Health insurance Industry in India leading the growth for Indian pharma
September 30, 2013: Indian pharma market is expected to break into the top 10 markets in the world in value with the total sales reaching US$ 26 billion by 2016, as per a recent report by IMS Health. It is interesting to note here that the surge is expected to be fuelled by the rise in health insurance in India. Market experts are expecting over 13-14 per cent annual growth in the health insurance market.
Factors like the increasing government funding, rising standards of care and overall boom in the opportunities for access to necessary treatment are expected to play a critical role in shaping a dynamic and sophisticated marketplace for healthcare in the Indian market. The pharma market in India is currently worth Rs 74,117 crore (US$ 12.35 billion) for the 12-month period ended May 2013 and is currently ranked on the 13th position, up from the 15th spot with sales of US$ 6 billion.
It may be noted here that the 2016 growth projection comes as an encouraging sign especially because the value erosion that is expected to take place because of the expanded price controls. In fact, the World Bank has projected a growth of covering at least 50 per cent of Indian population by 2015. Undoubtedly, health insurance is one of the most important areas in the rapidly growing healthcare market in India.
With initiatives like Rashtriya Swasthya Bima Yojana (RSBY) among others, the government has been trying to improve the healthcare scenario in the country. For the uninitiated, RSBY is a health insurance scheme for below poverty line families launched by the government of India. In fact, this policy is expected to hold a significant share in ensuring sustainable healthcare in the changing healthcare equation in the country.
As per the IMS Health data, health insurance business premiums are expected to reach Rs 30,000 crore by 2015, registering an increase of 302 per cent from 2011. It is encouraging to note here that health insurance coverage grew about 445 per cent between 2004 and 2011 in India.
The wide opportunity created by the rise in the health insurance market is expected to be a welcome sign for both Indian and international drug companies. At the same time, this is expected to improve the healthcare scenario in the country as well.