From Unichem chief PA Mody, who was following news coming out of the UK, to Swati Piramal, who is in London watching the uncertainty unfold over the region following the referendum to leave the European Union – Brexit was on the mind of many pharma industry heads as well.

Both Unichem and Piramal Enterprises have a base in the UK, in terms of a fully-owned subsidiary and manufacturing facilities, respectively. And so do several other drug companies including Glenmark, Wockhardt, Ipca, Torrent Pharma, Aurobindo, Marksons, even beleaguered Elder Pharma.

In fact, when it comes to the European Union, the number of big guns of the Indian pharma industry selling into the region becomes that much larger, including Dr Reddy’s, Cipla, Serum, Sun Pharma and so on.

The Brexit decision does not majorly impact drug companies selling into Europe as several companies sell directly into the different EU countries, explains Mody. In fact, says Piramal, the impact will be minimal since companies have globalised operations.

Key market

The Pharmaceuticals Export Promotion Council of India (Pharmexcil) Director General PV Appaji points out that the UK hovers between the second and third places for Indian drug exports. The outright leader is the US, with South Africa giving the UK a run for its money.

According to Pharmexcil data, the country’s exports to the US stood at ₹26,345 crore for the year ended March 2015, followed by the UK at ₹3,320 crore and South Africa at ₹3,126 crore.

And in the EU, Germany is a key market for many companies, he said, adding that the UK and other markets followed. Industry-hands point out that the UK offers the lowest pharma prices in the region, and so a good part of the exports go to the other countries besides the UK.

Echoing the minimal impact observation of industry players, Centrum Broking’s Ranjit Kapadia points out that the impact would be up to four per cent of revenues of the companies with an exposure to the UK.

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