Name
Chaithanya Reddy Sadu
IUD
08PMP03528
Enrollment No.
08BS0002864
SUBJECT: Business Strategy FACULTY NAME: Prof. A. Lakshmi Narasimha
TOPIC: Implementation of 7’S strategy at Dr.Reddy’s Laboratories
Student signature:
Faculty signature:
Introduct Intro duction ion to the compa company ny
It has significant presence in the regulated markets of USA, Germany and UK where it offers high quality medicines at affordable prices.
Strengths • World-class distribution capabilities • Strong product portfolio and an attractive pipeline • Proven ability to garner market share • Credible track record of successful “Day 1” launches • Strong relationships with key distributors, pharmacy chains and insurance funds.
Partnering Opportunities • In-licensing, co-development and product opportunities in difficult-to-make generics • Product portfolio expansion • Partners with unique platform technologies for product development Our Branded and Unbranded generic products offer affordable alternatives to innovator brands, both directly and through key partnerships.
Unbranded Generics Manufacturing Bandwidth • 7 Formulation plants [6 in India (1 USFDA approved), 1 in US]
Product Portfolio • Integrated product development center • 50+ products marketed in the US • 130+ ANDAs filed till date. 69 ANDAs pending approval at the USFDA, of which 32 are Para IV and 19 are FTFs. • 160+ products marketed in the EU • 200+ branded formulations marketed in India, Russia and other emerging markets • Among the top 10 generic companies in the US; ranks 5 in Germany; the 7 largest Generic Pharma company in Russia and among the largest pharma companies in India.
Branded Generics Our Branded Generics portfolio offers over 200 products in the major therapeutic areas of gastrointestinal, cardiovascular, pain management, oncology, anti-invectives, pediatrics and dermatology. Its top brands enjoy leadership positions in our key markets of India, Russia & the CIS, Romania and Venezuela.
India • Among the largest pharmaceutical companies • Product portfolio of over 200 brands across 13 therapeutic areas • Market leader in gastro-intestin gastro-intestinal, al, cardiovascular, pain management and oncology • 2000+ sales and marketing team • 300,000+ doctors and 1900+ stockists • Near 100% coverage of KOLs and key institutes • Stamlo, Omez, Reditux, Nise, Ketorol are market leaders in their respective category
Russia • Among the top 15 pharma companies. 14 in retail segment • Fastest growing international branded generic company by volumes • Top 5 brands occupy the 1 spot in their respective molecule space • 4 brands [Omez, Ketorol, Nise and Ciprolet] among Top 100 • Strong presence in gastro-intestinal, cardiovascular, anti-Infective, oncology, pain and dermatology • Building capabilities in wellness and nutraceuticals • 300 + sales and marketing team
Global oncology Strengths • One stop portfolio solution with a broad product basket for launches across the globe • Established capabilities in chemistry a nd biology enabling strong IP positions • Low cost development and manufacturing operations • Strong commercial infrastructure in focus geographies
Partnering opportunities • Partners for commercialization of our portfolio • In-licensing opportunities in: - Differentiated Products and NCEs (phase III, registered, marketed) - Complimentary basket of oncology products • Co-development and joint commercialization of molecules
Takeovers Promius Pharma is a branded Specialty company with a portfolio of in-licensed dermatology products and an internal pipeline in different stages of development. Promius Pharma's current portfolio contains innovative products for the treatment of psoriasis, atopic dermatitis and seborrhea dermatitis.
Strengths • 2 products in the market: EpiCeram Skin Barrier Emulsion and Scytera Foam, 7 products in pipeline • Track record of successful partnerships with Ceragenix, Foamix, Sinclair and Antares • Strong portfolio of in-licensed and co-developed dermatological products and an internal pipeline under development • Strong and committed sales force • State-of-the-art integrated product development center in Hyderabad, India
Partnering opportunities • In-licensing and product opportunities in branded dermatology space • Interested in late stage (phase II, Phase III, ready-to-market, or in-market) opportunities for development and commercialization • Out-licensing, co-development and commercialization partners for internal programs for market outside of the US We view generic biopharmaceuticals as an integral part of our mid to long term growth strategy and believe that building depth in development and manufacturing capabilities will be critical in accessin this opportunity. We have made significant efforts in this direction and have over the years succeeded in creating world class infrastructure and a highly capable team.
