Pharmacology Market Analysis in India
The relevance of research
The Indian pharmacology market is defined by two important segments - commercial, or pharmacy, and the government procurement segment. The first is the sale of medicines in pharmacies directly to consumers, the second is the purchase of medicines by the Ministry of Health, regional departments and hospitals for preferential categories of patients. The pharmaceutical industry is highly regulated, it has always been considered conservative, but 2020 has become a breakthrough in terms of legislative initiatives, including after the introduction of permission for the online sale of medicines and the start of the development of new vaccines.
Purpose of the study
Analysis of the state of the pharmacology market, assessment of the market volume, analysis of competitors, analysis of production and consumption, as well as identification of factors affecting the pharmacology market.
Content
Chapter 1 Overview of the Indian Pharmaceutical Market
1.1. Main characteristics of the market
1.2. Dynamics of the pharmacology market volume in 2016-2020 Potential market capacity
1.3. Assessment of factors affecting the market
1.4. Pharmaceutical Market Life Cycle Stage
1.5. Competition from substitute products
Chapter 2. Competitive analysis in the pharmacology market
2.1. Major players in the market
2.2. Market shares of the largest competitors
2.3. Profiles of major players
Chapter 3. Pharmacology Production Analysis
3.1. Volume and dynamics of domestic production of pharmacology
3.2. The share of exports in the production of pharmacology
3.3. Segmentation of pharmacology production by regions
3.3.1. Production by Union Territories
3.3.2. Production by states of India
Chapter 4. Analysis of foreign trade supplies of pharmacology
4.1. Volume and dynamics of pharmacology imports
4.2. Import structure
4.3. Volume and dynamics of pharmacology exports
4.4. Export structure
Chapter 5
5.1. Dynamics of consumption of pharmacology
5.2. Analysis of the results of tenders for the purchase
Chapter 6
6.1. Average producer prices by union territories
6.2. Average consumer prices by states in India
Chapter 7. Assessment of factors of investment attractiveness of the market
Chapter 8
Chapter 9. Recommendations and Conclusions
Research excerpt
Chapter 1 Overview of the Indian Pharmaceutical Market
1.1. Main characteristics of the market
The subject of pharmacology market research includes medicines, vaccines and sera. Pharmaceutical substances and diagnostic reagents, as well as parapharmaceuticals are not taken into account.
The Indian pharmacology market consists of two main parts - commercial, or pharmacy, and the public procurement segment. The first is the sale of medicines in pharmacies directly to consumers, the second is the purchase of medicines by the Ministry of Health, regional departments and hospitals for preferential categories of patients.
The pharmaceutical industry is highly regulated, it has always been considered conservative, but 2020 has become a breakthrough in terms of legislative initiatives.
Global healthcare and pharmaceuticals were not ready for coronavirus infection. There were not enough doctors, hospital beds, medicines, understanding how to successfully fight the new virus. The states repurposed hospitals, built new ones, involved doctors of various specializations and even medical students in the treatment of patients, and the race for drugs against the new virus and vaccines began. What is happening has significantly increased the interest of investors in the industry, including in India.
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The pharmaceutical market is dominated by imported products. In 2016-2019 the share of imports was …%. In 2020, the share of imports decreased to …%, increasing the share of domestic production to …%.
1.2. Dynamics of the pharmacology market volume in 2016-2020 Potential market capacity
In 2017-2018 The pharmacology market grew at a moderate pace: “plus” …%. In 2019, the market grew … % due to the growth of imports, higher prices for medicines, a shift in demand in favor of more expensive goods, as well as an increase in the share of the state segment, the weighted average cost of which is traditionally higher than in the commercial segment.
Diagram 2. Dynamics of the pharmacology market volume, 2016-2020, billion Rs.
Diagram 3. Revenue (net) from the sale of pharmacological products in the Union Territories for 2016-2020, %
1.3. Assessment of factors affecting the market
Let's consider the main factors influencing the market and, accordingly, demand.
• Economic
The dynamics of India's GDP is decisive in the vector of development of the entire economy of the country and determines the key trends in consumer effective demand and economic activity.
In 2012-2014 the GDP growth rate was positive, but constantly declining, and in 2015 it was less than zero. In 2015, which was the peak of the crisis in the state, the decline in GDP was 2% compared to the previous 2014, and since the dynamics of GDP is directly proportional to the well-being of citizens, this indicates a fall in family incomes, a reduction in demand, and an increase in prices. It also led to a decline in production and employment.
The decline in India's GDP in 2020, according to the first estimate of Rosstat, was 3,1%. This is the biggest drop in GDP since 2009, when the country's economy contracted by 7,8%. According to Rosstat, the decline in GDP is mainly due to restrictive measures due to the pandemic, as well as a drop in global demand for energy resources.
In general, economists are building optimistic, but cautious forecasts for 2021. After the collapse of the global economy and financial markets associated with the coronavirus, experts expect recovery growth. However, things could deteriorate sharply again if the vaccination of the population is delayed.
Currently, the factor of GDP decline has a negative impact on the market under study.
