778-Som-Lalit Institute Of Business Management - Gujarat ...

Pharmaceutical industry today
The Indian pharmaceutical companies‘ number is fairly low. There is cheap labour in
production for that reason there is foreign companies subsidiaries in India. In 2002,
there was over 20,000 registered drug manufacturers in India sold $9 billion worth of
bulk drugs. it was 85% of these formulations sold in India while over 60% of the bulk
drugs exported, more to the United States and Russia. As studied, Mostly the
players in the market are small-to-medium enterprises and 250 of the largest
companies control 70% of the Indian market. Multinationals represent only 35% of
the market, down from 70% thirty years ago according to act 1970.
Challenges
There are many challenges in India for pharmaceutical industry. Each company has
to spend 5-10% of its revenue in r&d department. There are market leaders such as
Ranbaxy and dr. reddy‘s laboratories spent only 5-10% of their revenues on r&d and
western pharmaceutical like Pfizer whose research budget last year was greater
than the combined revenues of Indian pharmaceutical industry. There is much other
reason for difference in product. One is disparity in cost differential. Therefore
advances in genomics have made research equipment more expensive than ever.
Second, the drug discovery process is over involved by a dearth of qualified
molecular biologists. Third, Pharma in India lack the academic collaboration that is
crucial to drug development in the west and so far due to the disconnect between
curriculum and industry.
Pharmaceutical marketing called medico marketing or pharma marketing in some
countries is the business of advertising or otherwise promoting the sale of
pharmaceuticals or drugs. There is negative effect of marketing practices. Some
evidence for marketing practices can negatively affect both patients and the health
care profession. there is limit to advertising by pharmaceutical companies in many
country.
Economics
Pharmaceutical company spending on marketing far exceeds that spent on research.
there are some studies. there was $1.7 billion was spent in 2004 to market drugs to
physicians in Canada and $21 billion spent in 2002. in 2005 pharma company has
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