Professional Documents
Culture Documents
Introduction
Ⅰ. Sector Performance:
The Indian Pharmaceutical Industry today is in the front rank of India’s science-based industries
with wide ranging capabilities in the complex field of drug manufacture and technology. A
highly organized sector, the Indian Pharma Industry is estimated to be worth $ 4.5billion,
growing at about 8 to 9 percent annually.
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.
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 injectable.
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 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. The Pharmaceutical Industry, with its rich scientific talents and research capabilities,
supported by Intellectual Property Protection regime is well set to take on the international
market.
Ⅱ. Sectors Policy-Legal, Economy and Technology
PHARMACEUTICAL INDUSTRY IN GLOBAL OVERVIEW: The global market for
pharmaceuticals reached $1.2trillion in 2018, up $100billion from 2017, according to the global use of
medicines report from the IQVIA institute for human data science. Going forward, the global market will
grow by4-5%CAGR, reaching $1.5trillion.that rate is lower than the 6.3%CAGR of the 2014-2018
period.
For the US specifically, the 2018 spending was $485billion, up 5.2%over the previous year, and the 2023
spending will be $625-$655, representing a 4-7%CAGR over the 5years period. For several years now,
IQVIA has been careful to distinguish “invoice” revenue (more or less equivalent to list pricing) from
“net” revenue –the revenue that actually accrues to the pharma industry after rebates and deductions are
factored in.US net revenue is expected to have risen 1.3%during 2018 and at a0-3% rate over the next 5
years The worldwide pharmaceutical market was worth about$1.3trillion in 2019, the 10 largest
pharmaceutical companies accounted for about a third of that, worth a collective $392.5billion in revenue.
ADVANTAGE IN INDIA
Competent workforce: India possesses a skill ful work force with high managerial and technical
competence. Cost-effective chemical synthesis: The track record for development, particularly in the
area of improved cost-beneficial chemical synthesis for various drug molecules is excellent.
Legal and Financial Framework: India is a democratic country with a solid legal framework and
strong financial markets. There is already an established international industry and business community
Information and Technology: It has a good network of world-class educational institutions 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 is constantly
growing.
Ⅲ Industry Structure:
The Indian pharmaceutical sector has expanded drastically in the last two decades. The
Pharmaceutical industry in India is an extremely fragmented market with severe price
competition and government price control. The Pharmaceutical industry in India meets around
90% of the country's demand for bulk drugs, drug intermediates, pharmaceutical formulations,
chemicals, tablets, capsules, orals and injectable.
There are approximately 300 big and medium scale Pharmaceutical companies and about 8000
Small scale units, which form the core of the pharmaceutical industry in India. In future it will be
a growth period of the Indian Pharmaceutical Industry. The growth is expected to emerge from
three major areas:
1. Contract research and development services.
2. Export led business of generics and bulk drugs and
3. Growth in specialty therapeutic areas in the domestic market.
Cipla, India’s No 2 domestic pharmaceutical company was incorporated as a public limited
company in 1935, in the name of Chemical Industrial and Pharmaceutical Laboratories Ltd. The
name was changed to the acronym ‘Cipla’ in 1984. Cipla is a leading manufacturer of
formulations in the country and nine of its brands figure amongst the top fifty selling brands.
Antibiotics are the mainstay of the company comprising about 40 per cent of sales. It’s well
known brands, Ciplox, Norflox and Novaclox figure amongst the top 25 pharma brands. Cipla is
known for its ability to launch several new products every year. Cipla has excellent process R&D
skills and a wide distribution network. It is a leading player in anti-infective and anti-asthmatic
formulations & has taken a major initiative in the Anti-Aids segment. During the year 1997-98, it
launched 18 new products. Currently Cipla has around 2200 employees and has incorporated a
unique flat organizational structure.
Board Of Directors :
D R Narang – Director
Dr H R Manchanda – Director
S A A Pinto – Director
V C Kotwal – Director
B K Khare – Director
CHAPTER-2
COMPANY PROFILE
On August 17 1935 Cipla was registered as a public limited company with an authorized capital of Rs.6
lakh.
In the year 1985 US FDA approved the company's bulk drug manufacturing facilities.
