Indian Contract Manufacturing - A Hot Opportunity

Published by: RNCOS

Published: Mar. 1, 2008 - 70 Pages

Table of Contents

1. Analyst View

2. Global Contract Manufacturing Market

2.1 Rising Trend of Outsourcing

2.2 Market Analysis

2.2.1 Market Size

2.2.1.1 Chemical Synthesis

2.2.1.2 Formulations & Packaging

3. India - Most Potential Contract Manufacturing Destination

3.1 Pharma Outsourcing Market

3.1.1 Contract Manufacturing Market

3.1.1.1 Chemical Synthesis

3.1.1.2 Formulation & Packaging

3.2 Manufacturing Analysis

3.2.1 Bulk Drugs

3.2.2 Formulations

3.2.3 Drug Packaging

3.2.4 Biopharmaceuticals

3.3 Cost Analysis

3.3.1 Employment Cost

3.3.2 Office Rental Cost

3.3.3 Industrial Land Rental Cost

3.3.4 Construction Cost

3.3.5 Cost of Utilities

3.3.6 Freight Cost

3.4 Analysis of Human Resources

3.4.1 Pharma Personnel

3.4.2 Pharma-related Degrees

3.5 Infrastructure Analysis

3.5.1 Manufacturing

3.5.2 Logistics

3.5.3 ICT

3.5.4 Energy Capacity & Production

4. Industry Analysis

4.1 Market Drivers

4.1.1 Increasing Prevalence of Generics

4.1.2 Cost Advantage

4.1.3 Well-developed Infrastructure

4.1.4 Improved IPR Laws

4.1.5 Emerging Pharmaceutical Market

4.1.6 Huge Pool of Human Resources

4.2 Opportunities

4.2.1 Supplementary Services in Pharma Outsourcing

4.2.2 Third Party Logistics Market

4.2.3 Pharma Machinery Market

4.2.4 Real Estate Market

4.3 Challenges & Threats

4.3.1 Counterfeit Drugs

4.3.2 High Wage Inflation & Attrition

4.3.3 Currency Appreciation

4.3.4 Threats from China

5. Key Players

5.1 Divis Laboratories Limited

5.2 Dr. Reddy's Laboratories Limited

5.3 Nicholas Piramal India Limited

5.4 Jubilant Organosys Healthcare Limited

5.5 Shasun Chemicals and Drugs Limited

5.6 Dishman Pharmaceuticals & Chemicals Limited

List of Figures:

Figure 2-1: Global - Contract Manufacturing Market (in Billon US$), 2006 & 2007E

Figure 2-2: Global - Forecast for Contract Manufacturing Market (in Billon US$), 2008-2012

Figure 2-3: Global - Contract Manufacturing Market by Type of Manufacturing (%), 2006

Figure 2-4: Global - Chemical Synthesis Market by In-house & Outsourced Manufacturing (%)

Figure 2-5: Global - Contract Chemical Synthesis Market (in Billon US$), 2006, 2007E, 2010F & 2012F

Figure 2-6: Global - Contract Formulations & Packaging Market (in Billlon US$), 2006, 2007E, 2010F & 2012F

Figure 2-7: Global - Formulations Market by In-house & Outsourced Manufacturing (%)

Figure 2-8: Global - Contract Dose Manufacturing Market by Type of Drug (%), 2006

Figure 3-1: India - Pharma Outsourcing Market (in Million US$), 2004-2007E

Figure 3-2: India - Pharma Outsourcing Market by Segment (%), 2006

Figure 3-3: India - Forecast for Pharma Outsourcing Market (in Million US$), 2008-2012

Figure 3-4: India - Contract Manufacturing Market (in Millon US$), 2004-2007E

Figure 3-5: India - Forecast for Contract Manufacturing Market (in Millon US$), 2008-2012

Figure 3-6: India - Contract Manufacturing Market by Type of Manufacturing (%), 2006

Figure 3-7: India - Contract Chemical Synthesis Market (in Millon US$), 2006, 2007E & 2012F

Figure 3-8: India - Contract Formulations & Packaging Market (in Million US$), 2006, 2007E & 2012F

Figure 3-9: India - Bulk Drug Production* (in Billion INR), 2001-02 to 2006-07E

Figure 3-10: India - Formulations Production* (in Billion INR), 2001-02 to 2006-07E

Figure 3-11: India - Drug Packaging Market (in Billion INR), 2006-07 & 2011-12F

Figure 3-12: Global - Contract Biopharmaceutical Manufacturing Market (in Billion US$), 2004, 2006 & 2007E

Figure 3-13: Global - Forecast for Contract Biopharmaceutical Manufacturing Market (in Billion US$), 2008-2012

Figure 3-14: Global - Biopharmaceutical Manufacturing Market by Segment (%), 2007E

Figure 3-15: India - Biopharmaceutical Market (in Billion INR), 2002-03 to 2006-07 & 2011-12F

Figure 3-16: India - Relative Annual Cost of Bioscale-up Manufacturing w.r.t. Other Countries

Figure 3-17: India - Relative Annual Cost of Secondary Manufacturing w.r.t. Other Countries

Figure 3-18: India - Office Rental Cost w.r.t Other Countries (in US$/Sq. Metre), 2003

