Important Segments to track growth for Pharma Companies
Investments in the global pharmaceuticals sector to increase to over $1,400 billion over the next three years, driven by a number of new medicines.
With healthy R&D spending going forward, the Contract Research and Manufacturing (CRAMS) segment offers growth opportunities to Indian companies.
Change in regulations around generic approvals will help Indian companies to increase penetration in Chinese markets, which will improve margin expansion.
What are CRAMS ?
CRAMS is defined as the process of outsourcing research services/ product manufacturing activities to organizations which can provide the service at a low cost.
CRAMS basically consists of the following two activities: contract research and contract manufacturing.
CRAMS is mainly used in the Pharmaceutical and Biotechnology sectors that require extensive R&D and large-scale manufacturing facilities.
It is expected that the demand for contract research and contract manufacturing is expected to increase in India in the future.
Future for Pharmaceutical Companies
Developing countries such as India, China, Mexico, and Brazil are witnessing significant improvements in their healthcare infrastructure and technological innovations in their drug development processes.
As a result, several pharmaceutical companies from developed countries are outsourcing the research and manufacturing operations to the vendors in such countries.
The availability of labor at a comparatively lower price is one of the critical reasons for the growing popularity of outsourcing these processes.
The pharmaceutical industry uses outsourcing services from providers in the form of contract research organizations (CROs) and contract manufacturing organizations (CMOs).
Comprehensive single-source provider from drug development through commercial manufacture has emerged in recent years.
development and manufacturing organizations (CDMO).
Owing to a wide ranging product mix consisting of high-end research services, biologics, and complex technology services, all offered at a low cost, contract manufacture and research services (CRAMS) industry has witnessed tremendous growth in the Indian subcontinent.
Picture Credit: RedNewswire
PHARMACEUTICAL CONTRACT MANUFACTURING MARKET TO REACH USD
144958.8 MILLION BY 2026 GROWING AT A CAGR OF 7.2%
The pharmaceutical industry has undergone significant changes over the years, in terms of technology for R&D of
One of these significant advances include the use of analytics for identifying various essential aspects of research.
The use of analytical tools for clinical data synthesis helps companies to quicken the drug development process.
Big data helps to avoid the high cost of adverse events.
It also allows companies to keep a record of patients for long duration, which enables regular monitoring after treatment. The advent of big data will benefit CROs as
it makes the process more efficient.
With lower cost manufacturers capturing a major portion of the market, India is in a pole position in the area of dosage form and end-to-end efficiency in outsourcing.
Industry experts find a tectonic shift across the contract research organisation landscape with several key pharma players now outsourcing their early drug development activities covering pre-clinical and early phase research to some of the leading CRO players in the market which was earlier handled by pharma companies themselves.
With externalization of research to emerging markets, India presents a strong case for outsourcing research and manufacturing.
Whilst contract manufacturing is expected to garner a larger share of revenues in the range of over 50-60 percent, the country is also witnessing a simultaneous contribution from the contract research services capturing rest of the CRAMS services and over 20 per cent of the APAC CRO market.
The Indian government policies to encourage exports and support the growing R&D through several tax benefits and have allowed the country to be on the forefront of contract research and manufacturing services.
Indian CRAMS companies hold a competitive edge across the global pharmaceutical industry in being the most preferred partners for drug development and manufacturing.
Owing to a wide ranging product mix consisting of high-end research services, biologics, and complex technology services, all offered at a low cost, CRAMS industry has witnessed tremendous growth in the Indian subcontinent.
Global CRAMS market is highly fragmented with over 1000
players with SEA countries such as India, China, Japan, Singapore, Malaysia etc. expected to show a robust double digit growth.
In most cases, process development and clinical research are the majorly opted services from CRAMS players.
According to the Indian Government, by 2020, India would be one of the top five pharmaceutical innovation hubs with one out of every five to 10 drugs discovered in India.
Despite positioning as the Go To market, China stands
strong as a key contender especially in the field of generics manufacturing.
This in turn is encouraging local pharma companies to make generic drugs, under the drug regulator’s priority review pathway, which until now has mostly been handed to innovative drugs.
China leading the charts.
Global Pharmatech said that contract manufacturing for the Indian market is a challenging space. Margins are low or non-existent.
This is particularly true for products under price control. Manufacturers who have large -scale operations which are run efficiently may make a profit but it is probably still below reasonable return on investment.
Data and reports