In the year 1988 they won National Award for Successful Commercialization of Publicly Funded R&D.
In the year 1991 the company launched etoposide a breakthrough in cancer chemotherapy in association
with Indian Institute of Chemical Technology. Also they manufactured antiretroviral drug zidovudine in
technological collaboration with Indian Institute of Chemical Technology Hyderabad.
In the year 1994 the company commenced commercial operations in their fifth factory at Kurkumbh
Maharashtra
In 1995, cipla launched Deferiprone, the world’s first oral iron chelator. .
In the year 1997 they launched transparent Rotahaler the world's first such dry powder inhaler device.
In the year 1998 they launched lamivudine. The company becomes one of the few companies in the
world to offer all three component drugs of retroviral combination therapy.
In the year 1999 the company launched Nevirapine antiretroviral drug used to prevent the transmission
of AIDS from mother to child.
In the year 2000 the company became the first company outside the USA and Europe to launch CFC-
free inhalers - ten years before the deadline to phase out use of CFC in medicinal products.
In the year 2002 the company set up four state-of-the-art manufacturing facilities in Goa.
In the year 2003 they launched TIOVA (Tiotropium bromide) a novel inhaled longacting
anticholinergic bronchodilator that is employed as a once-daily maintenance treatment for patients with
chronic obstructive pulmonary disease (COPD). Also they commissioned second phase of manufacturing
operations at Goa.
In the year 2005 the company set up state-of-the-art facility for manufacture of formulations at Baddi
Himachal Pradesh.
In the year 2007 they set up state-of-the-art facility for manufacture of formulations at Sikkim. In
February 2007 the company entered into a development and supply agreement with Drugs for Neglected
Diseases Initiative (DNDI) a global non-profit organization for a new anti-malarial combination drug as a
global initiative. During the year 2009-10 the company sold their intellectual property rights and
technical know-how of 'i-pill' an emergency contraceptive brand to Piramal Healthcare Ltd for the
territory of India at an aggregate consideration of Rs.95crore. Also they entered into a strategic alliance
with Stempeutics Research Pvt Ltd. promoted by the Manipal Group for the marketing rights of stem-
cell-based products being developed by Stempeutics. Cipla is sponsoring up to Rs.50crore in the initial
phase for research and development of these products. In April 2010 the company commenced
commercial production of pharmaceutical formulations at the Special Economic Zone (SEZ) project at
Indore Madhya Pradesh. This project includes facilities for the manufacture of aerosols respules liquid
orals pre-filled syringes (PFS) nasal sprays large volume parenterals (LVP) eye drops tablets and
capsules. The total investment for this project is about Rs.900crore. In May 2010 the company acquired
an undertaking for Rs.30.64crore by way of a slump sale arrangement. The undertaking has a
manufacturing facility approved by US FDA and WHO for APIs and intermediates. It is located at
Kurkumbh (Pune district). Also the company set up a wholly-owned subsidiary Cipla Singapore Pte Ltd'
in Singapore to aid logistics and distribution of the company's export business. In May 2010 the
company acquired 100% shareholding of a company for Rs.51.38crore. This company has a state-of-the-
art formulations manufacturing facility at Sikkim with capabilities to manufacture tablets capsules oral
liquids injections dry syrup and ointments/creams. During the year 2010-11 the company introduced a
number of new drugs and formulations such as Entavir (entecavir tablets) an antiviral for hepatitis B;
Febucip (febuxostat tablets) a drug for gout; Flosoft (fluorometholone acetate ophthalmic suspension) a
topical steroid for eye inflammation; Foracort (formoterol and budesonide autohaler) an asthma controller
therapy in a new easy-to-use breathactuated inhaler; Furamist AZ (fluticasone furoate and azelastine
hydrochloride nasal spray) a nasal spray for allergic rhinitis and Montair FX (montelukast and
fexofenadine tablets) an antiallergic combination for rhinitis. During the year Cipla (Mauritius) Ltd Cipla
