SUBMITTED BY MOHIT KANT A1802011303

STUDENT DECLARATION
I hereby declare that the project report entitled

PHARMACEUTICAL SECTOR IN INDIA AND CIPLA LTD

Submitted in fulfillment of the requirement of the degree of Masters of Business Administration

from Amity International Business School Amity University Noida

is my original piece of work and not submitted for the reward or any other Degree, Diploma, Fellowship or other similar title or prizes.

MOHIT KANT Signature of Mentor (MR SANJEEV CHATURVEDI) (MRS ALKA MAURYA) 2 MBA IB A1802011155 SECTION E

EXECUTIVE SUMMARY
Report Title: INDIAN PHARMACEUTICAL SECTOR AND CIPLA LTD.

Reasons for the project Pharmaceutical sector is one of the fastest growing sectors in India.In order to gain more knowledge and learn about the secotr I choose this pharmaceutical sector.

Project objectives TO FIND THE FINANCIAL POSITION OF THE COMPANIES TO KNOW ABOUT THE GLOBAL AND INDIAN MERGERS AND TAKEOVERS TO FIND OUT THE SWOT AND PESTEL ANALYSIS WHAT ARE THEIR MARKETING STRATEGIES INTERNATIONAL AFFAIRS OF THE COMPANY THE COMPETITION IN THE PHARMACEUTICAL SECTOR

AIM OF THE RESEARCH

This report aims at analyzing CIPLA a budding pharmaceutical company that started in from a scratch and not has a name worldwide. The company has marked its presence with significant achievements and today commands a market leadership status. Their story of success is based on dedication to nature, corporate and process hygiene, dynamic leadership and commitment to our partners and stakeholders. The results of our policies and initiatives speak for themselves.

This project deals with various important information of the company. The companys histor y ,mission and vision the objectives of the firm , the financial position its swot analysis the global strategies used by IND SWIFT LTD and the comparison with the major market leaders in todays scenario.

Many conclusion and findings were drawn out from this report that has made me realize the importance of pharmaceutical industry in India and the world and where this industry plans to grow. I myself have plans setting up a manufacturing plant somewhere in the near future and I guess this is just the kind of start which was required for me to gain the maximum knowledge about the industry and the growth prospects.

ACKNOWLEDGEMENT
I am very proud to finally have finished my project report .Researching in this area has provided me with new and interesting knowledge and facts about the pharmaceutical sector which before this research I had no knowledge of.

It is my proud privilege to express my deep sense of gratitude to my faculty guide Mrs Alka Maurya and Mr Sanjeev Chaturvedi for their support, guidance, stimulating discussions and critical evaluation of work and untiring efforts while carrying out my project work.

I also thank my dear friends, I shall ever remain under debt for their encouragement, love, moral support and every possible help without which it would have not been possible to accomplish this work.

In the end, I sincerely acknowledge all those who directly or indirectly helped me.

MOHIT KANT

S.NO

TOPIC

PAGE NO.

1)

GLOBAL PHARMACEUTCAL INDUSTRY

2)

INDIAN PHARMACEUTICAL INDUSTRY

10

3)

CIPLA MISSION VISION AND OBJECTIVES PRODUCTS FINANCIALS

17 19 23 25

4)

SWOT AND PEST ANALYSIS

28

5)

MARKETING AND GLOBAL STRATEGIES

31

6)

COMPETITORS INFORMATION

38

7)

CONCLUSION

50

8)

FINDINGS

51

9)

BIBLIOGRAPHY

53

PHARMACEUTICAL INDUSTRY
The pharmaceutical industry develops, produces, and markets drugs licensed for use as medications.Pharmaceutical companies are allowed to deal in generic and/or brand medications and medical devices. They are subject to a variety of laws and regulations regarding the patenting, testing and ensuring safety and efficacy and marketing of drugs.

