Aj SMC
Aj SMC
INDUSTRY PROFILE
The Indian pharmaceutical sector has come a long way, being almost non-existent before
1970 to a prominent provider of healthcare products, meeting almost 95 per cent of the country's pharmaceuticals needs. The Industry today is in the front rank of Indias science-based industries with wide ranging capabilities in the complex field of drug manufacture and technology. It ranks very high in the third world, in terms of technology, quality and range of medicines manufactured. From simple headache pills to sophisticated antibiotics and complex cardiac compounds, almost every type of medicine is now made indigenously. Playing a key role in promoting and sustaining development in the vital field of medicines, Indian Pharma Industry boasts of quality producers and many units approved by regulatory authorities in USA and UK. International companies associated with this sector have stimulated, assisted and spearheaded this dynamic development in the past 53 years and helped to put India on the pharmaceutical map of the world. The Indian pharmaceutical today is in front rank of Indias science-based industries with wide ranging capabilities in the complex field of drug manufacturing and technology. A highly organized sector, the Indian pharma industry is estimated to be worth $ 4.5 billion, growing at about 8 to 9 present annually. It ranks very high in the third world, in terms of technology, quality and range of medicines manufactured. From simple headache pills to sophisticated antibiotics and complex cardiac compounds, almost every type of medicines is now made indigenously.
ADVANTAGE TO INDIA
Competent workforce: India has a pool of personnel with high managerial and technical competence as also skilled workforce. It has an educated work force and English is commonly used. Professional services are easily available. Cost-effective chemical synthesis: Its track record of development, particularly in the area of improved cost-beneficial chemical synthesis for various drug molecules is excellent. It provides a wide variety of bulk drugs and exports sophisticated bulk drugs. Legal & Financial Framework: India has a 53 year old democracy and hence has a solid legal framework and strong financial markets. There is already an established international industry and business community. Sir. M Visvesvaraya Institute Of Technology, 3
2. COMPANY PROFILE
Shilpa Medicare Limited (Shilpa Medicare) is a publicly held India-based pharmaceutical company. The company is principally engaged in producing and exporting active pharmaceutical ingredients (API's), fine chemicals, herbal products, intermediates and specialty chemical products by using latest technology. Its product line includes oncology products, general active pharmaceutical ingredients, nutritional supplements and drug intermediates. The company's manufacturing facilities are well equipped to manufacture chemicals and API's. It also holds well equipped facilities for in-house testing and research and development activities.
This comprehensive SWOT profile of Shilpa Medicare Limited provides you an in-depth strategic analysis of the company's businesses and operations. The profile has been compiled to bring to you a clear and an unbiased view of the company's key strengths and weaknesses and the potential opportunities and threats. The profile helps you formulate strategies that augment your business by enabling you to understand your partners, customers and competitors better.
This company report forms part of our 'Profile on Demand' service, covering over 50,000 of the world's leading companies. Once purchased, our highly qualified team of company analysts will comprehensively research and author a full financial and strategic analysis of Shilpa Medicare Limited including a detailed SWOT analysis, and deliver this direct to you in pdf format within two business days (Excluding weekends).
Company information BOARD OF DIRECTORS: Omprakash Inani Vishnukant Bhutada Atim Kabra Carlton Felix Periera Pramod Kasat Venugopal Loya Rajendra Sunki Reddy N.P.S. Shinh : : : : : : : : Chairman Managing Director Director Director Independent Director Independent Director Independent Director Independent Director 7
Remuneration Committee Pramod Kasat Venugopal Loya Omprakash Inani Chairman Member Member
Investors Grievances Committee Omprakash Inani Venugopal Loya Vishnukant Bhutada Company Secretary Chairman Member Member Nagalakshmi Popuri
Auditors Bohara Bhandari Bung & Associates Chartered Accountants, Amar Complex, M.G. Road, Raichur - 584 101 Sir. M Visvesvaraya Institute Of Technology, 8
Study of Industrial Marketing Plan at Shilpa Medicare Limited A. BACKGROUND AND INCEPTION OF COMPANY
Established in 1987, Shilpa Medicare Limited has carved a niche for itself in the exceedingly competitive and quality-conscious sphere of pharmaceuticals manufacturing. It produce and export consistently high-quality Active Pharmaceutical Ingredients Fine Chemicals, intermediates, herbal products and specialty chemical products using sophisticated technology, meticulously following international specifications.