(UK) Ltd Cipla-Oz Pvt Ltd Four M Propack Pvt Ltd Goldencross Pharma Pvt Ltd Medispray Laboratories
Pvt Ltd Meditab Holdings Ltd Meditab Pharmaceuticals South Africa (Pvt) Ltd Meditab Specialities New
Zealand Ltd Meditab Specialities Pvt Ltd Sitec Labs Pvt Ltd and STD Chemicals Ltd. The company is
setting up API facilities at Bengaluru and Kurkumbh. They are also upgrading the API facilities at
Patalganga. The total investment for these projects is about Rs.400crore. The company proposes to
subscribe to the share capital of two biotechnology companies located in India and Hong Kong to obtain a
40 per cent and a 25 per cent share respectively. The total investment will be about USD 65 million in a
phased manner for setting up state-of-the-art facilities for bio similar products in Goa and China. On 3
May 2012 Cipla announced a major price reduction in selected cancer drugs. On 21st July 2012 Cipla
announced collaboration with Drugs for Neglected Diseases initiative (DNDI) a not-for-profit research
and development (R&D) organization to develop and produce an improved first-line antiretroviral (ARV)
combination therapy specifically adapted to meet the treatment needs of infants and toddlers living with
HIV/AIDS. On 14 August 2012 Cipla announced the launch of `Qvir' a novel 4 drug kit priced at
Rs.158 for treating HIV/AIDS. On 8 November 2012 Cipla announced a major price reduction on select
anti-cancer drugs. On 27 February 2013 Cipla announced an offer to the shareholders of Cipla Medpro
South Africa Ltd. (Med pro) to acquire 100% of the ordinary share capital of Med pro for ZAR 10.0 per
share via a scheme of arrangement. The Board of Directors of Med pro unanimously resolved to support
and facilitate Cipla's offer and recommended to Med pro shareholders that they vote in favour of all
resolutions required to implement the scheme of arrangement. Cipla Med pro South Africa is a leading
provider of chronic medicines to the public and private sectors. On 16 July 2013 Cipla announced that it
had completed the acquisition of 100% of the issued shares of Cipla Med pro South Africa Ltd. for an
aggregate consideration of ZAR 4507mn (Rs.2707crore). On 17 April 2013 Cipla announced the launch
of the first bio-similar of Etanercept in India for the treatment of rheumatic disorders. On 20 February
2014 Cipla and MSD announced the formation of an India-specific strategic partnership whereby Cipla
will have a non-exclusive license to market promote and distribute MSD's raltegravir 400mg tablet under
a different brand name in India. The drug is used for the treatment of HIV-1 infection in adult patients as
part of combination HIV therapy. On 12 May 2014 Cipla through its wholly owned subsidiary Cipla
(EU) Limited announced $21 million two-phase investment in Chase Pharmaceuticals Corporation Inc.
US (Chase) to support Alzheimer's disease drug development. On 19 June 2014 Cipla announced that it
has collaborated with Hetero to launch a bio-similar of the drug `Darbepoetin alfa' under the brand name
`Actorise'. The product is indicated for the treatment of anaemia caused due to chronic kidney disease.
On 7 July 2014 Cipla announced its intention to make investments of up to 100 million in its UK
subsidiary over the next few years. The investment will fund the launch of a range of drugs in the areas of
respiratory oncology and antiretroviral medicines as well as research and development clinical trials and
further expansion internationally and in the UK. In its bid to enter the markets of Czech Republic and
Slovaki Cipla. On 8 September 2014 announced commercial collaboration with UK-based S&D
Pharma. On 15 September 2014 Cipla announced that it had signed a non-exclusive licensing agreement
with Gilead Sciences Inc. for manufacturing and distribution of Sofosbuvir mono Ledipasvir mono the
fixed-dose combination of Ledipasvir / Sofosbuvir with each other and the combination of Sofosbuvir or
Ledipasvir with other active substances for the treatment of hepatitis C. On 18 September 2014 Cipla
announced that it has granted Salix Pharmaceuticals Inc. US-based speciality pharmaceutical company
exclusive rights under certain patent applications in the `Rifaximin Complexes' patent family controlled
by Cipla. Thegrant is on a worldwide basis excluding the countries of Asia (other than Japan) and Africa.