History
The earliest drugstores date back to the Middle Ages. The first known drugstore was opened by Arabian pharmacists in Baghdad in 754,and many more soon began operating throughout the medieval Islamic world and eventually medieval Europe. By the 19th century, many of the drugstores in Europe and North America had eventually developed into larger pharmaceutical companies. Most of today's major pharmaceutical companies were founded in the late 19th and early 20th centuries. Key discoveries of the 1920s and 1930s, such as insulin and penicillin, became massmanufactured and distributed. Switzerland, Germany and Italy had particularly strong industries, with the UK, US, Belgium and the Netherlands following suit. Legislation was enacted to test and approve drugs and to require appropriate labeling. Prescription and non-prescription drugs became legally distinguished from one another as the pharmaceutical industry matured. The industry got underway in earnest from the 1950s, due to the development of systematic scientific approaches, understanding of human biology (including DNA) and sophisticated manufacturing techniques. Numerous new drugs were developed during the 1950s and mass-produced and marketed through the 1960s. These included the first oral contraceptive, "The Pill", Cortisone, bloodpressure drugs and other heart medications. MAO Inhibitors, chlorpromazine (Thorazine), Haldol (Haloperidol) and the tranquilizers ushered in the age of psychiatric medication. Valium (diazepam), discovered in 1960, was marketed from 1963 and rapidly became the most prescribed drug in history, prior to controversy over dependency and habituation. Attempts were made to increase regulation and to limit financial links between companies and prescribing physicians, including by the relatively new U.S. Food and Drug Administration (FDA). Such calls increased in the 1960s after the thalidomide tragedy came to light, in which the use of a new tranquilizer in pregnant women caused severe birth defects. In 1964, the World Medical Association issued its Declaration of Helsinki, which set standards for clinical research and demanded that subjects give their informed consent before enrolling in an experiment. Pharmaceutical companies became required to prove efficacy in clinical trials before marketing drugs. Cancer drugs were a feature of the 1970s. From 1978, India took over as the primary center of pharmaceutical production without patent protection.[citation needed][3]

The industry remained relatively small scale until the 1970s when it began to expand at a greater rate.{{Citation needed|date=September 2007 Legislation allowing for strong patents, to cover both the process of manufacture and the specific products, came in to force in most countries. By the mid-1980s, small biotechnology firms were struggling for survival, which led to the formation of mutually beneficial partnerships with large pharmaceutical companies and a host of corporate buyouts of the smaller firms. Pharmaceutical manufacturing became concentrated, with a few large companies holding a dominant position throughout the world and with a few companies producing medicines within each country. The pharmaceutical industry entered the 1980s pressured by economics and a host of new regulations, both safety and environmental, but also transformed by new DNA chemistries and new technologies for analysis and computation.[citation needed] Drugs for heart disease and for AIDS were a feature of the 1980s, involving challenges to regulatory bodies and a faster approval process. Managed care and Health maintenance organizations (HMOs) spread during the 1980s as part of an effort to contain rising medical costs, and the development of preventative and maintenance medications became more important. A new business atmosphere became institutionalized in the 1990s, characterized by mergers and takeovers, and by a dramatic increase in the use of contract research organizations for clinical development and even for basic R&D. The pharmaceutical industry confronted a new business climate and new regulations, born in part from dealing with world market forces and protests by activists in developing countries. Animal Rights activism was also a challenge. Marketing changed dramatically in the 1990s, partly because of a new consumerism.[citation needed] The Internet made possible the direct purchase of medicines by drug consumers and of raw materials by drug producers, transforming the nature of business. In the US, Direct-to-consumer advertising proliferated on radio and TV because of new FDA regulations in 1997 that liberalized requirements for the presentation of risks. The new antidepressants, the SSRIs, notably Fluoxetine (Prozac), rapidly became bestsellers and marketed for additional disorders. Drug development progressed from a hit-and-miss approach to rational drug discovery in both laboratory design and natural-product surveys. Demand for nutritional supplements and socalled alternative medicines created new opportunities and increased competition in the industry. Controversies emerged around adverse effects, notably regarding Vioxx in the US, and marketing tactics. Pharmaceutical companies became increasingly accused of disease mongering or over-medicalizing personal or social problems.[4]

Research and development

Drug discovery is the process by which potential drugs are discovered or designed. In the past most drugs have been discovered either by isolating the active ingredient from traditional remedies or by serendipitous discovery. Modern biotechnology often focuses on understanding the metabolic pathways related to a disease state or pathogen, and manipulating these pathways using molecular biology or biochemistry. A great deal of early-stage drug discovery has traditionally been carried out by universities and research institutions. Drug development refers to activities undertaken after a compound is identified as a potential drug in order to establish its suitability as a medication
8

Indian Pharmaceutical Sector

The Indian Pharmaceutical Industry today is in the front rank of Indias science-based industries with wide ranging capabilities in the complex field of drug manufacture and technology. It ranks very high in the third world, in terms of technology, quality and range of medicines manufactured. From simple headache pills to sophisticated antibiotics and complex cardiac compounds, almost every type of medicine is now made indigenously. 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 by regulatory authorities in USA and UK. International companies associated with this sector have stimulated, assisted and spearheaded this dynamic development in the past 53 years and helped to put India on the pharmaceutical map of the world.

