Cancer drug pharmaceutical companies play a crucial role in developing innovative therapies to combat the rising incidence of cancer globally. As India faces a significant increase in cancer cases, experts predict it may become the “cancer capital of the world.” Factors such as lifestyle changes, environmental pollution, and genetic predisposition contribute to this alarming trend.
In response, Indian pharma companies are ramping up research and development efforts to produce affordable and effective cancer treatments. By focusing on targeted therapies and generics, these companies aim to make life-saving medications accessible to a larger population, addressing the growing cancer burden in the country.
Government Order
The government has requested that companies lower the cost of three anti-cancer medications so that consumers can benefit from the exemption from customs duties and the reduction in GST. The National Pharmaceutical Pricing Authority (NPPA) has issued an office memorandum instructing the concerned manufacturers to lower the MRP on three anti-cancer medications, Durvalumab, Osimertinib, and Trastuzumab, in keeping with the government’s pledge to guarantee the availability of medications at reasonable costs.
The Ministry of Chemicals and Fertilizers said in a statement that this is following the announcement made in the Union Budget for the year 2024–25 exempting these three anti-cancer medications from customs duty. The Department of Revenue, Ministry of Finance, issued a notification dated July 23, this year reducing the customs duty to nil on the three drugs. Companies that might be impacted are as follows
1. Beta Drugs Ltd
Beta Drugs Ltd focuses on developing high-quality oncology and specialty pharmaceuticals. With a current market price of ₹1,950, its market capitalization stands at ₹1,875 crore. Over the past five years, Beta Drugs has achieved impressive growth, with sales increasing by 35% and profit growing at the same rate. The company emphasizes research and development, creating innovative therapies that cater to the evolving needs of cancer patients.
Its commitment to affordability and accessibility positions it as a vital player in the Indian pharmaceutical landscape. However, the recent government mandate to cut cancer drug prices may challenge its profit margins, compelling Beta Drugs to adapt its strategies while continuing to meet patient needs.
2. AstraZeneca Pharma India Ltd
AstraZeneca Pharma India Ltd is a key player in the pharmaceutical industry, specializing in innovative medicines across various therapeutic areas. Currently, its shares trade at ₹7,333, with a market capitalization of ₹18,332 crore. AstraZeneca has demonstrated steady growth, with sales increasing by 12% and profit by 22% over the last five years.
The company focuses on research-driven solutions, particularly in the oncology, cardiovascular, and respiratory sectors. Its commitment to advancing healthcare and improving patient outcomes makes it a significant contributor to India’s healthcare landscape. However, the government’s mandate to reduce cancer drug prices may impact AstraZeneca’s revenue and profit margins, requiring strategic adjustments to remain competitive.
Also read…
3. Shilpa Medicare
Shilpa Medicare is a prominent player in the generic pharmaceutical sector, particularly in oncology. With a current market price of ₹433, its market capitalization is ₹7,524 crore. Over the past five years, Shilpa Medicare has achieved a sales growth of 10% and a profit growth of 15%.
The company focuses on developing high-quality, affordable medicines, and enhancing patient access to essential treatments. Shilpa’s robust pipeline and strategic partnerships drive its commitment to innovation, ensuring it remains competitive in the global pharmaceutical market. Nevertheless, the recent price-cut mandate may pose challenges to Shilpa’s profit margins, necessitating strategic planning to sustain its growth trajectory while maintaining affordability for patients.
Conclusion
In conclusion, the government’s mandate to cut cancer drug prices will present significant challenges for pharma companies. While these companies have demonstrated impressive growth and commitment to innovation, the reduction in pricing may squeeze profit margins and necessitate strategic adjustments. Each company must navigate this evolving landscape carefully, balancing the need for affordability with the financial viability of developing high-quality, effective cancer treatments to meet the increasing demand in India.
Written By: DIpangshu Kundu
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
Start Your Stock Market Journey Today!
Want to learn Stock Market trading and Investing? Make sure to check out exclusive Stock Market courses by FinGrad, the learning initiative by Trade Brains. You can enroll in FREE courses and webinars available on FinGrad today and get ahead in your trading career. Join now!!
