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MBA 631NTERNATIONAL
BUSINESS
IA- PART 1
Submitted By,
Jessica Yvonne Varma
# 1321250
MBA- 1-!J" inance
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1
CONTENT
Sl. No. TITLE PAGE NO.1 $A%&'( 1) !*&(+ &!+*
•
!ndian %.armaceutica/ !ndustry• &.e !ndian Advanta e-(esources a abi/ities• eadin om anies in t.e sector4• .a//en es aced by %.armaceutica/ !ndustry
2
3
6
52 $A%&'( 2) %(+ & %(+ ! '
• S eci ications• 7ua/ity• Sources o Su /y
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10
11
3 $A%&'( 3) %(+ ! ' + + *&(!'S• 9eo ra .ica/• (e u/atory• 'conomic• u/tura/
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16
15
1:6 $A%&'( 6) ! %+ ! Y (AM';+(" + $+S&
+ *&(Y
1<
5 $A%&'( 5) B ' %(!*& + B S!*'SS
• 'ntry Strate ies• Mar=etin Strate ies• Strate ies or Sustainabi/ity• inancia/ Strate ies
2021
21
22: (' '('* 'S 25
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CHAPTER – 1
INTRODUCTION – MALPASO PHARMA LTD
INDIAN PHARMACEUTICAL INDUSTRY
9/oba//y, t.e !ndian %.armaceutica/ industry is ran=ed t.ird /ar est in vo/ume terms and 10t.
/ar est in va/ue terms4 &.e sector is .i ./y =no>/ed e-based and its steady ro>t. is
ositive/y a ectin t.e !ndian economy4 &.e or anised nature o t.e !ndian %.armaceutica/
industry is attractin severa/ com anies t.at are indin it viab/e to increase t.eir o erations
in t.e country4 &.e !ndian %.armaceutica/ industry is .i ./y ra mented >it. about 26,000
/ayers ?330 in t.e or anised sector@4 &.e to ten com anies ma=e u or more t.an a t.ird o
t.e mar=et4
;it. 82 er cent o mar=et s.are ?in terms o
revenues@, eneric dru s orm t.e /ar est se ment
o t.e !ndian .armaceutica/ sector4
!ndian %.arma com anies .ave a /ar e c.un= o
t.eir revenues comin rom e orts4 !ndia e orts%.armaceutica/ roducts to more t.an 200
countries4 !n terms o va/ue, e orts o !ndian
%.armaceutica/ roducts increased at a A9( o
2:41 er cent to touc. S 1041 bi//ion durin Y0:-134
%.armaceutica/ e orts are e ected to cross
t.e (s 1 tri//ion ? S 1:418 bi//ion@ mar= t.is
year4 urin 2013-16, %.arma e orts stood at
(s C0,000 crore ? S 16455 bi//ion@4 +ut o t.is,
t.e s.are o ormu/ations >as 81 er cent4 &.e
Ministry o ommerce tar ets to e ort S 25
bi//ion >ort. o .armaceutica/s in 201:4
!ndia current/y e orts dru intermediates, Active %.armaceutica/ !n redients ?A%!s@,
inis.ed osa e ormu/ations ? s@, bio-%.armaceutica/s, and c/inica/ services across t.e
/obe4 ;.i/e some are ocusin on t.e enerics mar=et in t.e S, 'uro e and semi-re u/ated
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mar=ets, ot.ers are turnin t.eir attention to custom manu acturin or innovator com anies4
Bio %.armaceutica/s is a/so increasin /y becomin an area o interest iven t.e com /e ity in
manu acture and /imited com etition4
!ndia is a si ni icant
manu acturin base or
t.e %.armaceutica/
industry4 !ndian
com anies /ive in an
intense/y com etitive
environment4 Most !ndiancom anies ma=e t.eir
o>n bu/= actives4 A ter
/ibera/iDation, !ndian com anies .ave bui/t ( ca abi/ities t.at .ave en.anced t.eir
innovative abi/ity4
THE INDIAN ADVANTAGE- RESOURCES & CAPABILITIES
!ndian %.armaceutica/ industry today is a =no>/ed e intensive industry4 !ndian com anies
.ave acEuired over 15 com anies in 'uro e and t.e S over t.e /ast 10 years4 &.e
For aniDedG sector o !ndiaHs %.armaceutica/ industry consists o 250 to 300 com anies,
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>.ic. account or 80 ercent o roducts on t.e mar=et, >it. t.e to 10 irms re resentin 30
ercent4 $o>ever, t.e tota/ sector is estimated at near/y 20,000 businesses, some o >.ic. are
e treme/y sma//4 A ro imate/y 85 ercent o !ndiaHs demand or medicines is met by /oca/
manu acturin !ndiaIs %.armaceutica/ sector is current/y under oin un recedented c.an e4
Muc. o t.is is due to t.e introduction o roduct atents in 2005, be ore t.at, on/y rocess
atents >ere ermitted to be issued4 &.is .as been instrumenta/ to t.e domestic industryIs
.u e success as a >or/d>ide e orter o .i .-Eua/ity eneric dru s4
LEADING COMPANIES IN THE SECTOR