Growth Scenario in 2010:

India's pharmaceutical industry is now the third largest in the world in terms of volume. Its rank is 14th in terms of value. Between September 2008 and September 2009, the total turnover of India's pharmaceuticals industry was US$ 21.04 billion. The domestic market was worth US$ 12.26 billion. This was reported by the Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers. the Indian pharmaceutical market reached US$ 10.04 billion in size in July 2010. A highly organized sector, the Indian Pharma Industry is estimated to be worth $ 4.5 billion, growing at about 8 to 9 percent annually.

Leading Pharmaceutical Companies:

In the domestic market, Cipla retained its leadership position with 5.27 per cent share. Ranbaxy followed next. The highest growth was for Mankind Pharma (37.2%). Other leading companies in the Indian pharma market in 2010 are:

Sun Pharma (25.7%) Abbott (25%) Zydus Cadila (24.1%) Alkem Laboratories (23.3%) Pfizer (23.6 %) Piramal Healthcare (18.6 %) 9

Lupin (18.8 %) Ind swift ltd.

Future Prospects :
The Indian pharmaceuticals market is expected to reach US$ 55 billion in 2020 from US$ 12.6 billion in 2009. This was stated in a report title "India Pharma 2020: Propelling access and acceptance, realising true potential" by McKinsey & Company. In the same report, it was also mentioned that in an aggressive growth scenario, the pharma market has the further potential to reach US$ 70 billion by 2020

Due to increase in the population of high income group, there is every likelihood that they will open a potential US$ 8 billion market for multinational companies selling costly drugs by 2015. This was estimated in a report by Ernst & Young. The domestic pharma market is estimated to touch US$ 20 billion by 2015. The healthcare market in India to reach US$ 31.59 billion by 2020. The sale of all types of pharmaceutical drugs and medicines in the country stands at US$ 9.61 billion, which is expected to reach around US$ 19.22 billion by 2012. Thus India would really become a lucrative destination for clinical trials for global giants.

There was another report by RNCOS titled "Booming Pharma Sector in India" in which it was projectedt that the pharmaceutical formulations industry is expected to prosper in the same manner as the pharmaceutical industry. The domestic formulations market will grow at an annual rate of around 17% in 2010-11, owing to increasing middle class population and rapid urbanisation. Read More in Future Prospects of Indian Pharma Industry.

Characteristics of Indian Pharmaceutical Industry:

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 pharmaceutical companies 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 price control The pharmaceutical industry in India meets around 70% of the country's demand for bulk drugs, drug intermediates, pharmaceutical formulations, chemicals, tablets, capsules, orals and injectibles. There are about 250 large units and about 8000 Small Scale Units, which form the core of the pharmaceutical industry in India (including 5 Central Public Sector Units). These units produce the complete range of pharmaceutical formulations, i.e., medicines ready for consumption by 10

patients and about 350 bulk drugs, i.e., chemicals having therapeutic value and used 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 to produce any drug duly approved by the Drug Control Authority. Technologically strong and totally self-reliant, the pharmaceutical industry in India has low costs of production, low R&D costs, innovative scientific manpower, strength of national laboratories and an increasing balance of trade.

11

Top 10 Pharmaceutical companies in India, as of 2010

Rank 1 2 3 4 5 6 7 8 9 Cipla Ranbaxy (Taken over by Daiichi Sankyo in 2008) Dr. Reddy's Laboratories Sun Pharmaceutical Lupin Ltd Aurobindo Pharma GlaxoSmithKline Pharmaceuticals Ltd Cadila Healthcare Aventis Pharma Limited Company Revenue 2010
(Rs crore)

Revenue 2010
(Rs billion)

4,198.96 4,162.25 3,763.72 2,463.59 2,215.52 2,081.19 1,773.41 1,613 983.80 980.44

41.989 41.622 37.637 24.635 22.15 20.801 17.734 16.13 9.838 9.8044

10 IND SWIFT LTD

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Major issues concerning the pharmaceutical companies in India

