How Much Does it Cost to Start a Pharmaceutical Company in India?

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An investment made with knowledge pays the best interest. Indeed, you must know how much money is required when you plan to start a pharmaceutical company in India.

The business scenario becomes more and more dynamic with every passing day. Hence, one should know about different aspect beforehand.

Money is the vital factor when you launch a pharmaceutical company in India. How can you calculate the investment required?

Experts say that seasoned financial planners can do it accurately. Despite how accurately financial planning is done, it is recommended to keep some money reserved for contingencies.

Certification and licensing

A pharma company is supposed to have a list of licenses and approvals from various authorities. Out of these, some are one-time and some recurring.

  • To acquire drug license number and company registration you need 15000 to 20000 rupees. The cost of drug license number varies from state to state.
  • FSSAI registration is a recurring cost. Though a marginal one (100 rupees annually), it is a compulsory cost.
  • Trade Mark costs are 5000 rupees approximately.
  • You need to obtain Tax Identification Number or TIN if you do not have. It costs around 5K.

Operating expenses

Operating expenses are recurring expenses that you must incur regardless of you earn a single rupee or not.

It is the biggest challenge to keep the operating expenses under control.

  • Salaries of human resources working full-time or part-time in the organization. It includes the cost of outsourced resources as well.
  • Rent on premises, warehouses, call-centers and so on.
  • Production cost if you own the manufacturing unit.
  • Electricity bill.
  • Cost of the third-party manufacturer if any.
  • Cost of the auditor if any.
  • Tax liabilities.
  • Marketing and promotional expenses.

These are some of the vital cost heads. The cost in absolute terms depends on the size of the business, nature of products manufactured, raw material costs and so on.

Before you decide to launch the pharma company; make a comparative analysis of how feasible it would be in the given context.

If the products manufactured by you are not readily available in the local market, then it is a high probability of you earning big profits.

A stable business plan is mandatory for a stable business. To get the best returns, one should keep the costs under control.

It is possible by outsourcing business processes to experts, hiring third-party manufacturers, and following business efficiency measures.

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