Make in India — nowhere to go but up



Make in India recently published an advertorial in the Washington Post proclaiming that “2016 is India’s Growth Year For Pharma.” I don’t doubt that India has growth potential, as it ranks 51st out of 54 nations that I compare in the Scientific American Worldview scorecard.

The problem with Make in India’s encouraging proclamation is that there are serious systemic problems holding India back.

I have previously published my thoughts on the matter in the Journal of Commercial Biotechnology: Building biotechnology in India – Drugs are not the answer.

Further, while Make in India claims that India is the number one exporter of generic drugs by volume, NSF Science and Engineering Indicators show that China’s pharmaceutical value-add was $139 billion in 2014, wheras India’s was $10 billion. Further, China’s value-add is up 50% from 2011, whereas India’s value-add is up less than 5%. So what does it matter if India is the number one exporter by volume, if they can’t generate revenues?

I am not alone in my pessimistic stance. Hyderabad-based Hetero Pharma said that the country has lost nearly $10 billion worth of investment by not respecting IP norms.

Further, consider the sobering sentiment from the World Bank. India ranks behind the West Bank and Gaza in their latest ‘Ease of Doing Business’ ranking.

To close on a positive note, I think it’s clear that India’s pharmaceutical industry has great growth potential. I just hope that the policy makers and stakeholders are playing it long, and don’t think that 2016 will be a substantial inflection point.

   One Comment

  1. Ronald A. Rader
      March 24, 2016

    India is already falling well behind its primary competitor, China, in terms of both drugs and biopharmaceuticals. With drugs, already about 90% of the APIs/active agents (nearly all for generic knock-offs) are imported from China, with India just essentially having massive fill-finish capacity. With biopharmaceuticals, there is essentially zero innovation or real R&D and, as with drugs, the country (government included) is also targeting manufacture of low-end biogenerics for its own and other lesser- or non-regulated international markets. Sooner or later, even cheaper countries and/or improved automation in developed countries will threaten or destroy this business model. And the many infrastructure problems, including basic like water, air and electricity, simply don’t get better. Combine that with continued denial and avoidance of making major changes in pharm. industry business culture, e.g., having employees meet professional ethical standard and follow laws/regulations vs. doing what managers expect/require of them which too often can include fudging data (and not even doing a good job of that) to make everything seem OK to upper-level management and in regulatory filings. It seems that such corruption of the pharmaceutical R&D and manufacturing paradigms comes more from the bottom-up and is much more ingrained in India, e.g., where fudging data shows required loyalty and is simply part of the job, allowing deniability by corporate management, while in China it’s more a matter of following orders passed down from upper-level management, with this following of orders much easier to control and stop.