Strengths • Proven generic biopharmaceutical development capabilities with two marketed products - Grafeel (filgrastim) and Reditux (rituximab), in emerging markets • Developed and launched Reditux (rituximab) - the world's first generic monoclonal antibody • Pipeline of eight generic biopharmaceuticals in various stages of development with two in clinical development • The product portfolio spans multiple therapeutic areas - oncology, auto-immune diseases and CNS • GMP facilities to manufacture Biologics, in adherence with global regulatory requirements at a significant cost advantage
Partnering opportunities • Partners with intent and capabilities to commercialize generic biopharmaceuticals in specific geographies
SWOT ANALYSIS
STRENTHS ➢ Wholly owned subsidiaries in US and Europe ➢ Joint ventures in China and South Africa ➢ Markets pharmaceutical products in 115 countries ➢ Partnerships with global pharmaceutical companies like Novartis, NOVO Nordisk, etc. ➢ Strong product portfolio ➢ Manufacture and market over 250 medicines targeting a wide range of therapies ➢ Wide range of anti-cancer drugs developed ➢ Over 100 APIs developed ➢ Six New Chemical Entities(NCE) ➢ Low cost base ➢ Contributes to company’s high profit margin of around 34% of sales ➢ Partnerships with key players in the market keeps its cost base down ➢ Research Driven & Global Talent ➢ Expertise in developing innovative product formulations ➢ 6120 employees worldwide including 951 scientists in which 323 are dedicated towards new drug discovery research
OPPORTUNITIES ➢ Take a drug all the way to market ➢ Take a molecule from its pipeline all the way to the market place costeffectively market ➢ Buy back of the integrated drug development company from ICICI Ventures and Citigroup ➢ Domestic Generic drugs market ➢ In another 4-6 years, many product patents obtained after the 2004 legislation will go off providing an opportunity to the company increase its domestic footprint in Generics
WEAK NESS THREATS ➢ High amount of revenues from overseas ➢ Needs to gain FDA approval for all ➢ India - a rich source of Active Ac tive sources and products ➢ Products have to pass strict FDA trials Pharmaceutical Ingredients (APIs), hence major source of revenue is before going to market, which can be exports of APIs. May loose out to costly and time consuming ➢ This may delay the company entry to western world, especially Europe, where currency is much more stable particular markets which affects than the Indian Rupee revenue ➢ Over-reliance on partnerships ➢ Competition from US and European
TOWS ANALYSIS SO STRATEGIES ➢
With its low cost base and wide product portfolio, it can penetrate into the vast domestic market. ➢ It can leverage upon its huge research and development team to discover more drugs. ➢ It can partner with huge pharma retail outlets like Hetero and Apollo to promote more of their products.
ST STRATEGIES By leveraging on the low cost advantage, vast human resources in the R&D team it can expand its domestic market thus reducing the loss risk in case of losing US and European market. ➢ Increase the German market position by introducing new products into the market. ➢
WO STRATEGIES ➢
➢
By buying out the integrated drug development company from ICICI ventures and CITI group the company can actively manufacture its own drugs using API, with this it can hedge the threat of losing its market to western players in the API export market. As in next four years, many product patents obtained after the 2004 legislation will go off providing an opportunity to the company increase its domestic footprint in Generics.
