The Indian pharmaceutical industry has gained impressive traction with a high growth trajectory over the recent years and rapidly integrating with the global industry. Out of most of the evolution of the Indian pharmaceutical sector, Gujarat has carved out a significant portion of the Indian pharma pie. As per the Industrial Extension Bureau (iNDEXTb), Gujarat accounts for one-third of India’s pharma market, with 130 USFDA approved units and 628 WHO GMP manufacturing units.
The pharmaceutical industry is forming abundantly in Gujarat out of the state’s other major industries, such as agriculture, gems, jewelry, textiles, and chemicals.
In the modern-day, Gujarat’s pharmaceutical sector has become increasingly innovative, spreading business horizons across many pharmaceutical segments. These segments include the production of generics, R&D (Research and Development), CRAMS (Contract Research and Manufacturing Organizations), bulk drug productions, and NCE (New Chemical Entities). As a result, Gujarat’s pharmaceutical companies adopt effective and efficient business models and are well-positioned to explore promising future opportunities. However, before we go further, let us have a look at the history of this sector in Gujarat.
A Glance at the History of the Pharmaceutical Sector in Gujarat
Gujarat got its first and country’s second pharmaceutical company, Alembic Pharmaceuticals Ltd, in Vadodara, in 1907. During the 1940s and 50s, “an era of therapeutic revolution,” companies like Sarabhai Chemicals, Cadila laboratories, The Gujarat Pharmaceutical, and Chemical Works were established. LM College of Pharmacy was also established in 1947, which became an essential landmark in the industry’s history. This college has provided many qualified entrepreneurs, drug controllers, and technocrats to the state. The State of Gujarat emerged as an independent state from the Greater Bombay state on 1st May 1960. With the synergistic efforts of central and state Governments, the pharmaceutical industry grew in the state. Gujarat’s companies geared up for globalization in the past decade and saw a quantum leap in production and exports with a strong focus on regulated markets.
Pharmaceutical Industry of Gujarat in Statistics
Pharmaceutical clusters of the state:
- As per the article in Pharmaceutical Technology, there are 124 pharmaceutical-related facilities in Gujarat, the third-highest of Indian states.
- Gujarat’s third-largest city, Vadodara, has many pharma manufacturing facilities, 29 in the western state.
- Gujarat’s largest city and financial capital, Ahmedabad, has 24 facilities.
- Ankleshwar has the third-largest number of 19 facilities in the state and is an industrial township.
- These locations account for 57% of all facilities in the state and are all east of the Gulf of Khambhat.
- Other states such as Bharuch, Rajkot, and Valsad also have extensive facilities.
Other Statistics:
- Vibrant Gujarat’s Pharmaceuticals and Medical Devices report says that “Gujarat is the biggest exporter of pharma products in India and accounts for 19.5% of India’s pharma exports in FY21.”
- Over 4000 manufacturing licenses were issued in the state facilities for allopathic, homeopathic, ayurvedic, and cosmetic drugs.
- 40% of India’s contract research organizations are based in Gujarat.
- Over 4.5 lakh product licenses were issued for the companies of the state.
- 40% of India’s machinery for the pharma sector is based in Gujarat.
- 53% of India’s total registered medical device manufacturers are in Gujarat.
- Gujarat has enjoyed a share between 35% and 46% of the national share in pharmaceutical production over the last two decades leading India in pharmaceuticals.
Top Companies of Gujarat Making it Big in the Sector
During the last decade, pharmaceutical companies of Gujarat like Zydus Cadila, Torrent, Sun Pharma, and Dishman have expanded their global footprint through mergers, acquisitions, and alliances with international companies. They are setting up subsidiaries and marketing offices overseas also. More and more companies are vigorously working towards getting their facilities approved by USFDA and other reputed regulatory agencies to augment their global market presence. Clinical research organizations such as Veeda and Lamba are also emerging with the incorporation of new techniques for patient trials and bioequivalence. Moreover, large manufacturers are entering the capital markets successfully and making most of the stock markets boom to extend resources for their research/production facilities.
Factors that Make Gujarat a Pharmaceutical Hub
- Location and Climate: Poor rainfalls, climate, and geography have long pushed Gujarat over the business, making it hard to scratch a living by farming. Gujarat shares a border with Pakistan and has a long coastline of 1,600 kilometers, making it a natural hub for international trade.
- Development of SEZ: Special economic zones (SEZs) subjected to unique economic regulations are established in Ahmedabad and Vadodara to encourage pharmaceutical investments.
- Policy Supports from Government: The government of Gujarat has allocated US$ 1.6 billion to Health and Family Welfare department in Budget 2021-22. The state government has incurred 50% of fees/costs for obtaining various Quality control approvals. Also, they have revised the timeline for the grant of manufacturing licenses to 60 days. Moreover, they give capital subsidiaries up to 12% of FCI for large units and an exemption of electricity duty for five years. Further, they provide financial assistance up to INR 5 crore for setting up R&D and product development centers by private companies.
- The Vibrant Gujarat Global Summit always encourages and provides opportunities for investors and promotes schemes that incentivize investments in Gujarat.
- Gujarat has a vast talent pool with strong academic institutions that provides an edge to the state at global levels.
- The state is a patent leader, various SMEs, research organizations, and academic institutions have filed nearly 1,000 patents over the last five years.
Conclusion:
Gujarat’s pharmaceutical industry is now keen on sustainable growth, major capacity expansions, and an increasingly important role in the global consolidation process. On the international horizon, pharmaceutical companies involved in contract research/manufacturing and clinical trials to leverage their potential have abundant opportunities. Regardless, this would call for an enormous change in the mindsets and transformation to attract global capital and talent. Companies that would develop the proper framework capitalizing on this opportunity by mitigating the risks would benefit the most. And after that, nothing can stop Gujarat from becoming a global pharmaceutical hub with solid building blocks. For more exciting, enriching articles and news related to the corporate world, stay tuned to our portal, CorpIndiaNews.
