HRM Policies Help Torrent Pharmaceutical Sustain in Competitive Market

PROJECT REPORT
On
HRM Policies of Torrent Pharmaceuticals
In partial fulfillment of the requirement of the award for
the degree of Bachelor Of Management (BM)
( Semester VI of Master of Management – MAM )
Under
Gujarat Technological University
Under the guidance of
Prof. Nikita Mcquin
Submitted by
Liji Jacob
Enrollment no. 137290585019
M.A.M – SEMESTER VI
Gujarat Technological University
Ahmedabad
March 2016
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Table of Content
Certificate
Preface
Acknowledgement
Declaration
Sr. No. Particulars Page No.

Part – I Industry Study
1 Growth and Evolution of the Industry 8
2 Players in the Industry 14
3 Distribution channel in the industry 24
4 Key issues and Current Trends 26
5 PESTEL Analysis 33
6 Financial Analysis of Pharmaceutical Industry 38
7 Michael Porter’s Five Force Model 40
8 SWOT Analysis 45
9 Future Outlook 47
Part – II Company Study
10 Company Information and Product Profile 49
11 SWOT Analysis 72
12 Conclusion 74
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Institute Certificate
This is to certify that MS. Liji Jacob has worked and completed her Project work for the
Sem-6 IMBA Programme, on title HRM Policies Of Torrent Pharmaceutical under my
supervision. It is her own work and facts reported by her personal findings and
investigations.
Name & signature of Guide Date of submission
Name & Signature of Professor in charge / Director of the Institute.
Stamp of the Institute with Date.
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Preface
This project report is the study on the pharmaceutical industry and its growth trends.
It has focused on the opportunity and threats the industry offers to the new
pharmaceutical companies. Further it also studies the HRM policies of Torrent
Pharmaceutical which has helped the company to sustain even in such a competitive
market.
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Acknowledgement
I would like to express my deepest appreciation to all those who provided me the
possibility to complete this report. A special gratitude I give to our Faculty Guide for the
project report, Ms. Nikita Mcquin, whose contribution in stimulating suggestions and
encouragement helped me to coordinate my project especially in writing this report.
I would also like to thank the faculty members and the staff members of “L.J
INSTITUTE OF MANAGEMENT STUDIES” for their kind support and help during the
project.
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Declaration
I, Liji Jacob, hereby declare that the report for “ Project ” entitled “ HRM Policies of
Torrent Pharmaceutical ” is result of my own work and my indebtedness to other work
publications, references, if any, have been duly acknowledged.
Place: (Signature)
Date: (Name of Student)
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Part - I Industry Study
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Growth and Evolution of Industry in India
Indian Pharmaceutical industry has been witnessing phenomenal growth in recent