!n t.e ast ten years, !ndian com anies .ave moved beyond t.eir traditiona/ e ort roducts
/i=e tea, co ee, /eat.er, iron ore, etc4 to so t>are and %.armaceutica/ roducts artici atin in
>.at is ca//ed as t.e ne> a eI industries t.at are tec.no/o y-=no>/ed e-service-intensiveI4
&.e success ac.ieved by t.e ne> enre o com anies is a/so due to t.eir care u/ se/ection o
mar=et se ments to artici ate in4 or e am /e, t.e %.armaceutica/ maKors essentia//y
artici ate in t.e eneric se ment o t.e %.armaceutica/ industry and not in t.e researc.-
intensive ne>-to-t.e->or/d roducts se ment4 orei n com anies >.o came to ta t.e
midd/e-c/ass mar=et discovered t.ese advanta es >.ic. t.e !ndian com anies /evera ed
a ressive/y to ta=e osition in overseas mar=ets
%.armaceutica/ industry in !ndia accounts or /ess t.an t>o er cent o t.e >or/d mar=et in
va/ue terms, des ite t.e act t.at >e are t.e t.ird /ar est in vo/ume terms
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9oin /oba/I and 9oin
internationa/I are entire/y
di erent4 or oin /oba/,I
one reEuires a /oba/ mind-
set and /oba/ as irations4
Becomin internationa/I
.istorica//y meant su /yin
out o !ndia4 You do not
.ave to be /oba//y
com etitive in t.e true sense
to e ort out o !ndia4 !nsome areas, you may not be /oba//y com etitive4 9oin internationa/ on/y means /evera in
some country and com any advanta es to ta overseas mar=ets4
oo=in at some o t.e success stories o com anies /i=e Sun %.arma, usin t.eir eneric
mar=et ca abi/ities .avin 2: manu acturin units across our continents4 !t .as more t.an 82
ercent o its sa/es comin rom internationa/ mar=ets4 i /a .as resence in more t.an 1:0
countries and it out er ormed ot.er /oba/ .arma maKors by o erin atented anti-A! S
dru s at a ordab/e rices4
!ndian %.armaceutica/ industry .as one o t.e ric.est resources in manu acturin , researc.
ca abi/ities, and entre reneurs.i 4 +ur industry .as ca abi/ities and ca abi/ities across t.e
va/ue c.ain and, >e are cost com etitive across t.e va/ue c.ain4
CHALLENGES FACED BY INDIAN PHARMECEUTICAL INDUSTRY:
Price Controls:
%rice contro/s are broad/y cited as t.e most critica/ c.a//en e t.at com anies ace in t.e!ndian mar=et4 !ndia is one o t.e most rice-contro//ed mar=ets in t.e >or/d, as under t.e
% +, rices and mar ins are monitored care u//y4 &.e % + is bein su ervised by t.e
*%%A4 %rice contro//ed dru s are essentia/ medicines, suc. as antibiotics and ain=i//ers, and
dru s used or t.e treatment o diseases suc. as cancer and ast.ma4
Infrastructure:
!n rastructure .as a/>ays been mentioned as a barrier to ro>t. o t.e %.arma industry in
!ndia4 %oor ener y and trans ort in rastructure .as traditiona//y osed a rob/em or
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com anies4 Some areas /ac= basic .ote/ aci/ities, reventin reac. and enetration4 ;it. t.e
overnment radua//y increasin investment in in rastructure, t.e situation is im rovin , but
it is sti// seen as an investment o ortunity in !ndia4
Counterfeiting:-
ounter eitin o dru s .as been a maKor issue in t.e !ndian %.arma s ace4 &.e in.erent
nature o t.e !ndian mar=et ma=es it di icu/t or a systematic study t.at Euanti ies t.e e tent
o counter eitin , to be carried out4 +r anisation o %.armaceutica/ %roducers o !ndia ?+%%!@
.as a/so carried out various initiatives to combat t.e situation /i=e or anisin seminars and
>or=in >it. t.e Ministry o $ea/t. to>ards t.e deve/o ment o o/icies a ainst s urious
dru s4
Intellectual Property:-
!ndia .as acce ted and made a commitment to t.e &rade-(e/ated As ects o !nte//ectua/
%ro erty (i .ts ?&(!%S@ in 1CC5, and =ee in >it. t.is commitment, im /emented t.e %atent
?Amendment@ Act in 20054 A/t.ou . t.is act does not a /y or dru s atented be ore 1CC5, it
is a maKor ste or>ard on t.e ear/ier atent scenario4 Since t.en, recommendations .ave been
made to t.e overnment re ardin im rovement and e ansion o t.e %atent ?Amendment@
Act, by t.e Sat>ant (eddy committee and t.e Mas.e/=ar re ort4 &.ese re orts .i ./i .tedt.e need or data e c/usivity and t.e revention o ever reenin I4
+vercomin t.e c.a//en es t.at e ist in t.e mar=et is a =ey im erative or uture ro>t.4
