Drug sales in India were $4.7 billion (€3.6 billion) in 2004 and have grown at a 20 per cent compound annual growth rate since 2000. India is the 4th largest drug market by volume, but only 13th largest by value.
The new R&D centre is housed in a brand new building in the same campus as RLL's earlier research facilities. The new R&D centre will focus on New Drug Discovery and the Development Functions of Medicinal Chemistry, Analytical Development (NDDR), Pharmacology, Molecular Technologies, Infectious Diseases, Metabolism & Pharmacokinetics
RLL has the largest R&D budget in India amongst pharmaceutical companies. It has spent a cumulative $166 million (€136 million) on R&D since the beginning of its research efforts in 1994 and expects to spend 10 per cent of sales on R&D going forward.
With the commissioning of the new R&D centre, Ranbaxy now has in place a total of three modern research facilities in the same campus. R&D centres I and II focus on the development of generics and Novel Drug Delivery Systems; the new R&D centre III, is dedicated to New Drug Discovery Research.
Besides these, RLL has another R&D building, which houses its regulatory and administrative departments. The focus areas for research for RLL are infectious diseases, urology, respiratory/inflammatory and metabolic diseases.
The Company presently has around 8-10 NDDR programs including two NCEs (New Chemical Entities) in the clinical phase of development.
RLL has a total of 19 manufacturing facilities spread across 7 countries. These include 10 plants in India (3 Active Pharmaceutical Ingredients Facilities & 7 Dosage Forms Facilities), 4 Dosage Forms (DF) plants in the US and one DF plant each in Ireland, China, Malaysia, Vietnam and Nigeria.
Western pharmaceutical companies have increasingly focused on the country, allocating a considerable portion of time and costs in establishing a base there as well as bringing out a number of drugs.
According to a Goldman Sachs (GS) Global Investment Report, the country's impressive growth has forced existing drug companies to revise core strategies and target generic opportunities overseas.
Aided by India's cost advantage (one-fifth of western costs) this has resulted in a surge of Abbreviated New Drug Applications (ANDA) being filed from India.
Currently, Indian companies enjoy a decisive 'cost advantage' over western drug firms. Estimated Indian drug costs range from one-fifth to two-fifths of western costs.
As a consequence, there has been a surge of ANDAs being filed by Indian companies (a quarter of all US ANDAs filed in 2004 compared with only five in 1997). GS estimate products totalling around $35-40 billion (€27-30.5 billion) in innovator sales are being targeted by India's generic industry at present.