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OVERVIEW – INDIA FORMULATIONS

Lupin's India business has demonstrated robust growth in the current fiscal, featuring as the fastest growing player in the Indian Pharmaceutical Market (IPM). This is quite a commendable feat given the backdrop of a tough business environment, regulatory challenges coupled with frequent changes in drug prices by the National Pharmaceutical Pricing Authority (NPPA), impact of demonetization in the market and an increase in competition.

During the year ended March 2017, Lupin’s India Formulations Revenues reached Rs.38,157 million, representing growth of 11% over the previous year and 15% CAGR over five-year period. With 3.3% market share, Lupin is the 6th largest player in the Indian Pharmaceutical Market (IPM).

The Company’s Top 5 therapies constitute more than 70% of the business in revenue terms. The endeavour has been to consolidate leadership in existing therapy areas by introducing novel molecules in the marketplace. We continue to strengthen our business by building new and fast growing therapeutic areas such as Gynaecology, Dermatology, Urology and Oncology, which will bolster our growth prospects for future.

We improved our ranking by two places and are currently the 6th largest player in the IPM. We have sustained our position in the Anti-TB and Cardiology therapy, where we are ranked No. 1 and No. 2 respectively. We also improved our ranking in Respiratory, Anti-Diabetic and Anti-Infective therapy area. We registered particularly strong growth in Respiratory, Anti-Diabetic, Gastro-Intestinal and Gynaecology therapeutic areas and improved upon our market share during the year.

We have gained a distinctive edge over the competition through multiple strategic alliances with multinational pharma players which helped us to outperform the market on new product launches throughout the year. It is also a matter of great pride for us to see 9 of our brands feature amongst the Top 300 brands of IPM which includes an addition of 4 new brands in FY 2017 alone. Lupin ranked 4th in the new Introductions by value in IPM. Three brands introduced during the year achieved leadership position in their respective therapy areas. We have continued to focus on our product mix through new introductions; moving from acute to chronic and semi-chronic therapy segments and expanding alliances to meet unmet market needs. This is a reflection of the commitment of our sales and marketing initiatives as well as our ability to nurture and grow brands in an extremely competitive market.

Lupin is well positioned to maintain its leadership in new product introductions with the goal to consolidate and improve its market share across segments. The success in the domestic market is an outcome of the dedication and expertise of our team of over 6,600 front line staff who remain committed to growth through strong customer engagement.

We improved our field force effectiveness through cutting edge technology solutions and devices (for instance, iPads for field force) by providing know-how and knowledge of new and existing products through detailing tools and digital solutions. Our on-going efforts to keep our field force abreast of the latest developments through e-learning modules and guides have also lead to a more confident and effective field force. Further, leveraging technology has helped us achieve efficient tracking and improve field force productivity.

As we embark on our journey next year, we are conscious of the challenges that lie ahead of us. With the imminent launch of GST by the Government of India, the industry dynamics are likely to be impacted resulting in a short term disruption. We expect this to stabilize in the medium term and prove beneficial to the industry over the long term. We are well prepared to address the challenges posed by this structural change and are gearing up to ensure minimal disruption to our supply chain.

The Company launched the ‘Softovac’ brand under its OTC division in select regions in the second half of FY 2017 and has plans to execute the pan-India launch next fiscal year to start our journey in OTC business.


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