Companies present in the API+Formulation+Branded drug segment fetch high margins. They are called vertically integrated.
Companies operating in the only formulation segment are currently at risk of raw material/API supply from China.
Companies operating in the only formulation segment are currently at risk of raw material/API supply from China.
India has a strong presence in the API+Formulation+Generic segment but dependant on China for raw material.
Outsourcing happens from top to bottom. Branded drugs are still manufactured mostly in developed countries.
Generic drugs are thin margin high volume business
Outsourcing happens from top to bottom. Branded drugs are still manufactured mostly in developed countries.
Generic drugs are thin margin high volume business
Companies operating in the bottom of the pyramid don't have bargain power, hence never get rich valuations. While companies at the middle-top part of the pyramid often secure inventions through patent protections, hence they get a power to wipe out competitors
Sadhana Nitrochem is a good example of companies operating at the bottom of the pyramid.
Companies can get some edge over competitors by scale, cost-effective manufacturing process, intellectual property, or investment barriers.
Companies can get some edge over competitors by scale, cost-effective manufacturing process, intellectual property, or investment barriers.
Companies operating at the middle & top of the pyramid always get a rich valuation. But when any company attempting to move up in the pyramid, creates value and hence rewards investors. Many India pharma companies have done this post-90s
