We will reach Rs 1,000-crore sales in a year-and-a-half |
Pallavi Ail | Updated: May 13 2014, 05:50 IST |
SUMMARY Sixty-seven-year-old Indoco Remedies re-invented itself almost a decade ago to take advantage of a pharmaceutical market on the cusp of massive growth. |
Sixty-seven-year-old Indoco Remedies re-invented itself almost a decade ago to take advantage of a pharmaceutical market on the cusp of massive growth. It reaped the benefits soon, with revenues jumping from R243.43 crore in FY06 to nearly R630.8 crore in FY13. Managing director Aditi Kare Panandikar took charge of the R1,279-crore Mumbai-based company about four years ago, having spent 21 years in its various departments. In an interview with Pallavi Ail, she discussed the impact of the amended National List of Essential Medicines (NLEM), the USFDA’s action against Indian firms and Indoco's future plans. Excerpts Indoco Remedies caught investors’ attention in FY14, with the stock jumping 131%. What caused this surge? How did the amended NLEM impact
your revenues? Traditionally, we have never had more than 11-13% of products under NLEM — with the latest amendment, it might have expanded a couple of percentage points. We are not overdependent on a single brand — 80% of our domestic revenues come from top 20 brands. Long ago we had a cefadroxil brand. The year it came under DPCO, sales were adversely impacted as it was the second-largest brand. Since then, there has been a definite strategic thought — as we build brands, we will not put all our eggs in one basket. What are your plans for the
sales mix? The contribution of the international business is slated to go up gradually. We expect that at the R1,000-crore mark, we will have 55% from domestic and 45% from international businesses. We expect to touch that mark in a year-and-a-half. We have always concentrated on complex products. We were never going after big blockbusters as there is so much risk related to getting the timing right. If you get there in time, it is a big plus; if you miss the boat, it’s a huge loss. That never works for a company of our size, so we have always gone with the difficult-to-do formulations, where even if we don’t get the timing right, we have not lost too much of an opportunity. We have always tried to play with products/segments/ molecules where competition is naturally low.
So, the US will do its own part, but the size
accumulation coming from that market will not be the kind that people
expect. When I say 45% will come from the international business,
probably 30% of that will still be from Europe. What are your views on the
increased USFDA scrutiny? How has your experience been with the
regulator? Things that have happened in the
last one year have not been just for Indian companies, but for all
manufacturing sites outside of the US — the USFDA has decided to up its
quality benchmark.
How do you see consolidation in Indian pharma in
the aftermath of the Sun-Ranbaxy deal? Do you have any M&A plans? |