Corporate Strategy Dr.

Reddy¶s Laboratories Limited
Presenting by Pratush Reddy D

Contents«
‡ Company Overview ± Dr.Reddy¶s ‡ More Details ± Dr.Reddy¶s ‡ Comprehensive Analysis
± PEST Analysis
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± SWOT Analysis

Reddy¶s The image part with relationship ID rId3 was not found in the file. AnjiReddy ± CEO : Mr. ‡ First Indian PharmaCompany to take up Drug Discovery research .V. Company Overview ± Dr. Growth: Turned around Indian Bulk Drug industry Indian Bulk Drug industry ± Mid-80s: Import-dependent ± Mid-90s: Self-reliant ± 2000 onwards: Export-oriented industry Transformed industry sobriquet from ÄImitators to ÄInnovators The image part with relationship ID rId5 was not found in the file. The image part with relationship ID rId6 was not found in the file.G.The image part with relationship ID rId2 was not found in the file. ‡ Year of Establishment :February 1984 ± Founder: Dr.Prasad The image part with relationship ID rId4 was not found in the file.

‡ ‡ ‡ ‡ Revenue Employees Head Quarters Business Types : $420 million (Q2 FY11) : 13000 + : Hyderabad : »Global Generics »Pharmaceutical Services & Ingredients »Proprietary Products .The image part with relationship ID rId2 was not found in the file. More details The image part with relationship ID rId3 was not found in the file. The image part with relationship ID rId6 was not found in the file. The image part with relationship ID rId5 was not found in the file. The image part with relationship ID rId4 was not found in the file.

Reddy s Presence across the Globe: .Dr.

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com/docs/13899768/Pest-Analysis-of-pharma-Industry-complete-project) . This is throwing many an investment plan into the doldrums. ‡ A combination of diverse political thought have got together to cobble together a rag-tag coalition.docstoc. 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.POLITICAL ‡ Innovator companies are lobbying for making more stringent patent laws which could make selling of patented products more difficult ‡ Developed countries are constantly making stringent regulatory systems (GMP) resulting in increased in manufacturing cost. (http://www.

‡ This has shown a marked increase in FDI and FII inflows (but we are lagging behind if we compare with China) ‡ Since 1990.scribd. (http://www.ECONOMICAL ‡ It has a competitive and dynamic private sector that accounts for more than 75% of India's GDP.com/doc/26251406/Fundamental-Analysis-Dr-Reddy-s-Lab) . the economy of India has witnessed a decent growth rate of 6% and has been successful in overcoming poverty by about 10%.

y Cattle-rearing encourage diseases communicated by animals. y Early child bearing affects the health standards of women and children. y Poor Sanitation and polluted water sources prematurely end the life of about 1 million children under the age of five every year. y Increasing pollution is adding to the healthcare problem.SOCIAL y Cost effective generic drugs are needed by developing and under developed countries for healthcare therefore demand should rise. (http://www.com/docs/13899768/Pest-Analysis-of-pharma-Industry) . y In India people prefer using household treatments handed down for generations for common ailments.docstoc.

TECHNOLOGICAL ‡ Initial investment for Drug discovery is very high and about 15-20 years are required for developing one drug molecule. . ‡ Thus Dr Reddy s has to continuously upgrade technology and synchronize all the areas of drug discovery for minimizing failure risk. If clinical trials fail whole investment is lost. ‡ High end technology is required for selecting desired molecule. ‡ New molecule has to go through clinical trials.

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STRENGTHS: ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ ‡ Wholly owned subsidiaries in US and Europe Joint ventures in China and South Africa Markets pharmaceutical products in 115 countries Partnerships with global pharmaceutical companies like Novartis. (http://www. Strong product portfolio Manufacture and market over 250 medicines targeting a wide range of therapies Wide range of anti-cancer drugs developed Over 100 APIs developed Six New Chemical Entities(NCE) Low cost base Contributes to company¶s high profit margin of around 34% of sales Partnerships with key players in the market keeps its cost base down Research Driven & Global Talent Expertise in developing innovative product formulations 13000 employees worldwide including new drug discovery research scientists. etc.com/doc/31313536/Implementation-of-7s-Srategy-in-Dr-Reddy-s) .scribd. NOVO Nordisk.

where currency is much more stable than the Indian Rupee ‡ Over-reliance on partnerships ‡ In order to compete effectively in global markets.scribd. strategic partnerships required to develop products. ‡ Lack of resources similar to US and Europe based competitors to develop a drug to marketing stage ‡ Generic drugs smallest focus ‡ Smallest portion of revenues from generics at around 20% ‡ Lack of patent legislation in India harms sales of its products (http://www. hence major source of revenue is exports of APIs.WEAKNESSES: ‡ India . May loose out to western world.com/doc/31313536/Implementation-of-7s-Srategy-in-Dr-Reddy-s) .a rich source of Active Pharmaceutical Ingredients (APIs). especially Europe.

scribd.com/doc/31313536/Implementation-of-7s-Srategy-in-Dr-Reddy-s) .OPPORTUNITIES: ‡ Take a drug all the way to market ‡ Take a molecule from its pipeline all the way to the market place cost-effectively market ‡ Buy back of the integrated drug development company from ICICI Ventures and Citigroup ‡ Domestic Generic drugs market ‡ In another 4-6 years. many product patents obtained after the 2004 legislation will go off providing an opportunity to the company increase its domestic footprint in Generics (http://www.

Merck & Co ‡ Revenues running into billions which dwarfs Reddy¶s annual turnover Litigation charges ‡ Reddy¶s lost the case against Pfizer for the use of generic form of Norvasc drug. Legal cost $10m and also loss of market opportunity. ‡ Heightened concerns about profitability of German generics business of Beta pharm (http://www. Novartis.g.com/doc/31313536/Implementation-of-7s-Srategy-in-Dr-Reddy-s) . which can be costly and time consuming ‡ This may delay the company entry to particular markets which affects revenue ‡ Competition from US and European Companies ‡ Based in lucrative markets e.scribd.THREATS: ‡ Needs to gain FDA approval for all sources and products ‡ Products have to pass strict FDA trials before going to market.

SWOT Evaluation (http://www.scribd.com/doc/31313536/Implementation-of-7s-Srategy-in-Dr-Reddy-s) .

‡ It can leverage upon its huge research and development team to discover more drugs.SO STRATEGIES ‡ With its low cost base and wide product portfolio. it can penetrate into the vast domestic market. ‡ It can partner with huge pharma retail outlets like Hetero and Apollo to promote more of their products. .

many product patents obtained after the 2004 legislation will go off providing an opportunity to the company increase its domestic footprint in Generics. with this it can hedge the threat of losing its market to western players in the API export market. ‡ As in next four years. .WO STRATEGIES By buying out the integrated drug development company from ICICI ventures and CITI group the company can actively manufacture its own drugs using API.

ST STRATEGIES ‡ By leveraging on the low cost advantage. ‡ Increase the German market position by introducing new products into the market. . vast human resources in the R&D team it can expand its domestic market thus reducing the loss risk in case of losing US and European market.

. ‡ The above strategy also helps to rapidly enter the markets where approvals take long time.WT STRATEGIES ‡ Take a molecule from its pipeline all the way to the market place cost-effectively market to reduce the cost of obtaining approval.

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