ICRA Sees Growth In Indian Pharma Industry By 9-11% In FY22

Driven by the push from emerging as well as domestic markets in the upcoming quarters, the Indian Pharma industry in the Financial Year-22 is expected to be pegged at 9-11 percent, says credit rating agency, ICRA. ICRA’s sample of 21 Indian Pharma companies showed moderate growth of 6.4% in the second quarter of FY22, which diminished by 16% in the preceding quarter.

Some of the major reasons attributed to this cause hover around pricing pressures prevailing in the US market and the normalization of the base. That said, there remained healthy growth in the domestic and emerging markets. There was an increase of 15.3% year-on-year in the sample set recorded when it came to the domestic revenues as against a 14.6% year-on-year growth in the Indian Pharmaceutical Market. A steady normalization in the footfalls at hospitals along with field force operations had consistent traction in acute therapies, and better pricing supported healthy revenue growth across the companies.

As per ICRA, there will be sustenance as far as doctor visits and even elective surgeries go due to the rise of the Omicron variant. Besides that, the performance of new launches, apart from the momentum in the revenue growth, will continue to be a key analyzer. When it comes to the US market, the growth in the revenue for the sample set stood firmly muted at 1.9% in the second quarter because of high single-digit to low past erosion and also past inventory liquidation, highlighting COVID-related uncertainties that still exist.

Companies are now concentrating on specialty products, complex generics, injectables, etc., to enhance margins for the US business, which has already been impacted by pricing pressure. Notably, the companies in the sample set encountered a healthy growth y-o-y in revenue with an increase of just over 12 percent from the European business. This was essentially due to the improvement in the demand for non-COVID products and also new product introductions, Rupee depreciation, and of course, expanding market coverage.