India, focus on their regulatory compliance, R&D & manufacturing capacity, policy transparency, client testimonial, and supply chain efficiency. Chemox is one of India’s top API and Intermediate manufacturers, following the WHO-GMP standards. Contact us for more details.
What is India’s current API manufacturing capacity?
India is one of the most efficient API manufacturers, complying with international standards. India has the highest number of USFDA-approved and over 2000 WHO-GMP-certified facilities, supplying APIs to over 150+ countries.