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CHAPTER TWO:
PRODUCT PROFILE
SPECIFICATIONS:-
&>o se ment o roducts are e orted4 Bu/= dru se ments and ormu/ations4 Bu/= dru s are
active .armaceutica/ in redients ?A%!s@ >it. medicina/ ro erties, >.ic. are used to
manu acture ormu/ations4 + t.e tota/ number o .armaceutica/ manu acturers, about 88L
roduce ormu/ations, >.i/e t.e remainin 23L manu acture bu/= dru s4
Bulk Drug
&.e !ndian .armaceutica/ industry manu actures about 600 bu/= dru s be/on in to various
t.era eutic se ments4For!ul"#$o%
ormu/ations are t.e end- roducts o t.e medicine manu acturin rocess, and can ta=e t.e
orm o tab/ets, ca su/es, inKectab/e or syru s, and can be administered direct/y to atients4
Based on t.e .armaceutica/ customer base, t.e !ndian A%! manu acturin se ment can be
divided into our arts branded, eneric, +ver-t.e-counter, and atented roducts4
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Branded Generics:-
&.e to brands in t.is cate ory are ore , %.ensedy/ ou . and Voveran4 &.ese dru s a/so
.ave a brand remium >.ic. di ers bet>een t.era eutic areas4 or e am /e)
&.e number 1 ran=ed brand or t.e
mo/ecu/e Amo ici//in /avu/anate,
Au mentin, commands a remium
as .i . as 2:0L over t.e ne t-in-
/ine brand Mo i=ind- V, and 101L
over t.e t.ird ran=ed brand /avam4
!nnovator brands can command
.i . remiums over branded enerics4 or e am /e, (is erda/, an innovator brand,
commands a 106
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C
urrent/y, t.e mar=et s.are o eneric enerics is very /o>4 ;e see t>o main .urd/es to ure
enericisation o t.e !ndian mar=et)
14 ac= o eneric enerics re u/ations and uide/ines or t.e estab/is.ment o bio-
eEuiva/ence, or e am /e t.e Abbreviated *e> ru A /ication ?A* A@ uide/ines t.ate ist in t.e 4S4
24 octor com ort derived rom rescribin medications on t.e basis o brand name4
A ood e am /e or t.is is t.e overnment run- Jan Aus.adiI ro ramme4 &.ey rovide no-
name eneric dru s at t.eir subsidiDed rices in 26-.our .armacies a// over t.e country4
Over-the-counter Products:
&.e +& mar=et >as >ort. about S 14< bi//ion in 2012, and %> estimates t.at by 2020, it
>i// ro> to S 11 bi//ion - a A9( o 1it. t.e otentia/ to reac. S 13 bi//ion at
an a ressive A9( o 20L4
+& ru sI means dru s /e a//y a//o>ed to be so/d +ver t.e ounterI by .armacists, i4e4
>it.out t.e rescri tion o a (e istered Medica/ %ractitioner4
The OTC segment growth drivers are:-
*ovartis, % iDer and Jo.nson Jo.nson are e am /es o M* s t.at .ave a stron resence
in t.e !ndian +& se ment4
Patented Products:-
&.e mar=et siDe or atented dru s as o today is very sma//4 ;it. ro>in a ordabi/ity,
dee enin o .ea/t. insurance and steady im rovement in !nte//ectua/ %ro erty (i .ts ?!%(@,
atented roduct /aunc.es s.ou/d increase ivin reat o ortunity or !ndia4
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These are the major products we have chosen for our International Business abroad:-
• orticosteroids• Anti-Ast.matic• Anaest.etics• Anti- iabetics• Anti-&ubercu/osis• !ntermediates• Anti-$y ertensive• Anti- e ressants• Antibiotics
UALITY:-
!ndian (e u/atory Bodies or 7ua/ity ontro/ in %.armaceutica/ industry)-
The Central Drug Standards and Control Organization (CDSCO)
&.e S + is /ocated under t.e Ministry o $ea/t. and ami/y ;e/ are4 !t rescribes
standards and measures or ensurin t.e sa ety, e icacy and Eua/ity o dru s, cosmetics,
dia nostics and devices in t.e countryN (e u/ates t.e mar=et aut.oriDation o ne> dru s and
c/inica/ tria/s standardsN su ervises dru im orts and a roves /icenses to manu acture4
The National Pharmaceutical Pricing uthorit! (NPP )
&.e *%%A instituted in 1CC8 under t.e e artment o .emica/s and %etroc.emica/s4 !t
maintains data on roduction, e orts and im orts and mar=et s.are o .armaceutica/ irms
and im artin in uts to %ar/iament in issues ertainin to dru ricin 4
"arious cts governing the regulation o# $ualit! standards:-
• ru s and osmetics Act o 1C60 and (u/es 1C65 re u/ates dru manu acturin ,
Eua/ity and mar=etin 4• %.armacy Act o 1C6<• &.e ru s and Ma ic (emedies Act o 1C56, etc4
