Trends of Third-Party Manufacturing in India

The pharmaceutical industry in India has been witnessing a transformative shift towards third-party manufacturing in recent years. This article delves into the trends shaping this phenomenon and provides a comparison between different types of pharmaceutical products in terms of their prevalence in the market.


What is Third-Party Manufacturing

Third-party manufacturing, also referred to as contract manufacturing, is a strategic arrangement where pharmaceutical companies outsource the production of drugs and other pharmaceutical products to specialized manufacturers. This model allows companies to focus on research, development, marketing, and distribution, while leveraging the manufacturing capabilities and expertise of third-party facilities.


  1. Expansive Growth: India has emerged as a global hub for third-party manufacturing, owing to its robust infrastructure, skilled workforce, and cost-effective production capabilities. The industry has experienced expansive growth driven by the increasing demand for generic drugs and the outsourcing trend among pharmaceutical companies worldwide.
  2. Diverse Product Portfolio: Third-party manufacturers in India cater to a diverse range of pharmaceutical products, including tablets, capsules, injectables, syrups, ointments, and more. This diverse portfolio enables pharmaceutical companies to outsource the production of various formulations based on market demand and specific requirements.
  3. Focus on Quality Assurance: Third-party manufacturers in India adhere to stringent quality standards such as Good Manufacturing Practices (GMP) and ISO certifications to ensure the production of high-quality pharmaceutical products. The emphasis on quality assurance has solidified India’s reputation as a reliable destination for pharmaceutical manufacturing.
  4. Technological Advancements: The adoption of advanced technologies and manufacturing processes has revolutionized third-party manufacturing in India. Automation, digitization, and continuous process improvements have enhanced efficiency, scalability, and product quality, enabling faster time-to-market for pharmaceutical products.
  5. Strategic Partnerships: Pharmaceutical companies, both domestic and international, are increasingly entering into strategic partnerships with third-party manufacturers to optimize costs, mitigate risks, and expand their product portfolio. These collaborations enable companies to leverage the expertise, infrastructure, and economies of scale offered by third-party manufacturers while focusing on core competencies.


Comparison Between Different Types of Pharma Products (Percentage Distribution)

Type of Pharmaceutical Product Percentage Distribution
Tablets 40%
Capsules 25%
Injectables 15%
Syrups 10%
Ointments 5%
Others 5%
  • Tablets: Tablets manufacturing constitute the largest percentage of pharmaceutical products manufactured in India, accounting for 40% of the market share. They are widely used due to their convenience, ease of administration, and varied formulations.
  • Capsules: Capsules manufacturing  follow closely behind, comprising 25% of the market share. They offer flexibility in formulation and are preferred for encapsulating both liquid and solid medications.
  • Injectables: Injectable pharmaceuticals hold a significant share of 15% in the market. They are essential for delivering medications directly into the bloodstream and are used in various therapeutic areas.
  • Syrups: Syrups account for 10% of the market share and are commonly used for pediatric and geriatric populations or for patients who have difficulty swallowing tablets or capsules.
  • Ointments: Ointments represent 5% of the market share and are primarily used for topical application, offering localized treatment for skin conditions and wounds.
  • Others: The remaining 5% includes a diverse range of pharmaceutical products such as powders, suspensions, creams, and gels.


The trends of third-party manufacturing in India underscore the industry’s evolution and its pivotal role in meeting global healthcare needs. With a diverse product portfolio, stringent quality standards, and technological advancements, India’s pharmaceutical sector continues to drive growth, innovation, and accessibility in drug manufacturing. As pharmaceutical companies explore strategic collaborations and navigate market dynamics, understanding the distribution of different types of pharmaceutical products enables informed decision-making and sustainable business expansion in a competitive landscape.

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