The company has earned its spurs as a successful and reliable partner within the pharmaceutical industry. Buyers within the country and from across the borders count on its fast track integrated process development and finely honed expertise of its skilled and experienced personnel. The Company is already exporting to USA, Canada, Australia, Japan and European Countries viz., Germany, Switzerland, Netherlands, Belgium, Spain, Greece, Cyprus, Italy, United Kingdom etc., South American Countries like Mexico, Brazil, Columbia etc., African Countries like Kenya, Nigeria and West Indies etc., Asian Countries like Singapore, Taiwan, China, Malaysia, Thailand and closer to home to Iran, Egypt, Pakistan and Bangladesh.
Shilpa Medicare is synergizing strength through tie-ups for manufacturing products and co-marketing rights, for it believes in working together and sharing success.
Being proactive in approach, the company continually seeks out enquiries for development of new products drawing from the extensive knowledge-base of its qualified and experienced people as well as sophisticated facilities
10
Study of Industrial Marketing Plan at Shilpa Medicare Limited B. NATURE OF BUSINESS CARRIED
Shilpa Medicare Limited is a pharmaceuticals manufacturing company. Reliable Partner for API's & Customs Synthesis; recognized by Govt. of India & Export House. It is the largest Manufacturer and Exporters of Oncology API's from India & Bulk Drugs. Products registered in Europe, Russia, Korea, Iran, Canada, Japan, Australia, etc. With World class State of the art facility. WHO GMP Approved Plant. Patents filed for non-infringing manufacturing process. Highly efficient & cost effective technology & manufacturing process Shilpa Medicare Limited is an India-based company engaged in pharmaceuticals manufacturing. The Company produces and exports active pharmaceutical ingredients (API) fine chemicals, intermediates, herbal products and specialty chemical products. Some of its oncology products include Anastrozole, Bicalutamide, Carboplatin, Gemcitabine HCl, Irinotecan HCl Trihydrate and Oxaliplatin. Its general API's include Ambroxol HCl, Ticlopidine HCl and Buflomedil HCl. Chromium picolinate is its nutritional supplements. The Company's products under development include Bendamustine, Decitabine, Epirubicin, Fludarabine Phosphate, Paclitaxel and Lomustine. The Company operates in two segments: bulk drugs and intermediates and power. The Company's subsidiaries include Zatortia Holdings Ltd, Raichem Lifesciences (P) Ltd and Loba Feinchemie Gmbh.
11
The Quality Assurance Department ensures that the manufacturing facilities and procedures are standardized to provide the international quality attributes to the products consistently for each batch through a well-documented, validated and audited system.
Shilpa Medicare is fully equipped with gas chromatograph, spectrophotometers and other high-tech apparatus; as also micro-biological facilities to check the quality of raw material, semifinished products and finished products following Good Laboratory Practices by qualified and approved chemists.
12
Shilpa''s product quality is second to none and meets the most exacting demands of its clients. Making this possible are fully fledged Analytical, Instrumentation and Microbiology laboratories equipped with sophisticated instruments to test raw materials, process water, packing materials, intermediates and finished products. Impurity Profile, Residual Solvent, Stability and Microbiological studies are regularly carried out to fully characterize the products. The Quality Control instruments list as below: MAJOR QC INSTRUMENTS Sr. No. 01) 02) 03) 04) 05) 06) 07) 08) Type of Instrument HPLCs with UV detector HPLCs with PDA detector GCs with Head Space Samplers GCs with auto samplers (Liquid Injections) FTIR (PerkinElmer) UV-Vis Spectrometer (PerkinElmer) Polarimeter (Autopol V) TOC analyzer Quantity 24 No's 2 No's 1 No's 4 No 3 No 2 No's 2 No's 2 No's
13
General instruments like pH meters, KF titrators, Auto titrators, Ovens, Muffle furnaces, Incubators and other Microbial laboratory equipments like LAF, Autoclaves, ETP related analysis equipments are available To achieve and sustain market leadership for the products in national & international market by providing to meet the requirements of customer. This is achieved through the following quality objectives.
Development of approved vendors and procurement of raw material from approved sources.