On 8 October 2014 Med pro Pharmaceutical (Pvt) Ltd - a subsidiary company of Cipla Med pro
announced that it had entered into sales and distribution arrangement with Teva Pharmaceuticals (Pvt)
Ltd an affiliate of Teva Pharmaceutical Industries Ltd (Teva) - the largest generic pharmaceutical
manufacturer in the world for the territory of South Africa. As per the tie-up Cipla Med pro a 100%
subsidiary of Cipla Limited will exclusively market Teva's broad pharmaceutical product portfolio in
South Africa.
AREA OF OPERATION
Mumbai
Vikhroli (corporate office)
Bangalore
Patalganga
Kurkumbh
Goa
Baddi (Himachal Pradesh)
Sikkim
COUNTRIES OF EXPORT
Germany
Switzerland
Belgium
France
United States
Ireland
United Kingdom
Italy
Netherlands
Denmark
Spain
VISION MISSION AND QUALITY POLICY
Vision:
Cipla started with a vision to build a healthy India. And along the way realized that in our
own small way, we could contribute to making the world a healthier place. We’ll continue to
bring a smile on as many faces as we can to heal the world as we can to heal the world as
much we can. Because there’ll always be a better world out there for those who have the
passion to create it.
Mission: We use the latest pharmaceutical technology to tunnel over seven decades of
experience into one capsule that cures, one drop that defends and one puff that
protects. We explore every drug to its last particle and in still safe and sure healing to
create one does of confidence. The mission of caring life, which continues to this day
and god willing it will continue in the future.
Quality policy:
Cipla has 34 manufacturing facilities across India. We have dedicated plants for the
technologically- challenging formulations such as oncology products, hormones,
metered-dose inhalers (MDIs), beta- lactams, cytotoxic, injectable and
cephalosporin’s. Our manufacturing plants and processes are seen as among the most
sophisticated in the world. They roll out world- class products in over 65 therapeutic
categories. We use state-of-the-art technology, the most stringent operating
procedures, a highly motivated and technically competent team, highest standards of
safety practices and environmentally green and clean processes.
Cipla earned a name in worldwide for adhering to the highest standards of quality and
have received approvals from various ministers of health and major international
regulatory agencies.
1. Food and drug administration (FDA), USA2. Medicines and healthcare products regulatory
agency (MHRA), UK
3. Therapeutic goods administration (TGA), Australia
4. Medicines control council (MCC), South Africa
5. National institute of pharmacy (NIP), Hungary
6. Pharmaceutical inspection convention (PIC), Germany
7. World health organization (WHO) department of health, Canada
8. State institute for the control of drugs, Slovak republic ANVISA,
Brazil
WORK FLOW MODLE
Manufacturing (work flow model)
Manufacturing process is as follows:
Product
Finished
Batch release Dispatch
product testing
Quality control:
All type of testing done in the quality control department of pharmaceutical industries
is necessary as they plays an important role in defining the quality of products
manufactured in the pharmaceutical industry. These different types of testing cited
that whether the raw materials and the water used in the manufacturing of the
pharmaceutical products is right to use or not. Also plays an important role in
determination of the different components of drugs in right concentration. HPLC
technique is used most widely for the testing. This book gives a practical illustration
of most of the pharmaceutical Q. C. techniques followed in the labs including
microbial limit tests, determination of total microbial count(TMC), total bacterial
count (TBC), total fungal count (TFC), serial dilutions, tests for specified microbes,
biochemical tests, chromatographic techniques (HPLC, ion exchange
chromatography, size exclusion chromatography, affinity chromatography etc.)Cipla
quality control department has 4 major sectors:
Raw materials section
Instrument section
Finished product section
Stability section
Steps involved:
The raw material which is bought from various companies is stored in the
storage department
High performance liquid chromatography (HPLC), DT apparatus etc..,
If the sample passes the test it goes to the finished product section after
production or else it goes to the raw material section and the raw material is
reversed
After the final product is formed, it goes for packaging and thereafter it goes
to the stability section to check the stability of the product
Cipla uses state-of-the-art technology, the most stringent operating procedures, and a
highly motivated and technically competent team, highest standards of safety practices
and
environmentally green and clean processes.
