Domestic pharma industry revenues expected to grow 6-8 percent next fiscal: Rating agency ICRA

Structural factors such as ageing population and continued rise in lifestyle/chronic diseases, in addition to WPI-linked price hikes for NLEM products, new product introductions, and annual price hikes for non-NLEM products, are expected to support revenue growth for the industry, she added.

Since FY2018, IPM growth has largely been supported by price increases and new product introductions, even as volume growth remained between 2-3 percent each fiscal, Macherla said. Higher sales of anti-infectives, further supported by price increases taken to offset raw material cost inflation, aided the overall IPM growth of 14.6 percent in FY2022, she added.

However, given the high base, the volume contracted by 1.2 percent for the nine-month period of FY2023, ICRA said.

The steps being taken by the companies towards new product introductions and enhancements in field force are expected to support their growth going forward, it added. ICRA noted that drugs listed under National List of Essential Medicines (NLEM) accounted for 17-18 percent of the IPM, with some companies deriving around 30 percent of their revenues from such medications. In terms of emerging trends in the industry, e-pharmacies have gained significant traction in recent years and now account for 10-15 percent of the IPM currently, it added. 

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