DNA Money Edit: Indian pharma faces pricing troubles in US

It isn’t a great time for the pharma sector. While the March quarter has been a mixed bag in terms of earnings for Indian pharma companies, the recent antitrust lawsuit, filed by 44 American states, against pharma companies for fixing prices of generic drugs, including seven Indian drug makers, leaving a bitter taste.

According to data available, the domestic pharma market grew at an average of 11.2% from July 2018 to March 2019. 

On the other hand, the global pharma market has witnessed easing of the pricing pressure, giving some relief to the pharma companies operating in the generic pharma market in the US.

Due to the pricing pressure, some of the Indian companies have migrated to specialty and difficult-to-manufacture products for the US market. 

In the emerging market, Indian pharmaceutical companies have suffered due to currency fluctuations and lower purchasing power. 

Hence, the generic manufacturers suffer from pricing pressure, regulatory challenges, entry of new players, currency fluctuations and lower purchasing power.

Indian pharma companies cater to about 40% of the US generic demand in terms of volume and are likely to benefit from the strong growth of generics and biosimilars in the US market.