Pharmaceutical Sector In Robust Health

The pharmaceutical sector is very important for the Indian economy. Not only does it generate export revenues but it also gives India the distinct advantage of being a global leader in a field that serves humanity. This sector, since the advent of the current pandemic, has been continuously in the limelight. In fact, the sector has seen re-rating since March 2020 and the kind of wealth creation that has happened on the bourses in this sector is mindboggling. No wonder the sector has produced more multi-baggers than most other industries thriving in India in the last one year. Shreya Chaware discusses at length the opportunities that lie ahead for the sector while also throwing light on some of the top performing pharmaceutical companies in India.

-  Shreya Chaware

According to a report by India Ratings and Research, during May 2021 volumes in the sector grew 31.5 per cent YoY while price growth was seen of about 7 per cent and product launches increased by further 9.3 per cent, attributed to acute therapy products India is considered to be the largest provider of generic drugs globally. The Indian pharmaceutical sector supplies over 50 per cent of the global demand for various vaccines, 40 per cent of generic demand in the US and around 25 per cent of all medicine demand in the UK. Globally, India ranks 3rd in terms of pharmaceutical production by volume and 14th by value. The domestic pharmaceutical industry includes a network of 3,000 drug companies and around 10,500 manufacturing units. While the first wave of the coronavirus surely brought the sector into the limelight, the second wave gave a further boost to the pharmaceutical sector. Additionally, vaccine rollouts have already been positive news for the sector.

According to a report by India Ratings and Research, during May 2021 volumes in the sector grew 31.5 per cent YoY while price growth was seen of about 7 per cent and product launches increased by a further 9.3 per cent, attributed to acute therapy products. Further, the market is estimated to grow by around 8-10 per cent YoY in size during FY22. For May 2021, acute therapies such as anti-infective, analgesic and vitamins witnessed sales growth of 141.19 per cent YoY, 50.3 per cent YoY and 59.8 per cent YoY, respectively, while gastro grew 47.7 per cent YoY. It is believed that acute therapies, namely, anti-infective, analgesics and vitamins benefited significantly due to the second wave of the coronavirus as these therapies have a direct or indirect role in the treatment of patients.