Continuous R&D efforts to improve the process and quality. Strict systematic QC procedures in establishing the quality of the product. Education and training of employees to improve the quality. Adherence to cGMP norms as an integral part of the total quality management system. Assessment of changing requirements of customer expectation and meeting them. Develop environmental awareness among employees and adherence to pollution control norms.
14
15
DMF STATUS
Abacavir Sulfate Teck. Pack available Ambroxol HCl DMF available, CEP R1-CEP 2004-201 Rev 02 Acebrophylline DMF available Buflomedil HCl DMF available, CEP R0-CEP 2006-080 Rev 01 Lamivudine DMF available Nifedipine DMF available Phenylephrine HCl Under preparation Sildenafil Citrate DMF available Strontium Ranelate Teck. Pack available Terfenadine DMF available Ticlopidine HCl DMF available, CEP R0-CEP 2005-004 Rev 02 Ursodeoxycholic acid (from our Italian Principal) Under Development-Oncology APIst* PRODUCTS UNDER DEVELOPMENT (Oncology) Altretamine Cladribine Dasatinib Monohydrate Cytrabine Estramustine Exemestane Ifosfamide Melphalan Methotrexate Pazopanib Sunitinib Azacytidine Cyclophospamide Disodium Pamidronate Decitabine Erlotinib HCl Fludarabine Phosphate Lapatinib Distosylate Mitotane Nilotinib Sorafenib Tosylate Tandutinib
16
Shilpa Medicare is synergizing strength through tie-ups for manufacturing products and co-marketing rights, for it believes in working together and sharing success.
Being proactive in approach, the company continually seeks out enquiries for development of new products drawing from the extensive knowledge-base of its qualified and experienced people as well as sophisticated facilities.
17
Promoters
Institutions Public
Others
Shilpa Medicare Ltd is a privately owned company which is under taken by the following members: Omprakash Inani Vishnukant Bhutada Atim Kabra Carlton Felix Periera Pramod Kasat Venugopal Loya Rajendra Sunki Reddy N.P.S. Shinh : : : : : : : : Chairman Managing Director Director Director Independent Director Independent Director Independent Director Independent Director 18
Sun Pharma Dr Reddys Labs Cipla Ranbaxy Labs GlaxoSmithKline Lupin Cadila Health Piramal Health Divis Labs Glenmark Shilpa
424.25 1,496.00 303.95 499.95 2,187.00 389.55 737.20 417.75 616.70 276.05 209.20
H. INFRASTRUCTURAL FACILITIES
The Company has state of the art facilities for the employees. It gives importance to the environment and takes the utmost care of health of the workers. The company is situated in the outskirts of the city and is away from the pollution causing due to vehicles. The company has 20 acres. The space is also used for greenery concentrating on the environment that creates a good working condition for the employees. Sir. M Visvesvaraya Institute Of Technology, 19
20
(WO/2006/016203) Novel intermediates for the preparation of Camptothecin analogues (WO/2008/035377) Process and intermediates of 2,2' Difluoronucleosides (WO/2008/026222) Improved process for high purity Anastrozole (WO/2007/105231) Process and intermediate of Letrozole (WO/2009/078036) Design, Synthesis and Intermediates of substituted 1,2,4-Triazole [3,4-B]- 1,3,4Thiadiazoles (2313/CHE/2009) Novel Polymorphic Form of Bortezomib (160/CHE/2010) Filed ASMF/EDMF of Gemcitabine HCl over 27 EU countries and DMF filed in TGA, Medsafe, Swissmedic, Health Canada, etc. Filed ASMF/EDMF of Irinotecan HCl Trihydrate HCl over 27 EU countries and DMF filed in TGA, Medsafe, Swissmedic, Health Canada, etc. Filed ASMF/EDMF of Oxaliplatin HCl over 11 EU countries and also filed DMF in TGA, Australia Filed ASMF/EDMF of Temozolomide in EMEA, TGA, Health Canada, Swissmedic and Medsafe Best District Export Award obtained from FKCCI, Bangalore for the year 2005-2010 Star Export Excellence Award obtained from VITC, Bangalore for the year 2005-2010 Korean FDA Approved for Gemcitabine HCl & Ambroxol HCl Filed USDMF for Anastrozole, Temozolomide, Oxaliplatin, Irinotecan HCl Trihydrate and Oxaliplatin
21
J. WORKFLOW MODEL
Raw material
Additions
Filtration
Drying
QC Analysis
22
STAGE: II
Stage: I
Filtrations
Drying
QC Analysis
STAGE: III
STAGE: II
Filtration
Drying
23
Shifting
Packing
Product Export
K. FUTURE GROWTH AND PROSPECTS
Success is a direct result of experiences-good and bad. As Shilpa Medicare nears its silver jubilee, Usha Sharma traces the company's growth
Karnataka-based active pharmaceutical ingredients (APIs) company Shipla Medicare began its business in 1987. Vishnukant Bhutada, Managing Director of the company highlights its initial benchmark, "We started commercial manufacturing operations in 1989. Shilpa Medicare shares listed in Bombay Stock Exchange (BSE) in 1995. We are glad to say that we were first pharmaceutical company to launch Ambroxol HCl in India in 1998. Presently, we are the largest manufacturers and exporters of Ambroxol HCl in the world. We started manufacturing oncology API's in the year 2001."
