Drug discovery hotspots: India’s Genome Valley


Could India become an important centre of drug discovery innovation? Diana Spencer explores the evolution of the Hyderabad life sciences hub.

India is traditionally known as ‘the pharmacy of the world’ due to its huge pharmaceuticals manufacturing capacity and high quantity of exports, particularly generic medicines and vaccines.

Thanks to a new focus on R&D, increasing digitalisation and government investment, India is establishing itself as a significant player in drug discovery, and the Hyderabad life sciences hub has played a significant role in this.

It is emerging markets like India that analysts expect to spearhead the global growth of the pharmaceutical sector1.

The pharmacy of the world

In the global pharmaceuticals market, India ranks third worldwide for production by volume. Historically, this has been predominantly driven by generic drugs, with branded generics making up 70-80% of the retail market. However, the role of modern drug discovery technologies and novel treatment approaches is expected to grow over the next few years.

India’s domestic pharmaceutical market is expected to reach US$120-130 billion by 20302. Globally, India is the world’s largest supplier of generic medications, accounting for 20% of the worldwide supply by volume and supplying about 60% of the global vaccination demand.

In recent years, India has secured a position among the top 12 biotech destinations in the world, ranking third in the Asia-Pacific region3. Although pharmaceutical companies had previously been risk-averse and investment in R&D was lower than other countries, leading organisations are looking to increase research spending to 10-12% over the next few years, with biologics and novel chemical entities dominating4.

This has been partly inspired by stricter patent laws, but also the Covid-19 pandemic, which has brought the importance of medical innovation and pharmaceutical independence to the fore.

In 2021, a DDW article stated: “There is work to be done. It is clear that a collaborative approach between government, academia and industry, and recognising that investment is key, will help forge a successful path to success for this sector.”

Since then, Finance Minister Nirmala Sitharaman announced an additional outlay of Rs 197,000 crore (US$ 26,578.3 million) that will be utilised over five years for the pharmaceutical PLI scheme in 13 key sectors such as active pharmaceutical ingredients, drug intermediaries and key starting materials.

Following this announcement, the foreign direct investment (FDI) inflows in the Indian drugs and pharmaceuticals sector reached US$ 1,414 million between in FY 2021 and 2022.

Genome Valley

Another driving factor has been the creation and investment in Genome Valley in Hyderabad, India’s first structured hub for life sciences R&D, which has established Hyderabad as the country’s major life sciences cluster, ranking above Chennai and Bengaluru.

The hub offers industrial/knowledge parks, special economic zones (SEZs), multi-tenanted dry and wet laboratories, and incubation facilities, attracting national and international companies. It is home to more than 200 enterprises, including well-known global brands such as Novartis, GlaxoSmithKline, Ferring Pharma, Chemo, DuPont, Ashland, United States Pharmacopeia, and Lonza. These include India’s three largest vaccine manufacturers – Bharat Biotech, Biological E, and Indian Immunologicals5 – as well as some of the top ranked private biotech firms in the country, including Dr Reddy’s Laboratories and Shantha Biotechnics.

Industry Minister Sri KT Rama Rao comments: “Our contribution to pharmaceuticals is highest in the country and share in Indian exports also among the highest. Hyderabad is recognised as the vaccine hub of India. Industry has grown tremendously in the last five years with timely policy interventions, infrastructure development and thrust on education and training. In recent years, we have seen investments in R&D, medical device manufacturers, biologicals and other segments of the industry. Our vision is to be a USD 100 Billion Life Sciences economy in Telangana in next 10 years.”6

New projects and investment

In October 2022, an expansion to Genome Valley and five new projects were announced, including the Bio-Pharma Hub (B-Hub), which will support small and medium sized biopharma companies in conducting proof-of-concept studies.

Another new project was a process development facility for Yapan Bio. Commenting on the facility, Nandini Piramal, Chairperson of Piramal Pharma, said: “With this investment, the Yapan team can conduct a larger number of projects than before, resulting in the development and delivery of more novel products for clinical evaluation and ultimately, better, and faster treatments for patients.”

Contract research development and manufacturing organisation Aragen has also recently invested in Hyderabad, with the founding of a new manufacturing facility on the Mallapur campus. The company hopes the new space will enhance its new chemical entity (NCE) early-stage development offerings.

In January 2023, Eurofins Scientific announced the establishment of a laboratory campus in Genome Valley. The campus will support large global and Indian pharmaceutical clients as well as small biotech companies in the areas of synthetic organic chemistry, analytical R&D, bioanalytical services (for both large and small molecules), in-vivo pharmacology, safety toxicology and formulation R&D.

A second life sciences hub for the city is currently in development, expected to open in 2023. Hyderabad Pharma City is set to be the world’s largest pharmaceuticals cluster, with the aim of improving global health security through affordable and innovative products. It is expected to attract investment worth $9.7 billion and generate employment for 560,000 people7.

Covid-19 vaccines

Vaccines continue to play a significant role in Indian pharmaceutical exports. Genome Valley provides an estimated one-third of children’s vaccines globally. According to GlobalData, of the 40 marketed Covid-19 vaccines, Serum Institute of India’s (SII) Covishield and Bharat Biotech’s Covaxin have gained widespread use.

The analysts argue that a universal vaccine is sorely needed in countries like India. Dr Pavan Sunkireddy, Pharma Analyst at GlobalData, comments: “India has spent about $2.3 billion (INR 196.75 billion) until December 2020 to procure different Covid-19 vaccines. In addition, the government has allotted $4.09 billion (INR 350 billion) in 2021-2022 union budget for Covid-19 vaccination, a number which will continue to grow with the need for additional boosters in the future. Thus, investing in a universal Covid-19 vaccine could prove better for public health as well as more cost-effective for the government in the long-term.”

The Coalition for Epidemic Preparedness Innovations (CEPI) has partnered with Hyderabad-based Bharat Biotech, University of Sydney and ExcellGene to develop a ‘variantproof’ Covid-19 vaccine. CEPI is backing the consortium with $19.3 million to establish preclinical and clinical proof of concept.

With significant public and private investment in drug discovery and development in Hyderabad and across India, this will certainly be one market to watch over the next few years.


  1. https://www.mckinsey.com/~/media/mckinsey/dotcom/client_service/Pharma%20and%20Medical%20Products/PMP%20NEW/PDFs/778886_India_Pharma_2020_Propelling_Access_and_Acceptance_Realising_True_Potential.ashx
  2. https://www.ibef.org/industry/pharmaceutical-india
  3. https://www.ibef.org/blogs/life-sciences-and-genome-valley-promising-investment-destination
  4. https://www.businesstoday.in/industry/pharma/story/indian-pharma-firms-look-to-ramp-up-investments-in-rd-innovation-324194-2022-02-28
  5. https://sites.google.com/site/wealthprojects/genomevally-biotechhubofindia
  6. https://lifesciences.telangana.gov.in/wp-content/uploads/2020/12/Telangana-Indias-Youngest-State-Life-Sciences-Hub-A-report-from-KPMG.pdf
  7. https://www.thehindubusinessline.com/news/national/hyderabad-pharma-city-is-in-the-final-leg-of-planning-to-be-launched-soon/article66056983.ece

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