India’s Pharmaceutical Exports: Upcoming Challenges Ahead

India’s pharmaceutical industry faces scrutiny over quality control issues, with stricter US FDA inspections planned. Several companies, including Orchid Pharma and Glenmark, have faced recalls due to safety concerns.

Key View

• India’s domestic pharmaceutical industry will remain under increased scrutiny due to persistent quality control issues across domestic manufacturers.
• Regulators will face challenges implementing stricter controls across the pharmaceutical manufacturing sector.
• While India’s generic drugmakers face tariff risks, India-based companies will continue to dominate new generic drug approvals.

India’s domestic pharmaceutical industry will remain under increased scrutiny due to persistent quality control issues across domestic manufacturers. On May 6 2025, the US FDA announced plans to increase unannounced inspections at foreign manufacturing facilities producing medical products for the US market. This initiative aims to ensure compliance with strict quality standards and regulatory requirements, moving away from the previous model of scheduled inspections. FDA inspectors will now conduct surprise visits to overseas factories, including those in India, to enhance oversight of global drug production. This change addresses rising concerns about product quality and safety in international supply chains. For example, in February 2025, India-based Orchid Pharma received seven observations after an unexpected US FDA inspection at its active pharmaceutical ingredient (API) facility. In March 2025, India-based Glenmark Pharmaceuticals recalled bottles of a generic ADHD medication in the US due to impurities. More recently, in July 2025, drug samples from India-based I Heal Pharmaceuticals and Quixotic Pharma were found substandard following US FDA inspections. Moreover, between February and April 2025, drugs manufactured by India-based Sun Pharmaceuticals and Zydus Lifesciences were recalled due to impurity and dissolution problems, and Dr. Reddy’s products were recalled because of incorrect labelling instructions.

India’s pharmaceutical industry is a global powerhouse, supplying a significant share of generic medicines worldwide. However, the sector is encountering increasing challenges that could hinder its growth. Factors such as stringent regulatory scrutiny in international markets, particularly from the U.S. Food and Drug Administration (FDA), pose a significant barrier. Companies must navigate complex compliance requirements, which can be both time-consuming and costly, potentially affecting their global competitiveness.

Additionally, rising production costs, driven by fluctuations in raw material prices and reliance on imports, are straining profit margins. The recent disruptions in supply chains, exacerbated by geopolitical tensions and the ongoing impact of the COVID-19 pandemic, further complicate the landscape. As a result, Indian pharmaceutical manufacturers are under pressure to innovate while maintaining quality, a delicate balance that could be challenging to achieve amid these pressures.

Moreover, increasing competition from emerging markets and the evolving landscape of intellectual property rights add further complications. To sustain their position, Indian pharmaceutical companies must invest in research and development, explore new markets, and strengthen supply chain resilience. The future remains uncertain, but proactive measures are crucial to overcoming these hurdles and ensuring continued success in the global arena.

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