The domestic pharmaceutical industry is expected to witness revenue growth of 6–8% in the next fiscal, rating agency ICRA said on Thursday.
Despite several disruptive events, the Indian pharmaceutical market witnessed a healthy CAGR of 10.9% between FY2012 and FY2022.
"Going forward, ICRA expects revenues for its sample set to increase by 6–8% in FY2024 against 3–4% growth in FY2023," ICRA Assistant Vice President and Sector Head for Corporate Ratings Mythri Macherla said in a statement.
Structural factors such as an aging population and a 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% and 3% 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% in FY2022, she added.
However, given the high base, the volume contracted by 1.2% 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 the National List of Essential Medicines accounted for 17–18% of the IPM, with some companies deriving around 30% 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% of the IPM currently, it added.
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