Indian drugmakers seek govt tax reliefs, incentives to spur innovation

Indian drug manufacturers urged to focus on innovative drugs to maintain global pharmacy reputation, seeking government support in upcoming budget.

India's pharmaceutical companies are hoping for tax incentives and financial assistance for research on innovative drugs as Prime Minister Narendra Modi's government readies a federal finance budget likely to be presented in July.

The upcoming budget would be Mr. Modi's first major policy announcement in his third term as Prime Minister.

Indian drug manufacturers must focus on developing complex drugs beyond the usual generic variety if the country is to continue being renown for being the 'pharmacy of the world' for its affordable medicines, experts say.

"If the Indian government can give some income tax exemptions for 5-10 years for any new molecule developed in India...that can pull innovation to grassroot level...companies will start investing in innovation," Bharat Biotech's Chairman Krishna Ella told Reuters on the sidelines of an event in Hyderabad on Friday.

Bharat Biotech developed India's first indigenous COVID-19 vaccine, Covaxin.

India, whose pharmaceutical market is expected to be valued at $130 billion by the end of the decade, is the world's third largest manufacturer of drugs by volume after the United States and China and is a hub of generic drug manufacturers.

Generic drugs are cheaper versions of brand-name drugs.