MM Report on Pharma & Healthcare

8/7/2019 MM Report on Pharma & Healthcare

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L.J. Institute of Computer Applications- MBA

Report

On

Pharma-Healthcare Industry

In

India(Marketing Management – Abhijeet Sir)

(2nd Semester)

Presented by: Tejpal Chauhan (Roll No:

06)

Vishal R. Patel (Roll No: 30)

Akash Rajpura (Roll No: 35)





INTRODUCTION

The Indian Pharmaceutical Industry today is in the front rank of India’s science-basedindustries with wide ranging capabilities in the complex field of drug manufacture&technology.A highly organized sector, the Indian Pharma Industry is estimated to be worth $ 4.5 billion,growing at about 8 - 9 % annually. It ranks very high in the third world, in terms of

technology, quality and range of medicines manufactured. From simple headache pills tosophisticated antibiotics and complex cardiac compounds, almost every type of medicine is nowmade indigenously.

It is playing a key role in promoting and sustaining development in the vital field of medicines, Indian Pharma Industry boasts of quality producers and many units approved byregulatory authorities in USA and UK.

The Indian Pharmaceutical sector is highly fragmented with more than 20,000 registered

units. It has expanded drastically in the last two decades. The leading 250 pharmaceuticalcompanies control 70% of the market with market leader holding nearly 7% of the market

share. It is an extremely fragmented market with severe price competition and government pricecontrol.

The pharmaceutical industry in India meets around 70% of the country's demand for bulk drugs, drug intermediates, pharmaceutical formulations, chemicals, tablets, capsules, oralsand injectibles. There are about 250 large units and about 8000 Small Scale Units, which formthe core of the pharmaceutical industry in India (including 5 Central Public Sector Units). Theseunits produce the complete range of pharmaceutical formulations, i.e., medicines ready for

consumption by patients and about 350 bulk drugs, i.e., chemicals having therapeutic value andused for production of pharmaceutical formulations

Following the de-licensing of the pharmaceutical industry, industrial licensing for most of the drugs and pharmaceutical products has been done away with. Manufacturers are free toproduce any drug duly approved by the Drug Control Authority. Technologically strong andtotally self-reliant, the pharmaceutical industry in India has low costs of production, low R&D

http://www.pharmaceutical-drug-manufacturers.com/pharmaceutical-industry/








costs, innovative scientific manpower, strength of national laboratories and an increasing balanceof trade.

ADVANTAGE OF INDIA

Competent workforce: India has a pool of personnel with high managerial andtechnical competence as also skilled workforce. It has an educated work force andEnglish is commonly used. Professional services are easily available.

Cost-effective chemical synthesis: Its track record of development, particularlyin the area of improved cost-beneficial chemical synthesis for various drugmolecules is excellent. It provides a wide variety of bulk drugs and exportssophisticated bulk drugs.

Legal & Financial Framework: India has a 53 year old democracy and hencehas a solid legal framework and strong financial markets. There is already anestablished international industry and business community.

Information & Technology: It has a good network of world-class educationalinstitutions and established strengths in Information Technology.

Globalization: The country is committed to a free market economy and

globalization. Above all, it has a 70 million middle class market, which iscontinuously growing.

Consolidation: For the first time in many years, the international pharmaceuticalindustry is finding great opportunities in India. The process of consolidation,which has become a generalized phenomenon in the world pharmaceuticalindustry, has started taking place in India.



TOP 50 PHARMA COMPANIES IN INDIA ACCORDING

TURNOVER

S.NO Company NameTurn Over

(Rs crore)

Turn Over

(US $ Mill)