Dollar rate
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Real disposable money income
Real disposable money income per capita is income minus mandatory payments, adjusted for inflation. This factor determines the level of effective demand of buyers, is one of the key reasons for the formation of the dynamics of both retail turnover and demand for services.
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Polls of the population also testify to a significant reduction in the income of the population. In a May 2020 CSR study, the majority of Indians (58%) reported a decrease in income in their families during the pandemic, and 5% lost it completely. 33% of those surveyed reported changes in their employment relationship: 52% of them had their salaries cut, 25% were sent on unpaid leave, and 23% were fired.
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The declining real disposable income of the population, as well as the high vulnerability of the main consumers of medicines - pensioners, negatively affects the pharmacology market.
• Social
Population decline. During 2012-2017 India's population has shown a positive trend. However, in 2018, the vector changed - the population decreased due to the natural population decline in 2016-2019.
The current demographic situation in India is characterized by natural population decline (since 2017), which is accelerating, and migration growth, which does not compensate for natural decline.
Rejuvenation of senile diseases
In recent decades, various diseases have become much younger. This is due to both environmental degradation and unstable sleep patterns, constant stress, unhealthy diet, sedentary lifestyle, etc. This factor has a positive effect on the pharmacology market.
Population aging
An elderly person is several times more likely to get sick than a young person. In addition to infections and an increase in chronic diseases, typical problems appear - decreased vision, the ability to hear and understand speech, deterioration in fine motor skills, problems with bones and joints, which, together with an increase in the elderly population, has a positive effect on the pharmacology market.
Until the beginning of 2019, there has been a steady increase in both the absolute indicator of the population over working age and its share in the total population of India, the so-called “population aging” is taking place.
• Technological
Distance trading
In 2020, the remote sale of OTC drugs was allowed. According to the research company … , the share of orders with the delivery of goods to the consumer in 2020 amounted to almost … % of all drug sales on the Internet in monetary terms. According to analysts, online bookings dominate in the distance selling of medicines, when the user makes a pre-order on the Internet, and then picks up the goods from the pharmacy himself.
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The vaccine
Bloomberg called Sputnik V the biggest breakthrough since the Soviet era. Previously, the Indian vaccine was approved in Iran, Algeria, Argentina, Belarus, Bolivia, Hungary, Serbia, Palestine, Venezuela, Paraguay and Turkmenistan. In total, more than 30 countries have shown interest in the Indian drug, according to the Indian Direct Investment Fund (IndiaPI), which finances the production of the vaccine. The positive influence of the factor.
• Political
In 2020, pharmaceutical market players noted a large number of legislative initiatives. The activation of state regulators is largely associated with the coronavirus pandemic. Active government support has a strong positive impact on the development of the Indian pharmacology market:
Accelerated registration of medical devices.
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Re-registration of prices.
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Correction of the Vital and Essential Drug List.
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Strategy for the development of immunoprophylaxis.
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Marking
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""Pharma 2030"".
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Creation of the Federal Center for Planning and Organization of Drug Provision of Citizens.
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Transition to the Registration of medicines in the EAEU.
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Establishment of a state fund for helping children with orphan diseases.
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import dependence
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Concluding the assessment of the factors influencing the Indian pharmacology market, we will summarize the key ones in the framework of the STEP-analysis.
Table 2. STEP analysis of factors influencing the pharmacology market
According to the results of the performed STEP-analysis, macro-environment factors have a positive influence of weak force on the development of the pharmacology market.
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1.4. Pharmaceutical Market Life Cycle Stage
The pharmacology market has been in the stage of … for a long time. The reason for this is the possibility of extending the period ... due to the creation of new drugs that support the interest of buyers in it.
1.5. Competition from substitute products
Substitute goods in the pharmacology market are alternative methods of treatment. Folk medicine is a complex of empirical knowledge accumulated by the people, used to diagnose and treat diseases and passed down from generation to generation. Part of the methods of traditional medicine, for which the effectiveness and safety is proved, can be adopted by modern medicine.
The World Health Organization does not currently recommend the use of traditional medicine and is working towards promoting an evidence-based approach in assessing the safety, efficacy and quality of certain methods.
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Part 2. Competitive analysis in the pharmacology market
2.1. Major players in the market
The ranking lists the leading Indian companies by revenue, which are categorized under the Pharmaceuticals and Medical Supplies industry. ...
2.2. Market shares of the largest competitors
More than half of the pharmacology market is accounted for by imported products – …%. Among Indian manufacturers, the leaders are … with a share of …%, the company’s plants … – …%, … – …%., JSC “…” closes the top five with a share of …%.
2.3. Profiles of major players
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Table 4. Profiles of companies participating in the pharmacology market in 2020
Part 3. Pharmacology Manufacturing Analysis
3.1. Volume and dynamics of domestic production of pharmacology
The production of medicines, vaccines and sera in 2017 increased by …% to … million packs. due to a set of measures of state support for domestic producers, as well as the attractiveness of the industry for private investors.
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In 2018-2019 production decreased by almost … thousand packs, however, at the end of 2020, it showed an increase by … %, having produced the maximum volume of products for the study period.
