CIPLA MEDICINE

Cipla was born out of Dr. K.A. Hamied’s vision to harness Indian expertise for self-
sufficiency in the chemical and pharmaceutical industry in India. Dr. K.A. Hamied was an
exemplary visionary who donned various hats; he was a chemist, an entrepreneur and
pioneer, an active participant in India’s independence struggle, a close ally of Mahatma
Gandhi, Dr. Zakir Hussain and various others, a legislator in the Bombay Presidency, head
of various associations, Sheriff of Bombay, proactive supporter and sponsor of institutes of
scientific excellence in India.
Be it the commencement of bulk drug production in India, the landmark Indian Patents Act
of 1970, the several ‘firsts’ in India and the world, its historic international stance on the
price and availability of antiretroviral drugs for HIV treatment in 2000-2001, its free-of-cost
Palliative Care Centre for terminally-ill cancer patients, Cipla, under the leadership of its
current Chairman Dr. Y.K. Hamied, has stood for fearlessness and compassion. It is not for
nothing that we say ‘None Shall be Denied’.

Apart from its various national and international milestones, the story of Cipla’s growth and
expansion, its ups and downs, successes and challenges is also one that deserves to be
chronicled. According to Dr Y K Hamied, Cipla was ranked 56 in the 1960s.

It is with this view that the Cipla Archives project has been launched recently. We treat our
proud legacy with the seriousness and the sense of responsibility it deserves. We want to
share Cipla’s story, celebrate its rich history, remind ourselves of the lessons learned, and
reflect on the evolution of the pharmaceutical industry in India and at Cipla’s role in shaping
it.

The Cipla Archives will bring together and house a treasure-trove of documents,
photographs and oral history interviews, among other material. As the project progresses,
we hope to make information available through this website. With this initiative and related
activities, we not only hope to showcase Cipla’s history but also contribute to the
development of business archives in India, and serve as a forum for debates and discussions
on the history and historiography of science and the pharmaceutical industry in India.

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 Milestones

 1935: Founder Dr. KA Hamied sets up Cipla

 1939: Mahatma Gandhi visits Cipla and inspires Cipla's founder to make essential
medicines for the nation and help make it self-reliant
 1960s: Pioneers API manufacturing in India and helps lay the foundation for the bulk drug
industry in India
 1970: Spearheads the New Patent Law, enabling Indian pharmaceutical companies to
manufacture patented products to make it possible for Indian companies - for the first time -
to manufacture any medicine and offer it at an affordable price to any Indian
 1978: Pioneers inhalation therapy in India by manufacturing Metered-Dose Inhaler (MDI) at
a time when imported supplies had stopped
 1994: Launches the world's first oral iron chelator, Deferiprone, to revolutionize thalassemia
treatment by making it affordable, painless and convenient
 1996: Makes the world's first transparent dry powder inhaler
 2001: Pioneers access to HIV treatment by making anti-retrovirals (ARVs) available at less
than a Dollar a Day resulting in millions of saved lives
 2005: Produces an anti-flu drug in less than 3 months during the Bird Flu epidemic, which
under normal conditions would have taken at least 3 years to develop
 2012: Makes another medical breakthrough by reducing cancer drug prices and making
cancer treatment affordable
 Now: Venturing into newer challenges in platform technologies, biotechnology and stem
cells to address the unmet medical needs of the world cost-effectively

. Company Profile:

Cipla is based in India’s commercial capital Mumbai, The

Chemical, Industrial & Pharmaceutical Laboratories. Today, Cipla is a leading player in
anti-infective and anti-asthmatic formulations. The company also specializes in the
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manufacturing of steroids and hormones. Cipla manufactured ampicillin for the first time in
the country in 1968. In 1983, Cipla developed two anticancer drugs, vinblastine and
vincristine from the common garden plant Vinca rosea in association with the National
Chemical Laboratory. The company pioneered the manufacture of the antiretroviral drug,
zidovudine, in technological collaboration with Indian Institute of Chemical Technology in
1993. In 1997 Cipla became the first company in the world by launching transparent
Rotahaler, a dry powder inhaler device. In 1998 the company launched lamivudine, and
became one of the few companies in the world to offer all three component drugs of
retroviral combination therapy (zidovudine and stavudine already launched).Cipla received
clearance from the Drugs Controller General of India to manufacture and market the
country's first non-nucleoside reverse transcriptase inhibitor (NNRTI), nevirapine, for the
treatment of AIDS. Cipla Ltd became India’s second largest pharmaceutical, edged out the
multinational giant GlaxoSmithKline which was reigning supreme in the country for long,
in terms of drug sales last year. Consistently maintaining a fast-track growth momentum,
Cipla has registered an 80-percent jump in net profit for the quarter ended on March 31
2006, driven by growth in domestic sales and exports. In the fourth quarter, Cipla posted a
net profit of 1.90 billion rupees. Net sales grew 63 percent to 8.7 billion rupees. Cipla's
exports in the quarter grew 63.7 percent while domestic sales rose 56.4 percent. Cipla
anticipates 15 to 20 percent growth in this year. Cipla's R&D division focuses on the
development of new products and new drug delivery systems across a range of therapies.
The company is spending over 4 per cent of its total turnover on R&D activities. The
company supplies drugs to treat over 2 lac HIV-positive patients worldwide. The company
has also been among the major suppliers of anti-malarial drugs and drugs for
schistosomiasis to international markets.

Business Overview

The present businesses of Cipla can be broadly classified into:

Domestic branded formulation sales (74% of total sales; 19-20% operating profit margin)

Domestic unbranded formulation sales (7% of total sales; over 10% operating profit margin)

Exports (19% of total sales; around 38-40% operating profit margin). Breakup of exports is
as follows:

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Europe (17%), US (30%), Africa (34%), Middle East (8%) and Australia (11%).

Cipla has been relatively low profile on its R&D initiatives compared to the domestic peers,
all of whom have set their sights on discovering new chemical entities (NCEs). But lately,
R&D spend of Cipla has increased by 25% to Rs. 300 mn (4% of sales) and the company
has an R&D team of 200 people. In future the R&D expenditure is expected to grow at a
faster pace compared to sales and might rise to over 5% of sales. The business environment
for Cipla has become highly competitive in the last few years. The major factors affecting
Cipla are as follows:

New Drug R&D costs are prohibitive, which has made MNC’s to spread their R&D costs
through Mergers / Acquisitions.

In Indian Pharmaceutical Sector prices of over 60% of the Drugs/Formulations is controlled

by the government through DPCO (Drug Price Control Order). For Cipla DPCO coverage is
around 55% Low entry barriers in the bulk drugs market has led to a situation of over-
capacity, which has made major domestic players, shift their focus towards formulations
segment. As a result Cipla, which is earning nearly 80-85 percent of its sales from
formulations, is facing increasing competition. With the focus on post 2005 era, MNC’s are
strengthening their position in India through marketing tie-ups with local majors and fully
owned subsidiaries. This can lead to even higher degree of competition.

VISION AND MISSION

VISION
To heal South Africa and to become the largest and most respected pharmaceutical company
in Southern Africa.

