Indian pharma companies seek lion’s share in generics market

AHMEDABAD: With the global generics market outside the US, Europe and Japan projected to grow to $52 billion by 2009, Indian pharmaceutical companies are diversifying their markets. This will be bigger than the estimated combined generics market size of $41 billion of the US, Europe and Japan by 2009, as per the projections made by global investment firm CLSA Asia-Pacific Markets in its recent report.

JB Chemicals & Pharmaceuticals president Pranabh Mody said instead of tapping the US or European generic markets like many other Indian pharma companies, they have decided to focus on the Russian, CIS and African markets instead. “Currently, about 45% of JB’s revenues come from Russia and CIS countries, 42% from India, 7% from APIs and the rest from other countries,” says Mr Mody.

CLSA’s report says that while the US has been the focus market for most generic companies, it sees diversification as a better policy.

It expects the generic opportunity outside the US, Europe and Japan to reach $52 billion by 2009 from $34 billion in 2004. These opportunities are vast, but they are spread across more than 160 countries, with each having their own local idiosyncrasies, strong players, etc. A successful business can be built through product-supply partnerships with local players. Such a relationship helps the local partner capitalise on its front-end without marketing conflicts while the supplier takes advantage of manufacturing and product development skills and a low-cost base.

Ranbaxy’s spokesperson said as a fully-integrated company, it is present in 23 of the top 25 world pharmaceutical markets and in 21 of the 25 EU countries. Ranbaxy has a balanced business model. In the coming years, Ranbaxy will focus on increasing the momentum in the generics business in its key markets of the US, Europe, Japan, BRICS (Brazil, Russia, India, China) and South Africa through the organic and inorganic growth routes.

Sun Pharmaceuticals spokesperson said while they are well positioned for growth in the US, they expect the ex-US markets to continue showing strong growth.