The Indian Pharmaceutical Industry

The Indian pharmaceutic IndustryThe Indian pharmaceutic Industry now is in the front rank of Indias science- found industries with wide ranging capabilities in the complex field of do do medicatess manufacture and plan science. A highly organized domain, the Indian Pharmaceutical Industry is estimated to be deserving, $4.5 one zillion million million, learning at nigh 8 to 9 portion one-yearly. It ranks really high in the thirdly dry land, in term of technology, flavor and range of medicines manufactured. From simple headache pills to innovative antibiotics and complex cardiac compounds, near every type of medicine is straightaway do indigenously.The depend of purely Indian pharmaceutical companies is fairly humiliated. Indian pharmaceutical labor is mainly ope esteemd and control guide by dominant inappropriate companies having subsidiaries in India referable to availability of cheap labour in India at worst cost.Most pharmaceutical companies opera ting in India, even the multinationals, employ Indians al comely about exclusively from the lowest ranks to high level management. Mirroring the social structure, firms ar very hierarchical.Homegrown pharmaceuticals, like many other businesses in India, be ofttimes a mix of human race and private enterprise.Although many of these companies atomic bod 18 publically possess, leadership is passed from father to son and the founding family holds a majority share.In 2002, all oer 20,000 registered medicate manufacturers in India sold $9 trillion worth of locutions and volume doses. 85% of these conventionulations were sold in India while oer 60% of the multitude drugs were merchandiseed, mostly to the United States and Russia. Most of the players in the Indian plenty are small-to-medium enterprises. It has been estimated that 250 of the largest companies control 70% of the Indian foodstuff. The 1970 Patent symbolize., do the multinational companies to represent s ave 35% of the trade, bring from 70%, thirty long time ago.In foothold of the world(prenominal) grocery store, India currently holds a modest 1-2% share, that it has been developing at approximately 10% per twelvemonth. India gained its foothold on the globose scene with its innovatively engineered generic wine drugs and active pharmaceutical ingredients (API), and it is now seeking to pay back a major player in outsourced clinical research as well as contract manufacturing and research. in that respect are 74 U.S. FDA-approved manufacturing facilities in India, much than in any other country outside the U.S, and in 2005, almost 20% of all Abbreviated New Drug Applications (ANDA) to the FDA were filed by Indian companies. Growths in other fields notwithstanding, generics are still a large part of the picture.As much(prenominal), the Indian pharmaceutical constancy has now get the third largest producer in the world and is poised to grow into an application of $ 20 g azillion by 2015, from the current turnover of $ 12 billion.As a result, manufacturing expertise and efficiency were the lonesome(prenominal) choosements to participate in this sedulousness, creating low barriers of entry. The most critical challenge facing the orbicular pharmaceutical labor today is the increase cost of drug discovery and knowledge and the change magnitude time to securities manufacture. This is advertize compounded byImpending bare expirations of blockbuster moleculesPricing pressuresLow public opinionChallenges to intellectual proportion by increasingly aggressive generic companies.Re-importation pressuresMedicare/Medicaid reformIncreasing regulative hurdlesThis scenario is forcing the multinational pharmaceutical companies (MNCs) to rethink their strategic options in assign to exploit their core competencies across the globe. In this situation, India stands to a gain a lot because of its inherent gains like stability, culture, cost, and ameliorat e workforce. This has led to increase alliances and collaborations as a result the leading(a) Indian pharmaceutical companies devote become some of the most efficient manufacturing units in the world. In fact, India has the highest itemise of US FDA (Food and Drug Administration) certified manufacturing facilities outside USA.The overall phenomenal progress made by the effort in the pass away three decades has instilled a blotto belief in the government and the pharmaceutical companies in India that the country has a competitive strength and it should be enhanced by suitable insurance policy measures and firm specific actions with regards to export, knowledgeability, strategic alliances and investment.The pharmaceutical policy 2002 echoes the same sentiments and has shifted con pennyimerate of the policy from self reliance in drug manufacturing to the objective of enhancing global competitiveness. The introduction of policy says The staple fiber objectives of the governmen ts policy relating to drug and pharmaceutical sphere were enumerated in drug policy of 1986. These basic objectives still remain mostly valid, however, the drug and the pharmaceutical industry in the country today calculates sweet challenges on account of liberalization of the Indian economy the globalization of the