PHARMACEUTICAL

INDUSTRY

BYPRATEEK GUPTA (33)Sathish Kumar (46)

The pharmaceutical industry develops, produces, and

markets drugs or pharmaceuticals licensed for use as

medication .

PHARMACEUTICAL INDUSTRY

GLOBAL PHARMACEUTICAL MARKET

580

600

670

710

750

790

880

900

940

959

0 200 400 600 800 1000 1200

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012Pharma Sales

Pharma Sales

Source of

Data

By Deloitte

IN US

BILLION $

Globally region wise Sales

America

Europe

Australia, Asia and

Africa

Japan

45.36

12.02

18.26

24.36

Source of Data

By Deloitte

959 US BILLION$

2012-2013

1. Johnson & Johnson

2. Pfizer

3. Roche

4. GlaxoSmithKline

5. Novartis

6. Sanofi

7. AstraZeneca

8. Abbott Laboratories

9. Merck & Co.

10.Bayer HealthCare

MAJOR PLAYERS OF THE WORLD

The research based pharmaceutical industry is

playing a major role in reviving Europe’s economy.

There is rapid growth in market and research

environment in the emerging economies such as

brazil, china and India.

In 2012 North America accounted for 41.0% of world

pharmaceutical sales compared with 26.7% for

Europe.

MAIN TRENDS

PHARMACEUTICAL R&D EXPENDITURE IN EUROPE, USA AND

JAPAN

(MILLION OF NATIONAL CURRENCY UNITS*) , 1990 -2012

The cost of developing a new chemical was

estimated at 1172 million pounds.

On average, only one to two of every 10,000

substances produced in laboratories will successfully

pass all stages of development process required to

become a marketable medicine.

PHARMACEUTICAL RESEARCH IN EUROPE

PHASES OF RESEARCH AND

DEVELOPMENT

NUMBER OF NEW CHEMICALS(1993-

2012)

In 2011 the pharmaceutical industry in Europe invested

about € 29,200Million in R&D.

Facing increased competition from emerging economies

like India Brazil and China.

The change of focus towards emerging economies.

According to EUROSTAT data pharmaceutical sector is the

sector contributing huge amount of money to R&D.

IMPORTANCE OF RESEARCH AND

DEVELOPMENT.

Distribution margins, are generally fixed by governments, and

VAT rates vary from country to country in Europe

On average, approximately 35% of the retail price of a

medicine goes not to the manufacturer, but rather to the

distributors (pharmacists and wholesalers) and state

Breakdown of the retail

price of a medicine in

2011 (%).

PRICE STRUCTURE

It is usually produced by manufacturer not by inventor.

Marketed according to Intellectual Property Rights.

The market share is higher in European union.

GENERICS

EXPORTS, IMPORTS AND TRADE

BALANCE

On average, 16.6% of total health expenditure in Europe being

spent on pharmaceuticals and other medical nondurables.

In costly diseases such as cancer and rheumatoid, arthritis ,

medicines account for even less than 10% of the total disease

costs.

ADDED VALUES OF MEDICINES IN HEALTH

CARE

INDIAN PHARMA INDUSTRY

Sources: http://www.ibef.org/industry/pharmaceutical-india.aspx

PHARMA MANUFACTURING & PATENTS

India is home to 10,500 manufacturing units and

over 3,000 pharma companies.

India accounts for 36.9 per cent (3,411) of the 9,296

Drug Master Files (DMFs) filed with the USA, which is

the highest outside of the USA (as on December 31,

2013).

Higher spending on R&D, owing to products patents

have made India a major destination for generic drug

manufacturing.

MARKET SIZE

From a market size of US$ 12.6 billion in 2009, the Indian

pharmaceutical market will grow to US$ 55 billion by 2020,

with the potential to reach US$ 70 billion in an aggressive

growth scenario. In a pessimistic scenario characterized by

regulatory controls and economic slowdown, the market will

be depressed but is still expected to reach US$ 35 billion.

India currently exports drug intermediates, Active

Pharmaceutical Ingredients (APIs), Finished Dosage

Formulations (FDFs), Bio-Pharmaceuticals, and Clinical

Services across the globe.

As per 'Pharma Vision 2020', the Government of India aims to

make India a global leader in end-to-end drug manufacturing.

Manufacturing costs in India are approximately 35-40 per cent

of those in the US due to low installation and manufacturing

costs.

Indian vaccines are exported to 150 countries.

The projected human resource requirement in the Indian

pharma sector is estimated to be about 21,50,000 by 2020

ROAD AHEAD

The growth in Indian domestic market will be boosted by

increasing consumer spending, rapid urbanization, increasing

healthcare insurance and so on.

The lifestyle segments such as cardiovascular, anti -diabetes,

anti-depressants and anti -cancers will continue to be lucrative

and fast growing owing to increased urbanization and change

in lifestyle patterns.

For the US market, Indian companies are developing niche

portfolios in various segments. High margin injectables,

dermatology, respiratory, biogenerics, complex generics, etc.,

have become areas of interest.

ADVANTAGES

Due to a genetically diverse population and availability of

skilled doctors, India has the potential to attract huge

investments to its clinical trial market.

Demand for generic medicines in rural markets has seen a

sharp growth. Various companies are investing in the

distribution network in rural areas.

Growing demand could open up the market for production of

high-end drugs in India.

