Page 65 - FBL AR 2019-20

Corporate Statutory FinanCial
overview StatementS StatementS

FDI inflow Growing R&D
FDI inflow for drugs and pharmaceuticals Contract research is a fast-growing
sector stood at USD 16.39 billion between segment in the Indian healthcare industry.
April 2000 and December 2019. Inflows The cost of developing new drugs is as low
into sectors such as hospitals and as 60% of the testing cost in the US.
diagnostic centres and medical appliances (Source: Invest India, IBEF, First spot, Economic
stood at USD 6.63 billion and USD 1.88 Times, Live Mint)
billion, respectively during the same
period.

Budgetary initiative taken several measures to address this The continuous innovations in research
In Budget FY 2020-21 the Government issue through various initiatives such as and development activities to increase the
allocated a total of H1,16,900 crores Integrated Child Development Services yield, improve enzyme specificity as well as
to boost public healthcare, which (ICDS), National Health Mission (NHM) and stability, are expected to propel the growth
includes the provision of H69,000 the mid-day meal scheme. According to of the market.
crores for expanding PM’s Jan Arogya a World Bank, India loses nearly USD 12 Wastewater management and
Yojana (PMJAY), which is a 10% increase billion in Gross Domestic Product (GDP) to treatment
compared to the last year’s healthcare malnourishment. However, interventions
budget of H62,659.12 crores. The to alleviate the loss would cost ~USD India is the largest contributor to waste
budgetary allocation of H35,600 crores 524 million annually. This would render a due to the immense size of its population:
for the nutrition-related programme PM benefit-to-cost ratio of almost 23 times. it accounts for 4% of the world’s water
Poshan Abhiyan seems to be one of the The focus towards preventive care has also resources but 16% of the world’s
most ambitious healthcare programmes, as been accentuated due to the increasing population.
the Government seems to have recognised costs of healthcare: 62% of the healthcare India is one of the world’s most water-
the fact that the most people are facing costs incurred in India are out-of-pocket stressed countries, and with the country
healthcare challenges due to malnutrition. expenditures; 60% of medical prescriptions hurtling towards a water crisis, treated
by doctors in India include supplements. wastewater is being widely used a
Indian API industry overview (Source: Invest India) sustainable and cost-effective solution.
The majority of APIs for generic drug Indian enzymes industry overview India generates almost 62,000 million
manufacturing across the globe are litres of sewage per day in urban areas, of
sourced from India, which also supplies The Indian enzymes market stood at which only 37% of is treated, indicating
approximately 30% of the generic APIs H2360 crores in FY 2018-19. The Indian a huge headroom of growth. Over the
used in the US. The Indian government manufacturers are not only supplying to last two decades, there has been a four-
also plans to finance the construction domestic market but are also exporting fold increase in untreated waste water
of three bulk drug parks through an to a number of countries. According disposal, with 80% of waste water from
investment of H3000 crores over the next to DGCI&S (Directorate General of human activities being discharged into
five years. In addition, the government Commercial Intelligence and Statistics) waterways without pollution removal and
would create a production-linked India exported worth H287 crores in FY per capital waste water generation being
incentive system for the promotion of 2018-19 and H78.57 crores in the first 121 litres per day. As a result, it has become
domestic manufacturing of critical drug quarter of FY 2019-20. The USA, Germany, imperative to introduce sewage treatment
intermediaries and APIs. Japan, China, Malaysia and Denmark were plants and proper waste management
the leading importers of Indian enzymes in
(Source: europeanphaarmaceuticalreview.com, FY 2018-19. systems.
the Print) (Source: India Today, Times of India)
Indian nutraceutical industry India’s enzymes market is divided into The Company’s overview
overview industrial and specialty enzymes. The
industrial segment is further categorised Incorporated in 1951, Fermenta Biotech
The Indian nutraceuticals market is into food & beverages, detergent, Limited has established a reputation in
expected to grow from USD 4 billion in animal feed, paper & pulp, textile and the areas of pharmaceuticals, enzyme
2017 to USD 18 billion in 2025, clocking others. The specialty enzymes segment technologies and environmental solutions.
a CAGR of 21% between 2018 and 2025. is categorised into pharmaceutical, Fermenta ‘thinks young’ and ‘moves with
Among the other factors, propelling the research & biotechnology, diagnostics and the times’ on the one hand and effortlessly
demand for nutraceuticals in India, one biocatalysts. Among the two, the specialty carries its decades of rich legacy on the
of the major factors is the fact that 15% enzymes segment has been dominating other. During the year under review, the
of the population is undernourished in the market over the past few years. Company has merged with its parent
the country, and the Government has

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