Healthcare innovation in India is set to undergo significant growth, with expectations to double to $60 billion by FY28, according to a recent report by Bain & Company and HealthQuad. The overall healthcare market in India, valued at $180 billion in FY23, is projected to expand at a compound annual growth rate (CAGR) of 12 percent, reaching $320 billion by the same period.

Currently, healthcare innovation contributes around 15 percent ($30 billion) to the overall healthcare market in India, with a majority of it being export-driven. Aarthi Rao, partner at Bain & Company, anticipates substantial expansion, emphasizing that this growth will stem not only from value-engineering but also from business innovation, particularly in sectors such as biotech, vaccines, and med-tech.

Over the past three years, healthcare innovation has nearly doubled from a baseline of $17 billion in FY20. The sector comprises four key segments, including pharma services (such as CDMO and CRO), pharma IT, medtech, and healthtech.

Charles-Antoine Jannsen, managing partner of HealthQuad, highlighted India’s evolving role in healthcare innovation, citing the country’s emergence as a major player in vaccine production during the pandemic. This shift has propelled India’s capabilities in biological manufacturing and research, positioning it as a key contributor to global healthcare.

The Indian vaccines and biotech market, valued at $4 billion in FY23, has witnessed rapid growth, with exports driving a significant portion of revenue. Biotech startups are exploring advanced technologies to develop innovative products, including cell and gene therapy, protein biologics, and gene editing.

Healthtech has experienced remarkable growth since 2020, with the market doubling from $3 billion in FY20 to $7 billion in FY23. Telemedicine, e-pharmacy, and wellness solutions have seen accelerated adoption, fueled by the impact of the COVID-19 pandemic.

Pharma services remain a dominant segment, accounting for around 50 percent of the healthcare innovation market. India’s pharma services market, valued at approximately $16 billion in FY23, has seen steady growth, driven by factors such as US FDA-approved manufacturing plants and a skilled workforce.

Overall, India’s healthcare innovation landscape is evolving rapidly, presenting significant opportunities for growth and transformation across various sectors.

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