world economy and on account of unexampled obligations chthoniantaken by India under the WTO commensuratenesss. These challenges require a change in current pharmaceutical policy and the accept for impudently initiatives beyond those enumerated in drug policy 1986, as circumscribed in 1994, so that policy inputs are directed to a greater extent towards promoting speed up yield of the pharmaceutical industry and towards making it much internationally competitive.The direct for radically improving the policy framework for knowledge-based industry has to a fault been acknowledge by the government. The Prime Ministers Advisory Council on Trade and Industry has made important recommendations regarding knowledge-based industry. The Pharmaceutical industry has been identified as one of the most important knowledge based industries in which India has a comparative advantage. THE increment STAGE OF Indian drug companyCEUTICAL INDUSTRYSECTION-12.1 produce STAGES OF INDIAN PHARMA INDUSTRYBengal Chemicals Pharmaceuticals Limited (BCPL), established in 1901, is a popular sector Undertaking (PSU) of the Government of India and is Indias first pharmaceutical company. The company was started by Prafulla Chandra Roy in Kolkata (then known as Calcutta) and has since manufactured such household Indian increases as Hospitol, naphthalene balls, and Phenol. The company is headquartered in Kolkata and reported aggregated revenues of Rs 6,199 lakhs (US$ 138.2 million) in fiscal 2006.The emerging industry, however, received setbacks in the post world war-II completion as a result of refreshed healing(predicate) developments in the western countries that triggered natural excrement of older drugs from grocery usage by in the rawer drugs like sulpha ,antibiotics, vitamins, hormones, antihistamine, tranquilizers, psychotic pharmacological substances etc. This culminated in the discontinuation of topical anaesthetic yield based on indigenous materials and forced the industry to import bulk drugs meant for touch them in to formulations and for selling in the national mart place. material bodyure- 2.1 stages of Growth of Indian Pharmaceutical Industry.Source ISID Working Paper, 2006/05.The government started to encourage the harvest-tide of drug manufacturing by Indian companies in the early 1960s. In the post independence period, Indian pharmaceutical industry exhibited four stages of crop (see Figure 2.1 2.2). In the first stage during 1950s-60s, the industry was for the most part dominated by international enterprises and it hatchd to rely on imported bulk drugs notwithstanding its comprehension in the list of basi c industries for plan targeting and monitoring. Foreign firms, enjoying a soaked patent certificate under the Patent and Design Act 1911, were antipathetic to local business and mostly opted for imports from home country as works of the patent. Given the inadequate capabilities of the national help sector to start local fruit of bulk drugs and hesitation of foreign firms to do so, the government decided to interfere through starting public sector enterprises. This led to the establishment of the Indian Drugs and Pharmaceuticals Ltd. (IDPL) plants at Rishikesh and Hyderabad in 1961 and the Hindustan Antibiotics at Pimpri, Pune, in 1954, to manufacture penicillin. The starting of the public sector enterprises has been an important feature in the evolution of the pharmaceutical industry as it assumed initiative roles in producing bulk drugs indigenously and led to signifi cigarett knowledge spillovers on the private home(prenominal) sector.The second growth stage, of the indu stry took place in the 1970s. The enactment of the Indian Patent Act (IPA) 1970 and the New Drug Policy (NDP) 1978 during this stage are important milestones in the history of the pharmaceutical industry in India. The IPA 1970 brought in a number of radical changes in the patent government by reducing the chain of patenting to only soures and not pharmaceutical products and also for a short period of seven course of studys from the earlier period of 16 classs. It also recognizes autocratic licensing after three years of the patent. The enactment of the process patent consecrated importantly to the local technological development via adaptation, reverse engineering and immature process development. As there exits several ways to produce a drug, domestic companies innovated cost-effective processes and flooded the domestic market with cheap but prime(a) drugs. This led to the steady rise of the domestic firms in the market place. The NDP 1978 has increase the pressure on for eign firms to manufacture bulk drugs locally and from the basic stage possible. Foreign ownership up to 74 per cent under the Foreign Exchange Regulation Act (FERA) 1973 was permitted to only those firms producing high technology drugs. Foreign firms that are simply producing formulations based on imported bulk drugs were required to start local production from the basic stage at heart a two year period. Otherwise were required to reduce their foreign ownership holding to 40 per cent. New foreign investments were to be permitted only when the production involves high technology bulk drugs and formulations thereon.In the third growth stage or phase of evolution Indian pharmaceutical industry developed modern technology for manufacturing of all dosage forms like tablets, capsules ,liquid ,oral, injectables etc.. This domestic industry based on large scale reverse engineering and process innovation secured near self sufficiency in production of bulk drugs belonging to various(a) maj or therapeutic groups resulting in dour impact on competitive position of Indian pharmaceutical firms in national and international markets.During , 1980-90s ,Indian pharmaceutical industry had emerged as one of the most export oriented sectors in Indian pharmaceutical industry with more than 30% of the production being exported to the foreign market. In 1991, domestic firms contribute about 70-80% market share in case of bulk drugs and formulations respectively. The trade deficits of seventies had been replaced by trade surpluses of 1980s. ( chassis-2.1).The fourth stage of evolution of industry during 1990s witnessed dramatic changes in the policy regime governing the pharmaceutical industry. The drug de-licensing, hundred percent foreign investments is permitted through automatic itinerary and price control has been significantly reduced. One of the major factors that confirm increased the confidence of foreign multinationals looking for local opportunities in India is the adop tion of a new product patent regime in January 2005, before that India had already carried out three amendments in march-1999, June2002 and April 2005, in the patent act of 1970 to run to bring Indian patent regime in harmony with the WTO agreement on Trade Related Intellectual Property Rights (TRIPs). The third and the final exam one, known as the Patents (Amendment) Act, 2005 came into force on 4th April 2005 and introduced product patents in drugs, food and chemicals sectors. The term of patenting has also been increased to a 20 year period. The number of pharmaceutical units has also increased to over 23,000 in 2002, provided moreFig 2.2 Growth phase of Indian pharmaceutical industrygraph1SOURCE BEST PHARMA INDUSTRY REPORT-2011-INDIAThe fifth stage is in progression (Fig.2.2), in which we are observing investment in innovation and research, with enactment of new IP laws and investments in biotechnology aided companies. there is promising growth in production of bulk drugs and formulations ( dishearten 2.1) from Rs 10 crores in 1947-48 to Rs 21100 crores in 2002-03 in formulations and almost nil in 1947-48 to Rs 5 cd crores in 2002-03 in bulk drugs production. The drug industry also becomes capable to spent 497crores in 2002-2003 from almost nil in 1947-48 on research and development of new molecules.All in all Indian drug sales are expected to rise by an annual 8% to nearly $26.59 bn among 2006 and 2015 and further is the matter of wait and watch depending up on conditions everyday in international and domestic markets. In the UNIDO-classification of develop countries, according to the give tongue to of art in the pharmaceutical sector India is ranked among the take in and today India manufactures over 400 bulk drugs and around 60,000 formulations.2.2 Drug industry-growthAs shown in, set back 2.1 and table2.2, depicts the growth progress in production of bulk drugs and finished formulations. India produces bulk drugs related to various therapeutic areas. Indian pharmaceutical industry, manufactures over 400 bulk drugs and roughly 60,000 finished medicines used in different formulations.2.3 THE GROWTH SCENARIO IN CONTINEUMIndias US $ 3.1 billion pharmaceutical industry is festering at the rate of 14 percent per year. It is one of the largest and most advanced among the developing countries.Domestic DemandThe industry has enormous growth capableness. Factors listed below pick up the rising demand for pharmaceuticals. The growing population of over of a billion Increasing income Demand for quality wellnesscare service Changing lifestyle has led to change in disease patterns, and increased demand for new medicines to combat lifestyle related diseases.More than 85 per cent of the formulations produced in the country are sold in the domestic market, there has also been a record increase in drug addiction of drugs worldwide. India with its large population has recorded the therapeutic segmentation in healthcare market with ch anges in pattern of drug consumption in turn affecting its production.Fig2.3 shows the dowry increase in sales in various therapeutic segments. India is largely self-sufficient in case of formulations. Some life saving, new multiplication under-patent formulations continue to be imported, peculiarly by MNCs, which then market them in India. Overall, the size of the domestic formulations market is growing strongly at 10 percent per annum ( tabularise, 2.4), with rs23047crores in 2006-07, from rs2350crores in 1987-88.Fig 2.3 Percentage Increase therapeutic segments.SOURCE ORG-MARG AUDIT-2011.Table 2.4 shows demand for drugs as per therapeutic segments, showing categories, for intercession of lifestyle-related diseases such as diabetes, cardiovascular diseases, and central nervous system are on the increase. Health scenario is also changing. There are around 700,000 new cases of cancer each year