Failure of the new patent system: Prerequisites associated with Sec 3(d) of the Patent (Amendment) Act 2005 restrict the copyright of an existing drug. Moreover, mandatory licensing permits Indian companies to keep producing generics of copyright products for overseas selling to underdeveloped nations. Lack of proper infrastructure: Issues associated with regular power cuts and lack of suitable transport infrastructure will decelerate the expansion of the sector. Inadequate funds: Restricted funding from FIs, venture capitalists and the government may decelerate the expansion of biotechnology sector in India. Regulatory impediments: Rising of due meticulousness and conformity with product standards leads to high costs and interruption in the launch of new products. Severe competition: Low margins and restricted capital to assist R&D is the result of intense pricing competition among local producers. This rivalry will further deepen from the joining in of the big drug companies in the Indian market to control the cost benefit and large reserve sources.

Future Scenario
With several companies slated to make investments in India, the future scenario of the pharmaceutical industry in looks pretty promising. The country's pharmaceutical industry has tremendous potential of growth considering all the projects that are in the pipeline. Some of the future initiatives are:

According to a study by FICCI-Ernst & Young India will open a probable US$ 8 billion market for MNCs selling expensive drugs by 2015

The study also says that the domestic pharma market is likely to reach US$ 20 billion by 2015 The Minister of Commerce estimates that US$ 6.31 billion will be invested in the domestic pharmaceutical sector

Public spending on healthcare is likely to raise from 7 per cent of GDP in 2007 to 13 per cent of GDP by 2015

Dr Reddy's Laboratories has tied up with GlaxoSmithKline to develop and market generics and formulations in upcoming markets overseas

Due to the low cost of R&D, the Indian pharmaceutical off-shoring industry is designated to turn out to be a US$ 2.5 billion opportunity by 2012

13

SWOT ANALYSIS OF CIPLA

STRENGTHS
Regular Market Expansion Futuristic Wide Distribution Network Innovative Packaging New Product Development Multibrand Strategy Vast Experience in Export Market Access to New technology Ensuring product quality USFDA (United States Food and Drug Authority) Approved Strong R & D

WEAKNESS
Less Advertising and media Coverage Inadequacy of Sale support Communication Gap

OPPORTUNITY
Hugh market Potential Addition to existing product line Government is promoting Pharma and IT industry.

14

THREATS
Competition

__"________________a__

PEST ANALYSIS Political Factors

1. Today there is political uncertainty in the air. A combination of diverse political thought have got together to cobble together a rag-tag coalition, that is riddle with ideological contradictions. The Minister in charge of the industry has been threatening to impose even more stringent Price Control on the industry than before. This is throwing many an investment plan into the doldrums. DPCO which is the bible for the industry has in effect worked contrary to the stated objectives. DPCO nullifies the market forces from encouraging competitive pricing of goods dictated by the market. In Pharma industry there is a huge PSU segment which is chronically sick and highly inefficient. The Government puts the surpluses generated by efficient units into the price equalization account of inefficient units thereby unduly subsidizing them. Effective the January, 2005 the Government has shifted from charging the Excise Duty on the cost of manufacturing to the MRP thereby making the finished products more costly. Just for a few extra bucks the current government has made many a life saving drugs unaffordable to the poor. The Government provides extra drawbacks to some units located in specified area, providing them with subsidies that are unfair to the rest of the industry, bringing in a skewed development of the industry.

2.

3.

5.

6.

7.

Economic Factors
1. India spends a very small proportion of its GDP on healthcare ( A mere 1% ). This has stunted the demand and therefore the growth of the industry. Per capita income of an average Indian is low ( Rs. 12,890 ), therefore, spending on the healthcare takes a low priority. An Indian would visit a doctor only when there is an 15

2.

emergency. This has led to a mushrooming of unqualified doctors and spread of nonstandardized medication. 3. The incidence of Taxes are very high. There is Excise Duty ( State & Central), Custom Duty, Service Tax, Profession Tax, License Fees, Royalty, Pollution Clearance Tax, Hazardous substance (Storage & Handling) license, income tax, Stamp Duty and a host of other levies and charges to be paid. On an average it amounts to no less than 40-45% of the costs. The number of Registered Medical practitioners is low. As a result the reach of Pharmaceuticals is affected adversely. There are only 50,00,000 Medical shops. Again this affects adversely the distribution of medicines and also adds to the distribution costs. India is a high interest rate regime. Therefore the cost of funds is double that in America. This adds to the cost of goods. Adequate storage and transportation facilities for special drugs is lacking. A study had indicated that nearly 60% of the Retail Chemists do not have adequate refrigeration facilities and store drugs under sub-optimal conditions. This affects the quality of the drugs administered and of course adds to the costs. India has poor roads and rail network. Therefore, the transportation time is higher. This calls for higher inventory carrying costs and longer delivery time. All this adds to the invisible costs. Its only during the last couple of years that good quality highways have been constructed.

