India to witness the fastest growth rate in biologicals in next 5 years, CPHI

Of all the biologics markets in the world, India will witness the fastest rates of overall growth in biologicals over the next five years, said the Convention on Pharmaceutical Ingredients' (CPHI) annual industry report released on Tuesday.

This growth, the report said, will be accompanied by the rapid emergence of a bio contract development and manufacturing organisation (CDMO) space, a trend observed in China and Korea.  

The report highlighted that the global pharmaceutical sector currently stands at an intriguing crossroads, marked by a mosaic of technological advancements, strategic shifts, and regional metamorphoses that collectively paint a largely positive future for drug discovery, manufacturing, and distribution in the coming five years.

The report also noted an evolving narrative for CDMOs, particularly those originating from the Asia-Pacific region, with this year's focus prominently on India.  

“The country is transitioning from being primarily a generics powerhouse to becoming a hub for high-value drugs. This shift is further amplified by the West's inflationary climate, marginal pressures, and dwindling enthusiasm for building new facilities," the report stated.  

While a 'China plus one' strategy is currently in vogue, analysts envision a landscape where, five years down the line, the emphasis might shift from being China-centric to adopting an 'India plus one' approach.”

In terms of technology, while AI technologies predominantly originate from the US and China, the report suggested that India's Information Technology prowess positions it as a potential leader in AI-driven pharmaceutical innovations. The report highlighted that, “With the world's most extensive 'naive patient' base for clinical trials, the confluence of India's pharmaceutical and IT sectors could establish it as a global epicenter for secondary data analysis using AI.” 

Furthermore, the report indicated that biotech investments will noticeably pivot towards mRNA technologies. The pharmaceutical industry's anticipation of an FDA-approved cancer mRNA vaccine by 2025 exemplifies the high hopes placed on this technology. In tandem with this, the 'golden triangle'—comprising London, Cambridge, and Oxford—is poised to further solidify its position as a dominant hub for biotech investments. 

The report also drew attention to the US Inflation Reduction Act (IRA) of 2022, which casts a long shadow over the global pharmaceutical landscape. The IRA's enforcement of price negotiations for top-spending Medicare drugs has the potential to restrict revenue streams for innovators, potentially stifling reinvestments in research and development. The report suggests that such legislative shifts could bring about seismic changes in CDMO strategies and outsourcing dynamics on a global scale. 

The past year has witnessed a return to the pre-pandemic underlying growth drivers for the industry. Notably, India, at least in the short term, is projected to represent a higher growth arena than China. The report highlighted that AI, mRNA, the Middle East, and microbiome breakthroughs are the new additions to the story of a rapidly growing pipeline, alongside the ongoing rise of outsourcing as a key driver.