Packaging
Pharmaceutical packaging and labelling has to be carried out for the purpose of the safety
of the pharmaceutical preparations in order to keep them free from contamination hinder
microbial growth, and ensure product safety through the intended shelf life for the
pharmaceuticals.
Packaging labelling is ay written, electronic, or graphical communication on the package
or a separate but associated label.
Types:
o Blister packaging
o Strip pack
o Container pack
o Aerosol packing
o Purpose:
o Physical protection
o Barrier protection
o Information transmission
o Marketing
o Anti-counterfeiting packaging
OWNERSHIP PATTERN
ORGANIZATIONAL STRUCTURE:
COMPETITORS INFORMATION
Ranbaxy labs
Nicholas piramal
Sun pharma
Novartis
Pfizer
Dr Reddy’s labs
Lupin
Glen mark
Divis labs
Study of various departments
1. Pharmaceuticals: the company is a leading domestic pharmaceuticals major,
has a
product range comprising antibiotics, antibacterial, anabolic steroids,
analgesics/antipyretics, antacids, anthelmintic, anti-arthritis, anti-inflammatory
drugs,
anti-TB drugs, anti-allergic drugs, anticancer drugs, antifungal, antimalarial,
antispasmodics, antiulcer ants, immunosuppressant’s etc. it’s a leader in the
antibacterial and anti-asthmatic segments and is the first player in Asia to launch
nonCFC metered dose inhaler.
2. Animal health care products: these include aqua products, equine products,
poultry
products, products for companion animals, and products for livestock animals,
aqua
products but equine and companion animal care products continue to be its
focused
area such as,
Deworming
Flea and tick control
Joint care
Skin care
Scheduled
Anxiety and stress
3.OTC: these include child care products, eye care products, food supplements,
health
drinks, life style products, nutraceuticals and tonics, skin care products, and oral
hygiene products
4. Flavour and fragrance: cipla manufactures a wide range of flavours, which are
used
in foods and beverages, fruit juice, baked goods, and oral hygiene products. Cipla
fragrances have wide ranging applications such as in personal care product,
laundry
detergents and room fresheners
5. Active pharmaceutical ingredients(API)
Cipla is one of the biggest exporters of low cost, high quality APIs across the
world.
Major bulk drugs and intermediates manufactured by cipla are: adefovir
dipivoxyl,
albendazole USP, albuterol sulphate, alendronate sodium.32H20, alpra zolam,
amlodipine besylate, anastrazole, atorvastatin, aripiprazole, azelastine HCL etc.
Infrastructure & Facilities
Our investments in manufacturing capital include development of new drug
delivery systems, facilitation of infrastructure supporting API and formulation
developments and strengthening of platform technologies.
Highlights:
46 state-of-the-art manufacturing facilities across 5 countries
50+ dosage forms 1,500+ products
26,000+ global employees
1,300+ scientists and 6 R&D facilities
4 Lakh+ healthcare professionals 3.5 lakh+ pharmacists
AWARDS AND ACHIEVEMENTS
AWARDS:
Cipla directors received Padma Bushan award in 2005 i.e. Dr. Y. K. Hamied.
In 1976 cipla launches medicinal aerosols for asthma.
In 1980 won chemexil award for excellence of exports
In 1988 won national award for successful commercialization of publicly funded
in
Research & development.
In 1997 cipla became the first company in the world by launching transparent rota
haler, a dry powder inhaler device
CFC-free inhalers.
In 1998 the company launched lamivudine, and became one of the few companies
in
the world to offer all 3 component drugs of retroviral combination therapy
(zidovudine and stavudine already launched).
Set-up state of the art facility for manufacture of formulations at Sikkim in 2007
ACHIEVEMENTS:
In the year 1935, Dr K A Hamied sets up “the chemical, industry and
pharmaceutical
laboratories ltd”, in a rented bungalow, at Bombay central. In the year 1941 as
the Second World War cuts off drug supplies the company starts
producing fine chemicals dedicating all its facilities for the war effort.
In the year 1952 the company set up first research division for attaining
selfsufficiency in technological development.
