OTC busi­ness set to fuel Glen­mark’s growth

Business Standard - - COMPANIES - ANEESH PHADNIS

Glen­mark is tar­get­ing 12-15 per cent rev­enue growth in the do­mes­tic mar­ket in 201819 with fo­cus on se­lect ther­a­pies, launch of dif­fer­en­ti­ated prod­ucts and ex­pan­sion of over-the- counter (OTC) of­fer­ing.

Glen­mark is ranked 13th in In­dia with an­nual sales of over ~28 bil­lion and has a mar­ket share of 2.4 per cent, ac­cord­ing to AIOCD-AWACS, the mar­ket re­search wing of the All In­dia Or­gan­i­sa­tion of Chemists and Drug­gists. The over­all in­dus­try-wide sales growth for 2017-18 was 5.7 per cent. With 8.6 per cent growth dur­ing the same pe­riod, Glen­mark was the third-fastest among the top 20 phar­ma­ceu­ti­cal com­pa­nies, be­hind Lupin and Sanofi.

“We are look­ing to in­tro­duce an an­ti­hy­per­ten­sion drug and a cou­ple of on­col­ogy drugs. We are work­ing on in-li­cens­ing op­por­tu­ni­ties in der­ma­tol­ogy and on­col­ogy ther­a­pies, but those dis­cus­sions are at an early stage,” said Su­jesh Va­sude­van, Glen­mark’s head of In­dia for­mu­la­tions.

Va­sude­van ex­pects the do­mes­tic pharma in­dus­try to re­turn to growth lev­els of 10-11 per cent in 2018-19 af­ter a de­cline in sales in the pre­vi­ous year. Last year, sales fell to sin­gle-dig­its ow­ing to price ero­sion and is­sues re­lated to the im­ple­men­ta­tion of the goods and ser­vices tax (GST).

The OTC seg­ment will be an­other lever of growth, Va­sude­van said. “Our strat­egy is to lever­age our strength in der­ma­tol­ogy. We are look­ing at switch­ing brands (from pre­scrip­tion to OTC) and build brands in niche ar­eas. Re­cently, we ex­tended the VWash brand with the launch of san­i­tary nap­kins and will in­tro­duce two vari­ants of anti-per­spi­rant pow­ders,” Va­sude­van said.

Ear­lier this month, the drug­maker an­nounced the launch of Akynzeo, the first com­bi­na­tion drug in In­dia, to treat chemo­ther­apy-in­duced nau­sea. The drug is be­ing launched through a li­cens­ing agree­ment with Swiss firm Helsinn. It will help Glen­mark strengthen its pres­ence in the ther­apy seg­ment.

For Glen­mark, the fo­cus has been on core ther­a­pies (der­ma­tol­ogy, on­col­ogy, car­di­ol­ogy and anti-di­a­betes) and build­ing a few strong brands. This has helped in bet­ter re­source al­lo­ca­tion, pro­duc­tiv­ity and mar­gin im­prove­ment.

The firm’s do­mes­tic busi­ness has an op­er­at­ing mar­gin of close to 30 per cent, but it did not di­vulge ad­di­tional de­tails. The launch of drugs (with­out patents) such as teneligliptin (di­a­betes) and Apremi­last (pso­ri­a­sis) has given the com­pany the first­mover ad­van­tage in high-growth seg­ments. The com­pany’s um­brella brands (hy­per­ten­sion drug Telma, skin care pow­der and cream Can­did and cough syrup As­co­ril) con­trib­ute to around 30 per cent of its do­mes­tic sales. In the first nine months of 2017-18, Glen­mark’s do­mes­tic busi­ness re­ported a rev­enue of ~19.05 bil­lion and ac­counted for 28 per cent of the com­pany’s to­tal rev­enue.

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