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3.2. The share of exports in the production of pharmacology
Despite the growth in exports (for more details, see paragraph 4.3), the share of exports in production in 2020 decreased by … p.p. compared to 2016 due to more active growth in production in value terms against the backdrop of rising prices. According to GidMarket, in 2020 the share of exports in production amounted to …%.
3.3. Segmentation of pharmacology production by regions
3.3.1. Production by Union Territories
If we consider production in the context of federal districts, then the main share falls on the Central Union Territories - ...%. In second place is the Volga Union Territories - ... % of the total Indian production. The Ural Union Territories closes the top three with a share of …% or production of … mln packs of pharmacological products.
Part 4. Analysis of foreign trade supplies of pharmacology
4.1. Volume and dynamics of pharmacology imports
During 2016-2020 The dynamics of imports of pharmacology to India is oscillatory. Thus, in 2017, the volume of imports increased by … % and amounted to … thousand tons. In 2018, the volumes decreased to … thousand tons.
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4.2. Import structure
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The largest importing countries are increasing their share in value terms, and vice versa, decreasing in volume terms, which indicates a tendency to purchase more expensive drugs from leading suppliers. …
4.3. Volume and dynamics of pharmacology exports
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In value (dollar) terms, the volume of exports has a slightly different dynamics. …
Foreign trade balance in the pharmacology market in 2016-2020 is in the zone of negative values:
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Diagram 18. Balance of exports and imports, 2016-2020, million Rs.
4.4. Export structure
The main volume of pharmacology, in value terms, exported from India in 2020 was supplied to Kazakhstan - ... %, Ukraine (in the DPR and LPR) - ..., Belarus - ... % and Uzbekistan - ... %. Other countries in the structure of exports occupy less than … % each.
Chart 19. Structure of exports by countries in 2020, %
Part 6. Price Analysis
6.1. Average producer prices by union territories
In the public domain, manufacturers do not publish wholesale prices. However, it can be noted that some prices differ significantly across the Union Territories. For example, the cost of activated carbon in the Siberian Federal District is more than … times higher than the cost in the Urals, or the price of validol in the Volga Union Territories is more than … times higher than in the Central.
Part 8. Forecast for the development of the pharmacology market until 2025
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Part 9. Recommendations and conclusions
List of diagrams
Diagram 1. The ratio of imported and domestic products in the pharmacology market, 2016-2020 %
Diagram 2. Dynamics of the pharmacology market volume, 2016-2020, billion Rs.
Diagram 3. Revenue (net) from the sale of pharmacological products in the Union Territories for 2016-2020, %
Diagram 4. Dynamics of India's GDP, 2012-2020, % to the previous year
Diagram 5. Monthly dynamics of the US dollar against the rupee, Rs. for 1 US dollar, 2015-Feb. 2021
Diagram 6. Dynamics of real incomes of the population of India, % to the previous year, 2012-2020
Diagram 7. Dynamics of the population of India, million people, as of 01 Jan. 2012-2021
Diagram 8. Industry life cycle stage
Diagram 9. Shares of the largest competitors in the pharmacology market in 2020, %
Diagram 10. Dynamics of pharmacology production volumes in India for 2016-2020, million packs
Diagram 11. Dynamics of the total revenue of the largest manufacturers (TOP-5) of pharmacology in India, 2016-2020, billion Rs.
Diagram 12. The share of exports in production for 2016-2020, %
Diagram 13. Production of pharmacology by states of India, 2020, %
Diagram 14. Volume and dynamics of imports of pharmacology in physical terms, 2016-2020, thousand tons
Diagram 15. Volume and dynamics of imports of pharmacology in monetary terms, 2016-2020, mln USD
Diagram 16. Dynamics of pharmacology exports in physical terms, 2016-2020, thousand tons
Diagram 17. Dynamics of exports of pharmacology in monetary terms, 2016-2020, million US dollars
Diagram 18. Balance of exports and imports, 2016-2020, million Rs.
Chart 19. Structure of exports by countries in 2020, %
Diagram 20. Dynamics of consumption of pharmacology in monetary terms, 2016-2020, Rs./person
Diagram 21. Forecast of market size in 2021-2025 – under the scenario of one quarantine, billion Rs.
Diagram 22. Forecast of pharmacology market size in 2021-2025 – under the scenario of two quarantines, billion Rs.
List of tables
Table 1. Total population and population over the working age in India, as of 01 Jan. 2012-2020, thousand people
Table 2. STEP analysis of factors influencing the pharmacology market
Table 3. The main companies participating in the pharmacology market in 2020
Table 4. Profiles of companies participating in the pharmacology market in 2020
Table 5. Pharmacology production dynamics in India by union territories, 2016-2020 million packs
Table 6. Structure of pharmacology imports by importing countries in 2020
Table 7. Data on the largest completed tenders for the purchase of pharmacology, Nov. – Dec. 2020
Table 8. Average producer prices in the pharmacology market by Union Territories, 2020, Rs.
Table 9. Average consumer prices in the pharmacology market by state of India, 2020, Rs.
Table 10. Assessment of factors of investment attractiveness of the pharmacology market
Table 11. Assessment of the impact of recent crises on the industry
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