India’s healthcare industry is projected to strengthen over the next three years, driven by a wave of new drug launches and steady domestic demand, according to a report by Systematix Research.
Growth in India’s domestic medicines market — particularly through innovative therapies such as GLP‑1 drugs for chronic conditions — is expected to push expansion into the high single‑digit range through 2029, reinforcing optimism about the sector’s resilience and long‑term potential.
The report highlights that while the US generics segment — traditionally a major revenue driver for Indian pharmaceutical companies — is likely to see flat earnings due to persistent competitive pressures, opportunities are emerging elsewhere. Biosimilar drug introductions in the US and other regulated markets could create additional growth avenues, although translating these into meaningful profitability may hinge on pipeline strength and competitive dynamics.
Companies with larger footprints in branded and innovative portfolios are seen as being better positioned for future growth. Firms that invest in biosimilars with less crowded pipelines and maintain solid balance sheets are expected to remain more resilient amid evolving market conditions.
Recent quarterly performance data showed that India’s healthcare sector delivered better‑than‑expected results in the third quarter of the 2025‑26 financial year. Domestic sales continued to grow steadily, while the pace of revenue erosion in high‑value products in the US was slower than anticipated — boosting overall sector performance. Tailwinds from favourable currency movements also supported emerging market growth during the period.
Still, challenges remain, particularly in active pharmaceutical ingredient (API) pricing, which continued to experience pressure. Policymakers and industry stakeholders have noted that raw material costs remain a critical factor in maintaining competitive margins for manufacturers.
Government initiatives such as the Production Linked Incentive (PLI) schemes for pharmaceuticals and medical devices have also helped stimulate manufacturing activity and attract investment, further supporting the sector’s growth story. New plants and facilities under these schemes are expected to boost production capacity and enhance India’s role in global pharmaceutical supply chains.
Overall, while competitive pressures in certain export markets persist, steady domestic demand, new drug introductions, and expanding opportunities in biosimilars and innovation‑driven therapies are expected to underpin a healthier growth outlook for India’s healthcare sector over the next three years.