In the year 1960 they started operations at second plant at Vikhroli Mumbai
producing fine chemicals with special emphasis on natural products.
In the year 1968 the company manufactured ampicillin for the first time in the
country.
In the year 1972 the company started Agricultural Research Division at Bangalore
for
scientific cultivation of medicinal plants.
In the year 1976 they launched medicinal aerosols for asthma.
In the year 1980 the company won Chemexil Award for Excellence for exports.
In the year 1982 the company started operations in their fourth factory at
Patalganga
Maharashtra.
In the year 1984 they developed anti-cancer drugs vinblastine and vincristine in
collaboration with the National Chemical Laboratory Pune. Also they won Sir P C
Ray Award for developing in-house technology for indigenous manufacture of a
number of basic drugs.
FUTURE GROWTH AND prospectus
Growth strategy
Development of innovative drug delivery systems for new and existing active
drug
substances continued to be an integral part of the country’s growth strategy. Work
on new
medical devices, mainly in the area of respiratory medicine, progressed rapidly, as
did its
inhaled insulin project. The company has developed a unique transdermal
delivery system. It
has already launched a spray patch for testosterone and another for estradiol.
Other new
developments include a novel dry powder inhaler device and a unique single-
action singledose inhaler device. Cipla has entered into a research agreement with
Avestha Gngraine
technologies private limited. Bangalore with the objective of working on a
collaborative
biopharmaceutical development programme. The partnership will focus on the
development
of range of bio similar products for autoimmune disorders, cardiovascular
diseasesandca.
Future outlook
Cipla keeps the steady momentum of growth with an overall growth of more than
57% in income from operations for the quarter ended march 2006.
Currently, we are one of the largest exports of pharmaceutical products in India,
exporting APIs and formulation products to more than 160 countries including the
U.S and a number of countries in Europe, Africa. Australia, Latin America and
the
middle East. Both the international as well as the domestic business have recorded
a growth of more than 56% and 63% respectively.
RATIO ANALYSIS:
PROFIT AND LOSS ACCOUNT OF CIPLA LIMITED
INTERPRETATION OF RATIOS
Debt equity ratio =Debt equity ratio decreased it shows that company went to
less debts for
raising funds and investing liability have decreases.
Current ratio = current ratio increased in the year 2020 when compared to
previous year
which shows company is in the better position to pay the liability
Assets turnover ratio= from this ratio we came to know that assets has been
efficiently
decreased in the current year 2020 compared to previous year 2019
Financial Stability:
- Threat of Terrorist Attacks – We believe in the world of post 9/11, corporations such as Cipla
Hamied have to live with operating under the shadow of a terrorist attack. The prudent policy
should be to take insurance and other types of hedging instruments to mitigate the losses
occurring because of the terrorist attacks.
- Judiciary Independence – In the matter of commercial and business decisions, judiciary of the
country is independent to a large extent. Business do face problem when the conflict is between
public interest and proprietary technology similar to ruling in South Africa where government &
judiciary allowed generic AIDS drug irrespective of patents of global companies. Homegrown
drug major Cipla has urged the government to increase fund allocation for the healthcare sector,
improve ease of doing business and formulate policies that aid the domestic pharmaceutical industry.
- Government Regulations and Deregulations – The government is adhering to all the rules and
regulations under World Trade Organization norms. There is consistency in both policy making
and implementations of those policies.
- Political Governance System – Based on the information provided in the Cipla’s annual report
of 20-21, it seems that the country have a stable political system. Cipla Hamied can make
strategies based on the stable political environment.
- Employment Rate – If the employment rate is high then it will impact Cipla Hamied strategies
in two ways – it will provide enough customers for Cipla Hamied products, and secondly it will
make it expensive for Cipla Hamied to hire talented & skillful employees.
- Price Fluctuations in both Local and International Markets – Compare to the level of
quantitative easing in last decade the prices of Cipla Hamied products and prices of overall
products have remained sticky in the US market. Cipla Hamied should consider the fact that at
deficit levels of United States in an emerging economy can lead to rampant inflation and serious
risks of currency depreciation.
- Work Force Productivity – Work force productivity in US has grown by 25-30 % in last two
decades even though the salaries are not reflecting those gains. It can enable Cipla Hamied to
hire skilled workforce at competitive salaries.
