Union Minister of Health and Family Welfare Mansukh Mandaviya launched the Rs 5,000 crore Promotion of Research and Innovation in Pharma and MedTech sector (PRIP) scheme, which aims to transform India’s pharma medtech industry from a cost-based one to innovation-based.
The scheme aims to strengthen research infrastructure in India, the third largest pharmaceutical industry in the world by volume, with a current market size of around $50 billion.
Terming it as a clarion call for Aatmanirbharta in the pharma sector, Mandaviya stressed that India needs a strong and vibrant research environment. This will help it become the world leader in the pharma and medtech space.
“It’s not that we do not have research in India, but the multinational companies invest 20-22 per cent of their profits into research and development (R&D) whereas an Indian company invests around 10 per cent”, he said.
The Indian pharma industry has largely remained confined to generic drugs, where it is holding global leadership.
“In 2021, R&D investments by the top 10 Indian pharma companies amounted to around 7.2 per cent of their sales. There is a need to increase R&D expenditure in the country by further promoting research and innovation,” a notification dated August 16 had said.
Secretary general of the Indian Pharmaceutical Alliance (IPA) Sudarshan Jain said that PRIP is an important milestone for India. “It would encourage India’s pharmaceutical companies and foster a vibrant ecosystem for R&D. Overall, this is a step towards ‘Make and Discover in India’ from ‘Make in India’.”
The scheme comes at a timely juncture as the global medical devices market is projected to grow from $455.34 billion in 2021 to $657.98 billion in 2022-2028. This is a compound annual growth rate (CAGR) of 5.4 per cent.
India accounts for only 1.5 per cent of the global medical devices market, while having 8 per cent share of the global MedTech R&D workforce.
A recent report of the Pharmaceutical Exports Promotion Council of India suggested that Indian pharma exports could surge to $24 billion in FY24, an increase from $23 billion in FY23.
“The PRIP scheme will undoubtedly catalyse the growth of innovative MedTech portfolios in India. The industry is encouraged by the government’s focus on R&D as it will aim to utilise India’s existing strengths,” Pavan Choudary, chairman, Medical Technology Association of India, said.
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The PRIP scheme has two main components — the first one would focus on infrastructure building.
It includes establishing ‘centres of excellence’ in seven campuses of National Institutes of Pharmaceutical Education and Research (NIPER) at a tentative cost of Rs 700 crore over five years.
The second component would include financial assistance to large industries, micro, small and medium industries (MSME’s) and startups. They will carry out research in collaboration with academic institutions as well as for in-house R&D. Around Rs 4,250 crore has been kept aside as financial outlay for this component.
“Earlier, strict rules prohibited small players from conducting any medical research. But with this scheme, the government has opened the doors for medical research and device technology to startups and MSMEs,” the minister added.