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Indian pharma companies are focusing on Latin America as a key growth market. India’s expanding footprint in Latin America is a testimony to its growing influence in the global pharma industry.
Latin American regulators have been actively approving Indian pharmaceutical companies, acknowledging their impact on lowering healthcare costs across the region. The Brazilian Health Regulatory Agency, Agencia Nacional de Vigilância Sanitária (ANVISA), a force to reckon with in the global pharma industry, has approved a significant number of Indian manufacturing sites, highlighting India’s critical role in the region’s drug supply chain.
This trend is not limited to generics and active pharmaceutical ingredients (APIs). India is also making headway in exporting high-value drugs and biosimilars. This evolving dynamic underscores India’s increasing capability and commitment to meeting global healthcare needs, especially in regions where cost-effective solutions are highly valued.
Growing South American market
Now South America is a specific geographic area which covers 12 sovereign states of Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, Guyana, Paraguay, Peru, Suriname, Uruguay, and Venezuela; two dependent territories: the Falkland Islands and South Georgia and the South Sandwich Islands; and one internal territory: French Guiana.
Latin America is more about shared linguistic and cultural characteristics covering 33 countries of Brazil, Argentina, Venezuela, Ecuador, Peru, Columbia, Mexico, Guatemala, Honduras, Nicaragua, El Salvador, Costa Rica, Panama, Belize, Haiti, Cuba, Dominican Republic, Jamaica, Trinidad & Tobago, Bahamas, Barbados, St. Lucia, Grenada, St. Vincent & Grenadines, Antigua & Barbuda, Dominica, St. Kitts & Nevis, Brazil, Colombia, Argentina, Peru, Venezuela, Chine, Ecuador, Bolivia, Paraguay, Uruguay, Suriname, and Guyana. Other dependencies and territories such as French Guyana and Puerto Rico are also part of Latin America.
For Indian pharma, Latin America has a large and growing population with increasing healthcare needs. The rising prevalence of chronic diseases and the demand for improved healthcare services make it an attractive market for pharmaceutical products. This gives scope for generics for which India is recognised as the Pharmacy of the World. In 2023-24, Indian pharma exports increased 10 per cent to US$ 27.9 billion, with Brazil being one of the top five export markets.
The expanding middle class in many Latin American countries has greater purchasing power, which can drive demand for both branded and generic medications. Many Latin American countries have been working to streamline their regulatory processes to facilitate quicker approvals for pharmaceutical products, which can be beneficial for Indian companies looking to enter or expand in these markets.
Indian pharmaceutical companies are known for their cost-effective production capabilities. This advantage allows them to offer competitive pricing in Latin America, which can be appealing in markets where cost is a significant factor.
The usual business is through partnerships or joint ventures with local companies in Latin America, which helps them navigate regulatory requirements, distribution networks, and market dynamics more effectively. Moreover, for Indian pharmaceutical companies, diversifying their market presence beyond the US and Europe can mitigate risks associated with market saturation or regulatory changes in those regions.
Overall, Latin America’s potential for growth and development in healthcare makes it a strategic focus for Indian pharmaceutical companies looking to expand their global footprint.
Soaring trade
From a government of India perspective, the trade with Latin America has been growing steadily. In FY 2022-23, India recorded its highest-ever trade with the region. It reached $48 billion. The major exports from India to Latin America include pharmaceuticals besides chemicals, machinery, petroleum products and vehicles.
India’s role in Latin America’s healthcare sector is evolving beyond its reputation as the Pharmacy of the World. Many Indian pharmaceutical companies have production plants and subsidiaries in Latin America, including small, medium, and large companies.
Some of these companies according to information in the public domain are Dr. Reddy’s Laboratories at Mexico, Colombia, Chile, Venezuela, Brazil, Torrent Pharma at Mexico and Brazil. Zydus Cadila in Brazil and Mexico. Glenmark at Argentina, Brazil, Peru, Dominican Republic, Uruguay, Mexico, Colombia, Ecuador and Venezuela, Aurobindo at Brazil, Mexico and Colombia, Sun Pharma at Brazil, Mexico, Peru and Venezuela, Strides in Mexico, IPCA in Mexico, ACG Capsules at Brazil and Argentina, Intas and its affiliate Accord at Mexico and Brazil, Emcure in Brazil, Peru and Mexico.
Biocon is in Brazil and Mexico, Hetero is in Mexico, Brazil and Colombia, Cipla is in Brazil and Colombia. Natco Pharma in Brazil. Chennai-based Caplin Point at Colombia, El Salvador, Guatemala, Ecuador, Honduras and Nicaragua. Micro Labs in Mexico and Dominican Republic. Himalaya Drug Company in Peru with a USA office, among others.
The Covid impact
It is reported that, “When India began its own Covid-19 vaccination drive at home, the Serum Institute of India shipped two million doses of the Covishield vaccine from Mumbai to Sao Paulo, Brazil, after urgent pleas from the South American nation. Bharat Biotech inked an agreement to supply Brazil with 12 million doses of its Covid-19 vaccine. In addition, India shipped 870,000 Covid-19 vaccine doses to Mexico and another 580,000 doses to Argentina. About a half-dozen more Latin American countries depended on India to secure a supply of Covid-19 vaccines at affordable costs. All this highlights India’s valuable contribution in global health supply chains, accounting for over 20 per cent of the world’s generic medicine supply and 62 per cent of the world’s vaccine supply.”
Scope for partnership
Lifesciences companies can introduce advanced healthcare solutions beyond generics, such as advanced diagnostics, telemedicine services, and digital health technologies. This would address specific regional needs and contribute to healthcare infrastructure development.
There has been ample scope for establishing manufacturing facilities in Latin America to reduce supply chain disruptions, lower costs, and increase the availability of essential medications and medical devices.
Partnering with local healthcare providers, research institutions, and universities have been able to facilitate knowledge transfer, improve service delivery, and enhance product offerings tailored to regional needs. Companies collaborating with government bodies and non-governmental organizations can help address public health challenges and improve healthcare accessibility.
Many Indian companies have invested in local expertise to ensure compliance and streamline market entry. Tailoring healthcare solutions to meet regional health challenges, such as prevalent diseases or healthcare infrastructure gaps, can strengthen the relevance and impact of Indian healthcare products and services. The companies are offering training and capacity-building programs for healthcare professionals in Latin America. This in-turn improves the effective use of Indian technologies and contribute to overall healthcare quality.
Investing in healthcare infrastructure, such as building or upgrading hospitals and clinics, are seen to significantly enhance India’s role as a healthcare partner in the region.
The Indian pharmaceutical industry has made significant inroads, primarily by providing high-quality, affordable APIs, vaccines, and generic drugs. Now companies are moving from a supplier of generics to a player in the branded and retail markets. This according to industry experts will help Indian pharma to build brand recognition and loyalty among Latin American consumers.
Inorganic growth path
Indian pharma strategy is to chalk the inorganic growth path. This is where it is collaborating with local pharmaceutical companies or distributors to provide valuable insights into regional market dynamics and regulatory requirements. Joint ventures or strategic partnerships are seen to facilitate easier market entry and distribution.
As part of the organic growth intent, greenfield investments by setting up manufacturing facilities or forming partnerships with local manufacturers are seen to help Indian companies reduce costs and improve supply chain efficiency, in an effort to ease regulatory hurdles.
ANVISA demands compliance expertise. Navigating the regulatory landscape in Latin America can be complex. Building expertise in local regulations and maintaining compliance will be crucial for success. This may involve working closely with local regulatory bodies and adapting to regional regulatory requirements, said a section of the industry.
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