years, driven by rising consumption levels in the country and strong demand from
export markets. This segment of Industry has shown tremendous progress in terms of
infrastructure development, technology base and wide range of products. The industry
now produces bulk drugs belonging to all major therapeutic groups requiring
complicated manufacturing processes and has also developed excellent GMP (Good
Manufacturing Practices) compliant facilities for the production of different dosage
forms. The strength of the industry is in developing cost effective technologies in the
shortest possible time for drug intermediates and bulk activities without
compromising on quality. This is realized through the country's strengths in organic
chemicals' synthesis and process engineering. India is today recognized as one of the
leading global players in pharmaceuticals.
The Indian Pharmaceutical market is excepted to benefit from rapid growth and reforms
taking place in the Indian economy. With increased spending of the government on
healthcare programmes, rural development and rural health improvement initiatives,
through National Rural Employment Guarantee Scheme and National Rural health
Mission, healthcare access in rural India has been improving, which has opened up
huge untapped opportunities to the IPM. All these factors, coupled with a favorable shift
in healthcare models in terms of promotion of medical tourism in India, which is growing
by more than 20% y-y.
Corporatisation of hospitals and pharmacies, opening up of new distribution channels
and move to more scientific methods of promotion will help the IPM maintain double
digit growth, in the vicinity of 11-13% over next 3-5 years.
The US and European pharmaceutical markets are heading towards generics and this
move is excepted to offer enormous benefits to India. Due to high priced drugs in
western world, manufacturers are pressurized from their government to control cost and
this in turn compels them to move their manufacturing base to India.
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Demand for effective medicines is rising, as the population ages, new medical needs
emerge and the disease burden of the developing world increasingly resembles that of
the developed world. The E7 countries Bra, China, India, Indonesia, Mexico, Russia and
Turkey are also becoming much more prosperous, with real gross domestic product
projected to triple over the next 13 years. By 2020, the E7 could account for as much as
one-fifth of global sales.
Research & Development is the key to the future of pharmaceutical industry in India.
There is inconsiderable scope for Collaborative Research Partnerships in India. India
can offer several strengths to the international R&D community.
These strengths relate to availability of excellent scientific talents who can develop
combinatorial chemistry, new synthetic molecules and the plant derived candidate
drugs. The R&D expenditure by the Indian pharma industry is less than 4% of the
industry’s turnover. However, now that India is entering into the Patent protection area,
many companies are spending relatively more on R&D.
At the dawn of the 21st century, the crimson rays are smiling happily on India. The new
millennium has many economic opportunities for us, one of them being medical tourism.
For the uninitiated medical tourism refers to a tourist visiting another country with the
dual purpose of getting medical treatment, which is more affordable in the other country
and enjoying a vacation as well.
The Indian pharmaceutical industry is one of the most attractive investment destinations
in the world. With ever increasing returns, lowering risks and anticipated multifold
growth, investors are more interested in this industry than ever before. Since 2000, the
drugs and pharma sector has attracted one of the highest foreign direct investment
inflows of approximately $12.689 million.
From its nascent stages in the 1970s, the Indian pharma industry has become a mature
industry. While, the industry was previously known for manufacturing generic drugs, the
industry dynamics have now undergone a sea of change.
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Presently, the Indian pharma industry stands diversified into various spheres of
activities including research and development, manufacturing of branded, generic and
branded generic drugs, manufacturing APIs, laboratory testing and clinical research.
The Indian pharma industry ranks fourth in terms of volume and thirteenth in terms of
value globally
India has become a prime destination for manufacture of branded, generic medicines
with a strong export element. It is estimates that around 40% of the generic drugs in US
come from India. The spending pattern of an erstwhile manufacturing-oriented industry
has also changed with the industry spending around 18% of revenue on R&D activities.
Unlike many other countries, the involvement of the Indian government in the pharma
industry has been deep and often controversial.
The government has made numerous efforts to stimulate organized growth of the
industry. In the pursuit of achieving global leadership in the manufacture of end to end
drugs, the government unveiled its Pharma Vision 2020, which inter alia, provides for
reduction in approval time for new facilities to boost investments. Further, robust
mechanisms such as Drug orders and the National Pharmaceutical Pricing Authority
have been implemented to address the issue of affordability and availability of
medicines.
The growth story of the Indian pharma industry into a mammoth industry is an
impressive one marked with numerous important turning points. These turning points
have typically stemmed from the issues faced by the industry and have changed the
nature and mechanisms of the industry, and to a large extent have sculpted the trends
in the industry.
In India, modern system of medicine is a 20th century phenomena, though the

