Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Pharmaceuticals and Healthcare: Sector Outlook
Emerging Market presence and Patent Expiry to drive earnings, Remain Positive: We
remain positive on the Indian Pharmaceutical space from a medium term (2-3 years)
perspective. We believe Emerging Markets (EM) to be the next growth frontier for the global
pharmaceutical industry. Most of the companies in the Indian Pharma space have a
significant (>50%) revenue coming from the EMs. Patent expiries will continue to drive
earnings, with over US$114bn worth of branded drugs expiring in next four years. Other
themes that we believe will drive earnings will be the outsourcing opportunity and biogenerics
opportunity (2013 onwards). With a lot of momentum building up, we believe this decade
(2011-2020) can also see some positive surprises on Innovation front.
• Emerging markets – Next growth frontier: The pharma sector in emerging markets is
expected to grow by ~12 % vs low single-digit rates for developed markets. We believe
high GDP growth and the imperative need to improve healthcare in EM will drive growth in
Pharma spend. Most of the companies in the Indian Pharma space have significant
(>50%) revenue coming from EM. We believe Indian players (having large product
portfolios and the ability to manufacture and operate in multiple therapeutic categories)
are very well positioned to grab the burgeoning opportunity.
• Patent expiry cycle will continue to drive earnings for next 4-5 years: In the next four
years, over US$114bn worth of branded drugs face a threat from generics. We believe
Indian players are very well positioned to tap the opportunity. FTF opportunities of block
buster drugs (for ex, Lipitor) to remain the key for the players. We expect the US business
of the Indian players will grow significantly over the next 4-5 years.
• Pharma outsourcing – Advantage India: There exists a significant cost arbitrage in
manufacturing (65% and 50% lower than the US and Europe, respectively) and R&D. With
availability of a large well-trained talent pool, the highest number of FDA-approved
manufacturing facilities (~119) outside the US, chemical capabilities and process
engineering skills, and significant labour cost advantage (~1/10th of the cost in the US), we
believe global pharma outsourcing in India to be a very big opportunity.
• Biogenerics – Opportunity of the decade: We believe leadership in Bio-generics
requires technology platforms, market presence, regulatory expertise and a rich portfolio.
We believe with high entry barriers, players like Biocon, Dr Reddy, and Ranbaxy, having
established franchises, will be much better positioned to monetize the opportunity.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Pharmaceuticals and Healthcare: Sector Outlook
Emerging Market presence and Patent Expiry to drive earnings, Remain Positive: We
remain positive on the Indian Pharmaceutical space from a medium term (2-3 years)
perspective. We believe Emerging Markets (EM) to be the next growth frontier for the global
pharmaceutical industry. Most of the companies in the Indian Pharma space have a
significant (>50%) revenue coming from the EMs. Patent expiries will continue to drive
earnings, with over US$114bn worth of branded drugs expiring in next four years. Other
themes that we believe will drive earnings will be the outsourcing opportunity and biogenerics
opportunity (2013 onwards). With a lot of momentum building up, we believe this decade
(2011-2020) can also see some positive surprises on Innovation front.
• Emerging markets – Next growth frontier: The pharma sector in emerging markets is
expected to grow by ~12 % vs low single-digit rates for developed markets. We believe
high GDP growth and the imperative need to improve healthcare in EM will drive growth in
Pharma spend. Most of the companies in the Indian Pharma space have significant
(>50%) revenue coming from EM. We believe Indian players (having large product
portfolios and the ability to manufacture and operate in multiple therapeutic categories)
are very well positioned to grab the burgeoning opportunity.
• Patent expiry cycle will continue to drive earnings for next 4-5 years: In the next four
years, over US$114bn worth of branded drugs face a threat from generics. We believe
Indian players are very well positioned to tap the opportunity. FTF opportunities of block
buster drugs (for ex, Lipitor) to remain the key for the players. We expect the US business
of the Indian players will grow significantly over the next 4-5 years.
• Pharma outsourcing – Advantage India: There exists a significant cost arbitrage in
manufacturing (65% and 50% lower than the US and Europe, respectively) and R&D. With
availability of a large well-trained talent pool, the highest number of FDA-approved
manufacturing facilities (~119) outside the US, chemical capabilities and process
engineering skills, and significant labour cost advantage (~1/10th of the cost in the US), we
believe global pharma outsourcing in India to be a very big opportunity.
• Biogenerics – Opportunity of the decade: We believe leadership in Bio-generics
requires technology platforms, market presence, regulatory expertise and a rich portfolio.
We believe with high entry barriers, players like Biocon, Dr Reddy, and Ranbaxy, having
established franchises, will be much better positioned to monetize the opportunity.
No comments:
Post a Comment