Pharma exports slowest in 15 years, to miss target this fiscal
New Delhi: India's pharmaceutical exports registered slowest growth in at least 15 years at 1.2 percent to USD 14.84 billion last fiscal amid growing tension with the US over intellectual property rights related issues.
As the IPR issues raised by the US - India's biggest market - are unlikely to be resolved anytime soon, industry observers say that pharma exports will miss the target of USD 25 billion set for 2014-15 in a government strategy paper.
According to the Commerce Ministry data, in 2012-13, the country's pharma exports aggregated USD 14.66 billion.
The growth registered in 2013-14 is the slowest in nearly 15 years. The previous slowest was in 2009-10 when the pharma exports grew by just 5.9 percent. In calendar year 2000, they grew by 7 percent.
"2013-14 has seen slowdown in growth because of the US raising concerns and due to increase in global competition," PV Appaji, Executive Director, Pharmexcil told the agency.
Elaborating on hurdles faced by Indian companies, an official said: "The US industry is alleging that India's IPR laws particularly with regard to pharma sector discriminate American firms. They are putting pressure on their government to take actions against India."
The US is the top destination for Indian pharma exports followed by the UK. America accounts for about 25 percent of India's pharma exports.
The Obama administration has been strongly criticising India's investment climate and IPR laws, especially in the pharmaceuticals sectors.
US pharma companies had objected to India's move to issue a compulsory license in March, 2012 to Hyderabad-based Natco Pharma to manufacture and sell Bayer's cancer-treatment drug 'Nexavar' at a cheaper price.
Compounding the problems for Indian pharma firms, Vietnam too has raised concerns over medicines imported from India. An industry official stated that "if Vietnam were to ban imports from India, It will further impact our exports".
Appaji, however, said: "DCGI is looking into concerns raised by Vietnam over quality defects in drugs supplied from various countries, including India which is a major supplier to the country."
Despite the challenges, he said: "India has been able to make its name as a quality supplier of affordable medicines across the globe. We are expecting around 12 percent growth this fiscal."