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 MISSION
To become the preferred partner in medicine

BOARD OF DIRECTORS

 Founder: Dr. K.A.Hamied (1898-1972)

 Chairman: Dr. Yusuf K Hamied
 Non-Executive Vice-Chairman: Mr. M.K. Hamied
 Managing Director and Global Chief Executive Officer: Mr. SubhanuSaxena
 Whole-time Director: Mr. S. Radhakrishnan
 Executive Director: Ms. SaminaVaziralli
 Non-Executive / Independent Directors: Mr. Ashok Sinha ,Dr. Peter Mugyenyi, Mr.
AdilZainulbhai, Ms. Punita Lal

ORGANIZATIONAL STRUCTURE

Cipla has incorporated a unique, flat organization structure that seems to work for them.
Brother, MK Hamied, looks after marketing and his cousin Amar Lulla heads the finance
division, while YK Hamied is responsible for Cipla's overall vision and strategy. Stories
about Hamied the workaholic are legendary. Managers at Cipla say that whenever he is in
India, he is in office by seven in the morning, looking at new products in the laboratories.
Hamied is basically a scientist by nature. Apart from driving Cipla's international growth he
is actively involved with his 200-people strong R&D division. Employees at Cipla are very
well paid. His chemists with PhD's make about $10,000 (Rs480, 000) a year, a good salary
in India. The lowest-paid of his 3,500 employees makes about $2,400 (Rs115, 200) a year.
Hamied may be generous with employees but it does not mean that he is not aware of costs.

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In fact the reason he manages to charge less for all his drugs is because he is a shrewd cost
cutter, and keeps his overheads low.

COMPANY LOCATION AND ITS BRANCHES

Sl. No. Year Name of the Company/industry Number of Students

placed
01 2006 Medrich Steri Labs, Bangalore 10 (Av. Sal. 10,000)
02 2006 Archana B. M. Reddy College of Pharmacy 01 (Sal. 14,000)
03 2006 Cadila, Ahmadabad 01 (Sal. 15,000)
04 2006 Natco pharma, Hyderabad 02 (Av. Sal. 15,000)
05 2006 Sipra Labs, Hyderabad 02 (Av. Sal. 15,000)
06 2005 Aditi Laboratories, Hyderabad 03 (Av. Sal. 10,000)
07 2005 Micro Labs, Bangalore 02 (Av. Sal. 14,000)
08 2005 Medrich Steri Labs, Bangalore 05 (Av. Sal. 12,000)
09 2005 Sun Pharma, Bangalore (Marketing) 03 (Av. Sal. 12,000)
10 2004 Cipla, Hyderabad 01 (Sal. 10,000)
11 2004 Arabindo Pharma, Hyderabad 01 (Sal. 10,000)

• Name and duration of programmes(s) having affiliation with Foreign University : NIL

• Details of the Foreign Institution/University : Not Applicable

ACHIEVEMENTS

Milestone
1935

Dr K A Hamied sets up "The Chemical, Industrial and Pharmaceutical Laboratories Ltd." in

a rented bungalow, at Bombay Central.

1941

As the Second World War cuts off drug supplies, the company starts producing fine
chemicals, dedicating all its facilities for the war effort.

1952

Sets up first research division for attaining self-sufficiency in technological development.

1960
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Starts operations at second plant at Vikhroli, Mumbai, producing fine chemicals with special
emphasis on natural products.

1968

Cipla manufactures ampicillin for the first time in the country.

1972

Starts Agricultural Research Division at Bangalore, for scientific cultivation of medicinal

plants.

1976

Cipla launches medicinal aerosols for asthma.

1980

Wins Chemexcil Award for Excellence for exports.

1982

Fourth factory begins operations at Patalganga, Maharashtra.

1984

Develops anti-cancer drugs, vinblastine and vincristine in collaboration with the National
Chemical Laboratory, Pune. Wins Sir P C Ray Award for developing inhouse technology
for indigenous manufacture of a number of basic drugs.

1985

US FDA approves Cipla's bulk drug manufacturing facilities.

1988

Cipla wins National Award for Successful Commercialisation of Publicly Funded R&D.

AWARDS AND REWARS

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Awards:

1998: Conferred the All India ONE seller award by M/s Bal Pharma, Bangalore

1999: Conferred the All India TWO Seller by M/s BD Ltd.

2000: Conferred the All India TWO Seller by M/s CIPLA Ltd. (Generics)

2001: Conferred All India TWO Seller by OKASA a division of M/s CIPLA Ltd (Generics)

2002: Conferred All India ONE Seller by M/s CIPLA Ltd. (Generics)

2002: Conferred All India ONE Seller by OKASA a division of M/s CIPLA Ltd (Generics)

2003: Mr. Narendra Srisrimal awarded the Best Growth Award by Mr. S. Semmalai,
Honorable Minister of Health and Education.

2004: CSR recognition in the form of an award: Mr. Narendra Srisrimal awarded the Best
President of the Rajasthan Youth Association, an office he holds on an honorary basis

2005: Conferred All India BEST PRODUCT MIX by M/s Lupin Ltd.

2006-2007: We were rewarded All India ONE Seller by M/s Lupin Ltd. (Mass Marketing
Division)

2006-2007: All India Second Top Seller for Lucipro Group.

2006-2007: All India Second Top Seller for Eufox Group.

2006-2007: National Award for Best Promotional Activity.

2008-2009: All India Top Seller Award for Lupin Mass Marketing.

2008-2009: National Award for Best Promotional Activity.

2008-2009: National Award for Best Stockist Meet.

2008-2009: All India Top Seller for Defenac Group.

2008-2009: All India Second Top Seller for Lupisulide Tablets.

2009-2010: All India Top Seller for Lupin Mass Marketing

2009-2010: Product Champion Winner - All India Second Top Seller Award for Acemiz
Group

2009-2010: Best Product Mix Seller Award

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2009-2010: Best GWP Quality Award

2010: Received ISO 9001:2008 International standards Certificate in the year 2010 for
providing quality Logistics, Storage, Distribution, Clearing and Forwarding Services

Apart from these recognitions, we have won several other Product awards for registering
record sales of Individual products on an All-India basis

COMPETITORS

Competition

1. Sun Pharmaceuticals
2. Dr. Reddy’s laboratories
3. Lupin
Competitors 4. Ranbaxy labs

These are some of the competitors of CIPLA - APOLLO HOSPITALS (HOSPITAL&

MEDICAL SERVICES), AURBINDO PHARMA, BILCARE (PACKAGING), BIOCON,
DISHMAN PHARMA, DIVIS LABS, Dr. REDDY's LABS, Pftizer, GlaxoSmithKline,
Alkem, Glen mark, Ipca LABS , Lupin, Opto Circuits(Hospitals & Medical Services),
Orchid Chemicals, Nicholos Piramal Health, Ranbaxy Labs, Sterling Bio, Sun Pharma, Sun
Pharma Advanced Research Company, Wockhardt, Zydus Cadila Healthcare, Ajanta
Pharma , Alembic, Zandu Pharma , Aarti Drugs etc.

Competition Table (BSE Data):

Company Last Price Market Sales Net Profit Total

Cap. (Rs. Turnover Assets
cr.)

