India's CDMO Sector: Poised for Explosive Growth Amid Global Supply Chain Shifts
Prakruti life science
Prakruti Life Science is a well established and recognized name in pharmaceutical industry in India.
One sector that has been growing at a fast pace in India is the CDMO manufacturing sector, i.e., contract development and manufacturing.
It is a very important part of the pharmaceutical supply chain.
In simple terms, international companies are outsourcing research and manufacturing to Indian CDMO pharma companies.
Here is where it gets interesting:
One major positive trigger for CDMO companies recently is the U.S. Biosecure Act, passed in September 2024.
The U.S. Biosecure Act aims to shift supply chains away from China, presenting a huge opportunity for India's pharmaceutical industry.
The act proposes to ban Chinese biotech companies from operating in the U.S., which is expected to benefit top CDMO companies in India.
Veteran investor Madhusudan Kela recently stated that the “CDMO sector in India could grow fivefold in the next decade.”
Due to geopolitical tensions between the U.S. and China, a significant amount of contract manufacturing previously allocated to China is now likely to shift further toward India.
India has recently become an attractive destination for CDMO pharma companies, thanks to its low manufacturing costs, foreign direct investments, and government incentives like the PLI scheme.
Some of the top CDMO companies in India leading in this space include Divi’s Labs, Prakruti Life Science, Piramal Pharma, Laurus Labs, Syngene, and Suven Pharma.
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1moA good news indeed. HR 8333 - Biosecure Act passed but senators left the legislation out of a pivotal defence budget bill. The China Plus One approach may propel many startups as well as Big Pharmas to consider India as a possible alternative.