24
He continues to say, "Shilpa Medicare is also entering into a joint venture (JV) agreement with an Italian company, to form Raichem Medicare, to set-up manufacturing facilities for its products through a special purpose vehicle. We have also acquired land in the Forma SEZ near Jedcherla in the state of Andhra Pradesh (AP) to set-up an R&D centre and formulations unit through its 100 percent Raichem Life sciences. Sharing company's manpower strength, Bhutada says, "At present we have total manpower strength of around 250 people and we are going to increase the same by around 450 employees within a short period. We also continue to invest in people processes and skill development, and provide them with a high performing environment."
Sticking to base: The company has carved its niche for itself in the exceedingly competitive and qualityconscious sphere of pharma manufacturing. It produces and exports consistently high-quality API fine chemicals, intermediates, herbal products and specialty chemical products using Sir. M Visvesvaraya Institute Of Technology, 25
Long way to go: Over the next two years, the company would be setting-up it's Contract Research and Manufacturing Services (CRAMS) operations entering (JV with the Italian Company) and also in setting-up an R&D centre and formulations unit in the Forma SEZ near Jedcherla (AP). "We are getting major business from European as well as from our Asian customers. The company has acquired 99.99 percent stake in Loba Feinchemie, Austria which has APIs, laboratory chemicals and customs synthesis manufacturing facilities and the strong marketing net-work in European countries," adds Bhutada. The company is one of the major exporters of API's to various countries like Japan, Taiwan, Korea, Singapore, Mexico, Europe and USA and we are looking new opportunities to explore mainly USA and Europe counties. Bhutada shares the company's future plans, "At present, we are mainly concentrating on the oncology segment. To gain from
26
27
3. McKINSEYS 7S FRAMEWORK
Introduction
The 7-S framework of Mckinsey is a management model that describes 7 factors to organize a company in a holistic and effective way. Together these factors determine the way in which a corporation operates. Management should take into account all of these factors, to be sure successful implementation of strategy. Large or small, they are interdependent, so if u fails to pay proper attention to one of them, this may affect all others as well. On top of that the relative importance of each factor may vary over time. The 7-S framework was first mentioned in The art of Japanese Management by Richard Pascale and Anthony Athos in 1981. They had been investigating how Japanese industry had been so successful. At around the same time that Tom Peters and Robert Waterman were exploring what made a company excellent. The 7-S model was born at a meeting of these four authors in 1978. It appeared also in In search of Excellence by Peters and Waterman, and was taken up as a basic tool by the global management consultancy company Mckinsey. Since then it is known as their 7-S Model. According to Waterman, organization change is not simply a matter of structure, although structure is significant variable in the management of change. Again it is also not a simple relationship between strategy and structure, although strategy is also a critical aspect. In their view effective organizational change may be understood to be a complex relationship between strategy, structure, system, style, skills & shared values. The first three elements-strategy, structure &system are considered the hardware of success. The next four style skills, staff,
28
Lets look at each of the elements specifically: Strategy: The plan devised to maintain and build competitive advantage over the competition. Structure: The way the organization is structured and who reports to whom. Systems: The daily activities and procedures that staff members engage in to get the job done. Shared Values: Called Super Ordinate Goals when the model was first developed these are the core values of the company that are evidenced in the corporate culture and the general work ethic. Style: The style of leadership adopted. Staff: The employees and their general capabilities. Skills: The actual skills and competencies of the employees working for the company. Sir. M Visvesvaraya Institute Of Technology, 29
30
31
32
33