4.

5.

6.

7.

8.

Socio-cultural Factors
2. Poor Sanitation and polluted water sources prematurely end the life of about 1 million children under the age of five every year. In India people prefer using household treatments handed down for generations for common ailments. The use of magic/tantrics/ozhas/hakims is prevalent in India. Increasing pollution is adding to the healthcare problem. Smoking, gutka, drinking and poor oral hygiene is adding to the healthcare problem. Large joint families transmit communicable diseases amongst the members. Cattle-rearing encourage diseases communicated by animals. Early child bearing affects the health standards of women and children.

3.

4. 5. 6. 7. 8. 9.

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Technological Factors
1. 2. 3. Advanced automated machines have increased the output and reduced the cost. Computerization has increased the efficiency of the Pharma Industry. Newer medication, molecules and active ingredients are being discovered. As of January 2005, the Government of India has more than 10,000 substances for patenting. Ayurveda is a well recognized science and it is providing the industry with a cutting edge. Humano-Insulin, Hepatitis B vaccines, AIDS drugs and many such molecules have given the industry a pioneering status. Newer drug delivery systems are the innovations of the day.

4.

6.

7.

17

18

Competition
Name Last Price Market Cap.
(Rs. cr.)

Sales Turnover 1,933.12 5,249.07 6,123.84 5,672.10 4,508.50 2,146.43 2,919.88 1,318.52 1,154.63 1,566.62 1,990.05 1,754.92 1,244.64 4,133.12 1,881.10 2,206.30 594.03 1,018.95 1,627.22 1,031.21

Net Profit

Total Assets

Sun Pharma Dr Reddys Labs Cipla Ranbaxy Labs Lupin GlaxoSmithKline Cadila Health Divis Labs Glenmark Biocon Piramal Health Wockhardt Pfizer Aurobindo Pharm Ipca Labs Jubilant Life AstraZeneca Abbott India Sterling Bio Ind-Swift Labs

462.50 1,483.15 281.35 513.85 474.35 2,091.00 759.00 735.50 322.95 337.55 357.60 383.25 1,350.60 124.05 257.20 200.25 1,234.25 1,419.85 69.60 85.00

47,895.67 25,135.81 22,590.19 21,659.13 21,179.58 17,711.40 15,540.41 9,758.36 8,730.36 6,751.00 5,979.45 4,194.13 4,030.38 3,611.36 3,233.17 3,189.60 3,085.63 1,941.68 1,864.40 290.90

1,383.80 893.31 967.12 1,148.73 809.98 563.69 610.38 435.57 212.18 459.25 12,896.91 -132.07 226.34 593.80 255.37 279.63 64.13 60.94 146.21 87.62

6,731.06 7,465.00 7,054.34 9,393.11 4,135.95 1,935.96 2,653.90 1,851.10 3,125.98 2,115.45 11,984.78 2,549.76 1,163.45 4,887.33 1,584.17 5,129.93 179.70 305.38 5,161.19 1,040.41

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Type

Public BSE: 500087 NSE: CIPLA Pharmaceuticals 1935

Traded as

Industry Founded

Headquarters Mumbai, India Key people Products Revenue Net income Employees Website Y. K. Hamied (CMD), Chairman Pharmaceuticals and diagnostics 5,717.72 crore (US$1.28 billion) (2010)[1] 1,082.59 crore (US$241.42 million) (2010) over 16000 www.cipla.com

Cipla Limited (BSE: 500087, NSE: CIPLA) is a prominent Indian pharmaceutical company, bestknown outside its home country for manufacturing low-cost anti-AIDS drugs for HIV-positive patients in developing countries. Founded by nationalist Indian scientist Khwaja Abdul Hamied as The Chemical, Industrial & Pharmaceutical Laboratories in 1935, 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.[2]

Company Profile
Cipla offers services like consulting, commissioning, engineering, project appraisal, quality control, know-how transfer, support, and plant supply. Apart from its presence in the Indian market, Cipla also has an export market and regularly exports to more than 185 countries in all corners of the world.

