PHARMA & LIFE SCIENCES

Snapshot

Overview of Pharma Industry in AP

Indian pharmaceuticals - a formula for success

India is one of the most predominant and fastest growing country in the global pharmaceuticals industry. It is the largest provider of generic medicines globally, holding a 20% share in global supply by volume, and since before the COVID-19 pandemic overcame the globe, supplied 62% of the global demand for vaccines and has only seen a steady rise since. India is in the top 3 countries in the world for production by volume and 14th by value. India has the highest number of US-FDA compliant Pharma plants outside of USA and is home to more than 3,000 pharma companies with a strong network of over 10,500 manufacturing facilities.

The pharmaceutical industry in India is currently valued at $41.7 bn and is expected to reach $65 bn by 2024 and to $120 bn by 2030.

Generic drugs, with 71% market share, form the largest segment of the pharmaceutical industry in India. As per the domestic market share in the pharmaceutical industry by revenue, Anti-Infectives (13.6%), Cardiac (12.4%), and Gastrointestinal (11.5%) had the biggest market share.

Andhra Pradesh is at the helm of the pharma industry in India and is the largest exporter of Pharma products amongst Indian states where Indian export of Drugs and Pharmaceuticals was valued at $2001.78 bn in August 2021 with a growth of 1.21% over exports of $1977.76 bn in August 2020.

Andhra Pradesh has established itself as one of the most prominent connection points with major world markets. Andhra Pradesh is a strong and reputed Pharma and Biotechnology hub of the nation with several major companies making the state their preferred destination. It is also home to Asia’s largest “Integrated Medical Devices Manufacturing Park – AP Med-Tech Zone (AMTZ)" setup in 270 Acs in Vishakapatnam.

INR 18,000+ Cr
(USD 2.5 bn)
invested till date
INR 44,000 Cr
(USD 6.3 bn)
production value in
2018-2019
88,984
Direct Employment

250+ APIs/Bulk Drug units 38 WHO approved 20 USFDA approved

4 Pharmaceuticals Clusters in Vishakapatnam, Srikakulam Nellore , Vijayanagaram

16% of India’s production value as on FY 2018-19

6% of national exports as on FY 2018-19 i.e, INR 24,538 Cr (USD 3.5 bn)

6% share of Pharmaceutical and Medical

AP Pharma Ecosystem

Primary focus of AP’s pharma industry has been on Bulk Drugs Exploring collaborations across product classes – medical device technology, biosimilars, gene therapy, and specialty drugs – to usher-in the next leg of growth

Existing Pharma Clusters in
Andhra Pradesh		 Acres (SEZ &
Non-SEZ)		 Key Pharma Industries
Jawarharlal Nehru Pharma City (JNPC), Vishakapatnam 1,424 Biocon, Orchid Chemicals & Drugs, Shasun Chemicals & Drugs, Mylan Laboratories, GVK, Hetero Drugs, Vijayasri Organics, etc
APSEZ Pydibhimavaram, Srikakulam 3,350 Laurus Labs, Escientia Advanced Sciences, Vasudha Pharma, Phalanx Chemicals, Lee Pharma, Beatus Laboratories, etc
APSEZ, Atchutapuram, Vishakapatnam 330 Dr. Reddy Labs, Aurobindo Pharma, Virchow Laboratories, Andhra Organics, Green Tech Labs, Synpure Labs, etc
APSEZ Naidupeta, Nellore 1,491 Aurobindo Pharma, Shimoga Life Sciences, Anvitha Lifecare, Gelcaps Industries, Chemsynth Labs, United Alacrity,etc

Schemes/Policies

Micro & Small Projects

Reimbursement of 100% stamp duty

Power reimbursement of Rs. 1/- per unit for 5 years

Reimbursement of 100% net SGST for 5 years

15% investment subsidy (up to Rs.20 lakhs)

Interest subsidy of 3% for 5 years

Reimbursement of 25% land conversion charges

Medium, Large & Mega Projects

SGST reimbursement based on employment for 5 years

50% reimbursement for employment below 1000

75% reimbursement for employment below 2000

100% reimbursement for employment above 2000

Composite Lease cum Buy Model to de-risk investments and reduce upfront costs – land provided on lease for 33 years, with option to buy land after 10 years of operations

Reimbursement of 100% of net SGST accrued to state for a period of 10 years from DCP, limited to 125% FCI

Reimbursement of 100% stamp duty and transfer duty paid by industry on purchase of industrial land and lease of land/shed/buildings, mortgages and hypothecations

Waste and effluent treatment services at doorstep at through common CETPs in Bulk Drug Park

Reimbursement of 50% of registration charges of various countries for product approval, limited to INR 25 lakhs

10% of the cost of establishing of Technology and Research Institutes, limited to INR 5 Cr

Govt of India Schemes for Electronics Manufacturing

The objective of the scheme is to enhance India’s manufacturing capabilities by increasing investment and production in the sector and contributing to product diversification to high-value goods in the pharmaceutical sector. One of the further objectives of the scheme is to create global champions out of India who have the potential to grow in size and scale using cutting-edge technology and thereby penetrate the global value chains. The manufacturers of pharmaceutical goods registered in India will be grouped based on their Global Manufacturing Revenue (GMR) to ensure wider applicability of the scheme across the pharmaceutical industry and at the same time meet the objectives of the scheme. The qualifying criteria for the three groups of applicants will be as follows:
Group A : Applicants having Global Manufacturing Revenue (FY 2019-20) of pharmaceutical goods more than or equal to INR 5,000 cr.