traditional system of medicine has been in practice for many centuries.
Therefore, in discussing the evolution of the IPI, three points of time are very
relevant. These are: 1900-1970, 1970-1990 and the decade of 1990s
.
The period 1900-1970 signifies the dominance of the multinationals in this field that
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were basically importing bulk drugs and formulations from abroad. Most domestic
manufacturers were engaged in repacking the formulations produced by the
multinationals and production was concentrated in the hands of the multinationals.
Production of modern medicine by indigenous units started with the setting up of
Bengal Chemical and Pharmaceutical works in 1892, which was followed by the
establishment of Alembic Chemical works in 1907 and Bengal Immunity in 1919.
At this point in time, the Patents Act of 1911 was in practice, which facilitated
patenting all the known and possible processes of manufacturing of the said drug
besides patenting the drug itself.
Hence, the indigenous firms were legally prevented from manufacturing most of the new
drugs during the life of the patent secured by the latter, i e, for 16 years, which could be
extended to a maximum of another 10 years if the working of the patent had not been
sufficiently remunerative to the patentee. This gave them the monopoly power initially.
The domestic firms were also forbidden from processing a patented drug into
formulations or importing it. However, the Second World War and the introduction of
sulpha drugs and penicillin gave on impetus to the pharmaceutical industry. The policy
instruments of independent India emphasized on creating a strong public sector unit.
In the pharmaceutical front, specific areas of production were defined for the public,
private and the domestic sector. The setting up of the public sector units and the
technical institutes meant for creating technical skills in the country contributed to the
growth of the domestic industry. By 1952, a few drugs like tetanus anti-toxin, PAS
and Iodochlorhydroxyquinoline were produced in India from their basic stages .
However, the import content of the basic drugs was high due to which the prices of
the pharmaceutical products of India were the highest in the world.
The second period of 1970-1990 is very significant for the IPI since, a few important
changes that had implications on the growth of the IPI took place during this time.
The Patent Act of 1911 was amended in 1970, which came into force in 1972. The
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1970 Patent Act provides protection for the processes of manufacturing the drug for
seven years from the date of filing the application or five years from the date of the
grant of the patent. Under this Act only one process that was used in the actual
manufacturing could be patented. This change brought a renaissance to the
pharmaceutical industry of India.
More units larger in size and capacity set up in the 1970s and 1980s started producing
drugs, which were primarily imported till then. The technical institutes that were set up in
the early 1950s and 1960s resulted in creating technical and engineering skills, which
could easily adapt the technology developed elsewhere, proved to be very
advantageous for the industry. By 1972, over 100 essential drugs covering a wide
spectrum of therapeutic groups like antibiotics, sulpha drugs, anti leprotic drugs,
analgesics, antipyretics, vitamins, tranquillisers, photochemical and various other
pharmaceutical chemicals were produced in India from basic stages.
A significant increase in the production of bulk drugs and formulations is observed

before and after the 1970s. In the early 1970s, the government introduced the MRTP
Act the FERA, which aimed at reducing the concentration of economic power with
few units and controlling the flight of foreign exchange from the country.
Basically units, which were not bringing in any new technology were asked to reduce
their foreign equity and renewal of their license was also subject to their bringing in new
technology. This resulted in the dilution of the foreign equity, which is reported in the
Table As a strategy to protect the domestic industry from competition, the FERA
companies were also not permitted to produce a list of drugs, which were delicensed
during the 1980s.
In the 1990s, several significant changes occurred in the pharmaceutical sector with
the introduction of trade liberalization measures. All those drugs, which were reserved
for the production by the public sector, were delicensed in two stages.
One immediate impact of this de-licensing of the drugs was that production increased
manifold besides increasing the competition among the domestic firms and from
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foreign companies in the 1990s. The increased production had a positive impact on
exports and on the balance of trade.
The government also increased the automatic approval limit for foreign direct
investment in the pharmaceutical industry from 40 per cent to 51 per cent. This was
subsequently increased to 74 per cent in 1997. In 1994, government of India signed
the TRIPS Agreement.
The de-licensing of the drugs and the policy of the government to allow
subcontracting or loan licensing system resulted in an uneven growth of the domestic
pharmaceutical industry. About 70 per cent of the production in the pharmaceutical
sector is contributed by loan licensees. As of 2000, it is estimated that the total
number of units engaged in the production of pharmaceutical units is 24, 000
(including that of loan licensees). Out of which 1.25 per cent or 300 belong to the
organized sector and 23, 700 belong to the small and medium sector [GITCO 2000].
It is estimated that out of this 300 units only a few units will have the R & D facilities
that is recognized by the department of science and technology (DST), while most
others have sophisticated quality control laboratories, some of which even match the
international standards.
Most of the firms are engaged in the production of finished formulations that are in
the off patent segment. Lack of adequate funds for modernization, increased
competition from the private sector and high cost of production resulted in the decline
of the public sector in the 1990s.
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Players in the Industry
The Pharma industry has grown in leaps and bounces over the years with organizations
having multiple patents, millions of dollars investments in research and development,
and highly efficient product. Here is the list of some of the top Pharmaceutical
Companies in India in 2015
1. Sun Pharmaceutical Industries Ltd.
Among all pharmaceutical companies in India, Sun Pharmaceutical Industries Limited is

