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The Indian analytical instruments industry expects that there will be meagre funding by the government in this sector after the COVID-19 phase. The industry anticipates that its customers in the pharma and biotech sector would curtail Capex on new purchases during the post-COVID-19 phase.
There will be a major wipeout in earnings as customers from all sectors will continue to manage with the existing analytical instruments. This is the expected outcome from the COVID-19 lockdown scare, according to experts in the Indian analytical instruments industry.
It is difficult to analyze the future as this is a difficult situation where a microorganism like the corona virus has dislodged the economy and disrupted industry practices, said S Thyagarajan, chairman, Spinco Biotech and Spincotech at a webinar organized by Messe Muenchen India.
“There are three possible situations that the sector would encounter. One is the prospect of a global depression. Second is corona virus episode to prevail till September. The third being the return of the virus resulting in a relapse even among the cured COVID-19 cases in 2021,” he added.
Delving on the topic of ‘COVID-19: How will the analytical industry respond to customer support and supply chain challenges,’ Gautam Rajan, president, Indian Analytical Instruments Association and managing director, Marsap Services, said that there would be considerable impact on the business and that collaboration was the new paradigm for the sector.
According to Ramesh Datla, chairman, ELICO, there would be an unexpected impact not just in the present but in the future too. This is because of the supply chain issues. Moreover, analytical instrument manufacturing is complex, demanding multi-disciplinary capability and deep science. India largely has multinational players in the space providing the key equipment across government and private labs.
Policy makers do not understand this sector though the government is a major purchaser of these instruments and global companies have entered India on their own. However, despite a hit on our revenue generation for 2020, the future looks good as pharma industry among others is heavily dependent on analytical instruments. Hence, despite the challenges, there are huge opportunities giving scope for growth, he added.
K V Venugopalan, consultant and former president, Waters India, noted that considerable funding was being extended for pharmaceuticals and not for the analytical instrument industries by the government. There have been problems of custom duties too. Now with the lockdown, the situation is uncertain and tough.
Highlighting the customer support and supply chain challenges, Bharat Bhardwaj, country manager, India, Agilent Technologies International said that risk mitigation strategies were the need of the hour.
Besides tackling issues of supply chain and customer support from a ‘Work From Home’ environment, companies like Agilent are learning from its office in China about the ‘re-open office’ model in the post-COVID-19 phase.
Globally the analytical instrument market for lifesciences is valued at $69,753 million. India share is miniscule at $2,523 million. Hence global companies will look to drive more business from India. But there are multiple issues like supply chain logistics resulting in distribution difficulties that will hamper growth, said Thyagarajan.
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