%nternational standard o# &harmaceutical machiner!:-
• StandardiDation• %.armaceutica/ 7ua/ity System !S+-C001• 'very .armaceutica/ com any needs to meet t.e /atest 9M% com /iance• 9M% >ou/d >ant t.e mac.inery manu acturers to o//o> a set o rocedures and ru/es
>it. ro er documentation in t.e manu acturin 4
SOURCES OF SUPPPLY
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&.e domestic bu/= dru industry is oised to bene it rom t.e im endin atent e iries in
t.e re u/ated mar=ets /eadin to increase in eneric enetrationN t.ereby rovidin a
si ni icant o ortunity or su /y o A%!s to manu acturers o suc. eneric dru s cou /ed
>it. increased outsourcin o bu/= dru s by mu/tinationa/ .armaceutica/ com anies4
&o ain more contro/ over bu/= dru su /ies, >e .ave increased our bac=>ard inte ration in
=ey A%! se ments4 !n addition to t.e a arent bene its o reater cost e iciencies and Eua/ity
contro/, in-.ouse A%! manu acturin aci/ities o er reater manu acturin /e ibi/ity and
minimises t.e re/iance on t.ird arty su /iers4
As many o t.e maKor Mu/tinationa/ .armaceutica/ com anies .ave ado ted, >e are
o//o>in a artners.i arran ement >it. su /iers eit.er t.rou . outsourcin contracts or
/on term a//iances4 &.is >i// .e/ ma imise cost e iciencies4
or e!ample" some of the major tie-ups between pharmaceutical companies and domestic
#PI suppliers are:
A =ey c.a//en e .o>ever >ou/d be to >in t.e con idence o eneric manu acturers as a
re/iab/e and cost com etitive su /ier4
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CHAPTER 3:
COUNTRY PROFILE
The main importers of Indian Pharmaceutical products are:-
?Va/ue in Mi//ion S @
More t.an Kust c.ea eneric dru s, >it. e orts ro>in at near/y 30L er year, !ndiaHs
.armaceutica/ industry is >e// ositioned or reater researc. s ends4 +ver t.e /ast t.ree
years e orts o .armaceutica/s ?/ar e/y enerics@ .ave ro>n at over 2145L and no>
accounts or over S 13 bi//ion in annua/ sa/es4 $i ./i .tin !ndiaIs dominance, near/y
60L o Abbreviated *e> ru A /ications ?A* A@ received by t.e A in 2012 >ere
rom !ndia, >it. a urt.er een January and
June 20134
$oo%ing at the top &' (lobal mar%ets for generic drugs:-
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.an es in t.e /oba/ /andsca e brou .t about by t.e increasin costs o .ea/t.care and
dryin ( i e/ines .ave been ab/e to create a number o o ortunities or !ndian /ayers4
&.e S and ' mar=ets .ave been t.e /ar est im orters o !ndian roducts, but increasin
scrutiny in t.ese eo ra .ies is t.reatenin e ort revenues and !ndian com anies >ou/d
.ave to /oo= at ris= miti ation strate ies4 nderstandin mar=et dynamics >i// be im erative
in determinin t.e e tent o ro>t. and reac. t.at !ndian com anies >i// be ab/e to ac.ieve4
;it. !ndian roducts com etin >it. t.eir /oba/ counter arts in terms o Eua/ity, !ndia .as
been ab/e to estab/is. a /oba/ oot rint4 !ndian com anies o eratin in t.e >est .ave been
ab/e to do so success u//y, but, mar=ets suc. as Ja an, arts o Sout. America, 9u/
oo eration ounci/ ?9 @ and ommon>ea/t. o !nde endent States ? !S@ sti// remain
unta ed and can be e /ored4 'ar ets that e have selected to enter:-
14 9u/ oo eration ounci/ >.ic. inc/udes Ba.rain, "u>ait, +man, 7atar, Saudi
Arabia, and t.e nited Arab 'mirates424 atin American ountries t.at inc/use, Ar entina, .i/e, BraDi/, Me ico, etc4
GEOGRAPHY:-
&) (CC
&.e 9 is .ome to 30,8ners.i com anies4 ;it. 2,5C2
com anies comin on board in 2013 a/one t.eir annua/ ro>t. .as been Euite substantia/ over
t.e ast years4 Mean>.i/e, 2,106 com anies came on board in 2010 as >ere 2,386 in 2011
and 2,:60 in 2012 avera in 2,000 ne> com anies settin u businesses in ubai annua//y4
&.is trend c/ear/y s.o>s t.e attractiveness o 9 Is com etitive business environment to
!ndian businesses4 +t.er actors are eo ra .ica/ ro imity o !ndia to some o t.e 9
countries /i=e ubai as t.is ma=es t.e cost o s.i in /o>er as t.e country can Euic=/y
su /y res. roducts to t.e A'4 A/so, t.e resence o /ar e o u/ation o !ndians /eads to
demand or t.eir countryIs roducts .ere4
&.e re/ation bet>een 9 and !ndia .as urt.er stren t.ened over t.e /ast decade, >it. t.e
