Demand for generic medicines in India growing rapidly: Report
Sep 27, 2024
New Delhi [India], September 27 : The demand for generic medicines in India is rising rapidly, while the sales of branded drugs are seeing a decline in sales, indicates a recent report by UBS.
The report highlighted that this shift is because of the growing number of Jan Aushadhi stores across the country, which provide affordable generic medicines. As these stores expand, the sales of more expensive branded medicines are likely to be impacted.
"The growth of India pharma market has been slowing and trends of sharp increase in unbranded generics" the report stated, pointing to the growing popularity of these more affordable alternatives.
The report noted that the surge in demand for generic medicines is largely driven by the government's efforts to increase the reach of Jan Aushadhi stores and trade generics.
"Unbranded generics are 25%+ of urban and 35%+ of non-urban markets" the report said
As per the report, currently, generic medicines account for over 20 per cent of the market, with Jan Aushadhi drug stores alone making up for 5 per cent.
The government is working to double the number of Jan Aushadhi stores over the next two years by offering incentives such as eased loan sanctions and capital expenditure reimbursements for opening new stores.
These efforts have led to a sharp increase in the number of Jan Aushadhi stores in the past year and a half.
"The result is a sharp increase in JA stores that could impact 1-2 per cent of annual growth of market on a base of 8 per cent CAGR" the report added.
The expansion of the Jan Aushadhi scheme is a key factor in the growing penetration of generic medicines in India. With more stores offering affordable alternatives to branded medicines, the competition is expected to intensify, putting pressure on companies that produce brand-name drugs.
"Manufacturers' profitability in unbranded generic is less than half that of branded generics and therefore increasing penetration of unbranded generics is a concern" said the report
As the government continues to push for more Jan Aushadhi stores, the Indian pharmaceutical market could see a significant shift in favour of generic medicines. This will provide more affordable healthcare options for Indian consumers.
