How the pharmaceutical industry became “Atmanirbhar” after 75 years of independence

The country will celebrate its 75th anniversarye Independence year 15e August 2022 and it is the day that holds significance in the growth of the pharmaceutical industry in India. Over the past decades since India’s independence, the industry has witnessed immense growth and become one of the major suppliers of drugs/medicines to countries across the globe. From nonexistent in the 1970s to supplying crucial drugs to more than two hundred countries in the fight against the pandemic, the Indian The pharmaceutical industry has shown its prowess in its commitment to better health for people around the world. With the government’s strong push towards an ‘Atmanirbhar Bharat’, several initiatives both at the business and political level have been implemented to propel the pharmaceutical industry to new heights.

Important factors in the growth of the pharmaceutical industry

Currently, the Indian pharmaceutical industry meets more than 60% of the global demand for different vaccines as well as ARV drugs, 30% of UNICEF’s annual global supply and nearly 60-80% of drug purchases from the UN come from India. In addition to this, the country also contributes almost 57% of APIs and 69% of FPPs (Finished Pharma Products) to the WHO pre-qualified list. In addition, about 40% of generic drug needs in the United States are met by India. All this is possible thanks to various initiatives that have been taken to stimulate the national pharmaceutical industry.

Here is an overview of the most important ones that have contributed to the strong growth of the industry:

The Patents Act of 1970

This was the first patent law introduced after India’s independence. It paved the way for process patenting and restricted end-product patenting, which allowed manufacturers to develop alternative processes for proprietary products already on the market.

Drug Policy 1978

The introduction of this policy along with the Price Control Order of 1979 proved to be landmark events for the pharmaceutical industry in India. It not only enabled the establishment of a National Medicines Authority, but also provided a ‘directional boost’ to the sector. The policy aimed to increase local production of bulk drugs, give leadership to UAPs, reduce imports of bulk drugs, encourage the growth of local industry, and reduce selling prices of important drugs as well as their formulations.

Hatch-Waxman Act of 1984

Even though this law was passed in the United States, it has contributed to the proliferation of generic drugs and has contributed a lot to the growth of the Indian generic industry. The law established the economic and legal foundation for today’s generic pharmaceutical industry.

Economic reform in India 1991

The Indian government in the year 1991 launched major economic reforms and entered the world of globalization. Economic reforms have contributed to the liberalization of the market, linking India’s pharmaceutical industry to the global economy. He also ensured the end of the “License-Raj” which allowed the pharmaceutical industry to enjoy greater freedom in the market. This created more leverage for domestic players and enabled market competition to produce better products.

By liberalizing the economy, the government has increased business opportunities in the country. As a result, a number of entrepreneurs have seized the opportunities and grown their pharmaceutical business from small business to big business.

Since the beginning of these reforms, the domestic pharmaceutical industry has experienced tremendous growth and currently exports drugs and medicines worth $19 billion across the world.

Recently, the Cabinet also approved two schemes, namely the Production Linked Incentives (PLI) Scheme and the Bulk Drug Parks Promotion Scheme to promote domestic manufacturing of essential raw materials/drug intermediates and APIs (Active Pharmaceutical Ingredients) in India.

The government plans to develop three mega bulk drug parks in India in partnership with the states. A sum of INR 3,000 crore has been approved for this program for the next 5 years. Under the PLI program, financial incentives will be provided to eligible producers of 53 identified critical bulk drugs on their incremental sales during the baseline year (2019-20) for a period of six years. The program will reduce the country’s dependence on imports from other countries for KSMs/drug intermediates and critical APIs.

Last words

Over the past few years, digitization has also become a key driver for the pharmaceutical industry, helping to deliver high-quality, hyper-personalized customer experiences and also improving business resilience and performance. Undoubtedly, digitalization will play an active role in the agility of the pharmaceutical value chain by bringing the sector closer to patients and doctors. More importantly, the pharmaceutical industry must strive to innovate more, making effective new drugs for emerging and unmet health needs. Steps like these will transform the industry into an innovation hub for the future.



The opinions expressed above are those of the author.