Sun Pharma 1,177.25 24,382.78 3,861.55 1,265.29 5,175.02

Cipla 268.05 20738.36 5,270.54 767.83 4,336.35

Ranbaxy Labs 319.80 13,443.49 4,494.52 -1,032.33 7,442.15

Dr Reddy’s Labs 784.70 13,235.32 4,197.53 560.89 5,899.40

GlaxoSmithKline 1,439.45 12,192.58 1,685.56 576.57 1,546.72

Lupin 975.40 8,228.35 2,967.13 416.97 2,320.21

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Piramal Health 328.30 6,861.90 2,333.46 275.32 1,520.76

Divis Labs 514.95 6,723.03 1,203.49 421.26 960.05

Cadila Health 449.00 6,128.81 1,945.72 265.91 2,052.70

Glenmark 216.50 5,425.18 856.11 217.93 1,552.79

TRADE UNION
Cipla is a global pharmaceutical company whose goal is ensuring no patient shall be denied
access to high quality & affordable medicine and support. Cipla’s journey began in 1935
when our founder, Dr K A Hamied, set up an enterprise with the vision to make India self-
sufficient in healthcare. Over the past 77 years, they have emerged as one of the world’s
most respected pharmaceutical names, not just in India but worldwide.
For patients, caring is a promise that they will do whatever it takes to ensure they have
continued access to the highest quality medicines at affordable prices; whether a disease
affects millions or just a few hundreds.
To the medical fraternity, caring means the assurance of world-class medicines and support
across multiple therapeutic areas.
For business partners, caring brings the confidence of always getting world-class quality and
competitive prices.

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For employees, caring manifests itself in a safe, equal-opportunities' workplace that fosters
innovation for a healthier world.
Cipla: Caring for life

2014 Economic Times Lifetime Achievement Award

2013 Excellence Award in Enviornment Health & Safety.

2012 Received the award for Outstanding Export performance.

2007 Listed in Forbes’s Asia.

2006 Received the International Trade Award.

2005 Received the Pharma Excellence Award.

1935 Cipla founder Dr K A Hamied set up Cipla to make India self-reliant in

healthcare.

SHARE HOLDERS
Cipla's Shareholding Pattern
Description Percent of Share (%)

Promoters 36.80

Individuals 20.13

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Institutions 17.20

FII 16.07

Govt. 0.00

Others 9.80

Share Holding Pattern (% of Shares Held)

CATEGORY OF SHAREHOLDER Total Number of Percentage
Shares ShareHolding (%)

Promoter

Indian Promoter 11,78,03,409 14.83

Foreign Promoter 17,76,82,187 22.37

Total Promoter 29,54,85,596 37.21

Non Promoter

Institutions

Mutual Funds / UTI 8,00,06,755 10.07

FI/Bank/Insurance 3,02,83,155 3.81

Govt 0 0.00

FII 24,38,302 0.31

Other 18,98,38,316 23.91

Total Institutions 30,25,66,528 38.10

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CATEGORY OF SHAREHOLDER Total Number of Percentage
Shares ShareHolding (%)

Non-Institution

Bodies Corporate 2,39,26,053 3.01

Individuals (upto Rs. 1 lakh) 6,23,18,289 7.85

Individuals (in excess of Rs. 1 lakh) 7,07,03,404 8.90

NRIs/OCBs 2,81,61,466 3.55

Others 14,39,83,025 18.13

Total Non-Institution 19,60,70,544 24.69

Total Non Promoter 49,86,37,072 62.79

Depository Receipts 1,09,96,496 0.00

Total 80,51,19,164 100.00

Cipla held by Mutual Fund Schemes

Scheme Holding(%)

SBI Pharma Fund Regular Plan Dividend 9.37

Reliance Pharma Fund Growth Plan Growth Option 9.31

UTI Pharma & Healthcare Fund Income 7.45

HDFC Core & Satellite Fund Growth 7.03

ICICI Prudential Value Fund Series 9 Cumulative 6.22

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ICICI Prudential Value Fund Series 1 Dividend 6.19

UTI Focussed Equity Fund Series I Growth 5.34

UTI Focussed Equity Fund Series IV Growth 4.95

ICICI Prudential Indo Asia Equity Fund Growth 4.90

UTI Focussed Equity Fund Series V Growth 4.46

ICICI Prudential Growth Fund Series 7 Dividend

4.25
Payout

UTI Focussed Equity Fund Series VI Growth 4.13

ICICI Prudential Value Fund Series 2 Dividend 4.11

ICICI Prudential Value Fund Series 7 Dividend 3.95

ICICI Prudential Value Fund Series 5 Cumulative 3.61

Quantum Tax Saving Fund Growth Direct Plan 3.56

Invesco India Contra Fund Growth 3.54

Reliance ETF Shariah BeES 3.45

HDFC Charity Fund for Cancer Cure Arbitrage

3.38
Plan Regular Plan 50 Dividend Donation Option

ICICI Prudential Growth Fund Series 1 Dividend

3.36
Payout

Tata India Pharma & Healthcare Fund Regular Plan

3.35
Growth

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Quantum LongTerm Equity Fund Growth Direct
3.23
Plan

ICICI Prudential Value Fund Series 6 Cumulative 3.22

ICICI Prudential Value Fund Series 20 Cumulative 3.21

ICICI Prudential RIGHT (Rewards of Investing and

3.13
Generation of Healthy Tax Savings) Fund Growth

ICICI Prudential Long Term Wealth Enhancement

3.02
Fund Growth

ICICI Prudential Value Fund Series 4 Cumulative 3.01

HDFC Tax Saver Growth 2.86

HDFC Equity Opportunities Fund Series 2 1126

2.65
Days May 2017 (1) Regular Plan Growth

ICICI Prudential Nifty Low Vol 30 iWIN ETF 2.62

HDFC Equity Opportunities Fund Series 2 1100

2.61
Days June 2017 (1) Regular Plan Growth

ICICI Prudential Value Fund Series 11 Cumulative 2.44

IDBI Focused 30 Equity Fund Regular Plan Growth 2.43

ICICI Prudential Select Large Cap Fund Growth 2.28

UTI Opportunities Fund Growth 2.27

HDFC Premier MultiCap Fund Growth 2.22

ICICI Prudential Focused Bluechip Equity Fund 2.08

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Growth

Reliance Capital Builder Fund III Series A Growth 1.99

DSP BlackRock Equal Nifty 50 Fund Regular Plan

1.99
Growth

ICICI Prudential Dynamic Plan Growth 1.98

HDFC Growth Fund Growth 1.97

Reliance NRI Equity Fund Growth 1.95

Reliance Capital Builder Fund IV Series A Growth 1.90

ICICI Prudential Capital Protection Oriented Fund

1.89
VI Plan C 1825 Days Cumulative

ICICI Prudential Value Fund Series 15 Cumulative 1.88

ICICI Prudential Top 100 Fund Growth 1.86

ICICI Prudential Balanced Fund Growth 1.84

ICICI Prudential Multiple Yield Fund Series 7 Plan

1.83
B Cumulative

ICICI Prudential Multiple Yield Fund Series 10

1.81
Plan B Cumulative

HDFC Capital Builder Fund Growth 1.79

Tata Ethical Fund Appreciation 1.71

ICICI Prudential Capital Protection Oriented Fund

1.68
VIII Plan H 1105 Days Cumulative

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ICICI Prudential Multiple Yield Fund Series 10
1.67
Plan A Cumulative

HDFC Focused Equity Fund Plan B Regular Plan

1.66
Growth

Invesco India Business Leaders Fund Growth 1.64

Reliance Mid & Small Cap Fund Growth 1.52

ICICI Prudential Capital Protection Oriented Fund

1.47
VI Plan A 1825 Days Cumulative

ICICI Prudential Multiple Yield Fund Series 7 Plan

1.45
C Cumulative

ICICI Prudential Multiple Yield Fund Series 8 Plan

1.38
D Cumulative

DHFL Pramerica Large Cap Fund Growth 1.37

HDFC Equity Fund Growth 1.36

UTI Long Term Equity Fund (Tax Saving) Regular

1.31
Plan Dividend

ICICI Prudential Equity Income Fund Cumulative 1.24

CORPORATE SOCIAL RESPONSIBILITY

CSR COMMITTEE

CSR Committee of the Board has been formed as required under the Act.