the leader. Established in the year 1983 by Dilip Shanghvi, Sun Pharmaceuticals
operates in more than 150 countries across the world.
In the year 2014, Sun Pharmaceuticals acquired Ranbaxy Laboratories Limited and
became the largest pharmaceutical company in India and the fifth largest
pharmaceutical company in the world.
Sun Pharmaceuticals has manufacturing units in many countries, that include India,
USA, South Africa, Canada, Ireland, Malaysia and Mexico. It also has Research and
Development (R&D) centres in India, USA, Israel and Canada.
The company offers various quality pharmaceutical products for different domains and
some of the area are Diabetology, Neurology, Cardiology, Gastroenterology and
Orthopedics. Sun Pharmaceuticals , headquartered In Vadodara, Gujarat is an Indian
pharmaceutical company that has its operation globally.
Market Capitalization: Rs 1,89,139 Crore (As on 16th January 2016)
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2. Lupin
Lupin is another leading pharmaceutical company and stand at second in the list of top
10 best pharma companies in India 2016. Incorporated in the year 1968, Lupin is one of
the fastest growing and best pharmaceutical companies in India.
The company produces more than 5,500 pharmaceutical products of premier quality.
Some of the therapeutic areas, of which the company offer products are Neurology,
Cardiology, Diabetology and Orthopedics.
Lupin Pharmaceuticals , Inc is a wholly owned subsidiary of Lupin Ltd U. S. Its sales
and marketing headquarters is located in Baltimore MD. It is strongly focused on
research and is innovation driven.
Market Capitalization: Rs 76,613 Crore (As on 16th January 2016)
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3. Dr. Reddy’s Laboratories
With a market capitalization of Rs 63,779 Crore, Dr. Reddy’s Laboratories is the next
pharmaceutical company in this list. Founded in the year 1984, Dr. Reddy’s
Laboratories within a few decades has emerged as a leading pharmaceutical company
in India.
The company produces more than 200 pharmaceutical products and operates in more
than 20 countries across the globe. Dermatology, Cardiology, Gastroenterology and
Pediatrics are some of the therapeutic areas, of which the company offers
pharmaceutical products.
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4. Cipla
4th position on this list is occupied by Cipla, a leading pharmaceutical company

incorporated in the year 1935 and presently has operations in more than 150 countries.
Headquartered in Mumbai, Cipla is a swiftly growing pharma company and employ

more than 20,000 people.
Cipla produces more than 2,000 products and owns more than 30 manufacturing plants
in different parts of the country.
Some of the areas, of which Cipla offer products include Cardiology, Neurology,
Nephrology and Diabetology.
Cipla is a globally recognized Indian pharmaceutical Giant. It ensures to provide

patients with access to high quality, affordable and effective medicine and support.
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5. Aurobindo Pharma Limited
Aurobindo Pharma Limited is ranked fifth in the list of top 10 best pharma companies in
India 2016. Incorporated in the year 1986, Aurobindo Pharma Limited started operations
in India in 1988-99 with the establishment of the first manufacturing unit in Pondicherry.
Aurobindo is a big pharmaceutical company with 6 manufacturing units in India and

operations in more than 120 countries in the world. Neurology, Nephrology, Cardiology
and Gastroenterology are some of the therapeutic areas, of which the company provide
products.
Aurobindo Pharma founded in 1986 by Mr. Ramaprasad Reddy, Mr. K. Nityananda

Reddy and a small group of highly active and talented medical professionals, was
started out off a vision that promises to touch million lives through their large scale of
operation.
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6. Cadila Pharmaceuticals Limited
Cadila Pharmaceuticals Limited with a market capitalization of Rs 38,677 Crore is next

on this list. Headquartered in Ahmedabad, Cadila Pharmaceuticals Limited was
established in the year 1951 and presently operates in over 80 countries in the world.
Cardiology, Respiratory, Gastroenterology and Neurology are some of the therapeutic

areas, of which the company offer products.
The company has a large production capacity with a production capacity of more than
3,500 Million Tables and over 120 Million Capsules per year.
Cadila Pharmaceuticals Ltd. headquartered at Ahmedabad, Gujarat, is one of the

largest private pharmaceutical companies in India, that is serving this nation and other
countries through their life saving drugs and formulations. It is strongly focused on
innovation and research
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7. Divi’s Laboratories
Divi’s Laboratories is an Indian Pharmaceutical Company started in the year 1990 and
presently among top pharma companies in India.
The company is known for producing quality products for various therapeutic areas and
Cardiology, Dermatology and Diabetology are some of them.
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8. GlaxoSmithKline
GlaxoSmithKline (GSK) Pharmaceuticals Limited, a leading pharma company is the