increasin im ort o oi/ and as, ro>in trade, investment o ortunities and resence o a
/ar e !ndian dias ora4 A/so t.e /oba/ economic s/o>do>n and its im act on t.e deve/o ed
economies .ave rom ted a oo= 'astI o/icy rom t.e 9 nations, >.ic. .as en.anced
t.e si ni icance o !ndia as a otentia/ investor4 &.ou . t.ere .as been si ni icant ro>t. in
bi/atera/ trade bet>een t.e t>o re ions, t.e ro>t. in investment /o>s .as been /imited so
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ar4 $o>ever, !ndiaIs ro>in si ni icance as one o t.e astest ro>in /oba/ economic
o>er.ouses, driven by t.e momentous sur e in domestic consum tion and ro>in er
ca ita income .as ro e//ed many !ndian cor orates into t.e /ea ue o /oba/ mu/tinationa/s4
As a art o t.eir ro>t. initiatives, t.ese cor orates scouts or attractive overseas investment
o ortunities4 9 Is investor riend/y economic environment, eo ra .ica/ ro imity and
in.erent advanta es in ener y-intensive manu acturin .o/d tremendous otentia/ or
attractin urt.er investments rom !ndian industries4 Accordin to t.e overseas investment
data re/eased by t.e (eserve Ban= o !ndia, investments by !ndian irms in 9 .ave been
on t.e rise in t.e recent years4 !ndian irms .ave been investin in 9 countries across
sectors /i=e manu acturin , inancia/ services, rea/ estate construction, trade .os ita/ity,
a ricu/ture minin 4
*) $atin #merican Countries:-
&.e !ndia- atin America economic re/ations.i .as evo/ved si ni icant/y over t.e ast
decade, >it. ne> investments and va/ue-added businesses t.at su /ement t.e /ar e trade in
commodities4 !ndiaIs tota/ trade >it. atin America or 2012-13 is 61 bi//ion ' but Kust
1345 bi//ion are e orts, t.e /ar er c.un= bein im orts /ar e/y com risin oi/, minera/s and
a ricu/tura/ roducts ?Ministry o ommerce !ndustry, 2013@4
&.e .armaceutica/ mar=et in BraDi/, at an estimated 2: bi//ion a year, is t.e re ionIs
/ar est4 &.e enerics mar=et is ro>in ra id/y but is unta ed sti//4 9enerics account or
on/y one- ourt. o .armaceutica/ dru s so/d in BraDi/ muc. /o>er t.an t.e rou ./y 50 L
so/d in t.e 4S4 but sa/es o eneric dru s in BraDi/ are stron , increasin by 53 L in 2012
? atinve , 2013@4 &.e !MS onsu/tin 9rou .as inc/uded ive atin American
countries ' BraDi/, Ar entina, Me ico, o/ombia and VeneDue/a ' as art o t.e
%.armer in mar=ets t.at Oremain t.e /oba/ ro>t. en ineP or t.e .armaceutica/ sector4
REGULATORY ENVIRONMENT:-
&) (CC:-
&.e 9u/ coo eration counci/ ?9 @ re ion is considered as F'mer in mar=etG or
.armaceutica/ e ort and bi/atera/ trade4 &.e understandin o t.e re u/atory reEuirements
o t.is re ion can be bene icia/ or .armaceutica/ e ort4 Some incidents o t.e year 200do>n in .i ./y >e//-o and re u/ated mar=et o t.e '
and S, raised t.e demand or a/ternate destinations or business4 &.e re u/ations o 9u/
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countries are encoura in t.e im ort o Eua/ity eneric roducts, >.ic. can be ood ne>s to
t.e !ndian dru manu acturers4
Based on res onses rom 215 re resentatives o /eadin .armaceutica/ manu acturers in
!ndia and t.ose re istered in t.e si 9 countries, t.e ! ! study ound an over>.e/min=eenness to ta t.e 9 mar=et4
Accordin to a ! ! survey re ort F&.ere is a considerab/e sco e or increasin our e orts
o dru s and .armaceutica/ roducts to 9 countries, name/y Saudi Arabia, "u>ait,
Ba.rain, 7atar, nited Arab 'mirates and Su/tanate o +man
+ ortunities in t.e 9u/ oo eration ounci/ mar=et
•
9 countries- in
desire o !ndia to secure ener y su /ies urt.er stren t.ened economic and business ties or
mutua/ bene it4
&.ere is a t>o->ay /in= bet>een 9 and !ndia t.rou . trade and investments4 9 is o
vita/ im ortance or !ndia, iven t.e increasin im ort o oi/ and as, ro>in trade,
investment o ortunities and resence o a ro imate/y 840 mi//ion !ndian e atriates>or=in in t.e re ion4
http://www.ncbi.nlm.nih.gov/pmc/articles/PMC3122046/#CIT7http://www.ncbi.nlm.nih.gov/pmc/articles/PMC3122046/#CIT7
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9 -!ndia bi/atera/ trade increased at a A9( o 1046L to S 15040 bi//ion over 200C 164
