January 26, 2009

Medicine sales rise by 10%

Sale of medicines to consumers grew 9.8% to Rs 34,000 crore in the calender year 2008, compared with 13.4% in 2007. The slowdown is largely due to consumers shifting to cheaper brands and stockists not keeping enough products. Also, drug companies did not spend as much as on marketing initiatives in the second half of 2008, as they did in the same period previous year.

For the December month, industry sales rose 13.3%. This is the second consecutive monthly growth after the industry witnessed possibly its first sales decline in the October last year. In October, sales declined by 1.2%, but bounced back to register a 6.8% growth in November, according to figures compiled by research-based consultancy firm ORG IMS.

These figures are compiled from the data collected from wholesalers and represents the trend of the industry, and not the actual sales of over five lakh retailers across the country. The slowdown in drug sales in 2008 comes despite the popular perception that the drug industry is recession-proof and is an attractive investment opportunity during downturns.

Incidentally, the global sales of prescription generics drugs has also slowed down significantly to 3.6% in the October 2007-September 2008 period, compared with 11.4% in the same period a year ago, as per data available with the US-based IMS Health.

During the year, cardiovascular system recorded a 14% value growth in the Indian market, while anti-infectives registered a growth to the tune of 10%.

There is no change in the ranking of the top three companies from past year. Cipla continues to maintain its market leadership, followed by Ranbaxy Laboratories and GlaxoSmithKline (GSK). Delhi-based Mankind Pharma broke into the top 10, registering a growth of over 32% during the year.

Among the top products, Pfizer’s cough syrup Corex is the top selling drug in the country with over Rs 160 crore annual sales. Novartis painkiller Voveran is the second best selling drug, while Piramal Healthcare (earlier Nicholas Piramal’s) cough drug Phensedyly takes the third spot. However, ORG IMS maintains that the industry is independent of the global slowdown. Indian firms expect a strong domestic demand with a 11-14% growth in the next few years.

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