Time for India's drug makers to move up the value chain'

@ DIDIER BONNET, PROFESSOR OF STRATEGY & DIGITAL TRANSFORMATION, IMD BUSINESS SCHOOL

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As aleading global supplier of generics drugs and vaccines, India has built a strong competitiveness by producing affordable, high-quality medicines at scale. But the sector is now entering anew phase of transition that will require sustained investments in R&D and skillsets to move up the value chain.

Professor of strategy and digital transformation at Switzerland-based IMD Business School Didier Bonnet spoke to Manu Kaushik at the CII India Edge 2025 about the challenges for the industry, use of AI, and the row over data exclusivity provisions. Excerpts.

How can Indian drug companies move up the value chain?

This could be via a combination of two strategies. One is how can Indian companies capture even more of the generics markets from their production advantage built over several years. But the industry does not want to stay there because otherwise India will become the back-office production centre.

Moving up the value chain means getting into advanced drugs, different types of drugs and specialty applications. Some companies actually have two different streams of products — low-cost brands and new drugs. lot of pharma companies have developed a dual model of sorts over a period of time. It might sound nice on paper, but running a low-cost and high-end business in the same structure is very hard.