1Ranbaxy Laboratories Ltd. 4243.00 987.00

2Cipla Ltd. 2055.00 478.00

3 Dr. Reddy'S Laboratories Ltd. 1839.00 428.00

4Nicholas Primal India Ltd. 1440.00 335.00

5Aurobindo Pharma Ltd. 1341.00 312.00

6GlaxoSmithKline Pharmaceuticals Ltd. 1242.00 289.00

7Lupin Ltd. 1233.00 287.00

8Cadila Healthcare Ltd. 1172.00 273.00

9 Sun Pharmaceutical Inds. Ltd. 936.00 218.00

10Wockhardt Ltd. 767.00 178.00

11Aventis Pharma Ltd. 724.00 168.00

12Orchid Chemicals & Pharmaceuticals Ltd. 713.00 166.00

13Ipca Laboratories Ltd. 665.00 155.00

14Alembic Ltd. 614.00 143.00

15Pfizer Ltd. 594.00 138.00

16Morepen Laboratories Ltd. 570.00 133.00

17U S V Ltd. 561.00 131.00

18Matrix Laboratories Ltd. 557.00 130.00

19Biocon Ltd. 537.00 125.00

20Novartis India Ltd. 516.00 120.00

21 Torrent Pharmaceuticals Ltd. 507.00 118.00

22Abbott India Ltd. 446.00 104.00

23Cadila Pharmaceuticals Ltd. 444.00 103.00

24Merck Ltd. 404.00 94.00

25Unichem Laboratories Ltd. 388.00 90.00



26 Glenmark Pharmaceuticals Ltd. 382.00 89.00

27Wyeth Ltd. 352.00 82.00

28Divi'S Laboratories Ltd. 320.00 74.00

29J B Chemicals & Pharmaceuticals Ltd. 315.00 73.00

30F D C Ltd. 305.00 71.00

31Emcure Pharmaceuticals Ltd. 304.00 71.00

32Panacea Biotec Ltd. 277.00 64.00

33Strides Arcolab Ltd. 276.00 64.00

34 Shasun Chemicals & Drugs Ltd. 273.00 64.00

35Elder Pharmaceuticals Ltd. 270.00 63.00

36 Macleods Pharmaceuticals Ltd. 258.00 60.00

37Aarti Drugs Ltd. 238.00 55.00

38Dabur Pharma Ltd. 215.00 50.00

39Nectar Lifescience Ltd. 213.00 50.00

40Ind-Swift Ltd. 212.00 49.0041Astrazeneca Pharma India Ltd. 196.00 46.00

42Unimark Remedies Ltd. 194.00 45.00

43 Jagsonpal Pharmaceuticals Ltd. 184.00 43.00

44Organon (India) Ltd. 181.00 42.00

45Surya Pharmaceutical Ltd. 173.00 40.00

46Ind-Swift Laboratories Ltd. 167.00 39.00

47Dishman Pharmaceuticals & Chemicals Ltd. 129.00 30.00

48Ajanta Pharma Ltd. 121.00 28.00

49Concept Pharmaceuticals Ltd. 88.00 21.0050Flamingo Pharmaceuticals Ltd. 90.00 21.00



CHAPTER -2



THE VALUE CHAIN

First let’s understand the supply chain of Indian pharmaceutical industry.

Fig. Showing Traditional View of marketing that is the firm can make somethingand then sell it.

The supply chain of Indian pharmaceutical is chain from Factory to customer asshown in Fig.1 There has been a paradigm shift in the supply chain process of Indianpharmaceutical industry. Value added tax, consolidation of Pharma companies andemergence of Pharma retail chains are some the factors that are driving the changes in thedistribution cycle.

Companies that subscribe to this view have a best chance of succeeding ineconomies marked by goods shortage where consumers are not fussy about quality,

feature or style.

Fig 1 : Pharmaceutical SupplyChain from Factory to Shelf



In today’s hypercompition economy with increasingly rational buyers faced withabundant choice, a company can win only by fine-tuning the value delivery process andchoosing, providing and communicating superior valve.

For Successful Marketing is not only requiring proper channeling of supply chainbut it involves satisfying customer’s needs and wants. The task of any business is to

deliver customer value at profit while social responsible.

The Value chain identifies nine strategically relevant activities – Five

Primary and Four Support activities –that create vale and cost in specific business.

General Chain for Pharmaceutical Industry

Figure 1: General Chain for Pharmaceutical Industry

Figure 1 depicts the basic components of the pharmaceutical global value chain.All of these functions can be carried out by a large, vertically integratedpharmaceutical firm, or certain segments (typically with the lesser value-add) can becontracted out to other firms. The trend of contracting other, lower-cost firms for certain segments of production has grown recently over the past decade.



For a more in-depth look at the major segments of the pharmaceutical industriesto create value chain

Discovery:

The Discovery process, or the "research" of R&D,is initiated by after a specific biological target isidentified. This target, in the form of a gene or achemical, is manipulated to form the desired result. Thenit is tested through series involving cells, tissues, andmice.

After a few cycles and the compound have been

optimized, the firm applies for the intellectual propertyrights (patent) through its legal and administrativedepartments. The drug will have to go through morestudies and trials for as long as 12 years beforegovernment authorities will grant permission for thecompany to market the drug.



Product Development:

The Product Development process, or the "development" of R&D, exists primarily dueto the fact that the pharmaceutical industry is sohighly regulated. With institutions like the FDAof the US establishing strict guidelines in order to ensure the safety of its citizens, thecompounds that are developed in the discovery

phase are filtered through a series of clinicalstudies. These trials last for about four to sevenyears, after about one year of pre-clinical tests.Total, the pre-clinical and clinical trials make upabout 25% of all development costs, or about$170-240 million.

After clinical trials on human testsubjects are successfully completed, thepharmaceutical company can apply for approvalfrom the FDA (in the US) to market the drug.

Tests are also required to continue into the post-marketing Phase IV trials since clinical trials arelimited in size. If the drug performs hazardouslyin the larger populous,the FDA may recall thesubstance from the market entirely.

Fig Shows systematic Productdevelopment process which start with clinicaltrial and end at Phase IV (means stage at whichproduct is completely approved by regulatorybodies.



Manufacturing:

Manufacturing occurs during theProduct Development segment (for theproduction of clinical lots drugs for the trials)and for the production to market.

The process of manufacturing is heavilyregulated by governmental institutions in thepharmaceutical industry in order to ensure thatthe drugs are safe for consumption. Because of this, the process is heavily controlled, thefacilities are held to high quality standards, andworker aptitude is actively monitored.

Fig Shows complete manufacturingprocess of Pharma start from Chemicalsynthesis – Purification – formulationDevelopment to Dosage Form manufacturing

It’s also including Distribution chainwhich starts from packaging to storage totransportation logistics.



Marketing:

Marketing, distribution, and sales is thefinal step in the chain to deliver themanufactured goods to consumers. They canarrive there through two channels: direct-to-consumer or through medical practitioners. Theformer channel is for over-the-counter (OTC)drugs, and the latter for prescription medication.

In order to market a prescription-onlyproduct, pharmaceutical companies typicallyhave large, highly-skilled sales representativeshold conferences for doctors and the medicalcommunity in order to present data from theclinical trials. Otherwise, they send promotionalmaterials and information to individualpractitioners and hospitals, or have personalizedsales representatives sent to sell the product.

OTC medications are marketed throughtelevision advertisements, print media, or theInternet.

The drugs are then typically distributedthrough wholesalers and retail chains.

Documents

MM Report on Pharma & Healthcare