CSR ACTIVITIES/ PROJECTS/PROGRAMMES

The Company may undertake CSR activities through a registered trust or a registered

17
society or a company established by the Company or subsidiary or associate company
under section 8 of the Act or through such other trusts, NGOs, registered societies etc
which have an established track record of three years of undertaking such
projects/programmes.

The Company may collaborate with other companies for undertaking the CSR
projects/programmes subject to fulfilment of separate reporting requirements as
prescribed in the Rules.

The scope of CSR activities of the Company will inter-alia cover the below mentioned
key thrust areas.

The CSR activities shall not include any activity undertaken by the Company in
pursuance of the normal course of business of a Company.
Some of the activities the Company has been engaged in are as follows:

Sr. No Key thrust areas Activities/ Programmes/ Projects

1 Health  Palliative care for terminally ill patients
 Creating awareness on health
 Improving sanitation
 Providing easy access of medical support to
vulnerable communities
 Supporting Cancer / HIV / Thalassemia
patients
 Mobile Medical Units

2 Education  Setting-up / Developing infrastructure for

schools
 Arranging training and awareness
programmes for adolescents.
 Promoting e-learning
 Enhancing reading culture
 Awarding scholarships for meritorious/needy
students
 Providing vocational skills

3 Address Social Inequalities  Supporting old age homes

 Supporting orphans and differently abled
4 Environment  Promoting environmental sustainability
 Promoting conservation of natural resources
 Promoting of Renewable Energy Resources

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 5 Rural development projects  Enhancing livelihood
 Undertaking Sustainable Rural Development
Projects

6 Others  Undertaking disaster management

 Supporting NGOs & trusts for conducting
various programmes/activities
 Any other permissible activity under
Schedule VII of the Act

CSR EXPENDITURE

CSR expenditure shall include all expenditure including contribution to corpus, for
projects or programmes relating to CSR activities approved by the Board on the
recommendation of the CSR Committee, but does not include any expenditure on an
item not in conformity or not in line with activities which fall within the purview of the
Schedule VII of the Act.

The amount to be spent on CSR activities shall be calculated in accordance with the
provisions of the Act and Rules made thereunder.

Any surplus arising out of CSR projects, programmes or activities shall not form part of
the business profit of the Company.

EXECUTION, MONITORING & REPORTING

The CSR Committee shall:

1. Prepare and propose the CSR plan with the execution modalities and implementation
schedules to the Board.
2. Periodically appraise the Board on the status of the CSR plan.

3. Institute a transparent monitoring mechanism for implementation of the CSR

projects, programmes or activities undertaken by the Company.

To fulfill the above responsibilities, the CSR Committee would be equipped with
necessary resources. The CSR team has been setup to ensure effective implementation of
the CSR activities. The team would submit status reports of the projects/programmes to
the CSR Committee on a periodic basis.

All disclosures, display and reporting requirement related to CSR shall be made in
accordance with the provisions of the Act and Rules made thereunder.

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MANUFACTURING PROCESS

Bringing world class, flexible, contract manufacturing solutions to South Africa.

CMM is a 100% owned factory of Cipla Ltd (India) and derives direct benefit from the
pharmaceutical manufacturing expertise and technologies that Cipla has garnered over the
last 75 years. It brings world class, flexible, contract manufacturing solutions to South
Africa.

Situated in Durban, CMM is one of South Africa’s largest pharmaceutical manufacturing

plants that is approved by both the RSA’s Medicines Control Council (MCC/PIC’s) and the
Ghana FDA. The factory headed by a strong and experienced management team is fully
equipped to offer all pharmaceutical companies a world class, high volume manufacturing
solution for oral solid dosage formulations. Customers can be assured of the benefit of
leveraging our competitive advantage and strong buying power when sourcing raw and
packaging materials.

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The facility is uniquely designed in that there is physical segregation between the stores,
primary and secondary processing areas. This minimises the risk of cross contamination and
ensures uni-directional material flow. All incoming materials (raw materials, primary and
secondary material) and finished goods are received and housed in dedicated stores that are
temperature and humidity controlled.

Unique design and capabilities,

from start to finish.

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 CMM Offers

Turnkey manufacturing, packaging and testing solution for all solid dosage formulations.

The manufacturing division is fully equipped for wet granulation (including effervescent
granules), direct compression (including hard gelatine capsules), high speed tabletting and
aqueous & solvent coating. The unit has :

 Dispensaries, each with uni-directional airflow units

 Wet granulation suites equipped with a range of rapid mix granulators, fluid bed equipment,
sieves and mills
 Effervescent manufacturing suite equipped with planetary mixer and tray drying ovens
 Blending suites housing octagonal blenders (Blender capacities – 800ℓ to 2250ℓ,)
 High speed compression machines and an encapsulation machine
 Coating suites with high-tech coaters capable of handling solvent, aqueous and sugar
coating

Qualified Professional Team

CMM’s 300-strong staff complement is headed by a strong management team experienced

in international manufacturing practices. A full engineering support team is on site to
maintain the state of the art equipment and ensure continuous machine operation and
minimize downtimes through an extensive preventive maintenance program.

A highly skilled team of qualified professionals across all areas and departments ensure that
quality assurance, quality systems, technology transfer and manufacturing processes are
maintained at international standards.

Packaging

 Blister packing with cartonator (PVC, PVC/PVDC, Alu/Alu)

 Patient Ready Packs (LDPE foil laminate)
 Round HDPE bottle filling & induction cap, labelling with cartonator
 Round glass bottle filling with cartonator
 Sachet filling for powder and granules
 Bulk Packaging

Dedicated Tech Transfer Team

The state of the art QC lab is fully equipped with stability ovens, HPLC’s , dissolution
baths, GC, FTIR, UV & AA spectrophotometer, autoclaves and incubators can handle all
chemical & microbiological analysis and post importation testing.

TYPES OF PRODUCTS
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Cipla sells active pharmaceutical ingredients to other manufacturers as well as
pharmaceutical and personal care products, including Escitalopram (anti-
depressant), Lamivudineand Fluticasone propionate. They are the world's largest
manufacturer of antiretroviral drugs

Drug Name
Salmeterol + Fluticasone Cipla

Active Ingredients
Fluticasone propionate and salmeterol xinafoate.

CMI
Consumer Medicine Information is a document that has information about the product for
people who were prescribed the medicine. Patients are advised to discuss the content of this
document as well as any concerns with their health professional. It only applies to Australia.

PI
Product Information is a leaflet that is intended to assist health professionals with product
information. It shall only be used for the Australian product.

