In March 2024, global pharmaceutical companies are forming strategic partnerships with Indian firms to expand their market presence in India. This trend is expected to continue, benefiting patients and driving growth in the pharmaceutical market.
The Latest: Across March 2024, the landscape of India’s pharmaceutical sector has witnessed a notable shift as numerous global pharmaceutical companies have been forging strategic alliances with Indian firms to enhance their market penetration in the country. On March 27 2024, Dr. Reddy’s Laboratories announced an exclusive partnership with Sanofi Healthcare India to promote and distribute Sanofi’s vaccine brands across the country. The partnership will include well-established pediatric and adult vaccine brands such Hexaxim, Pentaxim, Tetraxim, Menactra, FluQuadri, Adacel and Avaxim 80U. On March 26 2024, Cipla announced its exclusive partnership with Sanofi to distribute and promote its central nervous system product range in India, which includes six brands, including Frisium (clobazam) anti-epileptic drugs. Similarly, On March 13 2024, Sanofi also partnered Emcure Pharmaceuticals to exclusively distribute and promote its cardiovascular brands Cardace (ramipril), Clexane (enoxaparin sodium), Targocid (teicoplanin), Lasix (furosemide) and Lasilactone (furosemide 20 mg and spironolactone 50 mg) in India. This trend is expected to continue potentially with non-exclusive deals allowing partnerships with multiple players. On March 11 2024, AstraZeneca also collaborated with Mankind Pharma to distribute asthma medication in India. This signified the reach of this partnership trend across multiple therapeutic areas.
Forecast Implications: The collaborations can lead to better accessibility of various medicines in India, including the latest treatments and drugs that multinational corporations (MNCs) can introduce to the market through local India based drugmakers. This can be particularly beneficial for patients in rural or less urbanised regions where access to advanced medications has traditionally been limited. By combining the strengths of MNCs (such as advanced R&D, global best practices and new drug development) with the extensive distribution networks and local market knowledge of Indian firms, the pharmaceutical market in India is likely to experience significant growth. India’s pharmaceutical market is projected to grow by 6.5% in 2024, reaching INR2.9trn (USD36.1bn).
Analysis: These initiatives will enable multinational corporations to tap into the extensive distribution networks and robust market presence of their Indian counterparts, thereby accessing a broader consumer base. These alliances are mutually beneficial; they provide the multinational corporations with an opportunity to harness the well-established distribution networks of their Indian partners, thereby significantly extending their reach beyond metropolitan strongholds to more diverse markets. MNCs, which traditionally have a limited presence in non-urban areas, are now able to penetrate these markets more effectively through the extensive distribution channels of their domestic allies. Conversely, Indian companies are afforded the privilege of associating with and learning from esteemed global brands, enriching their expertise. These partnerships, often structured around fixed-margin contracts, offer the multinationals the advantage of predictable profit margins while simultaneously amplifying their volume of sales through the robust domestic marketing and sales infrastructure. These positive developments coincide with recent investment in improving manufacturing quality and striving to meet international standards as well. However, despite these positive developments, it is important to acknowledge that the current improvements in regulatory and patent frameworks within India, while commendable, fall short of the comprehensive overhaul required.