Figure 3-19: India - Industrial Land Rental Cost w.r.t. Other Countries (in US$/Sq. Metre), 2003

Figure 3-20: India - Construction Cost w.r.t Other Countries (in US$/Sq. Metre), 2003

Figure 3-21: India - Number of FDA Approved Plants w.r.t. Other Countries, 2006

Figure 3-22: India - Cost of Logistics as Percentage of GDP w.r.t. Other Countries, 2006

Figure 3-23: India - Average Distance Covered by Truck w.r.t. Other Countries (in Km/day), 2006

Figure 3-24: India - Average Turnaround Time at Ports w.r.t. Other Countries (in Hours), 2006

Figure 4-1: Global - Generic Market (in Billion US$), 2001-2007E & 2010F

Figure 4-2: India - Domestic Pharmaceutical Market* (in Billion INR), 2002-03 to 2006-07 & 2011-12F

Figure 4-3: Global - Supplementary Services in Pharma Outsourcing Market (in Billion US$), 2006 & 2010F

Figure 4-4: India - Supplementary Services in Pharma Outsourcing Market (in Million US$), 2004, 2006 & 2007E

Figure 4-5: India - Forecast for Supplementary Services in Pharma Outsourcing Market (in Million US$), 2008-2010

Figure 4-6: India - Logistics Market (in Billion US$), 2006 & 2010F

Figure 4-7: India - Outsourced Logistics Market (in Billion US$), 2006 & 2010F

Figure 4-8: India - Pharma Machinery Market (in Billion INR), 2004, 2007E & 2010F

Figure 4-9: India - Real Estate Market (in Billion US$), 2006 & 2015F

Figure 4-10: India - Attrition in Pharma Market w.r.t. Global Level (%), 2005

Figure 4-11: India - Currency Exchange Rate* (From US$ to INR), 2001-2008

List of Tables:

Table 3-1: India - Bioscale-up Manufacturing Cost Model w.r.t. Other Countries (in US$)

Table 3-2: India - Secondary Manufacturing Cost Model w.r.t. Other Countries (in US$)

Table 3-3: India - Annual Cost of Pharma-related Labor w.r.t. Other Countries (in US$), 2004

Table 3-4: India - Cost of Utilities (Electricity, Gas, Water, Phone & Internet) w.r.t. Other Countries (in US$), 2004

Table 3-5: Cost of Freight to & from India w.r.t. Other Countries (in US$), 2004

Table 3-6: India - Number of Pharmaceutical Personnels w.r.t. Other Countries, 2003E

Table 3-7: India - Number of Pharma-related Graduate Degrees w.r.t. Other Countries, 2002

Table 3-8: India - Number of Pharma-related Masters Degrees w.r.t. Other Countries, 2002

Table 3-9: India - Number of Pharma-related Doctorate & Post Doctorate Degrees w.r.t Other Countries, 2002

Table 3-10: India - ICT Infrastructure w.r.t. Other Countries, 2007E

Table 3-11: India - Electricity Capacity & Production w.r.t. Other Countries, 2006

Table 4-1: India - Estimated Share of Counterfeit Drugs in Pharma Market (%)

Table 5-1: Divis Laboratories Limited - Key Financials (in Million INR), Mar 2006 & Mar 2007

Table 5-2: Dr. Reddy's Laboratories Limited - Key Financials (in Million US$), Mar 2005 to Mar 2007

Table 5-3: Nicholas Piramal India Limited - Key Financials (in Million INR), Mar 2006 & Mar 2007

Table 5-4: Jubilant Organosys Healthcare Limited - Key Financials (in Million INR), Mar 2006 & Mar 2007

Table 5-5: Shasun Chemicals and Drugs Limited - Key Financials (in Million INR), Mar 2006 & Mar 2007

Table 5-6: Dishman Pharmaceuticals & Chemicals Limited - Key Financials (in Million INR), Mar 2006 & Mar 2007

Abstract

• Indian contract manufacturing market is expected to grow in excess of CAGR 37% between 2007 and 2012.
• Most companies presently outsource APIs and intermediates from India. Moreover, India is also becoming a major hub for outsourcing formulations.
• Many Indian manufacturers have upgraded their manufacturing plants, which has enabled India to have a number of plants certified by the FDA, EDQM and various other regulatory agencies.
• The cost of secondary manufacturing in India is around 13%-15% of the cost in the US, the UK and Germany, with companies making substantial savings on costs of plant set up, labor and operations.
• India has more than four times the total drug manufacturing staff than the US and more than 12 times that in the UK.
• Growth of the contract manufacturing market is expected to provide a major boost to the pharma machinery market in India, which is expected to register revenues up to US$ 822 Million by 2010.
• Strong appreciation of the Indian Rupee against the US Dollar is having a detrimental effect on the profits of many Indian contract manufacturers.

• Evaluation of the total size and growth rate of the contract manufacturing market.
• Analysis of key segments.
• Evaluation of India’s capability in pharmaceutical manufacturing.
• Analysis of the total costs incurred while manufacturing a drug in India (such as cost of land, construction, labor, utilities, freight etc).
• Analysis of the country’s pharma-related human resources.
• Study of the country’s pharma-related infrastructure.
• Analysis of the key opportunities created by the industry.
• Analysis of key players, including their business overview, key facts, and financial information.

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