India's fast becoming pharma's go-to manufacturer

New Jersey may still be America's medicine chest, but India is fast becoming the world's medicine plant. As Big Pharma turns to outsourcing to shed costs--and India's homegrown pharma industry turns out more and more of the world's generic meds--the subcontinent's drug output is growing fast. Some 13 percent growth is expected this year, the New York Times reports, to just over $24 billion.

The lure is obvious: Costs are lower and because of the country's history in pharma manufacturing, workers are well educated and highly skilled. Plus, Indian drugmakers have experience dealing with FDA and other Western regulators, the NYT points out. Despite some high-profile quality problems, India still has a better reputation for quality control than China does.

Some pharma types--and expert observers--predict that lots of the work drugmakers do between R&D and marketing will end up in India. "What I see happening now is manufacturing and even packaging and even formulation are moving to India," Jim Worrell of Pharma Services Network tells the Times. And Sujay Shetty of Pricewaterhouse Coopers predicts that "everything in the value chain will move to different parts of the world that are cheaper," with India being a major beneficiary.

The next frontier is original drug development and outsourced R&D, industry types said. Discovery costs could be a tenth of what drugmakers pay in Europe or the U.S., Ajay Piramal, founder of Piramal Healthcare, estimates.

- read the NYT story