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Ranbaxy Laboratories Limited (BSE: 500359) is a pharmaceutical company that was incorporated in India in 1961. The company went public in 1973 and Japanese pharmaceutical company Daiichi Sankyo gained majority control in 2008.[2] Ranbaxy exports its products to 125 countries with ground operations in 46 and manufacturing facilities in seven countries.[citation needed]

History

Formation
Ranbaxy was started by Ranbir Singh and Gurbax Singh in 1937 as a distributor for a Japanese company Shionogi. The name Ranbaxy is a combination of the names of its first owners Ranbir and Gurbax. Bhai Mohan Singh bought the company in 1952 from his cousins Ranbir and Gurbax. After Bhai Mohan Singh's son Parvinder Singh joined the company in 1967, the company saw an increase in scale. Trading In 1998, Ranbaxy entered the United States, the world's largest pharmaceuticals market and now the biggest market for Ranbaxy, accounting for 28% of Ranbaxy's sales in 2005. For the twelve months ending on 31 December 2005, the company's global sales were at US $1,178 million with overseas markets accounting for 75% of global sales (USA: 28%, Europe: 17%, Brazil, Russia, and China: 29%). For the twelve months ending on December 31, 2006, the company's global sales were at US $1,300 million. Most of Ranbaxy's products are manufactured by license from foreign pharmaceutical developers, though a significant percentage of their products are off-patent drugs that are manufactured and distributed without licensing from the original manufacturer because the patents on such drugs have expired. In December 2005, Ranbaxy's shares were hit hard by a patent ruling disallowing production of its own version of Pfizer's cholesterol-cutting drug Lipitor, which has annual sales of more than $10 billion.[3] In June 2008, Ranbaxy settled the patent dispute with Pfizer allowing them to sell Atorvastatin Calcium, the generic version of Lipitor(R)and Atorvastatin Calcium-Amylodipine Besylate, the generic version of Pfizer's Caduet(R) in the US starting November 30, 2011. The settlement also resolved several other disputes in other countries. On 23 June 2006, Ranbaxy received from the United States Food & Drug Administration a 180day exclusivity period to sell simvastatin (Zocor) in the U.S. as a generic drug at 80 mg strength. Ranbaxy competes with the maker of brand-name Zocor, Merck & Co.; IVAX Corporation (which was acquired by and merged into Teva Pharmaceutical Industries

21

Ltd.), which has 180-day exclusivity at strengths other than 80 mg; and Dr. Reddy's Laboratories, also from India, whose authorized generic version (licensed by Merck) is exempt from exclusivity. In June 2008, Japan's Daiichi Sankyo Company agreed to take a majority (50.1%) stake in Ranbaxy, with a deal valued at about $4.6 billion. Ranbaxy's Malvinder Singh remained as CEO after the transaction.[4] On 16 September 2008, the Food and Drug Administration issued two Warning Letters to Ranbaxy Laboratories Ltd. and an Import Alert for generic drugs produced by two manufacturing plants in India.[5] By February 25, 2009 the U.S. Food and Drug Administration said it halted reviews of all drug applications including data developed at Ranbaxy's Paonta Sahib plant in India because of a practice of falsified data and test results in approved and pending drug applications. "Investigations revealed a pattern of questionable data," the FDA said.[6][7]

Acquisition
In June 2008, Daiichi-Sankyo acquired a 34.8% stake in Ranbaxy,[8] for a value $2.4 billion. In November 2008, Daiichi-Sankyo completed the takeover of the company from the founding Singh family in a deal worth $4.6 billion[9] by acquiring a 63.92% stake in Ranbaxy. The addition of Ranbaxy Laboratories extends Daiichi-Sankyo's operations - already comprising businesses in 22 countries.[citation needed] The combined company is worth about

Dr. Reddy's Laboratories Ltd. is an integrated pharmaceutical company focused on providing medicines through its three business segments: Global Generics segment, Pharmaceutical Services and Active Ingredients (PSAI) segment and Proprietary Products segment. Dr. Anji Reddy had worked in the publicly-owned Indian Drugs and Pharmaceuticals Limited, Hyderabad. Reddy's manufactures and markets a wide range of pharmaceuticals in India and overseas. The company has over 190 medications, 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 U.S. Food and Drug Administration (FDA). 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 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.]In 2010, the
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family-controlled Dr Reddy's denied[2] that it was in talks to sell its generics business in India to US pharmaceutical giant Pfizer,[3] which had been suing the company for alleged patent infringement after Dr Reddy's announced that it intended to produce a generic version of Atorvastatin, marketed by Pfizer as Lipitor, an anti-cholesterol medication.[4][5] Reddy's was already linked to UK pharmaceuticals multinational Glaxo Smithkline.[6]

