India is aiming to shift its pharmaceutical narrative — and the Centre’s recent decision to extend the deadline for its ₹5,000 crore R&D scheme underscores just how seriously it’s betting on this transformation.
A Generics Giant with Innovation Ambitions
For decades, India has been known as the “pharmacy of the world,” thanks to its dominance in low-cost generic drugs. But generics alone won’t keep the country competitive in the long run. At present, India contributes only about 3.4% of the global pharmaceutical market.
To change that, the government designed the Promotion of Research & Innovation in Pharma & MedTech (PRIP) scheme — a bold ₹5,000 crore endeavour to move away from mass manufacturing and towards high-value, innovation-led growth.
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What Exactly Is This Scheme About?
The PRIP scheme has two main components:
- Research Infrastructure Build-up:
- ₹700 crore is dedicated to establishing Centres of Excellence across seven branches of the National Institute of Pharmaceutical Education & Research (NIPER).
- These centres aim to foster deeper industry–academia links, encourage high-quality research, and build a talent pipeline that can drive long-term innovation.
- Direct R&D Grants:
- ₹4,200+ crore is earmarked for supporting companies — from nimble startups to large pharma firms — working on cutting-edge projects.
- Based on project size and risk stage, the scheme offers varying support: early-stage startups may get up to ₹5 crore, with no co-funding required for projects under ₹1 crore.
mint - Larger, more mature projects can receive grants up to ₹100 crore, though capped at around 35% of total project
- For strategic priority innovations—think orphan drugs, antimicrobial resistance, or niche medical devices—the support can go as high as 50% of project cost.
Why the Deadline Extension Matters
Originally, the application window for PRIP was closing soon. But the Centre recently extended the deadline to 10 November. Here’s the why behind that move:
- Promoting Inclusivity: The extension gives more time for a wider range of stakeholders — startups, MSMEs, multinational companies — to apply, ensuring broad participation.
- Technical Bottlenecks: Some applicants were caught in procedural delays like entity-locker registration and fee payment via the government portal (Bharatkosh). The extra time helps address these roadblocks.
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The Strategic Stakes: Why This Scheme Could Be a Game-Changer
- Closing the R&D Gap
In developed countries, big pharma often spends 15–20% of its revenue on R&D. In contrast, top Indian drug companies invested just 7.2% of their turnover into R&D in FY 2020–21. That’s a huge imbalance — and PRIP is designed to fix it. - Targeted Innovation
The scheme focuses on six priority areas: new chemical/biological entities, complex generics and biosimilars, medical devices, stem-cell therapies, orphan drugs, and antimicrobial resistance. These aren’t just commercially promising—they also align with public health priorities. - Risk-Sharing Model
By offering grants that co-fund part of the project cost, the government lowers the barrier for risky or early-stage innovation. This shared-risk model is crucial to encouraging bold R&D that Indian companies might otherwise shy away from. - Scaling Up India’s Global Footprint
With the right push, India could expand its pharma market share to 4–5% globally, translating to somewhere between $130–160 billion. That’s not just growth; it’s a statement of global ambition.
Challenges to Watch
- Absorbing Capacity: It’s one thing to allocate ₹5,000 crore; it’s another to ensure that companies and institutions are ready to absorb and utilize it effectively.
- Commercial Viability: High-risk research may yield big rewards, but also big failures—there’s no guarantee every supported project will translate into market success.
- Sustained Commitment: The scheme’s long-term success depends on consistent follow-through, not just the initial funding window.
The Bigger Picture
This extension isn’t just bureaucratic tinkering — it’s a signal. By giving more time, the government is demonstrating its commitment to inclusion, quality, and long-term innovation. More importantly, it’s putting its money where its ambitions are: transforming India from a generics powerhouse into the “laboratory of the world.”
If PRIP succeeds, India won’t just be making the world’s medicines — it may soon be creating them.
