Cipla: Legends & Legacies
Even as the political and regulatory challenges have made the otherwise recession-resistant pharmaceutical industry concerned about severe value erosion, there are certain players that still hold their heads high. Cipla, led by the legendary Y.K. Hameid did see a topsy- turvy year in the stockmarkets. But when it comes to reputation, the generic player continues to be right up there. The company, which made India proud in the global generic market with its bold stand against the Big Pharma monopoly, ranked in the top 20 of BW Businessworld’s Most Respected Companies survey 2017, and topped the pharma sector.
Cipla’s long history of supplying quality generic drugs and its stellar reputation as a strong competitor to costly global brands, despite several market challenges, has been the most important element that made it to the top of the list.
“For over eight decades, Cipla’s ethos of ‘Caring for Life’ has been firmly entrenched in everything we do,” says Cipla’s global CFO Kedar Upadhye. India’s fourth largest drug maker, which always fought against unjustified market monopolies by MNC giants and boldly launched cheaper generic drugs breaking such monopolies, could also make inroads in global markets. The company that had revenue of Rs 14,630 crore in FY17, is now making strides in the international markets by increasing its manufacturing as well as marketing capabilities there.
Pharma markets across the globe are witnessing regulatory interventions on multiple fronts. These developments require pharma companies to strategise their efforts around drug development, manufacturing and sales and marketing. Cipla, however, treats this scenario of fast changing generic market dynamics and the new policy and regulatory environment positively. “We believe the future for us is promising both in the domestic and international markets.” Upadhye adds. The scenario is not different in India too. “But, in the domestic business, we are evaluating our portfolio gaps within and across therapies, getting into strategic partnerships with MNCs and working towards various therapy-shaping initiatives.” These initiatives along with focus on sales force effectiveness will drive growth in the domestic business.
In the US, Cipla has successfully integrated the operations of Invagen and Exelan within their global operations. “With limited competition launches in the future, we believe our US business is poised for growth,” says the company CFO. The recently initiated global expansion and strategic collaborations have helped Cipla improve operational efficiency and offset the trend of value erosion in the generic market significantly. “Despite value erosion, generics across the globe still remain a significant opportunity for us,” says Upadhye.
Over the years, Cipla has expanded presence through acquisitions and partnerships in the US, South Africa and various territories within emerging markets. “We have tried to leverage our portfolio across regions while launching key market specific products. Also, we have been able to drive synergies across our global locations by integrating operations of these acquired entities seamlessly. In the US, as pricing pressure increases in the generics business, it will be important for pharma companies to continue investing in innovation and focus on developing complex and high-barrier-to-entry/limited competition products to drive both topline and bottomline, he adds.
