Indian pharmaceutical sector is the world’s third largest drug manufacturing sector. Indian Pharma industry supplies around 50% of the global demand for various vaccine, 40% of generic demand in the United States & 25% of all the medicines in the United Kingdom. Pharmaceutical sector has been immune to ups and downs of business cycles, proving to be a defensive sector that is firmly anchored on the premises that as long as people fall sick there will be demand for it. But the coronavirus, proved it wrong and has impacted it in various ways. The major impact being on Supply chain ultimately affecting every other aspect the companies work on. Impact on Supply chain: Supply chain of Indian pharma industry has been majorly affected by the COVID-19 by the lockdown that was imposed. In generic market India imports around 70% of the API needs from China. This created a lot of hardship for the Indian pharma companies relying on the imports from China at lower cost because of the lockdown that was imposed in China completely disturbing the demand-supply equilibrium as the manufacturing was on stand still. Rising Prices: Since India is heavily relying on imports of APIs from China, the less availability of the resources resulted in disruption of the demand-supply equilibrium. For instance, cost of paracetamol had gone up from Rs 250-300 per kg to Rs 400-500 per Kg. This happened, because there had been a delay in the supply of the available resources and the imposed lockdown restricting in the manufacturing of new resources ultimately resulted in the increasing prices of the products. Interstate Transport: There is a lot of medicine that is being distributed from various pharmaceutical hubs like GOA, BADDI, SIKKIM etc. The imposed lockdown had made it hard to transport the stock to the retailer. Government did and is doing its part to keep the flow of medicines maintained by exempting private laboratories from the lockdown to ensure the movement of lab technicians and transportation of samples, along with opening of temporary collection centres, should not face any hurdles. Despite the challenges faced by the sector it has been more than productive in these hard times. Covishield vaccine for corona made by the Pune based Serum Institute of India with British pharmaceutical giant AstraZeneca was proven to be highly effective for the disease. Apart from this there are various other vaccines being made in India. As compared to other sectors, the impact on the pharmaceutical sector was quiet a resistible one, as the other sector saw a great downfall and pharmaceutical sector not only resisted it, but also was the top performing sector in the equity market during the crisis. Indian pharmaceutical sector is expected to grow to US$ 100 billion, while medical device market is expected to grow US$ 25 billion by 2025. Thank you.
Regards,
Raj Gudhka,
Kautilya,
IBS Mumbai.
Comments
Post a Comment