urin t.e eriod, trade /o>s rom 9 to !ndia e anded at a A9( o 1143L to S
1014< bi//ion, >.i/e trade rom !ndia to 9 rose at a A9( o as driven by numerous a reements and !ndiaIs increasin oi/
im orts4
(CC- India Bilateral Trade:
*) $atin #merican Countries:
&.e .armaceutica/ sector re resents about 15 er cent o !ndiaIs e orts to t.e A re ion4
!ndicatin t.e be innin o strate ic en a ement in .armaceutica/s, !ndia and BraDi/ .ave
coo erated in i .tin t.e 'uro ean nionIs i//e a/ c/am do>n on enerics trade4 "ey non-
de ence sectors in !ndia- A trade are - ener y, minera/s, .armaceutica/s c.emica/s,
a ribusiness, !& !&'S, etc4
CULTURAL TIES (ITH INDIA:-
a) (CC:-
9 and !ndia .ave traded >it. eac. ot.er since /on 4 'very year, t.ousands o !ndian
i/ rims er orm $aK ritua/s in Saudi Arabia, urt.er stren t.enin t.e cu/tura/ bond4 ecades
o commercia/ en a ements bet>een t.e t>o .ave ostered and nouris.ed mutua/ ties4
9ro>in bi/atera/ trade and t.e !ndian e atriate o u/ation .ave urt.er stren t.ened t.ese
ties4
!ndian e atriates in 9 countries)-
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b) $atin #merican Countries:
n/i=e t.e re u/ar mode/ o trade >.ere !ndia e orts inis.ed roducts and im orts ra>
materia/s, .ere !ndia e orts ra> materia/s t.at atin America can add va/ue to and se//
>it.in its o>n mar=ets4 &.is is a .ea/t.y bi/atera/ arran ement t.at bui/ds con idence4
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CHAPTER 4:
FDI POLICY OF HOST COUNTRIES
INVESTMENTS:
!n 2013, tota/ orei n direct investment ? !@ to 9 rom !ndia stood at S 241 bi//ion4
&.e cumu/ative ! out /o>s rom !ndia to t.e 9 re ion durin 200< 13 stood at S C48
bi//ion, re isterin a A9( o 840L4 Mean>.i/e, cumu/ative ! out /o>s rom 9 to
!ndia durin 200< 16 stood at S 24C bi//ion, re isterin a A9( o 243L4 &.e sectors t.at
attracted most investments inc/ude o>er, construction, services, and meta//ur ica/ industries4
Accordin to t.e overseas investment data re/eased by t.e (eserve Ban= o !ndia,
investments by !ndian irms in 9 .ave been on t.e rise4 &.e A' is t.e most avoured
investment destination, accountin or around s rom !ndia to t.e
re ion in 20134 es ite bein t.e /ar est reci ient o ! rom /oba/ investors ?5:40L o
cumu/ative in /o>s over 2000 12@ amon 9 countries, Saudi Arabia attracted Kust 1243L
o !ndiaIs out>ard ! to 9 in 20134
+I flow to (CC from India , . / 0illion1:-
"ey actors rivin ! 9ro>t. in 9 )-
• 'conomic rivers)
9 nations and !ndia .ave re istered stron 9 % ro>t. over t.e ast decade, .e/ in
t.em ain si ni icant economic stren t.4 9 Is main ro>t. drivers >ere .i . ener y
rices, /ibera/iDation initiatives to attract more ! and economic diversi ication to reducede endence on its mainstay, t.e oi/ and as sector4 !ndia, on t.e ot.er .and, >itnessed a sur e
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in economic activities ost t.e 1CC1 economic /ibera/iDation t.at o ened t.e domestic
mar=ets to orei n investments4
• 9 countriesI ro>in economic stabi/ity)
ontinued investments on t.e overnmentIs art to e and and moderniDe basic
in rastructure .as .e/ ed t.e re ion to attract /oba/ investors4 Si nin o an im endin ree
trade a reement bet>een 9 and !ndia >ou/d urt.er o en u t.e mar=et or !ndia-based
com anies4
• !nvestment Barriers)
9 countries a/so o//o> diver ent standards re ardin ! re u/ations4 !n addition,
absence o a com etent investment aut.ority in t.e re ion remains a dra>bac=4 A/t.ou .
measures .ave been ta=en to im rove t.e investment environment, underdeve/o ed ca ita/
mar=ets are sti// an im ediment to investments4 &.ou . t.e recent vo/ati/ity e isode >it.
!ndian ru ee .as receded, /ac= o currency stabi/ity serves as a barrier to t.e cross-border
investments4 &.e (B!Is im osition o increased restrictions on overseas investments by
!ndian irms, iven t.e vo/ati/ity aced by t.e !ndian (u ee ?>.ic. de reciated more t.an
2040L in 2013 to an a//-time /o> o :as
/i ted in Se tember 20134 &.e (B! eased t.e recent curbs by a//o>in irms t.at .ave raised
unds via t.e e terna/ commercia/ borro>in ?' B@ route to invest u to 600L o t.eir net
>ort. a ainst a mont. a o /imit o 100L4
