Torrent Pharma: The Growth Pill
The
company, which came back to the fore after a long phase of stagnation, saw two
critical accolades coming to it in the last four years. It found its top place
among India’s fastest growing companies and its leader was named among the most
promising CEOs in the country
One unique element that Samir Mehta-led
Torrent Pharma kept unchanged in its corporate strategy while wading through
the odds, was to adhere to its fundamental values and principles amidst the
break neck speed and complexity. The company, which came back to the fore after
a long phase of stagnation, saw two critical accolades coming to it in the last
four years. It found its top place among India’s fastest growing companies and
its leader was named among the most promising CEOs in the country.
Even as the generic drug industry is going
through its most crucial phase globally with a crucial pricing pressure,
enhanced regulatory scrutiny and increasing competition, Torrent could buck the
trend by sticking to the said strategy. Looking at the positive side even at
times of crisis and keeping the fundamentals strong through continued
innovation helped it strive. Torrent made a strategic acquisition in India at a
time when the domestic market was turbulent with the hardest price control
regime and the slowest growth. It could also take a risky but informed decision
to test the low competition opportunities in the US market with the support of
its innovation capability.
According to executive chairman Samir Mehta,
the key factors that helped the company to feature in the fastest growing
companies during the last four years include the successful integration of
Elder portfolio (the business that it acquired in India in 2014) and strong
execution of low competition opportunities in the US.
“We
also focused on building larger brands with market leading share in India and
Brazil and a continued and significant improvement in efficiency across the
value chain including field force productivity,” he added.
Torrent Pharma, part of the Ahmedabad-based
$3 billion power-to-pharma Torrent Group, posted an average 166.28 per cent
growth in revenue and 466.88 per cent growth in profit between 2012 and 2016 on
the back of expanded sales in India and strong US sales. The much improved
efficiency in the manufacturing process and a better product mix also helped
the company to maintain a much higher rate of compounded annual growth during
this period.
Several successful launches in the US market
led to exceptional growth in profit due to low competition, in some cases. It
also achieved business growth in India at 15 per cent despite impact of hygiene
improvement measures and discontinuation of promotional schemes. The company
launched two biosimilars in India, to increase focus on specialty portfolio. It
also acquired and amalgamated a US FDA approved derma products manufacturing
facility of Zyg Pharma at Pithampur in Indore during the last four years.
But Mehta, who expects certain challenges to
retain this position going forward, also sees better opportunities in the
future.
“Improving
access to healthcare and reducing spend on it is a major goal of governments
around the world at present. But I take this as a challenge as well as an
opportunity,” says Mehta.
The other challenges that he sees in the
market are the increasing competition leading to pricing pressure across the
key markets and a continued compliance requirements under increasing regulatory
scrutiny and the need for diversified geographical spread.
“Improving
the efficiencies further, developing more responsive supply chain to ensure
greater agility and improved speed to the market, identifying niche
opportunities across key geographies and exploring inorganic opportunities to
broad base product offerings are the strategies that will help the company
continue to overcome these challenges,” he added.
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