Product Molecule

8X Shampoo Ciclopirox + Zinc pyrithione

9 PM Eye Drops Latanoprost 0.005%

ABAMUNE Tablets Abacavir sulfate

ABAMUNE-L Tablets Abacavir sulfate + Lamivudine

ACIVIR Cream Aciclovir

ACIVIR Eye Ointment Acyclovir 3%

ACIVIR DT Tablets Aciclovir

ACIVIR I.V. Injection Aciclovir

ACNEDAP Gel Dapsone

ACTIPEEL Gel Lactic acid 82%

MARKETING STRATEGY
23
Product in the Marketing Mix Of Cipla :

Cipla has the largest product kitty in India and its product range is vast and varied. It
includes 1500 products for therapeutic segments and nearly sixty dosage-forms. The
company provides services like commissioning, plant engineering, consulting and technical
know-how support and transfer. It is the first to manufacture oral iron chelator in the world.
Some of its products include-

 Active Pharmaceutical ingredients- It is largest exporter of high-quality and low-cost

APIs in global market and some vital intermediates and bulk drugs are
Albendazole USP, Adefovir Dipropyl

 OTC- Portfolio related to over-the-counter drugs include the artificial sweetener,

cosmetics and skin care, food supplements, child care, constipation, cold & flu, dental
care, medicated plasters, infant food, indigestion and medicated shampoos. It also has
a product division for animal health-care and this is dedicated to poultry, equine,
livestock animal products and companion animals

 Prescription- Some of it includes anti-inflammatory drugs, anti-acne drugs, anti-

asthma drugs, anti-allergic drugs, antibiotics and anabolic steroids

 Fragrance- It is manufacturer of various flavours that are used in beverages and food
items

Place in the Marketing Mix Of Cipla :

Cipla exports several of its products to nearly one hundred and sixty countries in the world
including the United States and numerous countries in the Middle East, Latin America,
Australia, Africa and Europe. Its distribution policy for global companies includes tie-
ups with other proficient companies so that it can take advantage of their distribution
system. In India, it has thirty-five manufacturing plants in places like Goa and Patalganga.
The company has several research and development units for development of new and
existing drugs. It has corporate offices in dealing with customers. Cipla has the strong
distribution network in the retail market and its medicines are easily available at medicinal
stores.

24
Price in the Marketing Mix Of Cipla :

Cipla is the leading health-care company in India and its aim is to provide access to high-
quality medicines at affordable rates. In order to meet the needs of its patients, it has decided
to keep an economic and reasonable pricing policy. Its aim is to make life-saving drugs
accessible to every needy patient and therefore for those drugs it has kept a minimum
pricing policy. Its efforts have reduced the prices of several vital drugs in the market. For
products that are exported it has maintained a competitive pricing policy, so that it can
successfully compete with its competitors.

Promotion in the Marketing Mix Of Cipla :

Cipla has undertaken various promotional activities to market its products. Its tagline
is Caring forLife and this has become its mission and hence this idea has been incorporated
in its employees, processes and products. In order to make a difference, the company
contributes to society through themes like education, health & sanitation and by creating
opportunities for decent livelihood. Cipla provides free-of-cost medication to terminally-ill
patients of cancer through Palliative Care Centre. It has developed strategies like selling
anti-aids drugs at an only 1/3rd price to developing countries like South Africa. It has tie-
ups with several global generic companies like Mylan, Watson and this helps it to hone its
own manufacturing, development and marketing skills. It has also initiated a program No
Touch Breast Scan for females.

Cipla believes in providing its employee’s best available opportunities and hence has
provided them with employee benefits. For some of its, products Cipla has taken the help of
commercial advertisement through television and print media. Cipla-I-Pill was its most
advertised product of the year 2007.

SEGMENTATION

AT CURRENT valuations, investors may consider staying invested in the company to

participate in the benefits that come from Cipla's powerful position in the domestic
pharmaceutical market and its proven research and development ability. The Cipla stock t
25
rades at around Rs. 1,152 at a price earnings multiple of 50 times the 1999-2000 annualised
earnings per share of Rs. 22.86.

Cipla derives about 85 per cent of its revenue from formulations (dosage form of medicines)
and the rest from bulk drugs (the ingredient for formulations). Formulations are the most
lucrative segment in pharma and the risks associated are typically lower then other
segments.

The Indian pharma market is highly fragmented with over 20,000 manufacturers competing.
In this market, Cipla has recorded high growth rates by carving out for itself a leading
position in the anti-infective and anti-asthma therapeutic segments. The comp any's top 10
brands are among the top rung brands in each segment.

To achieve a commanding position in a fragmented market, Cipla has made effective use of
the R and D resources at its disposal. Cipla's ability to quickly duplicate and introduce a
drug introduced elsewhere has played a significant role in improving its profitability over
the last few years.

Being among the earliest entrants into the market with a new drug enables a company to
achieve higher realisations. In addition, Cipla's strategy has an edge because of its ability to
market products at significantly lower prices.

India has committed to change its patent laws by 2005 to meet the GATT obligations and
companies such as Cipla will not be able to replicate drugs that are under patent elsewhere.
This is likely to have a negative impact on profit growth at the industry level.

Cipla is trying to offset the consequence of a change in patent laws by using its proven R
and D skills to make use of the opportunities presented by the global generic market. The
company has developed quite a few complex bulk drugs in the last few year s for exports.
This has, in turn, boosted profit margins because pharma exports typically provide the
highest realisations.

Its process research skills will also give Cipla a competitive edge in a generic market where
cost control is critical. Another opportunity is the potential for global pharma giants seeking
collaboration on projects that focus on the research skills of c ompanies such as Cipla.

In the near future, Cipla may be the recipient of significant pay-offs if its endeavour into
novel drug delivery systems and non-CFC inhalers find the right market. Cipla's research
programme has opted to focus on improving processes and delivery systems as opposed to
discovering new compounds. Its strategy involves lower pay-offs, and concurrent lower
risks.

Cipla's financial history indicates a high return on capital deployed in the last four years.
Between 1996-97 and 1998-99, the company's return on total capital deployed has ranged
between 36 per cent and 40 per cent. Even in this fiscal, against the bac kdrop of a

26
slowdown in the pharma market, Cipla's operating profit margin remains around 25 per cent
at the end of the third quarter.

Cipla's robust financial performance is underpinned by strong brands and proven R and D
skills. Shareholders can stay invested to get the benefits of the company's sound
fundamentals in the medium to long term.

PRICING STRATEGY

Cipla follows an excellent marketing strategy.

 Strategic Tie-Ups
Cipla has set up a wholly owned subsidiary, Cipla FZE situated at Jebel Ai Free Zone in
Dubai, United Arab Emirates. This is the part of strategy to explore the growing markets in
Middle East countries through exports. Cipla entered agreement with Pentech Pharma of
USA for marketing a range of generic products for American market. Pentech is involved in
developing therapies for lifestyle and quality of life conditions. This will further boost its
export performance.