Because o t.e overa// ease and stren t. in t.e !ndia-9 economic and cu/tura/ re/ations, it
is im erative to use Joint-Ventures, Mer ers as a mode o entry or t.ey can use t.e traditiona/
e ort mode o business >.ic. current/y re resents maKority o t.eir business in 9
countries4
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CHAPTER 5:
BLUE PRINT OF BUSINESS
ENTRY STRATEGIES FOR INDIAN MNC:-
'ntry barriers di er immense/y rom mar=et to mar=et re ion to re ion in t.e nationa/
mar=ets4 /assic issues needed to overcome inc/ude deart. o in rastructure, c.a//en es in
areas /i=e roduct distribution su /y c.ain mana ement4
Some o t.e >ays t.e com any can enter t.e mar=et are)-
• Through Partnering:-
%artnerin , >it. a /oca/ /ayer >ou/d robab/y cra t a F>in->inG situation, em o>erin t.e
mar=et entrant to bene it rom t.e artnerIs e istin resence and .ome country mar=et
understandin to estab/is. o erations, bui/d mar=et s.are and s>i t/y overcome /oca/
.indrances4
• #c2uisition:-
Buyin an a/ready re uted /ayer in an embryonic mar=et enab/es a orei n com any >it. an
a/ready constructed /oca/ osition t.at it can u//y assimi/ate into its /oba/ o erations >it.time4
• Manu acturin in $ome country and ta in t.e overseas mar=ets t.rou . direct or
indirect e orts)-
&.e main bene its o t.is are t.at t.ere are no cu/tura/ or /an ua e barriers, .i .er and
Euic=er turnaround, .i .er rotection on inte//ectua/ ro erty ri .ts, etc4
•
3!port 4ouses:-&.e e ort merc.ant .ouses /ay a dynamic ro/e in endorsin e orts to orei n /ocations4 !n
t.is scenario t.e manu acturers de/e ates t.e Kob o se//in t.e roducts abroad to s ecia/ist
a encies - &.e ' ort $ouses4 &.e main disadvanta e >it. t.is is t.at, t.e manu acturer .as
minima/ contro/ over t.e mar=et4
• $icensing:-
icensin is t.e /o>est-cost o tion to e and mar=et access, but bearin a .i . brand t.reat
and restrictive otentia/ to e /oit t.e /oca/ mar=et o ortunities4 &.e current trend t.ou . is
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more on out-/icensin , yet t.ere is increasin in-/icensin activities, >it. /ar e
.armaceutica/ brands /icensin out t.eir very vita/ ( activities, redominant/y c/inica/
tria/s4 icensin acts are increasin /y bein used to ma ni y t.e roduct ort o/io,
su /ement researc. e ort strate ica//y enter ne> mar=ets4
• 5oint 6entures:-
Joint Ventures a/most imitate t.e /icensin arran ements, but norma//y di er in t.e, eEuity
artici ation and mana ement in t.e /oca/ irm4 !n case o a Joint Venture, t.e artici atin
irms enera//y bear an eEua/ s.are in t.e eEuity artici ation and mana ement in t.e /oca/
irm4
• #c2uisition:-
AcEuisition) AcEuirin a orei n com any >it. a// its assets and /iabi/ities is t.e astest >ay
to enter a mar=et t.an deve/o in o>n aci/ities4
MAR)ETING STRATEGIES TO BE EMPLOYED:-
&.e abi/ity to create stron brand eEuity by en a in in ort o/io mar=etin is a =ey actor or
success in emer in mar=ets4 &.e stren t. o t.e sa/es and mar=etin or aniDation and its
ca abi/ities in terms o ie/d sa/es, romotions, mar=et researc. can /ay a critica/ ro/e4
%.ysician en a ement and t.e creation o brand eEuity can be even more im ortant or t.e
success o t.e branded eneric >.en t.e ori ina/ dru .as been o - atent or some time and
ot.er enerics .ave a/ready been /aunc.ed in t.e mar=et4
%romotiona/ activities can .e/ M* s maintain t.e re/evance o branded eneric o erin s in
a mar=et, and doin u ront ort o/io /i ecyc/e /annin and ta=in ste s to understand tar et
se ment needs can /ace t.e M* in a stron commercia/ osition >it. its branded eneric
o erin s4 A mu/ti-c.anne/ mar=etin strate y /evera in ne>/y ado ted c.anne/s ?suc. as
di ita/ access@ .as t.e otentia/ to reac. a broader audience to de/iver core branded enerics
messa in 4 +ne =ey oa/ o t.is strate y is insti//in trust and reco nition amon .ea/t. care
roviders and consumers or t.e .armaceutica/ arent com any4
STRATEGIES FOR SUSTAINABILITY:-
&oday, businesses are be innin to understand t.at sustainabi/ity is not on/y about bein
environmenta//y riend/y4 !t is about business, >.ic. u/timate/y means it is about money4 !