OT STRATEGIES Take a molecule from its pipeline all the way to the market place costeffectively market to reduce the cost of obtaining approval. ➢ The above strategy also helps to rapidly enter the markets where approvals take long time. ➢
Implementation of &7s strategy Organizational Structure at Dr. Reddy’s Laboratories Organizational charts: 1. Formal reporting relationships - High 2. Levels in hierarchy - High 3. Span of control - High 4. Dep Depar artm tment ental aliz izat atio ionn- High Functional Structure: Functional structure with horizontal linkage Systems to facilitate: a. Co Coor ordi dina nattio ion n
b. Co b. Comm mmun unic icat atio ion n c. Integr graation Ladder of mechanism for Horizontal linkage an d Coordination
H 5 4
Amount of horizontal coordinati
3 2 1
LOW
L
HIGH
Cost of Coordination in time and human resources 1-Information systems 2-Direct contact 3-Task forces 4-Full time integrators 5-Teams SYSTEMS Formal and informal procedures that support the strategy and structure (Systems are more powerful than they are given credit). Various elements of system are: ➢ Communications practice and system ➢ Management reporting system ➢ Approval process ➢ Planning/budgeting system ➢ Rewards system including appraisal ➢ “Rules” STRUCTURE For proper utilization of the Structure the following steps can be followed: ➢ Tasks define jobs ➢ Jobs define skills required ➢ Skills (and other considerations) define staff ○ Over time skills change as staff gains knowledge and experience, and as technology and corporate infrastructure mature ➢ Collection of jobs basis for structure SKILLS
➢
Distinctive competencies – what the company does best, ways of developing or shifting competencies ➢ In case of this company while Job Design it is to be considered whether the existing employees have the necessary skills and knowledge to fulfill proposed / expanded job requirements? STAFF ➢ Human Resource Development at HPL has been an integral part of the Company since its inception. It has had a significant strategic role in the Company's growth process and continues to do so. It is a function that has contributed to the bottom line of the Company and has built the HPL family. HPL today boasts of a strong online competency profiling system for its employees. ✔ It is to be kept in mind that the people of HPL are ways of shaping their basic management values ✔ Proper HR management processes should be used to develop new managers who can lead the organization. Importance should be given to the ways of introducing new employees and managing careers, socialization processes.
STYLE/CULTURE The culture of the organization, consisting of – Organizational culture: the dominant values, beliefs and norms which develop over time and become relatively enduring features of organization life – Management style: The precise way in which the control system influences the behavior depends on the style of functioning of the manager (i.e where they spend their time and attention, what they allow, what they reward, etc) Dr. Reddy’s basically follows an External Control System where decision making authority rests with the top management – Centralized in practical operations Regarding organization culture, HPL follows 3 following rules those are reflected from their Vision statement. 1. Re Resp spec ectt for for In Indi divi vidua duall 2. Cu Cust stom omer er Sa Sati tisf sfac acti tion on 3. De Dedi dica cati tion on to to Excel Excelle lence nce The company can follow the following aspects for improving its culture: ✔ Customer Delight: A commitment to surpassing the customer expectations. (and not only fulfilling) ✔ Leadership by Example: A commitment to set standards in the business and transactions and be an exemplar for the industry and their own teams. ✔ Integrity and Transparency: A commitment to be ethical, sincere and open in their dealings. ✔ Fairness: A commitment to be objective and transaction-oriented, thereby earning trust and respect.
Pursuit of Excellence: A commitment to strive relentlessly, to constantly improve themselves, their teams, their services and products so as to become the best. STRATEGY – MAXIMISING THE VALUE ✔
8 USFDA approved facilities (6 in India, 1 in Mexico and 1 in UK) - 3 Technology Development Centers (2 in India and 1 in UK) • Among the top three API players glob
MD Mr.Satish reddy
MANUFACTURING
PROCUREMENT
MARKETING & SALES Head
FINANCE Head
PROJECTS Head
GM- FINANCE PURCHAS
STORES
LOGISTICS
DGM-
Chief ManagerFINANCE
Manager Treasury
Manager Corporate
Manager Plant Finance &
Manager Marketing Finance
Manager Taxation
OFFICER-
Manager Payroll &