Industry Genre Founded Founder(s) Headquarters Products Revenue Net income Employees

Pharmaceutical Generic Pharma Company Mumbai, India 1983 Dilip Shanghvi Mumbai, India, India Pharmaceuticals 6,079 crore (US$1.36 billion) [1] 1,816 crore (US$404.97 million) 10,000 (2010)

Sun Pharmaceutical (or Sun Pharmaceutical Industries Limited) (BSE: 524715 and scrip ID SUNPHARMA) is an international pharmaceutical company based in Mumbai, India. It should not be confused with Sun Pharmaceuticals Corp, which is a manufacturer of sun care products, owned by the Playtex branch of Energizer Holdings.Sun Pharmaceutical, often known just as Sun Pharma, makes many generic and brand name drugs that are distributed in the United States, Europe, Asia and worldwide.

Acquisition of Taro Pharmaceuticals

A planned acquisition of Israeli Taro Pharmaceuticals initiated in March 2007 completed in Sept 2010;Taro has a strong franchise in dermatology and topical products, in addition to product
23

baskets in cardiovascular, neuropsychiatric and anti-inflammatory therapeutic categories. Taro US has more than 100 ANDA drug approvals in the U.S. alone. One NDA as well as 26 ANDA are awaiting with the USFDA

Lupin Ltd.

Type Traded as Industry Founded Founder(s) Headquarters Key people Products Revenue Profit Subsidiaries

Public BSE: 500257 NSE: LUPIN Pharmaceuticals, Drugs & Healthcare 1968 [1] Desh Bandhu Gupta[2] Mumbai, Maharashtra[3], India Nilesh Gupta, President & Director [2] Dr. Kamal Sharma, MD[4] Medicines and Vaccines 3,712.61 crore (US$827.91 million) (2009-2010) [5] 648.93 crore (US$144.71 million) (2009-2010) [5] Lupin Pharmaceuticals

Lupin Ltd.is world's largest manufacturer of the anti-TB drugs based in Mumbai, Maharashtra, India.[7] The company production contains the Cardiovascular (prils and statins), Diabetology, Asthma, Pediatrics, CNS, GI, Anti-Infectives and NSAIDs therapy and world largest manufacturer of Anti-TB and Cephalosporins segments It is also India' fifth largest drug maker by revenue India is the first Asian country where the company has launched the new

24

prescription drug after launching first anti TB drugs in single tablet.

History It was founded by Desh Bandhu Gupta in 1968. It became the first in India to manufacture Anti-TB API.

CHALLENGES
Every industry has its own sets of advantages and disadvantages under which they have to work; the pharmaceutical industry is no exception to this. Some of the challenges the industry faces are:

Regulatory obstacles Lack of proper infrastructure Lack of qualified professionals Expensive research equipments Lack of academic collaboration Underdeveloped molecular discovery program Divide between the industry and study curriculum

Government Initiatives
The government of India has undertaken several including policy initiatives and tax breaks for the growth of the pharmaceutical business in India. Some of the measures adopted are:

Pharmaceutical units are eligible for weighted tax reduction at 150% for the research and development expenditure obtained.

Two new schemes namely, New Millennium Indian Technology Leadership Initiative and the Drugs and Pharmaceuticals Research Program have been launched by the Government.

The Government is contemplating the creation of SRV or special purpose vehicles with an insurance cover to be used for funding new drug research 25

The Department of Pharmaceuticals is mulling the creation of drug research facilities which can be used by private companies for research work on rent

Conclusion :
Indian companies are climbing the value chain by moving to developed markets and from bulk drugs to formulation exports. As a result, Indian companies are expected to produce six of the top 10 drugs that are scheduled to lose patent protection over the next five years.

Indian companies are targeting opportunities rising in the regulated and unregulated markets. Research focus of large companies has shifted towards discovery of New Chemical Entities keeping in view the product patent era commenced from 1st Jan., 2005.

