India Pharma Outlook Team | Friday, 06 June 2025
A significant drop is being seen in the prices of active pharmaceutical ingredients (API) used for manufacturing drugs, bringing relief to India's pharmaceutical industry. China is largely depended upon the pharma industry for sourcing APIs, intermediates, and bulk drugs. During the Covid period,API prices had been shot up and stayed elevated until last year. A change has now been started in the situation, reducing raw material cost and boosting profit margins for pharma companies.
Prices of APIs have gone down significantly. It's largely due to over-capacity. We are seeing a huge impact on the prices of antibiotics, steroids, hormones, statins, among other, said Mehul shah, who tracks the chinese pharmaceutical industry.According to an industry analyst, Chinese supplier’s aggressive tactic to preserve market dominance is the reason why prices have decreased.
This aggressive pricing has made Chinese APIs more attractive to Indian Pharmaceutical companies, leading to increased imports when prices are low", he said on the condition of anonymity. Dinesh Dua former chairman of the Pharmaceutical Export Promotion Council said there were several factors that led to the price decline. " while China scaled up significantly after Covid-19, the demand of APIs has gone down too as India has taken steps to become self-reliant," he said." India's government has implemented the production-linked incentive scheme to boost domestic API production.
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Consequently, businesses like Torrent Pharmaceuticals and Aurobindo Pharma have started producing APIs like penicillin-G locally. Because of the excess supply brought on by this increased domestic output, prices are under pressure to decline.
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