Tuesday, October 14, 2008

THE LURE OF PHARMA IN INDIA

I got the above image from here.

The world over there is a buzz on the pharma and healthcare front. However, an economic slow down in developed markets, is shifting the focus to rapidly developing economies like India. Thus, the scene for pharma and healthcare, in India is indeed vibrant.

So what is alluring about pharma India?

The market growth, increase in GDP, and the huge population of India are indeed very alluring to pharma marketers. 1.1 billion is a big big number – now, that is the estimated population of India.

TTK Healthcare

This listed company is a very interesting case study. It is a multi product and multi category company. Its pedigree is very sound. The TTK group was established by the famous T T Krishnamachari. However, in the market, TTK Healthcare is perceived as a stable and very conservative company. As per the annual report of 2007 – 2008, the Chairman is Mr. T T Jagannathan, an elderly distinguished person, a B Tech GOLD MEDALLIST from IIT Chennai. He also has a Masters from Cornell University, USA.

The company views the lifestyle disorders, growing demand for herbal products, and the OTC market for healthcare and beauty products as an attractive market. Besides they are into veterinary care, biomedical devices (including heart valves) and food products. Woodwards gripewater and Eva range of body fragrance products are their popular brands

The pharmaceuticals segment in 2007 – 2008 on a net sales (after deduction of Excise Duty) of Rs. 96.16 crores, has a profit of Rs. 11.52 crores. The consumer division with all the hype and brand visibility on a net sales of Rs. 79.38 crores has a loss of Rs. 3.45 crores. The entire company (including pharmaceuticals, medical devices, consumer products, printing and other divisions) has a net sales turnover of Rs. 199.04 crores and profit of Rs. 21.99 crores. Just look keenly at the above figures, you will see that the pharmaceuticals division is contributing almost 50% of the profits, even though the sales is not even one third of the total sales

IF THIS IS THE STORY OF A CONSERVATIVE COMPANY YOU CAN WELL IMAGINE THE BALANCE SHEETS OF AGGRESSIVE BIGGIES AMONG INDIAN PHARMA. THAT IS THE LURE OF PHARMA!!

Wanbury

This company too is an interesting case study. Wanbury has a focused approach and operates mainly on two platforms: one, Wanbury concentrates on the OBG segment, and secondly, Wanbury looks to NDDS (ie., novel drug delivery systems) or other differentiated branded product offerings to make a distinguishing cachet in the pharma marketplace. By concentrating on the OBG segment Wanbury seems to get a better bang for the buck. It is this specialist-focused approach that worked for companies like Torrent, Intas, and Sun Pharmaceuticals too when they began their operations. In fact, this DNA has not changed for these companies – they have divisionalized and the specific divisions continue to have the basic focus.

Wanbury has created waves through a powerful launch of C-pink - the hematinic brand. Wanbury growing at 87% has just launched sustained release delivery based NDDS nitrofurantoin for management of UTI - particularly in gynec cases (there is the OBG focus once again). This market is again not crowded and has good potential as UTI in women is a chronic, frequent and recurring problem. The basic USP of Nitrofur SR (Nitrofurantoin-100mg, sustained release) is patient compliance.

The lure of pharma is profits, sales, financial health, feel-good feeling for the promoters, an excitement

Ayurvedic pharmaceuticals

From time immemorial, herbal and Ayurvedic products have been the sheet anchor of healing systems in India. While most companies looked to cash in on the opportunity through allopathic or Western Medicine products, few companies like Himalaya Drugs endeavored to present the ancient remedies in a modern scientific format, backed by clinical trials that are acceptable to modern physicians. Liv 52 continues to be a star brand of the Indian pharma market. In recent times, Himalaya has started an approach that can redefine its financial performance. Realizing the untapped rural potential (since most of the herbals are consumed in rural sector, and the fact that 70% of the Indian population is rural, and constitutes 21% of the total market), a new division of Himalaya is focusing on this market segment particularly in the Hindi belt where Ayurveda rocks most. In fact, evangelical marketers of Yoga and Ayurveda like Baba Ramdev are contributing to the market expansion of Ayurvedic pharmaceuticals.

Another very interesting dimension of this market is the possibility to address the end-consumers legally. Patient education strategy is meticulously adopted by Ayurvedic marketers, to enhance revenues through the OTX positioning.

The lure of Indian pharma is in its huge market potential.

Healthcare supplements market is exploding

There is a healthcare wave and this has caused a rush market for authentic healthcare supplements and services. Cashing in on this wave are companies like Juggat Pharma, Merck, and Mankind that have launched electrolyte energy drinks concept brands (in a ready-to-drink format), and creating ripples in the pharmaceutical and healthcare market. In fact, Juggat Pharma has pioneered the concept and contract manufactures the brands marketed by Merck and Mankind (info@jagdale.com).

All in all, hail the rise of Indian Pharmaceutical and Healthcare market!! The lure of Indian Pharma and Healthcare is irresistible!!!

This weekend there will not be any other blogpost due to preoccupations. Thanks for reading this blogpost, please do scroll down, click on older posts wherever required, and continue reading all other posts.

3 comments:

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