6 min readFeb 21, 2026 01:54 PM IST
First published on: Feb 21, 2026 at 07:05 AM IST
The title of the Sahitya Akademi Award-winning novel Deewar Mein Ek Khirki Rehti Thi (A Window Lived in the Wall) describes India’s pharmaceutical industry. It makes 60 per cent of the world’s medicines, saved patients over $2 trillion just in the last decade, operates more than a third of USFDA-authorised factories, and sells in 200-plus countries. Global mortality in AIDS and TB wouldn’t have crashed by 85 per cent without Cipla’s antiretrovirals and Lupin’s Rifampicin. This is not trade, it’s life support. But this success, impossible without policymaking — India’s Patents Act and America’s Hatch-Waxman Act — demonstrates the possibilities when entrepreneurial policy partners with entrepreneurs.
Dexterity by governments on opposite sides of the planet had the same motivations 14 years apart: Affordability and availability. In India in the 1960s, medicines cost more than in Europe, and Western pharma was neglecting infectious diseases. In America in the 1980s, prices for off-patent drugs did not decline without a clear path for generic competition. The Indian Patents Act of 1970 replaced product patents with process patents for 35 years. The Hatch-Waxman Act of 1984 formalised an abbreviated approval process and six-month exclusivity for the first successful applicant of a generic molecule.
The result was remarkable. America’s generic share of dispensed prescriptions rose from 1 per cent to 90 per cent today; the launch price of $2.62 per pill of the heart medication Crestor 20 years ago is now down by 90 per cent. The forthcoming generic versions of the breakthrough drug semaglutide (a weight-loss medication) will soon reduce current prices by a similar amount. US President Donald Trump can negotiate lower drug prices for public procurement without worrying about potential supply disruptions. And India’s domestic consumption of medicines now equals its exports.
The industry’s entrepreneurial success defies the vilification of entrepreneurs under the licence raj — PM Jawaharlal Nehru once told J R D Tata he hated the word profit — that was an unfair and incomplete view of the world. It weakened India by treating entrepreneurs as adversaries; it handicapped our labour without capital and our capital without labour. The philosopher Arthur Schopenhauer distinguished between talent and genius: Talent hits a target that no one else can hit; genius hits a target that no one else can see. The entrepreneurial policymakers behind India’s pharma success — Justice Rajagopala Ayyangar, Parliamentarian Jaisukhlal Hathi and many others — saw what nobody else did. But their vision would have been unfulfilled without entrepreneurs like Yusuf Hamied (Cipla), Anji Reddy (Dr Reddy’s), Parvinder Singh (Ranbaxy), Dilip Shanghvi (Sun), Ramanbhai Patel (Zydus-Cadila), and Desh Bandhu Gupta (Lupin) who matter more to India than their companies’ revenues, exports or profits because they have raised India’s soft and hard power, demolished the myth that multinationals possessed unfair advantages over Indian companies (there is only one MNC in the top 10 by domestic market sales, from nine in 1947), and ended pessimism about India’s ability to export quality goods (400 billion of the 800 billion pills consumed by Americans last year were made in India).
The challenge for India’s pharma industry is shifting from volume (producing 60 per cent of the world’s medicines) to value (accounting for only 6 per cent of the world’s medicine sales). Reaching the $350-billion target in pharma exports by 2047 requires taking advantage of five opportunities — generics, biologics, innovation, domestic market microstructure and contract manufacturing/research. And dealing with five challenges — science/research ecosystem, risk ecosystem, ease of doing business, China, and trade barriers. These point to the contours and possibilities of Indian pharma-policy partnership version 2.0: Increased investment in science, reduced regulatory burdens, and more freedom for universities.
India’s trade negotiation difficulties with the US remind us that the world order is changing. The only solution is to make ourselves stronger. China’s leverage in trade stems from substantial switching costs associated with moving away from the world’s factory. But it also arises from accounting for a third of new drugs licensed thanks to its lead in fast-follower drugs, which depend on massive investments in science, research and human capital. This allows the accelerated development of a similar drug with efficacy or a better side-effect profile. This does not differ from what China has done in batteries, solar panels, electric vehicles and AI (DeepSeek). It is no coincidence that Trump has fully exempted India’s pharma exports and most of China’s from punitive tariffs. This exemption reminds us that India’s geopolitical and military power is downstream of its economic and technological power.
I never want to live in China, but its strong choreography among education, policymakers, multinational companies, and domestic entrepreneurs has delivered geopolitical leverage. This accounts for its success in transitioning 400 million people from farm to non-farm employment (our share of agriculture is an embarrassing 45 per cent of our labour force). India’s per-capita income is now 20 per cent of China’s — it was the same in 1990 — mainly because of weaker teamwork. Adding mass prosperity (higher per-capita GDP) to mass democracy requires building on complementary strengths, not gloating about others’ weakness (government’s execution deficit or private sector’s trust deficit).
Every government struggles with reducing the gap between thinking and doing. India’s pharma industry found a structural solution. Chemistry professors and researchers founded Cipla, Alembic, Lupin, and Dr Reddy’s. Pharma’s global success demonstrates the possibilities of a state that partners with entrepreneurs. Entitled political dynasts peddle a dated distrust of business because they can’t comprehend abundance. Thankfully, recent policy and budget moves in trust-based decriminalisation, deregulation and digitisation recognise the power of entrepreneurship. They must accelerate.
The writer is an entrepreneur and co-author of the book Made in India