and total of around 2.5 million cases. It is estimated that there are around 40 million people in India with diabetes and the number is rising, 5.1 million HIV/AIDS patients, and 14 million tuberculosis cases. fit in to industry reports, while the Indian pharmaceutical industry witnessed a growth of 7 to 8 percent, the cardio-vascular segment recorded 15 to 17 percent growth and anti-diabetes segment of over 10-12 percent growth. So, with the increase in diseases and various ailments, consumption of medicines is on increase day by day (refer, Fig 2.3).As per estimates, Over 20,000 registered pharmaceutical manufacturers exist in the country. The domestic pharmaceuticals industry output is expected to exceed Rs260 billion in the financial year 2002, which accounts for merely 1.3% of the global pharmaceutical sector. Of this, bulk drugs had accounted for Rs 54 bn (21%) and formulations, the remaining Rs 210 bn (79%). Table 2.5, shows the 16.98% CAGR for bulk drugs amounting to rs17, 307.02 crores in 2009-10.2.4 BULK INDUSTRY GROWTHEX-IM MARKETThe export market growth h as been one of the most outstanding features of the Indian pharmaceutical industry (Table-2.5). Negligible before the 1970s, exports started picking up after the abolition of product patents in 1972, accelerating in the 1980s and then growing rapidly since the mid-1990s. In recent years, exports have been increasing annually at more than 20%. The proportion of exports in net sales for the studied cxx companies was 44%. The export market was found to be larger than the domestic market not only for large companies, such as Ranbaxy (Now owned by Japanese Daichi Sankyo Corporation), Dr. Reddys or Cipla , but also for smaller companies such as Granules , Shilpa Medicare, Kopran , Transchem, and Pure Pharmaceutical etc. The period between 2000 and 2010 witnessed Indias top 10 drug companies growing in their sales turnovers, ranging between Rs 500-Rs 800 crores, to professionally-run MNC generics manufacturing companies with turnovers ranging from Rs 3,500 crores to over Rs 7,000 crores. India is among the top 20 pharmaceutical exporters world-wide.Most of these exporting firms earlier babelike on bulk drug supplies, small exports to unregulated markets in Africa and Asia and formulation sales in the domestic market, the last 10 years power saw them aggressively tapping regulated markets of the US and Europe and not bad(p) into newer and emerging market exportationsOver 60 per cent of Indias bulk drug production is exported. Indias pharmaceutical exports are to the tune of Rs 87 billion, of which formulations contribute nearly 55 per cent and the rest 45 per cent comes from bulk drugs. In financial year 2005, exports grew by 21 per cent.Domestic pharmaceutical export, growing at 30 per cent per annum, touched a new height of US $ 4.8 billion in the financial year 2006-07. The years exports will push the drug sectors contribution to Indias Forex earnings to 7.75 per cent from the current 5 per cent. The growth in drug exports, despite the pressing generic competi tion in the global markets, is attributed to increased Abbreviated New Drug Applications (ANDAs) approvals in the US market and contribution from unconventional markets in Latin America, Australia and the emerging markets in the middle East and African Region. The formulations and exports are largely to developing nations in CIS, southmost East Asia, Africa and Latin America. In the last 3 years generic exports to developed countries have picked up.In the coming years, opening up of US generics market and anti AIDS market in Africa will boost exports.Indias pharmaceutical sector has seen unprecedented changes in the past decades ensuing for a strange growth in its exports (pharmaceutical exports occupy a share of 4.4% to 5.2% of Indias total exports over the last 6 years) and exports grew at a CAGR of around 22% in the 6 year period of 2004-05 to 2009-10( Fig2.4). Indias growth story in itself vindicates its potential it had a $ 333.33m turnover in 1980 to around $22.30 bn. by 20 10-11FIG 2.4 PHARMA EXPORT TOTAL EXPORT SHAREpharmaceutical industry in the country today faces new challenges on account of LIbralisation of the Indian economy graph2.JPGSOURCE Indian pharmaceutical export emailprotected2.5 Revenue from ExportAs earlier discussed India accounts for less than two per cent of the world market for pharmaceuticals, with an estimated market value of US $ 10.4 billion in 2007 at consumer prices, or around US $ 9 per capita but has the potential to reach more than 2% by 2020.India currently represents just US $ 6 billion of the $ 550 billion global pharmaceutical industry but its share is increasing at 10 percent a year, compared to 7 percent annual growth for the world market overall. Also, while the Indian sector represents just 8 percent of the global industry total by volume, move it in fourth place worldwide, it accounts for 13 percent by value, and its drug exports have been growing 30 percent annually. Cipla, Nicholas Piramal, Ranbaxy, Zydus Cadi la, Dr. Reddys are the few Indian pharmaceutical companies, which are known at the global level imputable to their quality products.The Indian market for over-the-counter medicines (OTCs) is worth about $940 million and is growing 20 percent a year, or double the rate for prescription medicines. The industrys exports were worth more than $3.75 billion in 2004-05 and they have been growing at a compound annual rate of 22.7 percent over the last few years, according to the governments draft National pharmaceuticals Policy for 2006, publish in January 2006. The Policy estimates that, by the year 2010, the industry has the potential to achieve $22.40 billion in formulations, with bulk drug production going up from $1.79 billion to $5.60 billion.ImportImports have registered a CAGR of only 2 per cent in the past 5 years. Import of bulk drugs have slowed down in the recent years as per DGIC reported data in the year 2010-11. The value of export was Rs 10,937 Crores, recording a declining growth of 9.82% as compared to 15.15% in 2009-10. The situation is advantageous and good sign, as the industry is comme il faut self reliant in production and less dependent on foreign markets.Based on the retrospective data, USA, Germany, Russia, UK, China, Brazil, Canada, South Africa, Nigeria, Netherlands, Spain, Turkey, Ukraine, Vietnam, Israel, Italy, Mexico, UAE, Singapore, Iran had been potential importers of Indian Drugs. Countries like South Africa, Israel, Turkey, Kenya, Singapore, UK, China, Russia, Italy and Vietnam etc. have been identified to be potential prospective markets with high growth rates of imports from India. Africa, Latin America, ASEAN and CIS countries with huge demands estimate them to be put in the category of focus countries as these are the emerging markets and have a huge potential with day in day out incremental growth rates of per capita drugs consumptions supported by treaties like SAFTA (with SAARC), treaties with GCC, EU, Japan, Korea etc. As shown in table 2.10, based on such estimates, it has been predicted that the 17% export growth of Rs 248,000 crores would be achieved in 2019-20 with a domestic growth of 22% amounting to Rs 233,000crores.Section-IICROSS BORDER ACQUISITIONS IN INDIAN pharmaceutic INDUSTRY2.6 INDIAN pharmaceutic SECTOR CROSS-BORDER ACQUISITIONThe health-care cost are rising world-wide. Leading companies across the world are merging. strategic alliances and collaborations are taking place in order to meet the increasing RD budgetary requirement that exceed billion dollars each for many leading global pharmaceutical players. Indian Drug manufacturers are pursuing foreign acquisitions due to their need toImprove global competitivenessMove up the value chainCreate and enter new marketsIncrease their product offeringAcquire assets (including research and contract manufacturing firms, in order to further boost their outsourcing capabilities) and new productsConsolidate their market sharesCompensate for con tinued lassitude in their home market.Often there is a significant crossroad of ingestion in creating manufacturing assets or investing in RD either in generics or in basic research resulting into wastages at national level. whence corporate have indulged either in acquisitions or mergers to avoid duplication of investments and capture larger market share at global place.Table 2.7 shows the data of number of overseas acquisitions by Indian pharmaceutical Industry. We can conclude that the year 2005 witnessed the maximum number of overseas acquisition due to paradigm change in pharmaceutical policies and enactment of certain new laws which are later discussed in this chapter. Indian companies had gained a lot by these cross border acquisitions and details of which has been given in table 2.8 galore(postnominal) Indian companies are seeking to expand their distinctive capabilities by acquiring specific skills, knowledge and technology abroad that are either unprocurable or of in adequate quality at home. By mergers and acquisitions they get advantage of acquiring new resources and gain entry to new markets for better profitability. Table2.8 shows the number of cross border acquisitions by Indian companies with their focus areas.2.7 INDIAN PHARMACEUTICAL MARKET AND THE WORLD DISCUSSIONThe period between 2000 and 2010 witnessed Indias top 10drug companies growing in their sales turnovers, ranging between Rs 500-Rs 800 crore, top professionally-run MNC generics manufacturing companies with turnovers ranging from Rs3,500 crore to over Rs 7,000 crore. India is among the top 20 pharmaceutical exporters world-wide. Most of these exporting firms earlier depended on bulk drug supplies, small exports to unregulated markets in Africa and Asia and formulation sales in the domestic market, the last 10years saw them aggressively tapping regulated markets of the US and Europe and penetrating into newer and emerging markets. The Indian industry had filed only 3 marketing a pplications with the USFDA in 1998, the number swelled to 148 in 2009. Approximately $123bn of generic products is at adventure (subject to patent renewal approvals by regulators) of losing patents by 2012.Even at a conservativist estimate of 15% opportunity this translates into $18.4bn opportunity for India. However the figures need to be appropriately deflated since Indian opportunity will lie in generics equivalent of branded