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India's Healthcare Sector to See Strong Growth on New Drug Launches: Report

A new report from Systematix Research forecasts stronger growth for India's domestic healthcare sector over the next three years, primarily fueled by new drug launches like GLP-1 medications. In contrast, earnings from the competitive US generics market are expected to remain flat for most pharmaceutical companies. The report highlights biosimilar drug launches as a potential growth avenue in the US, though profitability is uncertain due to market competition. Overall, the sector's long-term outlook is supported by steady domestic demand and emerging opportunities, despite ongoing pressures on raw material costs.

Key Points: India Healthcare Growth to Strengthen on New Drug Launches

  • Domestic growth to strengthen on GLP-1 drug launches
  • US generics earnings to remain flat for most firms
  • Biosimilar launches offer new US opportunities
  • Companies with innovative portfolios better positioned
2 min read

India healthcare sector growth to strengthen over next 3 years on new drug launches: Systematix Report

Report projects stronger growth for India's domestic pharma market over next 3 years, driven by new drug launches, while US generics face flat earnings.

"Over the next 3 years, we expect India branded formulation growth to strengthen on back of GLP-1 launches (high single digit). - Systematix Report"

New Delhi, February 23

The domestic healthcare sector is expected to see stronger growth over the next three years, supported by new drug launches, while earnings from the US generics business are likely to remain flat for most companies, according to a report by Systematix Research.

The report stated that growth in India's domestic medicines market is expected to strengthen on the back of GLP-1 drug launches, with growth projected in the high single-digit range over the next three years.

This is expected to support the overall expansion of Indian pharmaceutical companies, especially those with a strong presence in the domestic market.

It stated. "Over the next 3 years, we expect India branded formulation growth to strengthen on back of GLP-1 launches (high single digit)."

However, the outlook for the US generics segment remains cautious. The report noted that earnings contribution from the US generics space will at best remain flat for most companies, reflecting continued competitive pressures in the market.

At the same time, biosimilar drug launches are expected to create additional growth opportunities for Indian companies in the US. However, the report highlighted that whether these opportunities translate into meaningful profitability remains uncertain due to competitive challenges.

The report stated that companies with larger exposure to branded and innovative drug portfolios are better positioned for future growth. It added that companies making targeted investments in biosimilars with less crowded pipelines and maintaining strong balance sheets are likely to remain more resilient.

The report further noted that the Indian healthcare sector delivered better-than-expected performance in the third quarter of the financial year 2025-26, though the overall trend remained in line with expectations.

During the quarter, US sales positively surprised as the pace of erosion in high-value products was lower than anticipated. Domestic growth in India was also slightly better compared to the previous quarters, indicating steady demand in the local market.

In addition, emerging markets' growth was supported by strong currency-led tailwinds, which helped improve overall performance during the quarter.

However, prices of active pharmaceutical ingredients (API), which are key raw materials used in drug manufacturing, continued to remain under pressure.

Overall, the report highlighted that while challenges remain in the US generics segment, new drug launches, steady domestic growth, and emerging opportunities in biosimilars are expected to support the long-term outlook of India's healthcare sector.

- ANI

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Reader Comments

R
Rohit P
Good to see domestic growth is steady. But the flat outlook for US generics is a bit worrying. So many Indian companies rely on that market. They really need to focus on innovation and branded drugs, not just being the world's pharmacy for cheap copies.
A
Aditya G
The focus on biosimilars is the right path forward. The US generics game is a race to the bottom on price. If our companies can master complex biologics, that's where real value lies. Need more R&D investment!
S
Sarah B
As someone who follows healthcare stocks, this report is quite balanced. The caution on US generics is valid, but the domestic story looks robust. Companies like Sun Pharma and Cipla with strong Indian brands should do well. Time to review my portfolio!
M
Meera T
All this talk of growth is fine, but will it make my father's diabetes medicines cheaper? That's what matters on the ground. Reports often don't reflect the patient's reality. Hope the companies remember their social responsibility too.
V
Vikram M
The pressure on API prices is a key point. It's the backbone of our industry. If raw material costs are unstable, how can final drug prices be stable for us? Government should also focus on strengthening the API manufacturing ecosystem.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

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