Shilpa Medicare is fully focused on R&D as a means to offer quality products at competitive price and also for development of new products. We undertake innovation of new products as per customers' requirement. The production technologies of all existing products have been developed in-house and the R&D efforts are aimed at developing highly efficient and cost-effective technologies and manufacturing process Sir. M Visvesvaraya Institute Of Technology, 34
Quality Assurance Department Shilpa Medicare provides consistent quality to the customers. Strict quality assurance is inherent in every step of our process, from incoming raw materials to shipment of the finished product. Each of our raw materials is selected by our experienced purchasing department, based on strict physical and chemical criteria. Upon arrival at shilpas facility, each ingredient lot is carefully checked and analyzed by our quality control personnel. The Quality Assurance Department ensures that the manufacturing facilities and procedures are standardized to provide the international quality attributes to the products consistently for each batch through a well-documented, validated and audited system. Shilpa Medicare is fully equipped with gas chromatograph, spectrophotometers and other high-tech apparatus; as also micro-biological facilities to check the quality of raw material, semi-
35
C. SYSTEM:
The Shilpa Medicare limited uses the complete systemized processes in all fields like quality control systems, performance measurement systems, the date and time analysis systems, manufacturing processes, information systems. The company also uses the database systems for the day to day activities. Shilpa Medicare Pvt Ltd. uses the complete systematic processes in all the fields liquality control systems, standardized Operating Procedure (SOP), and the date and time analysis Systems for manufacturing processes. Wages and salary system The employees get adequate and equitable remuneration for the work done by them. In Shilpa Medicare Pvt. Ltd., the jobs are evaluated and based on this salary to be paid is determined. Salary is paid to the employees in the first week of the every month.
36
D. STYLE:
Decision-making is centralized with the head office. Authority is given to unit in-charge to take decision in day-to-day minor matters & other urgent matters. Decision-making depends on the authority & responsibility conferred on each individual & thus its distributed based on designation & position held. In important matters, meetings are held to seek opinions of top management & various department manager & the decisions are taken & implemented. Decision-making is co-ordinate & done with wide consultations of top management of department managers consultation which gives best possible gains.
E. STAFF:
The employees and their general capabilities which are necessary to accomplish the job which leads to achieve organization goals effectively and efficiently. Staff refers to the number of employees and types of employees in an organization. Staff is responsible for the development Sir. M Visvesvaraya Institute Of Technology, 37
As an employer, Shilpa Medicare limited follows ethical employment standards wherever it operates with a goal in mind company guarantees. To fulfill its entire legal obligation in terms of employment payments and benefits practices. Adequate and timely training for every one for the job for which they are employed. Career advancement related to performance and experience.
F. SKILLS:
The term skills includes those characteristics, which people use to describe a company. Organization have strengths in a number of area but their key strengths are dominant skills are few. These are developed over a period of time of the result of the interaction of a number of factors performing certain tasks successfully over a period of time, the kind of people in the organization, the top management style, structure, the management systems, the external environmental influence etc. Hence when organization makes a strategic shift it becomes necessary to consciously build new skills.
38
G. SHARED VALUES:
Values: Values refer to the institutional standards of behavior that strengthen commitment to the vision, and guide strategy formulation and purposive action. The core values are shaped around the belief that enterprises exist to serve society. In terms of this belief, profit is a means rather than an end in itself a compensation to owners of capital linked to the effectiveness of contribution to society and the essential ingredient to sustain such enlarged societal contribution. Such as: Customer satisfaction, Committed to total quality, Cost and time-consciousness, Innovation and creativity, Trust and team spirit, Respect for individuals, Integrity health and ethics.
