The pharmaceuticals industry in India will have something to pass on to patients other than drugs in 2008. Prices of more than 7,000 drugs classified as “essential medicines” are likely to witness a sharp fall after the forthcoming budget. <b1>
A section of the industry had also called on the government to extend the tax benefits available for research and development to pharmaceutical companies by five more years, a top industry executive said.
Yet others are demanding halving the 16 per cent excise duty levied on drug companies that are not set up in designated tax-free zones in states such as Himachal Pradesh and Sikkim.
Numbers though, speak of a bright 2008 ahead. IMS 2008 Global Pharmaceutical Market Forecast, a worldwide study by IMS-ORG, a global research organisation, says that India and other emerging markets will experience growth of 12-13 per cent to reach $85-90 billion (Rs 3,.4 to 3.5 lakh crore), driven by greater access to generics and innovative new medicines as primary care improves and becomes more available in rural areas, and as more people take out private health insurance.
“For the first time, the seven largest markets will contribute just half of overall pharmaceuticals growth, while seven emerging markets will contribute nearly 25 per cent of growth worldwide," says the study.
“Our only demand is to extend the tax benefits made available to research and development activities by five more years,” said DG Shah, director-general, Indian Pharmaceuticals Alliance, an industry body for generic pharmaceutical companies.
Contrary to previous years, the Indian domestic medicine market is emerging as a high growth area for pharmaceutical companies. According to IMS-ORG, the rural segment and metros show encouraging growth of 21 per cent and 16 per cent, respectively.