US pharma market may be witnessing single-digit growth, but American companies ranging from innovator firms such as Abbott and Pfizer to generic players such as Mylan are unfazed. They are confident the fast-growing Asia-Pacific market in general and the Indian market in particular will bail them out.
The $6.4 billion Pennsylvania-based Mylan entered India through its acquisition of the Hyderabad-based Matrix Laboratories for $736 million in 2006. Since then, Mylan has grown its India headcount by almost 40%. “Out of a global employee base of 18,000, Indians constitute 8,000.”
Reasons abound why India and other regional markets like Thailand, Vietnam and Indonesia are key to Mylan’s growth. “The Asia-Pacific region, of which India is a key constituent, grew 12% last year,” said Anirudh Deshpande, its head for emerging markets and exports.
The region fetches Mylan about $856 million in revenues annually. The company expects to touch $1 billion by December this year.
Experts say the tilt towards India / Asia-Pacific is linked to changing pattern in global markets. Market intelligence provider IMS Health estimates that global drug spending in 2016 will touch $1.2 trillion, and the US’s share of it will be only 31%, down from 34% in 2011.
On the other hand, emerging markets including India, Brazil and Mexico will grab 30% by 2016, up from 20% last year.
“Firms will have to ramp up operations in places like India or get left behind in the race,” said Sujay Shetty, partner, PricewaterhouseCoopers.
Mylan’s API (active pharmaceutical ingredients) business and its HIV segments are based in India. (The HIV division stated in August.)
Mylan would soon launch its women’s healthcare portfolio in the first half of 2013. “In the first phase, we will make available 20 products from our HIV division. We will also look at introducing other portfolios like gynaecology in the next couple of years.”
To further strengthen its India base, Mylan is working with the government’s National AIDS Control Organisation (Naco) and is open to public-private partnership (PPP) opportunities.
“We wanted our Indian footprint in both private and public sectors. Naco treats 5 lakh patients, while the private sector helps 1 lakh.”
Since 2008, Mylan had been supplying to Naco through the global drug purchase agency Unitaid’s paediatric programme. From last year, however, the firm started supplying directly to Naco for adult programmes as well as paediatric ones.
