How To Start Pharmaceutical Company?

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India is recognized as the pharmacy of the world and ranks 3rd in terms of pharmaceutical production by volume and 14th by value. India is the largest provider of generic drugs globally accounting for 20% of the worldwide supply. The pharmaceutical market in India was valued at USD 42 billion in 2020 and is expected to reach USD 130 billion by 2030. The low cost of production, huge domestic market, and supportive government policies have provided an ideal environment for entrepreneurs to start a pharmaceutical company in India. The pharma industry in India has more than 10,500 pharmaceutical manufacturing companies and supplies over 50% of global demand for various vaccines, 40% of generic demand in the US, and 25% of all medicine in the UK. Read on this blog to know how to start a pharmaceutical company.


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Advantages of Starting a Pharmaceutical Company in India

  • Low cost of production due to affordable raw materials, machinery, and skilled workers.
  • The availability of bank loans and subsidies has made it easy to start a pharmaceutical company in India.
  • Medicine spending in India is expected to grow by more than 12% by 2027, making India become one of the top 10 medicine spending countries. Hence there will be a surge in demand for pharmaceuticals.
  • The department of pharmaceuticals initiated a PLI scheme to promote domestic pharmaceutical manufacturing with an outlay of INR 6,940 from FY21 to FY30.
  • Demand for Indian pharmaceutical products across the globe has provided a plethora of opportunities.
  • Thrust on rural health programs, lifesaving drugs, and preventive vaccines by the Indian government will further increase the demand for pharmaceuticals.
  • The Union cabinet has allowed 100% Foreign Direct Investment under the automatic route for manufacturing of medical devices providing a big boost to the pharma sector.
  • In June 2021, the central government has announced an additional outlay of Rs. 197,000 crore that will be used over 5 years for the pharmaceutical PLI scheme.
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Structure of Pharma Sector in India

how to start pharmaceutical comopany structure

Steps To Start Pharmaceutical Company

1) Product Identification :

how to start pharma product


It is extremely important to identify suitable products according to raw material availability, budget, and location. There are a wide variety of products and segments you can choose from. Additionally, you can also explore homoeopathy, Unani, ayurvedic, and allopathy medicines. It is advisable to get guidance from an industry expert to choose the product to start a manufacturing industry

2) Market Research :

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The market research gives an overview of the market size, market trends, opportunities, challenges, competition severity, market gaps, etc. It assists in making crucial decisions and hence it reduces investment risks. Market research also helps in identifying the target audience. There are 2 different types of market research: primary and secondary. Both these researches play a vital role in identifying untapped business opportunities.

3) Registrations and Licenses :

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It requires various licenses and registrations to start a pharmaceutical company. Here are some of the important licenses required:

  • Drug License Number
  • No Objection Certificate
  • GST registration
  • Trade Mark Registration
  • Clearance from Drug Controller General Of India
  • MSME registration

4) Machinery and Raw Materials Procurement :

To start a pharmaceutical company, from the production of drugs to packaging requires various machinery such as:

  • Capsuling equipment to fill and polish capsules.
  • Coating machines to coat capsules.
  • Cooling towers
  • Filling equipment
  • Tablet compressing machines
  • Air compressors
  • Packaging machines

5) Production :

how to start pharma production


After formulation and product development, it is essential to develop a prototype to confirm the product’s functionality before production. After prototyping, the first production run has to be carried out to ensure the manufacturing process is optimal and no defect is present in the product. Proper training should be provided to laborers working in the pharma manufacturing company to avoid errors and to increase efficiency. SolutionBuggy has more than 550 pharma consultants and helps in optimizing the manufacturing process and reducing the cost of production.

6) Marketing :

how to start pharma marketing strategy


The rise of e-commerce platforms and B2B marketing has completely revolutionized the way of marketing for manufacturing industries. Some of the pharma industries still relying on the same old marketing strategies are struggling to grab the attention of clients. Hence it is extremely important to connect with marketing consultants to grow the industry at a rapid pace. Pharma consultants in SolutionBuggy offer concrete marketing strategies to increase sales and boost revenue.

Export Opportunities For Pharmaceutical Companies

India exported pharmaceutical products worth USD 24.5 billion in FY21 and the country’s pharma sector contributes more than 6.5% to the total merchandise exports. Indian drugs are exported to more than 200 countries and the United States is the largest market followed by Canada and Mexico. India received Foreign Direct Investment worth USD 20 billion between April 2000-December 2021. India is recognized as the 12th largest exporter of medical goods globally. 


how to start pharma exports

Government Policies For Entrepreneurs To Start Pharmaceutical Company In India

To achieve self-reliance Indian government has announced the Production Linked Incentive (PLI) scheme with an outlay of INR 6,940 from FY21 to FY30.

  • To encourage entrepreneurs to start a pharmaceutical company, the approval time to start a new manufacturing unit has been reduced significantly. No objection certificate required to export will be issued in 2 weeks compared to 12 weeks earlier.
  • To boost pharmaceuticals production locally, The Government of India is setting up mega bulk drug parks. The Punjab government has announced 3 pharma parks at Bathinda, Rajpura, and Wazirabad.
  • To make India a major hub for end-to-end discovery, the Department of Pharmaceuticals has announced Pharma Vision 2020.
  • The National Biopharma mission was launched in 2017 to boost the production of biopharmaceuticals in India.
  • National pharmaceuticals policy aims at providing a long-term stable policy environment and making India self-sufficient in end-to-end domestic drug manufacturing.
  • Pharmaceutical Technology Upgradation Assistance Scheme (PTUAS) has been facilitated to SMEs to upgrade their plant and machinery to enable them to compete on a global level.
  • The pharmaceutical Promotion & Development Scheme (PPDS) scheme aims at the promotion, development and export promotion in the pharma industry by providing financial assistance to conduct seminars, exhibitions, and mounting delegations to and from India for the promotion of exports as well as investments.
  • The government has allotted INR 1,900 crore for research and development in the pharma sector.
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Investment Required To Start Pharmaceutical Company

The investment required to start a pharmaceutical company depends on several factors such as the product you want to manufacture, drug type, production capacity, formulations used, level of automation in the manufacturing unit, and location. A small pharmaceutical company requires a minimum investment of INR 90 lakhs (Excluding land and infrastructure cost).

Are You Looking To Start Pharmaceutical Company

If you are interested to start a pharmaceutical company, register in SolutionBuggy and get all the services ranging from product selection to complete industry setup. SolutionBuggy being India’s leading consulting platform in the pharma industry, has more than 550 pharmaceutical consultants and has successfully completed 270 projects across India. Our pharma consultants having more than 20 years of industry experience handhold you in every step in starting a pharmaceutical company.

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