The global pharmaceutical industry is massive, with the value
chain divided into two parts: API and finished goods. API is the
foundation of the drug, allowing it to produce the desired
effect.
China is one of the world’s largest suppliers of API, and when
the coronavirus pandemic struck, the pharmaceutical industry
suffered losses due to a lack of raw materials.
API, or Active Pharmaceutical Ingredient, is a substance that is
included in medications to achieve the desired effect. It
replaces one of the two main ingredients in medicine, the other
being excipients, which deliver the API effect.
India has the world’s third-largest pharmaceutical industry.
China meets roughly 70% of India’s pharmaceutical needs,
including Active Pharmaceutical Ingredients needed to
manufacture finished drugs. When compared to APIs manufactured
in India, these Chinese APIs cost nearly one-third less. Due to
the subsidized pricing of Chinese APIs, domestic API
manufacturers in India were forced to close their doors.
As a result, Indian firms gradually began to withdraw from API
production as their large investments did not yield higher
returns. The high cost of APIs in India is due to a variety of
factors, including infrastructure requirements and the high cost
of manufacturing technology.
The Indian API market is currently characterized by notable
trends such as rapid growth in the biopharmaceuticals sector and
technological advancements in API manufacturing. In India, API
manufacturing is divided into branded or innovative and
unbranded or generic.
The ongoing global drug cliff is expected to boost the Indian
Active Pharmaceutical Ingredients (API) market’s revenues.
India’s API industry has grown. Because of its high quality, it
has received widespread recognition worldwide. In India, the API
market is expected to grow by 10% over the next two years.
The Indian government has proposed an INR 10,000 crore scheme to
boost domestic API manufacturing. This, in turn, would encourage
the export of these raw materials to drug manufacturers all over
the world. The government believes that this scheme will
increase revenue for API manufacturers in India. The Union
Cabinet established three API parks to reduce reliance on China
for 53 APIs.
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