im /emented >e//, sustainabi/ity can contribute ositive/y to a com anyIs inancia/ resu/ts4
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'stab/is.in /oca/ ca abi/ities in emer in
mar=ets can be a c.a//en e or /oba/
.arma /ayers, but t.e bene its can besi ni icant4 oca/ roduction can .e/
or aniDations s.orten su /y c.ains, avoid
currency /uctuations and better understand a
mar=etIs uniEue as ects, inc/udin
distribution oddities4 urt.ermore, settin u
/oca/ ( ca abi/ities can .e/ com any
attune t.eir roduct ort o/ios to meet t.eur ent needs in t.e country, and .irin and retainin /oca/ ta/ent can enab/e irms to bene it
rom emer in mar=etsI resources4
FINANCIAL STRATEGIES:-
Ac.ievin year-on-year cost reduction in t.eir overa// s endin by ri orous/y identi yin and
e/iminatin >astes in t.eir manu acturin and business rocesses4
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*lements o# cost reduction:
i=e any ot.er industry, .armaceutica/ cost .as severa/ direct and indirect costs)
• 'aterial cost: Around, :0 to 80L o .arma manu acturin cost is in /uenced by ra>materia/s4 &.ere ore, contro//in materia/ costs is one o t.e most im ortant areas t.at
com anies need to ocus on4• 'an&o er cost ) i=e ot.ers, t.e .arma industry a/so aces c.a//en es suc. as an
avera e 15L ro>t. in sa/aries and an a ro imate 20L attrition rate at o erative and
e ecutive /eve/4 &.ere ore, contro//in man o>er cost is becomin an im ortant
a enda item or t.e to mana ement4• *nerg!: &.e .arma industry uses a variety o uti/ity eEui ment, inc/udin boi/ers, air
com ressors, c.i//ers, brine units, air .and/in units ?A$ @, vacuum um s, 9 sets,
etc4 Savin s in o eratin t.ese units rimari/y resu/t rom ensurin e iciency o t.ese
mac.ines and reventin >asta e4 om anies ty ica//y /oo= at eneration,
consum tion and distribution e iciencies4• Pac ing costs: %ac=in costs are ty ica//y .i .er or ormu/ations as com ared to
A%!4 %ac=in costs can be reduced by at /east 10L by reducin ac=in reKections and
by va/ue-en ineerin t.e ac=in desi n4• nal!sing costs: 7ua/ity costs ?7 @ in most or anisations >ere not trac=ed and it is
on/y recent/y t.at or anisations .ave started /oo=in into t.is4
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Anot.er im ortant inancia/ strate y to be o//o>ed is to mana e t.e trans er ricin 4
GCC 'ar et:-
Saudi Arabia is t.e /ar est mar=et or .armaceutica/ sa/es in 9 4 it. /oca/ irmsN
(anba y >as t.e irst !ndian com any to enetrate t.e Saudi mar=et4 &.e 9 main /ayers
in t.is sector are Abbott, *ovartis, 9/a oSmit."/ine, Astra Ueneca, Jo.nson Jo.nson, and
% iDer4
3!pected Pharmaceutical .ales in (CC nations:-
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REFERENCES:-
• .tt ) >>>4s/ides.are4net bi inda in .armaceutica/-industry-335>>4business-standard4com content b2b- .arma indian- .arma-com anies-
need-to-ta -une /ored-mar=ets-to-boost-revenues-1160C0300635 14.tm/• .tt ) >>>4business-standard4com content b2b-c.emica/s success-strate ies- or-
indian- .arma-industry-in-an-uncertain->or/d-116021801558 14.tm /• .tt ) >>>4 rocess->or/d>ide4com mana ement mar=ets industries artic/es 615285• .tt ) >>>4K t s4com admin u /oads CrY$bt4 d • .tt ) >>>4indus4or .ea/t.care Secienti icL20Sessions r4L20%4V4A aKiL20-
L20!ndianL20%.armaHsL20 ontributionL20toL209/oba/L20Mar=et4 d • .tt ) >>>4e im- .arm4com
http://www.slideshare.net/bipindapin/pharmaceutical-industry-33589145http://www.business-standard.com/content/b2b-pharma/indian-pharma-companies-need-to-tap-unexplored-markets-to-boost-revenues-114090300435_1.htmlhttp://www.business-standard.com/content/b2b-pharma/indian-pharma-companies-need-to-tap-unexplored-markets-to-boost-revenues-114090300435_1.htmlhttp://www.business-standard.com/content/b2b-chemicals/success-strategies-for-indian-pharma-industry-in-an-uncertain-world-114021701557_1.htmhttp://www.business-standard.com/content/b2b-chemicals/success-strategies-for-indian-pharma-industry-in-an-uncertain-world-114021701557_1.htmhttp://www.process-worldwide.com/management/markets_industries/articles/415275http://www.jgtps.com/admin/uploads/9rYHbt.pdfhttp://www.indus.org/healthcare/Secientific%20Sessions/Dr.%20P.V.Appaji%20-%20Indian%20Pharma's%20Contribution%20to%20Global%20Market.pdfhttp://www.indus.org/healthcare/Secientific%20Sessions/Dr.%20P.V.Appaji%20-%20Indian%20Pharma's%20Contribution%20to%20Global%20Market.pdfhttp://www.exim-pharm.com/http://www.slideshare.net/bipindapin/pharmaceutical-industry-33589145http://www.business-standard.com/content/b2b-pharma/indian-pharma-companies-need-to-tap-unexplored-markets-to-boost-revenues-114090300435_1.htmlhttp://www.business-standard.com/content/b2b-pharma/indian-pharma-companies-need-to-tap-unexplored-markets-to-boost-revenues-114090300435_1.htmlhttp://www.business-standard.com/content/b2b-chemicals/success-strategies-for-indian-pharma-industry-in-an-uncertain-world-114021701557_1.htmhttp://www.business-standard.com/content/b2b-chemicals/success-strategies-for-indian-pharma-industry-in-an-uncertain-world-114021701557_1.htmhttp://www.process-worldwide.com/management/markets_industries/articles/415275http://www.jgtps.com/admin/uploads/9rYHbt.pdfhttp://www.indus.org/healthcare/Secientific%20Sessions/Dr.%20P.V.Appaji%20-%20Indian%20Pharma's%20Contribution%20to%20Global%20Market.pdfhttp://www.indus.org/healthcare/Secientific%20Sessions/Dr.%20P.V.Appaji%20-%20Indian%20Pharma's%20Contribution%20to%20Global%20Market.pdfhttp://www.exim-pharm.com/Top Related