Group B : Applicants having Global Manufacturing Revenue (FY 2019-20) of pharmaceutical goods between INR 500 (inclusive) cr and INR 5,000 cr.

Group C : Applicants having Global Manufacturing Revenue (FY 2019-20) of pharmaceutical goods less than INR 500 cr. Within this group, a sub-group for MSME industry will be made given their specific challenges and circumstances.

Quantum of Incentive

The total quantum of incentive (inclusive of administrative expenditure) under the scheme is about INR 15,000 cr. The incentive allocation is as follows:


Group A: INR 11,000 cr

Group B: INR 2,250 cr

Group C: INR 1,750 cr

Rate of Incentive
The rate of incentive on incremental sales (over base year) of pharmaceutical goods covered under Category 1 and 2 will be 10% for FY 2022-23 to FY 2025-26, 8% for 2026-27 and 6% for 2027-28.

The rate of incentive on incremental sales (over base year) of pharmaceutical goods covered under Category-3 will be 5% for FY 2022-23 to FY 2025-26, 4% for 2026-27 and 3% for 2027-28.
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100% FDI in the pharmaceutical sector is allowed in brownfield pharmaceuticals; wherein 74% is allowed under the automatic route and thereafter through the government approval route.

For further details, please refer below pdf

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Major Investors

Industry Scenario

  • The pharmaceutical industry in India is expected to reach $65 bn by 2024 and to $120 bn by 2030
  • The pharmaceutical industry in India is currently valued at $41.7 bn.
  • Generic drugs, with 71% market share, form the largest segment of the Pharmaceutical industry in India. This is set to grow as exports of generics to the US rise, as branded drugs worth $55 bn will become off-patent during 2017-2019. As per the domestic market share in the pharmaceutical industry by revenue, Anti-Infectives (13.6%), Cardiac (12.4%), and Gastrointestinal (11.5%) had the biggest market share
  • Under the Production Linked Incentive (PLI) Scheme for Promotion of Domestic Manufacturing of critical Key Starting Materials (KSMs)/ Drug Intermediates and Active Pharmaceutical Ingredients (APIs), 47 applications with committed investments of INR 5366.35 crore have been approved.
  • Export of Drugs and Pharmaceuticals was valued at $2001.78 bn in August 2021 with a positive growth of 1.21% over exports of $1977.76 bn in August 2020.

CM inaugurated YSR EMC

leadership

Press Releases

leadership

Electronics Industry

leadership

Proposed common infrastructure for Bulk Drug Park

  • Solid waste management
  • Storm water drains network

  • Common Warehouse
  • Dedicated power sub-station and distribution system with the necessary transformers at factory gate
  • Treatment of Raw water, Potable and Demineralised Water
  • Steam generation and distribution system

  • Internal road network, Compound Wall
  • Common logistics (Clearing and Forwarding, Insurance, Transportation, Customs, Weighbridges, etc.)

  • Suitable for even complex testing/research needs of APIs
  • Including microbiology laboratory and stability chambers
  • Emergency Response Centre
  • Safety/Hazardous operations audits center

  • Regulatory awareness facilitation Centre
  • Technology business incubator
  • Intellectual Property Rights management services
  • Process/Technology development laboratory/Reasearch Laboratory/with pilot plants run by eminent scientists with track record of such competitive technology development for import substitution
  • Industry Academia linkage Centre
  • Training center

Healthcare and Public Health Initiatives in Andhra Pradesh

  • YSR Kanti Velugu Programme in the state to provide free eye care, tests, surgeries etc
    • INR 560 Cr (80 mn) allocated for six phases over 3 years, benifiting 5.4 cr people
  • INR 200 Cr (USD 30 mn) allocated to medical college with INR 1600 Cr (USD 230 mn) dedicated for infrastructure development in hospitals and medical buildings
    • 25 Medical Colleges - 10 Govt & 15 Pvt
    • 1145 PHCs, 196 CHCs, 8 UHCs, 243 e-UPHCS
  • INR 93Cr (USD 13 mn)budgeted for improvement of Palasa Kidney Reasearch Center and State Cancer Institute
  • Launched 1,088 new ambulances under 108 and 104 services to address emergency care

  • Analyses of HIV/TB/COVID program data to improve quality/efficency
  • Develop models for children/adolescents to link to social welfare/protection schemes/education
  • Establish clinical research sites in AP to cunduct research related to HIV/TB/COVID and other infectious diseases
  • Capacity building workshops (1-5 days for AP program staff and students on public health
  • Population surveillance tools for as part of digital health initiative
  • Predictive analytics to improve efficiency of programs

Government Departments & Industry Associations

State Government

arrow APBDIC - Andhra Pradesh Bulk Drug Infrastructure Corporation
arrow Andhra Pradesh Industrial Infrastructure Corporation

Government of India

arrow Department of Pharmaceuticals
arrow National Pharmaceutical Pricing Authority

Industry Associations

arrow Indian Drugs & Pharmaceuticals Limited (IDPL)
arrow Hindustan Antibiotics Limited (HAL)
arrow Rajasthan Drugs & Pharmaceuticals Limited (RDPL)
arrow Karnataka Antibiotics & Pharmaceuticals Limited (KAPL)
arrow Bengal Chemicals and Pharmaceuticals Ltd. (BCPL)
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