 "Indian pharma Industry to log 8-10% revenue growth in FY24: Report")
India’s pharmaceutical industry is expected to have a revenue growth of 8-10 percent in Financial Year 2024 (FY24), ratings agency ICRA has said in a report.
Growth is likely to be driven by price increases, new products, and health care services expanding in semi-urban and rural areas, said the report based on data from ICRA’s sample set representing 60 percent of the industry.
Drugs in the National List of Essential Medicines (NLEM) contribute 17-18 per cent of revenue generated by the Indian Pharmaceutical Market (IPM). Some companies rely on NLEM drugs for up to 30 percent of their total revenue. The price of such drugs increased 12.1 per cent in FY24, marking the second consecutive year of double-digit price hike. The price increase is attributed to wholesale price index (WPI) inflation.
The report highlighted a proposed change in National Medical Commission (NMC) regulations to support generic drugs. The NMC recently released new norms that ask doctors to only prescribe generic drugs instead of certain brands. The changes support the government's focus on driving generic prescriptions to reduce health care costs. However, this could impact the branded generic formulations for manufacturers over the long term.
Despite little volume growth, IPM had a compound annual growth rate (CAGR) of 9.7 per cent between FY14 and FY23,
Acute therapies, constituting 62-65 percent of IPM, have outpaced the growth of chronic therapies since FY22. However, this trend is expected to reverse in the coming years. Lifestyle diseases and prolonged treatment for some ailments are likely to drive higher growth in the chronic therapies segment, said the report.