drugs, which would be cheaper. Ageing populations of the US (plus the 2010 US health care Reforms in action), China European economies leading to the more and more expenditure on medicines and appreciation in the per capita consumption value of the drug products with cheaper rates.As global markets such as wedlock America, Europe and Japan continue to slow down (graphical representation below), pharmaceutical companies are scanning markets for new growth opportunities to boost drug discovery potential, reduce time to market and squeeze be along the valu e chain. The Industry is beginning to recognise that some of the most promising opportunities will come from emerging markets (Asia/Australia/Africa Latin America). IMSHealth and other sources suggest that emerging markets (China, India, Brazil, Russia, Turkey, Mexico and South Korea) will contribute to over 40% of the incremental growth of the global Pharmaceutical industry over the next decade.With its enormous advantage ,including a large well educated ,skilled and English speaking workforce, low operational costs and improving regulatory infrastructure, India has the potential to become the regions hub for pharmaceutical and biotechnology discovery research, manufacturing, exporting and health care services within the next decade. However, in order for this to happen, it is imperative mood that the regulatory environment continues to improve . otherwise ,India will have to face tough competition from china leading to capture of market shares by china as their government stron g commitment and pro industry policies have produced a favorable and protective environment for not only product patent but also for crucial data protection so while developing an Indian collaborative RD strategy, pharmaceutical MNCs should wield in mind certain issues like data and IP security, cognitive operation metrics, and quality standards, and address and evaluate these upfront to ensure a happy relationship. Although the major factor that has increased the confidence of foreign multinationals looking for local opportunities in India is the adoption of a new product patent regime in January 2005. This already had facilitated concurrent global phase II and 3 clinical trials. A new patent regime has changed the dynamics of the Indian pharmaceuticals industry in other respects, too. Several leading domestic producers have begun to conduct original research into new chemical entities (NCEs) and novel drug delivery systems. However, these companies are likely to license most o f these drug candidates to westerly pharmaceutical companies, because few Indian companies can afford the high costs and failure rates associated with developing an NCE. In this context, several Indian firms have already entered into research partnerships with multinationals. Some pharmaceutical MNCs like AstraZeneca have exposed their own captive research centers in India to take advantage of the low costs as well as availability of high quality intellectual work force.Russia 2013, marketing insight estimates.(ASSOCHAM). IMS estimates the healthcare market in India at $31.59 bn. by 2020, whereas the global management consulting major, McKinsey Co. predicts that the Indian pharmaceutical market is expected to touch $40 by 2015. The industry has given practice to approximately 2.86 mn people and has around 20,053 units. Globally, India is 4th in terms of volume (8% of worlds production), 13th in terms of value, and 17th in terms of pharmaceutical export value. The drugs and pharm aceuticals exported are worth over $3.8 bn.Section-IIIINDIAN PHARMACEUTICAL MARKET2.8 DOMESTIC PHARMACEUTICAL MARKETThe pharmaceutical industry in India meets around 70% of the countrys demand for bulk drugs, drug intermediates, pharmaceutical formulations, chemicals, tablets, capsules, orals and injectibles. There are about 250 large units and about 8000 Small Scale Units, which form the core of the pharmaceutical industry in India (including 5 Central Public Sector Units). These units produce the complete range of pharmaceutical formulations, i.e., medicines ready for consumption by patients and about 350 bulk drugs, i.e., chemicals having therapeutic value and used for production of pharmaceutical-formulations.As discussed in earlier chapters about the Indian Pharmaceutical sector which is highly scattered with more than 20,000 registered units. It has expanded drastically in the last two decades. The leading 250 pharmaceutical companies control 70% of the market with market lea der holding nearly 7% of the market share. It is an extremely fragmented market with severe price competition and government price control. North Indian states UTs are also engaged in production of pharmaceutical products, few states like Himachal Pradesh, Uttaranchal, are also providing tax holidays so as to motivate the pharma companies to enhance their production facilities, more over the climatical conditions and other macro factors are suitable for the growth of pharma and especially biotech., Industries in these two states. Table2.14 shows the state wise distribution in north India.FiG.-2.6 STATE- WISE DISTRIBUTION OF PHARMACEUTICAL SECTOR IN INDIA, 2010-11 . graph3.JPGSource yearly report 201