West’s Reliance on Drug Supply from China May Lead to More Sourcing in India

So many Western drug companies source drug products, drug substances, excipients, and drug packaging from China. Many have speculated given the tensions between the world’s two major superpowers – the US and China – this may be a dangerous situation. The COVID outbreak in China has also hurt drug supply chains, the ability of Western drug manufacturers to audit Chinese drug suppliers, etc.

Friend shoring is the notion of moving supply chains to countries where political relationships are better. In contrast to China, India is a friendly country to the US with its own large pharmaceutical market and many drug suppliers. Indian companies already have manufacturing capabilities for APIs, excipients, packaging materials, and finished drug products. However, while the Indian pharmaceutical industry is getting more sophisticated, there are still bottlenecks like India’s dependence on China for specific drug ingredients, poor Indian drug regulatory management, etc.