The domestic pharma sector is witnessing strong growth due

to higher penetration in tier -II and tier-III cities and greater

focus on the largely - untapped rural market.

India is one of the fastest-growing pharmaceutical markets in the world and has established itself as a global manufacturing and research hub. A large raw material base and the availability of a skilled workforce gives the industry a definite competitive advantage.

The rise of pharmaceutical outsourcing and investments by multinational companies (MNCs), allied with the country's growing economy, committed health insurance segment and improved healthcare facilities, is expected to drive the market's growth.

India’s cost of production is significantly lower than that of the USA and almost half of that of Europe.

GOVERNMENT SUPPORT

The Government of India plans to set up a US$ 640 million

venture capital fund to boost drug discovery and strengthen

pharma infrastructure. Government expenditure on health has

increased from US$ 14 billion in 2008 to US$ 23 bill ion in

2011.

FDI in India allowed upto 100% on pharma industry.

Allocation of INR 5000 Million to set up four more institutions

of the stature of AIIMS in Andhra Pradesh, West Bengal,

Maharashtra and U.P.

Full exemption from excise duty is being provided for

HIV/AIDS drugs and diagnostic kits.

OPPORTUNITY FOR FUTURE

Sites that allow online ordering and delivery of prescriptions.

Manufacturer sponsored sites to access reliable health care

information.

Apps that remind patients to take medicine, schedule follow

up doctors visits.

Apps for patients to use as tools to monitor their health.

Customized interactive platforms with a focus on doctor

engagement for sales reps to util ize during office visits.

Since Pfizer was founded by cousins Charles Pfizer and Charles Erhart in 1849, the

pharmaceutical company has remained dedicated to discovering and developing new, and

better, ways to prevent and treat disease and improve health and well being for people

around the world.

CEO: Ian Read

Pfizer Locations: Corporate Headquarters:

New York, NY (USA)

Stock Exchange Listings: New York Stock Exchange (PFE)

London (PFZ)

Euronext

Swiss

Key Pfizer Pharmaceutical Products:

BeneFIX

Bosulif

Celebrex

Chantix/Champix

Detrol/Detrol LA

Diflucan

Duavee

Eliquis

Rare Disease:

Elelyso

Vyndaqel

Norvasc

Enbrel

EpiPen

Genotropin

Inlyta

Lipitor

Lyrica

Medrol

Premarin

Prevnar

Pristiq

Quillivant XR

ReFacto AF/Xyntha

Spiriva

Sutent

Vfend

Viagra

Xalatan/Xalacom

Xalkori

Xanax XR

Xeljanz

Zithromax/Zmax

Zoloft

Zyvox

Products

Millions of Dollars 2013 2012 2011

REVENUE $ 51,584 54,657 $ 61,035

NET INCOME $ 22,003 $ 14,570 $ 10,009

Research and

development

expenses

$ 6,678 $ 7,482 $ 8,681

Revenue, Net Income

REVENUE

Total revenues were $51.6 billion in 2013, a

decrease of 6% compared to 2012, Which

reflects an operational decline of $1.9 billion,

or 4%. Total revenues were $54.7 billion in

2012, a decrease of 10% compared to 2011,

which reflects an operational decline of $5.0

billion, or 8%.

The continued erosion of branded Lipitor (Cholesterol fighter)

in the U.S., developed Europe and certain other developed

markets (approximately $1.7 billion);

The loss of exclusivity for Geodon in March 2012 in the U.S.

(approximately $130 million);

Other product losses of exclusivity (approximately $1.3

billion);

Decreased government purchases of the Prevnar family of

products and Enbrel in certain emerging markets

(approximately $160 million); and lower revenues from

generic atorvastatin (approximately $145 million)

THE OPERATIONAL DECREASE WAS

PRIMARILY THE RESULT OF:

R&D EXPENSES

2013 v. 2012 : R&D expenses decreased 11% in 2013, compared

to 2012, primarily due to:

- - lower charges related to implementing cost -reduction and

productivity initiatives.

2012 v. 2011: R&D expenses decreased 14% in 2012, compared

to 2011, primarily due to:

-- savings generated by the discontinuation of certain therapeutic

areas and R&D programs in connection with their previously

announced cost-reduction and productivity initiatives.

SUN PHARMA

It was established in 1983.

Headquarters are in Mumbai, Maharashtra.

It was l isted on the stock exchange in 1994.

Chairman is Israel Makov.

25 manufacturing facil ities in 4 countries.

It ’s major acquisitions l ike Taro, URL Pharma and Milmet, Able and

many more.

2014- Acquired Ranbaxy for 4bil l ion$.

Sun Pharma to sustain its ranking as the 5th largest

global specialty generic pharma company

No. 1 pharma company in India

No. 1 by prescriptions in 13 specialty segments, Strong

OTC business with trusted brands

No. 1 Indian pharma company in US market.

More than 75% of its sales from international markets.

REVENUE COMPOSITION

Gross Annual Sales (Rs 161,995 million )

US Formulations ( 60%

)

International Generics (

38% )

API's ( 11% )

India Branded Generics

( 23% )

NET SALES

Rs Crores

2010-

2011

5723

2011-12 8006

2012- 13 11239

2013-14 16004

NET PROFIT

Rs Crores

2010-11 1816

2011-12 2587

2012-13 2983

2013-14 3204

Thank you !