Nandan Kulkarni, Director at Bernstein, has a message for investors still valuing Indian pharmaceutical companies purely on their US generics pipeline: that playbook is becoming obsolete. In a detailed conversation with ET Now, Kulkarni laid out why he believes Indian biopharma is at the beginning of a fundamental transformation — one that runs all the way to 2035 and remains significantly underpriced by the market.From generics factory to innovation powerhouseThe core of Kulkarni's thesis is a structural shift in what Indian pharma actually is. For decades, the sector was valued almost entirely on its ability to manufacture and export off-patent generic drugs to the United States. That model is not disappearing - but it is no longer the whole story.Indian biopharma companies are now hiring talent across chemistry, engineering, complex biotechnology, digital, and artificial intelligence. Capital allocation is shifting toward innovation -NDAs, 505(b)(2) filings, orphan drug designations, and specialty therapies. Kulkarni calls this the "innovation pyramid," and his argument is that as companies move up it, the earnings opportunity becomes substantially larger and more margin-accretive than the generics business ever was.Global regulatory frameworks are also moving in India's favour. Pathways around contract development and manufacturing organisations, speciality therapies, and orphan drug designations are opening meaningful new niches for Indian players - opportunities that did not exist at scale even five years ago.The assumption the Street is missingWhen asked to identify the single biggest blind spot in consensus thinking, Kulkarni was direct. The street continues to model Indian pharma as a chemistry and contract manufacturing story with some US generics exposure layered on top. What it is not adequately pricing in is the speed and depth of the innovation pivot, and the quality of talent being brought in to execute it.You Might Also Like:He argues that boardroom conversations across the sector have already shifted. The patent cliff discussions and generic opportunity assessments that dominated investor calls a decade ago are giving way to conversations about innovation pipelines, specialty positioning, and global partnerships. The earnings model has not yet caught up with that reality.GLP-1: A slow burn with a large payoffOne of Kulkarni's most closely watched calls involves GLP-1 drugs - the anti-obesity and diabetes medications that have reshaped global healthcare narratives. He projects insulin's market share dropping to around 50% by FY31 as GLP-1s offer patients better glycaemic control and weight management, effectively deferring the point at which insulin becomes necessary.For Indian companies, this is net positive. Insulin has historically been a lower gross-margin product. A shift toward GLP-1s and peptides moves the entire value chain upward. Indian biopharma companies are positioned on both sides - manufacturing off-patent GLP-1 products and building presence in next-generation formulations.Importantly, Kulkarni cautions that the adoption curve in India will look nothing like the rapid uptake seen in North American markets. Indian dietary habits, socioeconomic dynamics, and healthcare access patterns mean adoption will be slower initially, followed by a grassroots penetration phase before a meaningful second wave unlocks. The ecosystem around GLP-1s, nutrition, diagnostics, obesity management, and digital health, also has significant room to develop, creating opportunities well beyond the drug itself.You Might Also Like:China plus one: This time execution is actually happeningOn the China-plus-one supply chain diversification story, a narrative that has disappointed investors for three years, Kulkarni believes the current moment is genuinely different. The WuXi situation and escalating geopolitical tensions have moved the conversation from policy intent to active execution. Global innovators and policymakers are now structurally realigning supply chains, and India's depth in biopharma makes it a natural and necessary beneficiary.For long-term investors, his message is consistent: the sector has bottomed, the transformation is real, and the market is still catching up to what Indian biopharma is becoming.You Might Also Like: