Critique on Pharma Industry

The first Indian pharmaceutical company, Bengal Chemicals and Pharmaceutical Works, which still exists today as one of 5 government-owned drug manufacturers, appeared in Calcutta in 1930. For the next 60 years, most of the drugs in India were imported by multinationals either in fully-formulated or bulk form.

The government started to encourage the growth of drug manufacturing by Indian companies in the early 1960s, and with the Patents Act in 1970, enabled the industry to become what it is today. This patent act removed composition patents from food and drugs, and though it kept process patents, these were shortened to a period of five to seven years. The lack of patent protection made the Indian market undesirable to the multinational companies that had dominated the market, and while they streamed out, Indian companies started to take their places. They carved a niche in both the Indian and world markets with their expertise in reverse-engineering new processes for manufacturing drugs at low costs. Although some of the larger companies have taken baby steps towards drug innovation, the industry as a whole has been following this business model until the present.

MAJOR PLAYERS

RANBAXY LABORATORIES

(Ranbaxy Laboratories Limited is India's largest pharmaceutical company. Incorporated in 1961, Ranbaxy exports its products to 125 countries with ground operations in 46 and manufacturing facilities in seven countries. It is ranked among the top 10 generic companies worldwide. The CEO of the company is Malvinder Mohan Singh.

Ranbaxy went public in 1973.)

(Public Profile)

Ranbaxy Laboratories Limited, India's largest pharmaceutical company, is an integrated, research based, international pharmaceutical company, producing a wide range of quality, affordable generic medicines, trusted by healthcare professionals and patients across geographies. Ranked 8th amongst the global generic pharma companies, Ranbaxy today has a presence in 23 of the top 25 pharma markets of the world. The Company has a global footprint in 49 countries, world-class manufacturing facilities in 11 countries and serves customers in over 125 countries.

Earlier in June 2008, Ranbaxy entered into an alliance with one of the largest Japanese innovator companies, Daiichi Sankyo Company Ltd., to create an innovator and generic pharmaceutical powerhouse. The transformational deal will place Ranbaxy in a higher growth trajectory. The ranking of the combined entity will be catapulted to the No. 15th position in the global pharmaceutical space and it will emerge stronger in terms of its global reach and in its capabilities in drug development and manufacturing.

DR. REDDY'S LABORATORIES

(Dr. Reddy’s Laboratories Ltd. trading as Dr. Reddy's, founded in 1984 by Dr. K. Anji Reddy, has become India’s second biggest pharmaceutical company. Dr. Anji Reddy had worked in the publicly-owned Indian Drugs and Pharmaceuticals Ltd. Reddy's manufactures and markets a wide range of pharmaceuticals in India and overseas. The company has more than 190 medications ready for patients to take, 60 active pharmaceutical ingredients for drug manufacture, diagnostic kits, critical care and biotechnology products.

Dr. Reddy’s began as a supplier to Indian drug manufacturers, but it soon started exporting to other less-regulated markets – that had the advantage of not having to spend time and money on a manufacturing plant that that would gain approval from a drug licensing body such as the US’s Food and Drug Administration. Much of Reddy’s early success came in those unregulated markets, where process patents – not product patents – are recognized. With that money in the bank, the company could reverse-engineer patented drugs from more developed countries and sell them royalty-free in India and Russia. By the early 1990s, the expanded scale and profitability from these unregulated markets enabled the company to begin focusing on getting approval from drug regulators for their formulations and bulk drug manufacturing plants in more-developed economies. This allowed their movement into regulated markets such as the US and Europe.

By 2007, Dr. Reddy’s had six FDA-plants producing active pharmaceutical ingredients in India and seven FDA-inspected and ISO 9001 (quality) and ISO 14001 (environmental management) certified plants making patient-ready medications – five of them in India and two in the UK.

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At Dr. Reddy's we aim at providing affordable and innovative medicines for healthier lives. We serve society’s important needs for affordable medicines through the API component of PSAI and the Global Generics business, and for innovative products that solve unmet medical needs through the CPS component of PSAI and the Proprietary Products Businesses.

Headquartered in India, we are a global pharmaceutical company with a presence in more than 100 countries. We have wholly-owned subsidiaries in the US, UK, Russia, Germany and Brazil; joint ventures in China, South Africa and Australia; representative offices in 16 countries; and third-party distribution set ups in 21 countries. Dr. Reddy’s is the first pharmaceutical company in Asia outside of Japan to be listed on the NYSE.

Our strong portfolio of businesses, geographies and products gives us an edge in an increasingly competitive global market and allows us to provide affordable medication to people across the world, regardless of geographic and socio-economic barriers.

NICHOLAS PIRAMAL

(Nicholas Piramal India Limited (Nicholas Piramal India Limited (NPIL) is India's second largest Pharmaceutical Healthcare company with a presence in the cardio-vascular segment, the antibiotics and respiratory segments, pain management, neuro-psychiatry and anti-diabetics segments and biotechnology.

NPIL came into existence in 1988 when it acquired Nicholas Laboratories from Sara Lee and in the last 15 years grown primarily on acquisitions, mergers and alliances. Some of NPIL's acquisitions include the Indian operations of Roche Products Ltd., Boehringer Mannheim India Ltd., Hoechst Marrion Roussel Ltd,'s Research Centre, Rhone Poulenc India Ltd., ICI India Ltd.'s Pharma Division and Aventis' Research facilities.

NPIL has joint ventures and alliances with F. Hoffmann-La Roche Ltd., Switzerland; Allergan Inc., USA; UK; Gilead Sciences, USA; Cheissi, Italy; and IVAX Corp; UK.)

(Public Profile)

Nicholas Piramal India Limited is one of India's largest companies with an unmatched record of managing JVs/Alliances/Partnerships, and a proven commitment to IPR. With strong brand management and sales capabilities, a US FDA site-approved plant for on-and-off patent APIs and Intermediates, Basic Research, Process Innovation, Custom Chemical Synthesis, Formulations R&D, NDDS, and a world-class, accredited Clinical Research Organisation, NPIL is poised to emerge as India's pharma powerhouse.

With growth fuelled through a strategy of partnerships, quality acquisitions, brand building, focused selling and manufacturing, NPIL's consolidated net sales turnover was US$ 313 million (INR 14.1 billion) in 2005-06 (April to March)".

CIPLA

(Cipla, Founded 1935, originally founded as The Chemical, Industrial & Pharmaceutical Laboratories is a prominent Indian pharmaceutical company, best-known outside its home country for producing low-cost anti-AIDS drugs for HIV-positive patients in developing countries. Cipla makes drugs to treat cardiovascular disease, arthritis, diabetes, weight control, depression and many other health conditions, and its products are distributed in more than 180 countries worldwide. Among the hundreds of generic medications it produces for international distribution are atorvastatin, amlodipine, fluoxetine, venlafaxine hydrochloride and metformin.)

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Cipla is born

In 1935, he set up The Chemical, Industrial & Pharmaceutical Laboratories, which came to be popularly known as Cipla. He gave the company all his patent and proprietary formulas for several drugs and medicines, without charging any royalty. On August 17, 1935, Cipla was registered as a public limited company with an authorised capital of Rs 6 lakhs.

The search for suitable premises ended at 289, Bellasis Road (the present corporate office) where a small bungalow with a few rooms was taken on lease for 20 years for Rs 350 a month.

Cipla was officially opened on September 22, 1937 when the first products were ready for the market. The Sunday Standard wrote: "The birth of Cipla which was launched into the world by Dr K A Hamied will be a red letter day in the annals of Bombay Industries. The first city in India can now boast of a concern, which will supersede all existing firms in the magnitude of its operations. India has lagged behind in the march of science but she is now awakening from her lethargy. The new company has mapped out an ambitious programme and with intelligent direction and skillful production bids fair to establish a great reputation in the East. "

BIOCON

(Biocon is India's leading biotechnology enterprise. Established in 1978, the company today is an integrated biotechnology enterprise focused on the development of biopharmaceuticals. The company serves partners and customers in over 50 countries. Within the biotechnology space, the company ranks first in Asia in terms of revenues and market capitalisation and sixteenth globally.

The company is headed by Kiran Mazumdar-Shaw. Biocon went for an IPO in 2004. Biocon became only the second Indian company to cross a market capitalization of one billion U.S. $ on the first day of listing. Mazumdar-Shaw and her husband John Shaw own over 60% of the company's stock)

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Biocon’s fully integrated business model spans the entire drug value chain, from pre-clinical discovery to clinical development and through to commercialization. Our businesses in custom research (Syngene), clinical development (Clinigene) and biopharmaceuticals (Biocon) provide multiple revenue streams to balance risk, drive innovation, deliver products and accelerate growth. As we increase the complexity and scope of our own R&D and manufacturing operations, especially in new product discovery and development, we believe our custom and clinical research services will continue to offer important synergies.

Syngene : Pre-Clinical Discovery

Clinigene : Clinical Development

Biocon : Commercialisation

SERUM INSTITUTE OF INDIA

(Serum Institute of India founded by Cyrus Poonawalla and his brother Zavary in 1966, is a manufacturer of immunobiologicals including vaccines in India. The company is managed by the Poonawalla group- fully owned by Cyrus Poonawalla. The company is the fifth biggest vaccinemaker by volume, the top four being GlaxoSmithKline, Sanofi-Aventis, Merck and Novartis. Half the children in the world are immunized by vaccines made by the company, which is the world's biggest maker of measles and DTP vaccines. Serum produces a billion doses a year selling in 140 countries. It is one of the world's lowest cost producers of vaccines.)

(Public Profile)

Serum Institute of India Ltd. has established it's self as the world's largest producer of Measles and DTP group of vaccines. It is estimated that two out of every three children immunized in the world is vaccinated by a vaccine manufactured by Serum Institute. In fact, our range of products have been used in 140 countries across the globe.

Serum Institute of India was founded in 1966 with the aim of manufacturing life-saving immuno-biologicals, which were in shortage in the country and imported at high prices. Thereafter, several life-saving biologicals were manufactured at prices affordable to the common man and in abundance, with the result that the country was made self-sufficient for Tetanus Anti-toxin and Anti-snake Venom serum, followed by DTP (Diphtheria, Tetanus and Pertussis) group of Vaccines and then later on MMR (Measles, Mumps and Rubella) group of vaccines.

INTAS BIOPHARMACEUTICALS

(Intas Biopharmaceuticals Ltd. is an Indian biotechnology company headquartered in Ahmedabad, India. Located in the Moraiya, it is one of the leading biosimilar product manufacturer in Asia.

As an independent biopharmaceutical company of the Intas Group, the company has fully integrated biopharmaceutical operations with R&D facility and an EU-GMP certified bio-pharmaceutical manufacturing facility.

Intas Biopharma is also actively pursuing the Contract Research and Manufacturing Services (CRAMS) line of business. To expand its CRAMS business, Intas Biopharmaceuticals Ltd., in June 2008, acquired a US biotechnology corporation, Biologics Process Development Incorporated (BPD), based in Poway, California)

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Intas Biopharmaceuticals Limited (IBPL) is a fully integrated biopharmaceutical company based out of Ahmedabad, Gujarat. Since launch of biotechnology operations in May 2000, Research & Development (R&D) and Manufacturing of Biopharmaceutical products with a special focus on Oncology (Cancer) are the major thrust areas for the company.

Intas Biopharmaceuticals is India’s first and only biopharmaceuticals company to receive European Union - Good Manufacturing Practice (EU-GMP) certification for its manufacturing facility.

Intas Biopharma has carved a niche in the biopharmaceutical arena for its world class Quality Standards, with the facility complying strictly with International Good Manufacturing Practices and guidelines laid down by the World Health Organization (WHO).

Products are under registration in more than 78 countries. Locally, the company has strategic tie-ups to penetrate the highly competitive Indian market. Intas Biopharma has entered into several supply and marketing agreements with reputed international companies in regulated and semi-regulated markets of Europe, Asia-Pacific, Middle East, Russia & CIS, South and Central America and Africa.

BHARAT SERUMS

(Since inception in 1971, BSV has worked ceaselessly to research, develop, manufacture and market specialized biological, pharmaceutical and biotechnology products.

Today, BSV is one of the fast growing Indian bio-pharmaceutical companies. The product portfolio comprises of a wide range of products such as plasma derivatives, monoclonals, hormones, equine antitoxins and serums, antifungals, anaesthetics, cardiovascular and diagnostic products.

BSV is managed by an experianced Board of Directors, who are assisted by a team of dedicated and qualified professionals drawn from various disciplines. The management team comprises of qualified doctors, professionals and postgraduates having rich experience and expertise in their respective fields. )

(Public Profile)

Bharat Serums And Vaccines Limited (BSV) was incorporated to pursue an ambitious goal of introducing specialized healthcare products to meet the needs of a quality conscious market.

The Company manufactures and markets biological, pharmaceutical and biotechnology products. Today, BSV holds a formidable market share in India for plasma derivatives and is constantly expanding its range of products by introducing new and improved therapies based on strong research and development initiatives and efforts.

BSV has also sharpened its focus on R&D by continuous allocation of resources and manpower. The Company is introducing niche life saving injectibles, substantially improving the safety and efficacy of existing therapy.

LUPIN LABORATORIES

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Lupin Limited, headquartered in Mumbai, India has successfully positioned itself as a Transnational Pharmaceutical Company, with a wide global footprint. The Company develops and markets a wide range of quality, affordable generic and branded formulations and APIs in multiple markets across the world.

The Company has gained recognition as the world’s largest manufacturer of Tuberculosis drugs. Over the years, the Company has moved up the value chain and has not only mastered the business of certain intermediates and APIs, but has also leveraged its strengths to build a formidable formulations business. It has a significant presence in Cephalosporins, Cardiovasculars (prils and statins), Diabetology, Asthama and NSAIDs therapy segments.

During 2007, Lupin fast tracked its growth trajectory through two acquisitions. While the acquisition of Kyowa positioned the Company amongst the top ten generic pharma Companies in Japan; another acquisition in India provided it a springboard to leap ahead in the CRAMS space.

ORCHID PHARMACEUTICALS

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first year of operations (1994-95)

Orchid Chemicals & Pharmaceuticals Ltd (Orchid) was established in 1992 as a 100% Export Oriented Unit (EOU). Commencing operations in 1994, Orchid has achieved amazing and consistent growth, quantitatively and qualitatively to emerge among the Top-15 companies in the Indian pharmaceutical industry in a short span of fourteen years of operations.

Orchid has two manufacturing sites for APIs (at Alathur near Chennai and at Aurangabad, near Mumbai) and three manufacturing sites for Dosage forms (at Irungattukottai and Alathur in Chennai), besides two R&D centres (at Sholinganallur and Irungattukottai, Chennai). Orchid’s facilities are state-of-the-art and have several international regulatory approvals, including the US FDA and UK MHRA. Orchid’s API facilities are ISO certified for their quality, environmental management and operational health and safety systems. Orchid has a Joint Venture in China for manufacturing sterile APIs.

Orchid’s scientific and technical strengths have made it a partner of choice for several multinational corporations. Orchid has long-term exclusive marketing alliances with reputed global companies such as Apotex, Actavis, Dava and Hospira for distribution of Orchid’s products in the advanced markets of US and Europe.

PANACEA BIOTECH

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1984 Panacea Drug (P) Ltd. was formed

Panacea Biotec is India’s highly progressive research based health management company involved in research, manufacturing and marketing of branded pharmaceutical formulations, vaccines and natural products. The product portfolio includes highly innovative prescription products in important therapeutic areas like pain management, diabetes & cardiovascular management, renal disease management, osteoporosis management, anti-tubercular, gastro-intestinal care products and vaccines. The flagship brands of the company- Willgo for pain management; Glizid & Glizid-M for diabetes; Panimun Bioral & Mycept for kidney transplant occupy leadership positions in their therapeutic segments. This is in persuit of marketing strategies to build brands and drive the growth of the company.

The vaccines portfolio consists of oral polio vaccines (type I and type III), Enivac-HB (Hepatitis B vaccine), Enivac-HB Safsy, Ecovac-4 (DTwP+Hep B), Easyfour (DTwP+Hib), Easyfive (DTwP+Hep B+Hib). Vaccines in the offing are- Anthrax, Dengue, Japanese encephalitis and several others. Panacea Biotec has earned the distinction of being a WHO pre-qualified supplier of oral polio and Hepatitis-B vaccines and are in the process of obtaining similar pre-qualifications for other vaccines. Panacea Biotec is contributing in disease prevention and reducing the child mortality.

SUN PHARMACEUTICALS

(Established in 1983, Sun Pharma was a start-up company with five products. Since 1996, Sun has grown largely through a combination of internal growth, and acquisition of other pharmaceutical companies. For example, it bought US-based Caraco Pharm Labs, and ICN Hungary.

Sun Pharmaceutical (or Sun Pharmaceutical Industries Limited) is an international pharmaceutical company based in Mumbai, India. It makes many generic and brand name drugs that are distributed in the United States, Europe, Asia and worldwide. Sun manufactures both pharmaceuticals and active pharmaceutical ingredients (API), in essence, ingredients to be used in finished pharmaceutical products. Its products are in several therapeutic areas, including psychiatry, neurology, cardiology, diabetology, gastroenterology, respiratory, and orthopedics.)

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Sun Pharma came into existence as a startup with just 5 products in 1983. We are now an international speciality pharma company with over 7000 people, 17 manufacturing locations (including three in the US and one in Hungary), two research centers and a presence in 30 countries. We are one of the leading pharma companies in India, a rank that we've now been at for more than 5 years. (IMS-ORG Stockist Audit, August 2007).

TORRENT PHARMACEUTICALS

(Torrent Pharmaceuticals Ltd. Founded 1959, is the flagship company of the Torrent Group. Based in Ahmedabad, it was promoted by U. N. Mehta initially as Trinity Laboratories Ltd. and was later renamed to its current name Torrent Pharmaceuticals Ltd.

Torrent Pharmaceuticals operates in more than 50 countries with over 1000 product registrations globally. Moreover, it has 5 fully owned subsidiares:

Torrent do Brasila in Brazil

Torrent Pharma Gmbh in Germany

Torrent Pharma Ltd. in the Philippines

Zao Torrent in Russia

Torrent Pharma Inc. in USA

Torrent Pharmaceuticals acquired Heumann Gmbh, a Pfizer group company in 2005.)

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Enterprising individual, Shri. U N Mehta, when he ventured on his own to create history in the Indian pharmaceutical industry by implementing successfully the concept of niche marketing. His journey, characterized by ups and downs, reached a milestone in 1970, with the launch of Trinicalm Plus, an effective tranquilizer in the niche segment, central nervous system (CNS).

The foundations for Torrent were laid when 'Trinity Laboratories' began operations under the able guidance of Shri Mehta whose efforts are worthy of emulation.

'Trinity' was renamed 'Torrent' and with this not only did the company get a new name, it also focused on establishing its own manufacturing facilities in the early 80s. Torrent augmented its efforts with the expansion of its manufacturing capacity, emphasis on marketing and creating business opportunities through focus on exports. Torrent Pharmaceuticals Limited recorded a quantum leap in the year 1994. It has also been rated India's ninth best company among capital intensive companies in terms of ROCE in a study by ETIG-BCG in 2001.

WOCKHARDT

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Mr. Habil Khorakiwala, the Chairman of Wockhardt Limited, founded the company in the early 1960s

Wockhardt today, is distinguished by a strong and growing presence in the world’s leading markets, with more than 65% of its revenue coming from Europe and the United States. Wockhardt’s market presence covers formulations, biopharmaceuticals, nutrition products, vaccines and active pharmaceutical ingredients (APIs).

The Company has its headquarters in India, and has

14 manufacturing plants in India, UK, Ireland, France and US

Subsidiaries in US, UK, Ireland and France

Marketing offices in Africa, Russia, Central and South East Asia.

Wockhardt has a strong track record in acquisition management, with five successful acquisitions in the European market. These acquisitions have strengthened Wockhardt’s position in the high-potential markets of Europe, and have expanded the global reach of the organization.

Aiding Wockhardt's globalization plans are its fourteen world-class manufacturing plants in India, France, UK, Ireland and US. In addition to this are the dedicated complex (comprising six facilities) at its Biotech Park, and its state-of-the-art research laboratories.

CADILA HEALTHCARE

(Cadila Healthcare Founded 1954, is an Indian pharmaceutical company headquartered at Ahmedabad in Gujarat state of western India. The company is the fifth largest pharmaceutical company in India, with US$290m in turnover in 2004. It is a significant manufacturer of generic drugs.

Cadila Laboratories was founded in 1952 by Shri Ramanbhai Patel (1925-2001), formerly a lecturer in the L.M. College of Pharmacy, and his business partner Shri Indravadan Modi. The company evolved over the next four decades into one of India's established pharmaceutical companies.

In 1995 the Patel and Modi families split, with the Modi family's share being moved into a new company called Cadila Pharmaceuticals Ltd. and Cadila Healthcare became the Patel family's holding company. Cadila Healthcare did its IPO on the Bombay Stock Exchange in 2000.

In 2001 the company acquired another Indian pharmaceutical company called German Remedies. On June 25, 2007, the company signed an agreement to acquire 100 per cent stake in Brazils Quimica e Farmaceutica Nikkho do Brasil Ltda (Nikkho) for around 26 million dollars)

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From nine pharmaceutical production operations in India as well as a major R&D operation Zydus Cadila develops and manufactures a large range of pharmaceuticals as well as diagnostics, herbal products, skin care products and other OTC products. The company also makes Sugar Free, India's most popular artificial sweetener, and Nutralite, India's most popular cholesterol-free margarine.

Very few know this but still, pharma industry over the years has not only grown but has taken itself to greater heights of drug discovery and health care products. Up coming industry has played a major roll in Indian economy and also is been recognized by the government, for the same new revisions and policy makers has not only rewarded with special economic zone, tax free zone, and new module of research and development sector, but also has given equal importance to the small and medium scale industry to flourish together.

Article By:

Piyush Tripathi
Cell: +91-9824663306