AstraZeneca will continue to invest in India

Despite facing some hurdles in India, Pharamaceutical giant AstraZeneca says it will continue to invest in the country.

The India arm of British-Swedish multinational with a revenue of $25.7 billion has come under the lens of SEBI for violation of regulations on fraudulent and unfair trade practices. The regulator has mandated both BSE and NSE to monitor the delisting process of the company. In an emailed response, AstraZeneca's London-based spokesperson said: “We confirm that at every stage of the offer for sale and delisting processes, AstraZeneca has complied with the relevant SEBI regulations.”

Apart from catching the regulator's glare, AstraZeneca has been slashing its workforce and in January this year, the company closed its Avishkar research and development location, citing broader global business strategy to simplify its research and development footprint and focus resources on three core therapy areas –oncology, cardiovascular and metabolic diseases—and respiratory, inflammation and autoimmunity.

While all this may indicate a reduced focus on India, the company still believes India is an important market. “We are engaged in manufacturing, sales and marketing and are employing around 1,200 people (in India),” the spokesperson added.

Market-watchers, however, say the company has whittled down its India focus considerably since the last couple of years. “If you look at it, some of the other pharmaceutical companies have been ramping up their India development centres in the past couple of years,” said a senior vice-president of an Indian pharmaceutical company, who did not want to be named.

He pointed to Sigma Aldrich, which had hired around 200 employees in 2012 and 2013 for its shared services centre in Bangalore. Similarly, Life Technologies, which has been acquired by Thermo Fisher Scientific, earlier this month opened a new centre to help customers, scientists and others to come and use its facility for doing research in the field of genomics and other areas.

Part of the problem faced by AstraZeneca and many others are increased competition from generic drugs as some of the world’s most successful medicines come off patent.

Chairman Leif Johansson has admitted that in the 2013 annual report. Pricing issues in developed markets, rise in R&D costs are a huge cause of concern.

However, he added the world pharmaceutical market is still growing and underlying demographic trends remain favourable to long-term industry growth.