- Inequality Index / Ranking on Gini Index – Gini Index and level of inequality are a great
barometer for harmony and development of a society. If there is huge income inequality in the
society then the likelihood of conflict and crime increases. It can lead to uncertainty and
suppression of consumption in both short term and long term.
- Level of Household Income and Savings Rate – Increasing consumption and stagnant
household income in United States had led to credit binge consumption. It has decimated the
culture of savings as people don’t have enough to save. Cipla Hamied needs to be careful about
building marketing strategy that is dependent on “Purchase on Credit” consumer behavior.
- Attitude towards Health & Safety – The attitude towards health and safety is often reflected in
the quality of the products and cost structures of manufacturing processes. Cipla Hamied has
stringent norms for health and safety norms so in emerging economies it may have to compete
with players who don’t have high cost structures that of Cipla Hamied.
- Education Level in Society – Education level of the society impacts both the quality of jobs and
level of income. High level of education often results in better jobs, higher income and higher
spending on complex and aspirational products.
- Attitude towards Savings – The culture of saving in US and China is totally different where
savings rate in China is around 30% , it is well below 15% in United States. This culture of
consumption and savings impact both type of consumption and magnitude of consumption.
- Level of Social Concerns & Awareness in Society – Higher level of social concerns in the
society often result higher consumer activism and pressure from non-governmental
organizations, & pressure groups.
- Immigration Policies and Level of Immigration – What are the immigration policies of the
country, what is the level of immigration, and in which sectors immigration is encouraged. This
will enable the Cipla Hamied to determine – if required can it hire talent globally to work in that
particular market.
- Power Structure in Society – Cipla Hamied should carefully analyze both - What is the power
structure in the society? How it impacts the demand in the economy. For example the power
structure in US economy is slowly moving towards the older generation as that generation has
higher disposable income compare to the younger generation.
- Acceptance of Mobile Payments and Fintech Services – One of the areas where US are lacking
behind China is Mobile Payments. Cipla Hamied should assess what are preferred choice of
mobile payments in local economy and chose the business model based on it.
- Empowerment of Supply Chain Partners – Cipla Hamied should analyze areas where
technology can empower supply chain partners. This can help Cipla Hamied to bring in more
transparency and make supply chain more flexible.
- Transparency & Digital Drive – Cipla Hamied can use digitalization of various processes to
overcome corruption in the local economy.
- Technology transfer and licensing issues for Cipla Hamied – laws and culture of licensing of
IPR and other digital assets should be analyzed carefully so that Cipla Hamied can avoid
shakedowns and IPR thefts.
- Mobile Phone & Internet Penetration – Cipla Hamied should assess the level of internet and
mobile phone penetration in the country as it will it in building a requisite business model based
on local needs and realities.
- Integration of Technology into Society & Business Processes – Uber failed in China because it
tried to enter before smartphone were widespread in China. Cipla Hamied should build a strategy
that can integrate societal values, infrastructure, and Cipla Hamied business model.
Model
MCKENSY’S 7S FRAMEWORK:
McKinsey 7s model was developed in 1980s by McKinsey consultants Tom Peters, Robert
Waterman and Julien Philips with a help from Richard Pascale and Anthony G. Athos.
Since the introduction, the model has been widely used by academics and practitioners
and remains one of the most popular strategic planning tools. It sought to present an
emphasis on human resources, rather than the traditional mass production tangibles of
capital, infrastructure and equipment, as a key to higher organizational performance. The
goal of the model was to show how 7 elements of the company: Structure, Strategy, Skills,
Staff, Style, Systems, and Shared values, can be aligned together to achieve effectiveness
in a company. The key point of the model is its objectives.
Improve the performance of a company
Examine the likely effects of future changes within a company
Align departments and processes during a merger or acquisition
Determine how best to implement a proposed strategy
To facilitate organizational change
The Mckensy’s 7s model involves 7 interdependent factors which are categorized as either
“hard” or “soft” elements
Hard Soft
Strategy Style
Structure Staff
system Skills
Shared values
Mckensy’s 7s model
1. STRUCTURE:
Human resource:
Marketing department
Responsibility for growing revenue, increasing market share and contributing to
company growth and profitability include a marketing director or manager plus
marketing executives responsible for functions such as advertising, publications or
events
The marketing department works with internal and external product development
Marketing departments plan campaigns and develop communications material to
promote products and services to customers and prospects.
