Indian generic drugs face pressure

NEW DELHI — In the global pursuit of greater pharmaceutical accessibility, Indian generic drugs have gained popularity for their affordability and broad reach, while also facing persistent challenges related to quality oversight and intellectual property disputes.

Indian generic drugs have become a key option for patients worldwide by combining low prices with generally reliable quality. Unlike originator pharmaceutical companies, which often spend billions of US dollars and over a decade on drug development, Indian firms focus on process optimization and supply-chain efficiency, frequently reducing production costs to as little as 5 percent of those of patented medicines.

A notable example is Cipla, which reduced the daily cost of an anti-AIDS cocktail therapy from $30-$40 to less than $1, dramatically expanding access to treatment in developing countries.

This cost advantage is supported by India's flexible patent regime. The Patents Act of 1970 initially protected only manufacturing processes of new drugs, enabling the rapid growth of the industry. Even after India amended the law in 2005 to comply with WTO rules, it retained mechanisms such as compulsory licensing and patent challenges.

Industrial clustering has further strengthened India's competitiveness. Hyderabad, the country's pharmaceutical hub, hosts nearly 200 companies covering the full industry chain within a 50-kilometer radius.

According to Mordor Intelligence, India produces around 60,000 branded generics across more than 60 therapeutic categories and supplies about 20 percent of the global generic drug market, with the United States as a major market.

Despite the strong points, India's generic drug industry faces mounting challenges. Regulatory capacity remains limited. Reuters reports that the Central Drugs Standard Control Organization has only about 2,000 staff overseeing more than 10,000 factories and 1 million pharmacies.

Since 2022, deaths linked to Indian-made medicines have prompted tighter regulation and mandatory upgrades to meet WHO standards.

Compliance pressures are also threatening industry stability. According to India's Economic Times, of roughly 12,000 pharmaceutical companies, about 8,500 are small and medium-sized enterprises, and over 60 percent risk closure if they fail to meet Good Manufacturing Practices requirements on time. Experts warn this could lead to shortages of commonly used drugs such as antibiotics, antihypertensives and painkillers.

International pressure is intensifying as well. The Office of the United States Trade Representative has repeatedly listed India as a "priority watch country" for intellectual property concerns, while the US and EU markets continue to tighten quality standards for imported drugs.

Xinhua