The Indian Pharma sector is growing exponentially. Its value in 2004 was US$ 6 billion and US$ 10 billion by the end of year 2006. According to the Mc Kinsey study Indian Pharma industry is poised to grow to US$ 25 billion with market capitalization of almost us$ 150 billion from the current $US 6 billion generic based drug industry. With the global players extending their bid to tap Indias manufacturing prowess, contract manufacturing is estimated to generate US$ 1 billion in revenue in 2010. The growth is likely to be driven by increasing outsourcing of late-stage and off-patent moleculesby big-pharmaceutical organisations.
India's pharmaceutical industry is now the third largest in the world in terms of volume Between September 2008 and September 2009, the total turnover of India's pharmaceuticals industry was US$ 21.04 billion A growth of 13% Consists of more than 10000 pharma companies Top 10 Companies enjoy market share of 36% 26

 Most of the companies into Generic Drugs One of the lowest cost producers of drugs in the world

FINDINGS :
Increased generic penetration, intense competition, fragmentation of the industry has negatively impacted the overall value growth of the domestic pharmaceutical market. In this scenario, to grow in the domestic market, pharmaceutical companies are constantly eyeing for innovation, introduction of new value added products, product life cycle management and enlarging their market reach. Indian companies are putting their act together to tap the generic drugs markets in the regulated high margin markets of the developed countries. The US market will remain the most lucrative market for the Indian companies led by its market size and the intensity of blockbuster drugs going off patent. An estimated US$ 45bn of drugs expected to go off patent by 2007 in US alone.

Outsourcing in the fields of R&D and manufacturing is the next best event in the pharmaceutical industry. Spiraling costs, expiring patents, low R&D cost and market dynamics are driving the MNCs to outsource both manufacturing and research activities. India with its apt chemistry skills and low cost advantages, both in research and manufacturing coupled with skilled manpower will attract a lot of business in the days to come.

Indian companies have started investing more and more into R&D activity at home which is bound to one day give birth to new products invented in India and patented worldwide. This will enhance the bottom-line of Indian Pharma companies. Contract R&D is another offshoot of this phenomenon where MNCs set Indian companies to undertake research in the specified areas of their large Research projects. India offers cost advantages and skilled manpower for the purpose.

The Fields of Bio-technology and stem-cell Research has already produced wonderful results. Humuno-insulin and Hepatitis-B vaccines are producing wealth for India although in its infancy.

FMHG (Fast Moving Health Goods) is a new term introduced into the advertising world. Many a company has taken the direct route to the consumers home just like consumer product. This has led to an increase in the incidence of self-medication and rising sales volumes for the industry.

Non-allopathic medication is another field which is showing good promise in terms of peoples acceptance. With new and modern technology and standardization in the manufacturing and formulating practices, the therapeutic results with alternate systems of medicine are becoming more 27

predictable. This has led to the emergence of a totally new field of therapeutics. Many MNCs have also adopted these forms and reaped the benefit of a ready market.

Exports of bulk-drugs, formulations and API (Active Pharma Intermediates) have of late become the fashion. A company worth its salt has an export unit. The Government provides many fiscal incentives for exports such as Excise duty exemption, Exports subsidy, packing credits; export Financing, IT advantages, exemptions from Local laws etc. There are a number of examples where the companies started as a 100% EOUs (Export Oriented Units) and later diversified into local sales.

The pharma industry generally grows at about 1.5-1.6 times the Gross Domestic Product growth Globally, India ranks third in terms of manufacturing pharma products by volume The Indian pharmaceutical industry is expected to grow at a rate of 9.5 % till 2015 In 2010, India exported drugs worth US 10 billion in to the US and Europe followed by Central and Eastern Europe, Africa and Latin America The Indian vaccine market which was worth US $665 million in 2010 is growing more than 20% The retail pharmaceutical market in India is expected to cross US$ 12-13 billion by 2012 It has received foreign direct investment to the tune of US$ 1.43 billion

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BIBILOGRAPHY :
www.indswift.com http://www.indswiftltd.com/indswift_news.php http://www.indswiftlabs.com/aboutindswift.html http://gbu.indswift.com/ http://www.3mapl.com/ www.pharmabuzz.org

http://www.ranbaxy.com http://www.cipla.com www.lupinpharmaceuticals.com/ www.drreddys.com www.sunpharma.com/ http://www.moneycontrol.com/competition/indswift/comparison/IS02

http://www.cci.in/pdf/surveys_reports/indias_pharmaceutical_industry.pdf

Zinnov, "Pharmaceutical Outsourcing in India" http://www.zinnov.com/presentation/Pharmaceutical_Outsourcing_Overview.pdf www.slideshare.com www.scribd.com

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