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India and China Position for Growth in APIs
The US generic drug market is poised for strong growth over the next several years, and industry observers anticipate changing supply lines for active pharmaceutical ingredients (APIs) as well as resource challenges on a regulatory level.
"This is a time of growth for the generic pharmaceutical industry," said Kathleen Jaeger, president and CEO, of the Generic Pharmaceutical Association (GPhA, Washington, DC, www.gphaonline.org), who offered the keynote address at the GPhA Annual API Conference, held in New York City last week. "It is also a time of growth for the API sector. Today, APIs are a $17 billion industry worldwide."
With strong growth for generic APIs, including growth in the Indian and Chinese markets, Jaeger pointed to several factors to facilitate API flow into the US market. "Excessive paperwork, changing documentation requirements, and other regulatory burdens have slowed processing through US ports. That needs to change," said Jaeger. "We need to create a process that reduces uncertainty, that allows shipments to be 'pre-authorized,' that makes it easy for FDA to know that an API is authentic and that its supply chain is safe and secure. We are working with FDA and others to improve this process."
Jaeger also pointed to the need for more resources for foreign inspections as the number of drug master file (DMF) submissions increases generally, and particularly from offshore suppliers. "With more new firms springing up around the globe, it's becoming more of a challenge for FDA to find the resources to travel to these firms and provide the necessary inspections."
The rising influence of India and China in the global API market is evident in the increased number of DMFs filed by companies there over the last several years. In 2005, Indian companies filed 265 DMFs, up from 227 in 2004 and 139 in 2003, noted Cynthia Dowd Greene, vice-president for industry research at Newport Strategies (Portland, ME, www.newportstrategies.com), who also spoke at the GPhA conference.
Chinese companies, meanwhile, accounted for 75 DMFs in 2005, up from 51 in 2004. "The world is looking to China for low-cost APIs and intermediates," said Dowd Greene. "They are supporting Indian API and dose companies and are filing more DMFs."
While India strengthens is position on the generic API market, the country also is looking to advance its position into custom manufacturing for branded pharmaceuticals. "We see contract manufacturing in India to be at take-off stage," said Venkat Krishnan, vice-president of Ranbaxy Inc. (Gurgaon, Haryana, India,
), who also spoke at the GPhA conference. He offered industry estimates that show pharmaceutical contract manufacturing market in India will reach $1 billion by 2010. At the same time, contract research in India is expected to grow at 40% to 50% per year.