Production department
Production is the functional area responsible for turning inputs into finished outputs
through a series of production processes
Engages in the manufacturing or production of goods for the business organization
The production manager is responsible for making sure that raw materials are
provided and made into finished goods effectively
Other workers in this department include technicians, engineers, designers, machine
operators etc.
Quality assurance
A broad practice used for assuring the quality of products or services
Uses a number of tools for enhancing the quality practices tools vary from simple
techniques to sophisticated software systems
Quality assurance teams of organizations constantly work to enhance the existing
quality of products and services.
2. STAFF
In fiscal year 2018 cipla limited employed over 23 thousand employees across India.
Out of this there were around 2600 female employees and 13 employees with
disabilities. Cipla is one of the leading biotechnology companies across India, with a
focus on cardiovascular, diabetic and asthma related dieases.
2. STRATEGY:
3. Marketing Strategy of Cipla analyses the brand with the marketing mix framework which
covers the 4Ps (Product, Price, Place, Promotion). There are several marketing strategies
like product innovation, pricing approach, promotion planning etc. These business
strategies, based on Cipla marketing mix, help the brand succeed.
4. Cipla marketing strategy helps the brand/company to position itself competitively in the
market and achieve its business goals & objectives.
5. Let us start the Cipla Marketing Strategy & Mix to understand its product, pricing,
advertising & distribution strategies
Cipla Product Strategy:
Cipla is one of the leading pharmaceutical companies’ bases out of India. Cipla
offers vast and varied range of products and medicines in its marketing mix
product portfolio. Some of its products include:
o OTC- It includes personal care products along with the artificial sweetener,
infant food, etc. Cipla also has a dedicated division for animal health-care
products.
o Prescription- It includes steroids, anti-allergic, anti-inflammatory, anti-asthma
medicines etc.
o Fragrance- It manufactures food and beverage flavours as well.
o Active Pharmaceutical Ingredients- It is a leader in APIs which are cheaper
and of high-quality.
o Inhaled Products: More than 65 different inhaled products are sold by Cipla of
more than 20 ingredients like Synchrobreathe, multi-haler, nebulizer, nasal
spray, rota haler, etc. Cipla was the first company to manufacture oral iron
chetar in the world. Also, they are the world’s largest manufacturer of
antiretroviral drugs. Not only this, it provides services as well like
commissioning, plant engineering, etc. Needless to say, it faces tough
competition from players in the same industry like Ranbaxy Labs, Lupin, Dr
Reddy’s Laboratories, Sun Pharmaceuticals etc.
Cipla is the leader in India in health-care company, faces limited though tough competition
and envisions to provide affordable health facilities accessible by all, its pricing policy is well
in line with these 3 factors affecting it. It products are pocket friendly for its customers and
has managed to reduce the prices of several vital drugs in the market. Also, competitive
pricing policy is adopted by Cipla to compete with its competitors.
Cipla has its presence in 100 countries with wide distribution network (with 6500
distributors in India) with products being available easily at medical stores and
production facilities. In India only, it has 35 manufacturing units in 8 locations. Cipla
also has R&D units for the development of new drugs. It exports its products to nearly
160 countries which include Middle East, Australia, Africa, Latin America, Europe and
Middle East.
The promotional and advertising strategy in the Cipla marketing strategy is as follows:
The tagline of Cipla “Caring for Life” has become its mission and therefore contributes
actively to society through themes like generation of employment, education, health and
sanitation, etc. through its Palliative Care Centre, it provides to cancer patients free-of-cost
medication. The biggest value addition and promotion is done through the accolades brought
to company in several fields by widely recognised and reputed institutions around the world
in several years. Cipla won the Thomson Reuters India Innovation Award and it won Dun &
Bradstreet American Express Corporate Awards and many more. Hence this completes the
marketing mix of Cipla.