India's R&D policy to bolster drug discovery

Indian drug companies have a new ally. The UAE government is all set to provide incentives, including financial contributions, and will help create a full ecosystem to support Indian pharmaceutical companies having strong research and development facilities, reports The Pharma Letter’s India correspondent.

With the Department of Pharmaceuticals' (DoP) vision of developing India as a drug discovery and pharma innovation hub, the Indian government recently concluded a rapid assessment of India’s opportunity in global pharma R&D.

The basis of the DoP's vision was a white paper shared by McKinsey, which outlined potential and key imperatives for the Indian government, even as it described several opportune areas for developing excellence. It was pointed out that almost all the patented pharmaceutical products have come from global Big Pharma, and their research and development (R&D) spend as a percentage of sales is around 20% of their sales turnover.

In terms of highest R&D spending ratio to revenue for Indian drug companies, data showed Sun Pharma Advanced Research Company (SPARC) had 587% investment, followed by another drugmaker, Suven Life Sciences, which spent 304% of its revenues on R&D in FY20.

Other pharma companies also figured in the largest spenders of R&D in absolute terms. Alembic Pharma and Unichem Labs spent between 14% and 31% of their revenues on R&D. Dr Reddy's Lab spent 11.3%, Cipla 8.9%, Aurobindo Pharma 6.3% and Sun Pharma 9.8%.

In financial year 2020 in India, Lupin spent $225 million on R&D (14.3%). By contrast, the lowest was by Torrent with $57 million. On an average, Indian pharmaceutical companies tend to spend less than 13% of their annual turnover on R&D.

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