39
4. SWOT ANALYSIS
Introduction:
SWOT Analysis is a strategic planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or in a business venture. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieving that objective. A SWOT analysis must first start with defining a desired end state or objective. A SWOT analysis may be incorporated into the strategic planning model. Strategic Planning, including SWOT and Strategic Creative Analysis SCAN analysis, has been the subject of much research. Strengths: attributes of the person or company that is helpful to achieving the objective. Weaknesses: attributes of the person or company that is harmful to achieving the objective. Opportunities: external conditions that is helpful to achieving the objective. Threats: external conditions which could do damage to the business's performance.
Identification of SWOTs is essential because subsequent steps in the process of planning for achievement of the selected objective may be derived from the SWOTs. First, the decision makers have to determine whether the objective is attainable, given the SWOTs. If the objective is NOT attainable a different objective must be selected and the process repeated. The SWOT analysis is often used in academia to highlight and identify strengths, weaknesses, opportunities and threats. It is particularly helpful in identifying areas for development.
40
OPPORTUNITIES: 1. Shilpa Medicare Limited is having a better opportunity to setup a new plant in abroad since the export market for Shilpa Medicare Products is very well established. 2. Shilpa Medicare Limited can establish a new oral liquid plant at Raichur. 3. Being the lowest cost producer combined with FDA approved plants, SHILPA MEDICARE LIMITED can become a global outsourcing hub for pharmaceutical products. 4. Large number of drugs going off-patent in Europe and in the US between 2007 to 2011 offers a big opportunity for the Indian companies, like SHILPA MEDICARE LIMITED to capture this market. 41
42
EXPENDITURE: Manufacturing Expense Material Consumed Personal Expenses Selling Expenses Administrative Expenses Expenses Capitalised Provisions Made TOTAL EXPENDITURE 7.79 154.26 17.59 3.89 4.23 0.00 0.00 187.76 6.67 128.36 12.12 5.56 4.33 0.00 0.00 157.05
Profit and Loss for the Year Non Recurring Items Other Non Cash Adjustments Other Adjustments REPORTED PAT
KEY ITEMS Preference Dividend Equity Dividend Equity Dividend (% Shares in Issue (Lakhs) EPS - Annualised (Rs) 0.00 1.92 40.00 240.24 21.20 0.00 1.54 35.00 220.24 20.89
44
Study of Industrial Marketing Plan at Shilpa Medicare Limited Balance Sheet as at 31st March 2012
Particulars Current year (31st March, 2012) Liabilities Share Capital Reserves & Surplus Net Worth Secured Loans Unsecured Loans T OTAL LIABILITIES 9.18 226.03 235.21 50.97 0.00 286.18 4.40 107.79 112.19 67.47 0.00 181.19 Previous year (31st March, 2011)
Assets Gross Block (-) Acc. Depreciation Net Block Capital Work in Progress Investments Inventories Sundry Debtors Cash And Bank Loans And Advances Total Current Assets Current Liabilities Provisions Total Current Liabilities NET CURRENT ASSETS Misc. Expenses TOTAL ASSETS (A+B+C+D+E) 163.00 35.90 127.09 3.01 28.08 37.44 33.63 83.75 32.09 186.91 41.05 17.87 58.91 128.00 0.00 286.18 155.96 28.02 127.94 3.69 3.69 43.65 31.49 2.09 42.23 120.45 52.02 21.93 73.95 46.50 0.00 181.19 45
Calculation of cost benefit ratio =Profit/Capital 2010= 46.01=10.4569 4.40 2011= 50.93=39.8692 9.18 Profit margin increased in the year 2011 compared to 2010.
46
6. LEARNING EXPERIENCE
The In plant-Training is all about studying the industry profile, company profile, McKINSEYS 7S model, SWOT analysis and annual report with reference to organization. So, various aspects of an organization like strategy, system, staff, shared values, style and skill were studied which are of immense importance to us.
In my In-Plant training program I had an opportunity to get exposed to a Company called Shilpa Medicare Limited. I had an opportunity to go through the Industry profile, company profile, and information with reference to McKINSEYS 7S model of the company. I observed what are the strategies, what kind of structure they follow, what systems they are using, which leadership styles they use, how staff works, what are the skills required by the staff in Shilpa Medicare Limited.
The very first day in our project duration I moved around the company and had a brief introduction and a general glance about the organization. My external guide in the company guided me and from the next day gradually I went into the depth study about particular departments. My external guide used to take me to all departments. Where I got the full cooperation from the concerned staff.
47