 Low-risk business model:

Robust partnership model – CIPLA has entered into global tie-ups with various generic
players (like Watson, Mylan, Barr and Ivax) for supplying its generic products. This strategy
enables Cipla to leverage local market knowledge of its partners and utilize its own R&D,
product development, and manufacturing skills. Cipla's offer to sell anti- aids drugs at one-
third the price to developing countries like South Africa or any other country. The questions
were raised against the strategy the company follows but Cipla is not committing any illegal
or unethical act as it is entitled to sell anti- aids drugs in any country that does not have the
requisite patent protection. Cipla is not using pirated technology since India does not have a
product patent regime. Therefore, Cipla has the right to develop and reverse engineer any
pharmaceutical product not protected by the country's laws. Therefore, the issue is whether
Cipla is selling its products below its costs or is it able to sell cheaply because it has not
incurred any research and development (R&D) expenses like multinationals incur in
developing drugs. Cipla is entitled to "make hay while the sun shines', in other words,
capitalize on a sympathetic patent law in India, but keeping in mind that after 2010, the
world (and Indian) pharmaceutical industry will become a "jungle', where only the "fittest'
will survive.

Pharma Focus Asia's qualified and thoroughly researched circulation ensures that your
advertisement reaches the right people in the right companies. Only the most influential
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of spending from the top pharmaceutical companies in Asia and rest of the world receive
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Delivering reliable and accurate coverage of the pharma industry's progress, Pharma Focus
Asia helps its readers make informed decisions to stay ahead of the competition.

27
Readers Response
Quality content combined with a first-class approach to circulation will ensure that
advertisers are able to reach and impress the right people.

PRICING STRATEGY
Faced with pricing pressure, large Indian pharmaceutical companies are focusing on
selective product launches in the US market. The move comes amid increasing competition
in the generic drug space and customer consolidation, which are impacting the companies'
profits.

“I do not think we are going to file more than 20 products in a year, but we will choose them
well. Nowadays, in the US, you think you have a very good product but there are
eight companies filing the product on day one and then there another five after that. We are
running our R&D machinery really hard and the outcome may not be what we want. So we
will try and do less filings but focus on the ones that are lot more complex,”
said Cipla managing director Umang Vohra.

Cipla is a relatively late entrant in the US market and earns about 20 per cent of its revenue
from the market. However, established players such as Lupin and Sun Pharma too are
optimising their drug pipelines in the US on the back of customer consolidation.

In a post-result conference call earlier this month, Lupin's chief executive officer Vinita
Gupta stated that given the the structural change in the US market, it no longer made sense
to invest in products where it is the sixth or seventh entrant. “We have the potential, the
opportunity to prune our pipeline further, to focus on products where we can be among the
first 2-3 players in the market and can get a return on our investment and ideally sustain
revenue margin potential,” she said.

“Now, more than ever, our focus is on products that have strong entry barriers including
biosimilars, inhalation and complex injectables. We believe this focus will help us overcome
28
structural changes in key markets like the US,” said Lupin's managing director Nilesh Gupta
in a statement.

A thrust in complex and specialty portfolios, it is felt, will give Indian drug makers a
competitive edge in the US market. This is even more crucial now, due to consolidation in
the distribution channel and entry of about 50 new generic drug makers in the US in a year.
Multinational pharma companies like Novartis and Teva too are re-setting their pharma
businesses as challenges mount in the US. While Novartis is looking to sell its generic
drugs business in the US, while Teva is implementing a $3-billion cost-saving plan.

 Pharma majors are evaluating their generic drug pipeline in the US in view of
challenges like price erosion and customer consolidation
 Companies are focussing on developing speciality products
 Research and development strategy is geared towards limited products and
limited competition products
 Sun Pharma has withdrawn around 15 product applications in view of
changed market conditionsCadila Healthcare has said its portfolio will have a
mix of both high-volume generic drugs and speciality products

“We are relooking at part of our generic R&D,” Sun Pharma managing director Dilip
Shanghvi told analysts in a post-result conference call last week. Sun Pharma, which is
building a pipeline of specialty products in ophthalmic, oncology and dermatology in the
US, also has also withdrawn over 15 product filings over the past six months in view of
changed market conditions.

“Glenmark is focusing on limited launches and limited competition products,” a company

spokesperson said. “Our strategy has always been about filing 15-20 products every year,
and this will remain unchanged. However the nature of the filings will very different from
what we have done in the past.”

Last year Glenmark spent some Rs 12.62 billion on R&D, or 14-15 per cent of its sales
(excluding cholesterol drug Zetia). In FY2018, the R&D spend in absolute terms will be
significantly lower than last year, the company said.

Ahmedabad-based Cadila Healthcare's US product pipeline will include a mix of both large-
volume generics and specialty products, said managing director Sharvil Patel. The company
believes there is an opportunity in developing high-volume drugs given periodic supply
disruptions in the market.

“I believe in having large-volume products and obviously differentiated niche products. We

have a development pipeline of around 150 products, including complex ones. We are
putting lot of effort in developing specialty products and we will launch one this year. That
will be a key focus. We are also looking for partners for in-licensing technologies,” Patel
said.

29
The exception in the pack is Aurobindo Pharmaceuticals, which is building a large basket of
drugs in multiple-dosage formats. Sources familiar with the company's strategy say it isn't
reducing its plain vanilla generic drug filings but is parallelly focusing on complex products
such as injectables, peptides, and hormones in the US. Aurobindo does not sell finished
dosages in India and earns over 70 per cent of its sales in the US and Europe. That is one
reason for large number of filings in the markets.

