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IIPM 3-year full-time Integrated (MBA BBA) Programme

Sehgal of Nestor Pharmaceuticals also propounds how risk-taking is futile for Indian as he states, “The R&D which are required, involves a lot of cost. There was never much point in Indian manufacturers spending too much on R&D of their own when their new product discoveries could not be patent protected. R&D spending should now be ratcheted up – significantly and rapidly.” Merrily though, Indian pharmaceutical giants have no worries about it at all, and yet stand to earn a mindblowing $200 billion by 2014. God sent mercies for an ailing sector, really! Then there’s Ranbaxy, which has perhaps made the biggest proactive move amongst all in its cadre by pre-planning the first launch of the generic version of Pfizer’s lucrative drug Lipitor.

The Daiichi Sankyo-owned company has scheduled the launch of the first version of Lipitor in November 2011. And this is where you need to raise that tip of your hat for the erstwhile CEO of Ranbaxy Malvinder Mohan Singh (MMS). Yes, he perhaps got the MMS clip long back, forecasted that an opportunistic situation would come to pass, and settled rows with Big Pharmas long before he was ousted from Ranbaxy. While speaking to 4Ps B&M, a market analyst (who tracks a competitor firm and requests anonymity) declared, “Many shareholders thought they got the better of bad luck by getting the better of Singh, but honestly speaking his agreement with Pfizer has the potential of delivering $2 billion in revenues and his deal with the UK-based doc, AstraZeneca, for the Nexium drug can ring home $1.4 billion in revenues for Ranbaxy. Who can embody such vision now? They gave up the long term for the short term!” But who really cares; Daiichi saw it when Ranbaxy’s shareholders couldn’t – it saw a strong generics player, a great presence of Ranbaxy in third world nations and a super low-cost producer of drugs! But who cares?

Then there are also other players like the Indian subsidiary of the €9.3-billion Dutch pharma company, DSM, which has taken pro-active measures to forge new tie-ups with quite a number of global pharma majors for supplying atorvastatin (which is the basic compound that is used to manufacture Lipitor). Worthy of mention, realising the future need for generic drug manufacturing, the company had already entered into a manufacturing agreement with India-based Arch Pharma in 2007. Today, astrovastatin is rolled out of Arch’s plant!

Another point to note for the Indian giants, if they are to really capitalise on making money from the generic models of the off-patent drugs is that they should focus on other markets besides India. Essentially, the five biggest markets for off-patent drugs by 2014 are Japan, Italy, France, Australia, US and Germany. Therefore, it is not just critical to make the most of this opportunity in the country, but also to ensure that geographical diversification and international tie-ups play their part in cracking this drug deal!

But will players like Sun Pharma stop at just making money from these “lost IPR” opportunities? Well, not really as Baldota states, “Investing in R&D and coming out with new formulae that can be filed for patents, or maybe even move beyond just generic drugs, depending on the strategic focus, both can be attractive opportunities...” On the optimistic side, Sehgal of Nestor Pharmaceuticals thumps, “The pharma companies should certainly explore opportunities beyond generics with foreign investors eagerly eyeing up India’s wealth of human resource and its massive domestic market…” Fortune favours the ‘proactive’ brave, isn’t it?

Finally I have an antidote to the popular saying ‘Health is Wealth’… for now folks, for the Indian pharma gang members, the drug deal code is - ‘Wealth is Health’; yeah!

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2010.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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C’mon, be a sport Wendy!

If there is one thing that Wendelin Wiedeking, German sports carmaker, Porsche’s CEO for 16 years would be remembered for after he steps down from his post, it will have to be his horrendous plan to acquire Volkswagen because of which Porsche is saddling with huge mountains of debt to the tune of $14 billion. Maybe this is why the supervisory board of Porsche Automobil Holding SE unanimously accepted the CEO’s resignation. Did we tell you that Wiedeking is also Germany’s best paid CEO! Had Porsche been an American company, Barack Obama would have definitely thrashed Wiedeking with his famous ‘Say on Pay’ bill! Coming back to Germany, it is believed that despite much controversy surrounding Porsche’s buyout of Volkswagen (that actually triggered the CEO exit), talks of merger may revive once again following Wiedeking’s exodus. But it ain’t as easy as it seems to be. Before the merger talks take any form, certain issues still need to addressed gingerly before the merger gets a green signal.

Interestingly, Wiedeking was the one who got Porsche back from the brink of bankruptcy in 1992. But his idiosyncratic attempts to acquire Europe’s largest automaker, Volkswagen has taken Porsche into deep realms of debt. In fact, the hostile takeover attempts by Porsche opened the doors to Ferdinand Piech, Volkswagen’s powerful Chairman and a part-owner of Porsche, to turn the tables on Porsche. Piech even went to the extent of convincing the company to take over Porsche on the condition that the sports carmaker will improve its finances first. There is no denying the fact that Porsche will have to test the rough waters carefully before going ahead with its decision as experts expect the desired merger to be driving the growth of Porsche for many more years to come.

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2010.

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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Social media helping in brand advocacy?

Ever wondered how active users of social networking sites can help enhance the equity of a brand? Anderson Analytics conducted an online survey in June with 5,000 demographically representative respondents to identify users’ likely interests, buying habits, media consumption, et al, and concluded that there are definite data-driven segments in the social networking site market, both for non-users and users. “Most of the marketers don’t understand the nature of social networking. They are responding with little thought or strategy and are wasting money as a result,” says Rob Enderle, Principal Analyst and President, Enderle Group. Marketers need to advertise where the likely customers are spending most of their time and target the ad so that it will be consumed in the context of their activities and find a way to capture metrics of the success so that they can improve upon it. Enderle further adds, “They first have to profile their customers and then design a program that works within the context of this media.” Take for instance Facebook. It has been observed that Facebook-users are non-youth and average in the level of interest shown in the site compared to Twitter and MySpace. LinkedIn, on the other hand has a more professional user base. These social networks can be used to create forums that encourage consumers to share their experiences with a brand. Not only will this increase brand awareness, but it will also lead to higher levels of word of mouth advertising and will increase brand advocacy.

Arun Kumar Roy

For more articles, Click on IIPM Article.

Source : IIPM Editorial, 2009

An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).

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