BALANCE SHEET
MAR'17 MAR'16 YoY
(₹ Cr.) (₹ Cr.) %Change
Parameter

EQUITY AND LIABILITIES

Share Capital 160.90 160.68 0.14%

Share Warrants & Outstandings

Total Reserves 12,580.21 11,735.79 7.20%

Shareholder's Funds 12,800.51 11,985.88 6.80%

Long-Term Borrowings 0.00 0.00 0.00%

Secured Loans 0.00 0.00 0.00%

Unsecured Loans 0.07 0.13 -46.15%

-
Deferred Tax Assets / Liabilities -59.54 35.85
266.08%

Other Long Term Liabilities 125.20 130.72 -4.22%

Long Term Trade Payables 0.00 0.00 0.00%

30
Long Term Provisions 125.61 132.00 -4.84%

Total Non-Current Liabilities 191.34 298.70 -35.94%

Current Liabilities

Trade Payables 1,298.21 990.84 31.02%

Other Current Liabilities 685.43 582.73 17.62%

Short Term Borrowings 324.26 1,131.68 -71.35%

Short Term Provisions 247.93 249.22 -0.52%

Total Current Liabilities 2,555.83 2,954.47 -13.49%

Total Liabilities 15,547.68 15,239.05 2.03%

ASSETS

Non-Current Assets 0.00 0.00 0.00%

Gross Block 5,151.81 4,267.82 20.71%

Less: Accumulated Depreciation 897.81 441.71 103.26%

Less: Impairment of Assets 18.74 0.00 100.00%

Net Block 4,235.26 3,826.11 10.69%

Lease Adjustment A/c 0.00 0.00 0.00%

Capital Work in Progress 540.52 512.81 5.40%

Intangible assets under development 15.25 37.91 -59.77%

31
Pre-operative Expenses pending 0.00 0.00 0.00%

Assets in transit 0.00 0.00 0.00%

Non Current Investments 3,648.03 3,716.59 -1.84%

Long Term Loans & Advances 624.98 551.69 13.28%

Other Non Current Assets 138.30 126.57 9.27%

Total Non-Current Assets 9,202.34 8,771.68 4.91%

Current Assets Loans & Advances

Currents Investments 638.18 539.52 18.29%

Inventories 2,653.50 2,918.47 -9.08%

Sundry Debtors 1,938.79 1,896.41 2.23%

Cash and Bank 58.46 53.01 10.28%

Other Current Assets 281.42 334.70 -15.92%

Short Term Loans and Advances 774.99 725.26 6.86%

Total Current Assets 6,345.34 6,467.37 -1.89%

Net Current Assets (Including Current Investments) 3,789.51 3,512.90 7.87%

Total Current Assets Excluding Current

5,707.16 5,927.85 -3.72%
Investments

Miscellaneous Expenses not written off 0.00 0.00 0.00%

32
Total Assets 15,547.68 15,239.05 2.03%

Contingent Liabilities 4,518.35 4,117.10 9.75%

Total Debt 324.40 1,131.88 -71.34%

Book Value (in ₹) 158.37 148.08 6.95%

Adjusted Book Value (in ₹) 158.37 148.08 6.95%

MERGERS, ACQUISITIONS

India, Mumbai, February 18, 2016: Cipla, a global pharmaceutical company which uses
technology and innovation to meet the everyday needs of all patients, today announced that
its UK arm, Cipla (EU) Limited has closed the transaction to acquire two US-based
companies, InvaGen Pharmaceuticals Inc., and Exelan Pharmaceuticals Inc. The
acquisition was made by Cipla (EU) Limited through a wholly owned special purpose
vehicle which would merge into InvaGen Pharmaceuticals Inc. after the acquisition. The
combined revenue for the two companies for the year-ended 2015 is over USD230 million.

This acquisition is the second landmark acquisition in Cipla’s 80 year history – the first was
Cipla Medpro, South Africa. This acquisition will give scale to Cipla’s US business -
currently 8% of total revenue as well as providing a launch pad to introduce Cipla’s
pipeline of products in respiratory and injectables, among others, in the coming years.
Combined with the pipeline of InvaGen products, the overall portfolio will be wide-ranging
and will cover chronic therapies like CVS, CNS, respiratory, oncology and diabetes among
others.
The acquisition of InvaGen pharmaceuticals also provides Cipla with about 40 approved
ANDAs, 32 marketed products, and 30 pipeline products which are expected to be approved
over the next 4 years. In addition, InvaGen has filed 5 first-to-file products. Dosage forms
include immediate release, modified release and extended release tablets and capsules. With a
manufacturing footprint of ~350,000 sq.ft of GMP area, InvaGen has 3 units located in
Long Island, NY, with a total production capacity of 12 billion tablets and capsules per
annum and about 500 employees. With this acquisition, Cipla will have more relevance to
wholesale and retail customers.
Commenting on the acquisition, Mr. Umang Vohra, Global Chief Operating Officer,
Cipla Limited said: “The acquisition will further strengthen Cipla’s presence in the US
pharmaceutical market. InvaGen’s balanced portfolio, robust manufacturing base and strong
R&D capabilities will act as lever to expand Cipla’s reach in the US market.”

33
 About Cipla Limited

Cipla is a global pharmaceutical company which uses cutting edge technology and innovation
to meet the everyday needs of all patients. For 80 years, Cipla has emerged as one of the
most respected pharmaceutical names in India as well as across more than 150 countries. Our
portfolio includes 1,500 plus products across therapeutic categories with one quality standard
globally.

Whilst delivering a long-term sustainable business, Cipla recognises its duty to provide
affordable medicines. Cipla’s emphasis on access for patients was recognized globally for the
pioneering role played in HIV/AIDS treatment as the first pharmaceutical company to
provide a triple combination anti-retroviral (ARV) in Africa at less than one dollar a day and
thereby treating many millions of patients since 2001.

Cipla’s research and development focuses on developing innovative products and drug
delivery systems.
About Cipla (EU) Limited

Cipla (EU) Limited is a wholly owned subsidiary of Cipla Limited.

About Cipla USA Inc.

Through a comprehensive partnership model, Cipla has been dedicated to providing access to
medicines at an affordable price for over 30 years in the US.
Cipla USA own label was launched in January 2015. Cipla has executed over 20 US
partnerships and currently has over 40 commercialized products in the US. The Company has
supported the development of more than 150 ANDA’s and has received 75+ final approvals in
addition to 2 NDA’s approved and marketed in the US.
Cipla USA brings a variety of technologies to the US markets in order to keep its ongoing
commitment to provide access to high quality complex products at affordable prices.
For more information on Cipla, please visit – www.cipla.com and www.ciplausa.com

About InvaGen Pharmaceuticals, Inc.

Hauppauge, New York based InvaGen Pharmaceuticals is a leading generic pharmaceutical
company in the US. InvaGen is engaged in development, manufacturing, marketing and
distributing of generic pharmaceuticals with focus on wide range of therapeutic areas
including, cardiovascular, anti-infective, CNS, anti-inflammatory, anti-diabetic and anti-
depressants. Dosage forms include both immediate release and modified release and
extended release of tablets and capsules.
InvaGen has 3 manufacturing units with ~350,000 sq.ft. manufacturing and R&D area and
about 500 employees specialized in different fields. InvaGen’s goal is to come up with
innovations in generic medicines, improve quality of life for patients with high quality cost-

34
effective medicines.

Cipla SWOT Analysis, USP & Competitors

SWOT Analysis of Cipla with USP, Competition, STP (Segmentation, Targeting,
Positioning) - Marketing Analysis

Cipla

Parent Company Cipla

Category Pharmaceuticals

Sector Healthcare Industry

Tagline/ Slogan Caring for life

Commitment to make medicines affordable and accessible

USP particularly to cancer patients

STP

AIDS, respiratory disease, cancer cardiovascular disease,

Segment arthritis

Customers of various flavors and fragrances, OTC

products, prescription products, pesticides, agrochemicals,
Target Group doctors

They use latest technology to concentrate all their

knowledge of over seven decades in developing life saving
Positioning drugs

SWOT Analysis

35
 1. Cipla has developed good positive image by providing
support to cancer patients by issuing drugs at low cost
2. Imminent commencement of the Fixed-Dose
combination for treatment of uncomplicated P.
falciparum malaria to tackle the 200+ million cases of
malaria globally
3. Initiation of ‘No Touch Breast Scan’ a step forward in
the screening technology in India.
4. A foremost player in anti-infective and anti-asthmatic
formulations.
Strengths 5. Has a strong employee force of over 16,000

1. Strong competition from international and domestic

giants means limited market share
2. Cipla had faced problems during negative campaign by
Weaknesses AHF

1. It can venture into Alzheimer’s disease medication

2. They can use Viramune generic to achieve higher
growth.
3. Increased investment in the budding markets, to push
Opportunities expansion in the global economy

1. Constant price rises in the Indian country is taking its toll

and compounding the problem
2.The Indian Rupee depreciated as compared to the US
Dollar
3. Fluctuations in currency exchange rates have a
noteworthy impact on the Company’s operations and
Threats financial results.

36
 SUGGESTIONS AND CONCLUSION

From the basis of data analysis and inferences drawn the following
suggestions are offered for the improvement of marketing Strategies of
pharmaceutical companies
Marketing professionals are more aware of their companies Product and
Promotional Strategies and their Knowledge on pricing Distribution and Market
Strategies are not adequate. Therefore it is suggested that the companies most
initiate attempts to improve awareness of the marketing professionals through
meeting discussions and training programmes.
The marketing intermediaries who act as link between company and end users
are not much aware of the market product distribution and promotional Strategies
of the companies whose products dealing with ,Hence companies need to
organise awareness campaign for marketing intermediaries with regards to above
issues.
The End-Users of pharmaceutical products in other words Doctors prescribing
antibiotics are not properly informed by the companies of their products
promotions and distribution arrangements therefore a separate get-together,
conference discussions of the doctors on specific brands of the pharmaceutical
products will help the companies both for effective marketing and for
development of strong customer base.
In order to keep the life of antibiotic longer and to maintain least resistance it is
suggested to constitute an independent body by the government to regulate
marketing activities of pharmaceutical companies with respect to antibiotic.
As there is disparity in the pricing Strategies which determines the use of
antibiotics in order to ensure less resistance by preventing price war among the
companies , an independent agencies is to be created either by government or by
the pharmaceutical companies which can act as neutral agency to rationalise the
prices.
The Government most come out with regulation to restrict the sale of antibiotics
37
without prescription recognised medical practioners.
Hospitals must be instructed to follow Antibiogram Policy, Antibiotic rotation
policy and should be followed strictly.

38
 It must be made mandatory to use antibiotic products empirically only after
getting approval from concerned Microbiology department.
Pharmaceutical Companies and Pharmacy department of the hospitals should
focus on making high end antibiotic products available in time rater than making
easy availability of low-end products.
Sales teams should be equipped to provide thorough information on
pharmacokinetics and dynamics of drug, usage, indication and dosage to
concerned medical consultants and both of them have to work jointly towards
patient awareness, programs on creating awareness on importance and
compliance.

SUGGESTIONS WITH RESPECT TO THE MARKET STRATEGIES.

From the study it is evident that the performance of multinational pharmaceutical
companies is better that then Indian companies therefore this is high time Cipla ,
Ranbaxy and Microlabs to come out with innovative products and focus on R& D
in order to Growth, market share and Profitabality.
Pruning can improve return on investment, Growth Rate, more beneficial in
having limited resources and also helps in restoring balance. Hence companies
should focus more on analysing their current resources and existing market
coverage.
Astrazeneca, Pfizer and Glaxosmithkline Beecham have to make more
involvement in making products available in market place and promotion has to
be intensified where as Cipla, Ranbaxy and MicroLabs have to concentrate on
improving on their product efficacy.

SUGGESTIONS WITH RESPECT TO THE PRODUCT STRATEGIES.

Pharmaceutical companies are suggested to reposition their products to
enhancing its value and life span by which entry of new antibiotic can be
prevented due to which antibiotic resistance can be reduced.
Pharmaceutical companies for their survival need to focus on development of
new and innovative products through extended product research and sustainable
research and development in order to survive in the market.

39
SUGGESTIONS WITH RESPECT TO THE PRICING STRATEGIES.
AstraZeneca, Pfizer, and Glaxosmith Kline Beecham adopted skimming price to
launch new products and maintain price for the existing products. In the case of
price flexibility, it was observed that one price strategy is adopted and maintained
for all customers. On the other hand Cipla, Ranbaxy and MicroLabs adopted
penetration price strategy to launch new products and reducing the prices for
existing products and more flexibility price is adapted to all the customers.
Further, marketing professionals analysis lead to polarisation observed basically
with Astrazeneca, Pfizer and GlaxosmithKline Beecham where they launched
innovative products and spent huge money in market to create awareness about
the new products, at the same time enjoying the monopoly of the market. Hence,
patients have affordability constraint. On the other hand Cipla, Ranbaxy and
MicroLabs have launched generic version, no investment on innovation,
penetrating into establish market. Hence there is need to regulate the price of
antibiotics either through the government agencies by neutral mechanism to
avoid excess use of antibiotics and reduction in resistance.

SUGGESTIONS WITH RESPECT TO THE DISTRIBUTION STRATEGIES It

was found that, most of the companies have adopted multiple channel
structure and intensive distribution strategies. Therefore, it is suggested to
have structured distribution system across all companies instead of push
strategy, if pull strategy
is adopted, it will help to reduce unhealthy competition among channel partners.
This leads to brand replacement, price discounts, and quantity discounts which
will ensure that antibiotic products will move as per prescription in long run.

SUGGESTIONS WITH RESPECT TO THE PROMOTION STRATEGIES

Drug promotion is one of the factors contributing to unnecessary antibiotic use,
and inappropriate use of newer, broad-spectrum products, and therefore to
antibiotic resistance will increase. Regulation of promotion is to be taken
seriously. The World Health Organization (WHO-Europe) has described, ―An

40
 inherent conflict of interest between the legitimate business goals of
manufacturers and the social, medical and economic needs of providers and the
public to select and use drugs in the most rational way‖. Hence, companies should
have proper strategies to sustain it for longer period by hiring well trained sales
persons who are able to promote scientifically, companies have to give more
focus on sharing information on products, indication, through emails to key
customers. Only scientific conference has to be sponsored and gifts should carry
only clinical value . Patient awareness program are to be conducted frequently. A
Judicious use of promotional tools will help in keeping antibiotic for long run.

SCOPE FOR THE FUTURE RESEARCH

The current study of marketing strategy is limited to Pharmaceuticals
Companies operating in Karnataka.

Only six companies have been selected for the present study, this study is
confined only to anti-infective therapeutics and an few dimensions of marketing
strategies are considered. Hence there is scope to continue research along with
other dimensions of marketing Strategies or with respect to different therapeutics.

The research work was undertaken comprehensively to cover the sectorial

views of Marketing professionals, Marketing intermediaries and End-users. As a
result of no specific focus has been made on any one of them. Therefore a focused
research in specific group of respondents considered under this study can provide
avenues for further research. More than anything pharmaceutical industry is highly
dynamic fast growing business opportunity both for Indian and global players as India
is wide market for pharma products research into market identification product
development and promotion of products to untapped markets requires focus by
academic and industrial researchers.

41
CONCLUSION
Pharmaceutical marketing plays a vital role in the health care management of any
country. Pharmaceutical industry is one of the fastest growing industries of the recent
times. Antibiotic resistance places an increased burden on society in terms of high
morbidity, mortality, and high cost which hampers the development of any countries
economy. On the other hand pharmaceutical companies spend huge money on research
and development of newer antibiotic drugs. Hence it is very important to market
antibiotics in rational ways so has to reduce antibiotic resistance.
.
Aggressive marketing Strategies adopted by the companies to promote their
products is one of the contributing factor for the unnecessary use of antibiotics.
Introduction of new antibiotics and their excessive use leads to resistance, therefore
there is an urgent need to regulate the promotional Strategies of pharmaceutical
companies which are very rarely visible unlike that of market of other products there is a
wide market and untapped opportunities for pharmaceutical companies in India, But
antibiotic resistance is not only an hindrance for the product efficacy but can turn to be a
national problem in the health management arearna. Therefore all the stakeholders of
the public health should join hands in spreading the need for regulating undue growth of
antibiotic products on the one hand and promote products of high quality at affordable
prices to keep in tune with the national health policy.
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