Indian subsidiary of GlaxoSmithKline, a British Pharmaceutical Giant.
Headquartered in Mumbai, GlaxoSmithKline Pharmaceuticals Limited was established

in the year 1924 and stand among the oldest pharmaceutical companies in India.
GSK India offer products for various therapeutic areas, which are Dermatology,
Cardiology, Respiratory, etc.
GlaxoSmithKline Pharmaceuticals Ltd. is one of the oldest and renowned

pharmaceuticals company which was established in the year 1924 in India. At GSK,
their primary mission is to continuously improve the quality through formulation
improvement and monitoring in order to enable people to do more, work harder, feel
better and live longer
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9. Glenmark
Winner of Best Pharma Company in Emerging Markets Award, Glenmark

Pharmaceuticals is placed at ninth in the list of top 10 best pharmaceutical companies in
India 2016. Glenmark came into existence in the year 1977 and presently operates in
more than 90 countries across the globe.
Market Capitalization: 23,410 Crore (As on 16th January 2016)
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10. Torrent Pharma
10th position of this list is occupied by Torrent Pharma, a pharmaceutical company

started in the year 1969 and operates in more than 50 countries in the world.
Torrent Pharmaceuticals Ltd. is the flagship company of the Torrent Group. Based in
Ahmedabad, it was promoted by U. N. Mehta initially as Trinity Laboratries Ltd. and was
later renamed to its current name.
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Distribution channel in the industry
Drug distribution in India has witnessed a paradigm shift. Before 1990, pharmaceutical
companies established their own depots and warehouses. Now they have been
replaced by clearing and forwarding agents (CFAs)
o CFAs: These organizations are primarily responsible for maintaining storage of

the company’s products and forwarding SKUs to the stockiest on request. Most
companies keep 1-3 CFAs in each Indian state. On an average, a company may
work with a total of 25-35 CFAs. The CFAs are paid by the company yearly, once
or twice, on a basis of the percentage of total turnover of products.
o Stockist: Stockist is the distributor, who can simultaneously handle more than
one company (usually 5-15 depending on the city area), and may go up to even
30-50 different manufacturers. They pay for the products directly in the name of
the pharmaceutical company after 30 to 45 days.
o The retail pharmacy: He obtains products from the stockist or substockist through
whom it finally reaches the consumers.
Distribution in India
Replenishment based supply chain
Recording of what has been consumed at various supply chain nodes and replenishing
it at the front end by the previous supply chain node. It is an end to end solution
involving the front end distribution system, operations and procurement as well. It
enables the company to be more agile in meeting market demands and helps to meet
the two major challenges: excess inventory & shortages in system.
Association of druggists and stockists
All India Organization of Chemists & Druggists (AIOCD) has over 5.5 lac members from
retail chemists and pharma distributors/ stockists. Stockist plays a very powerful role in
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pharma distribution in India. Companies cannot bypass stockists and sell directly to
institutions or retail chains. They may face a ban from the stockists and considering the
substitutes available for each molecule, companies cannot take the risk of loosing the
sales.
Retail pharmacy chains
Organized pharmacy retail sales in India are only 3% of the total sales. They can
procure the stock from the stockists registered in the association only. The remaining
97% market is completely controlled by the stockists. Sales representatives do rarely
come and talk with the concerned distribution managers in the retail chains to sell their
products.
Institutional supplies
Institutional supplies are 7% of the total drug sales in India. Distribution for institutions
happen either through stockist or directly from the company CFA. Companies bid for the
tenders passed by these institutions like major PSUs, including NTPC, BHEL etc.
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Key Issues and Current Trends
Few issue that have affected the Indian pharma industry and how the scenario is
changing.
IPR: A changing face
Intellectual property rights in the pharma sphere have been a contentious issue globally.
Previously, the IPR debates were typically between the branded pharma companies
and generic pharma companies. India was no exception to this IPR tussle and in view of
the large poor population in need of basic healthcare, the Indian authorities were initially
not keen on granting substantial IPR protection. However, over a period of time, the
Indian authorities have become more sensitized to the need and importance of IPR
protection for the long term good of the industry.
 Better patent protection
The Indian Patents Act was enacted in 1970 and inter alia contains provisions relating
to pharmaceutical patents. A major change in the patent laws in India was the enacted
of the Patent Act, 2005, which made patent laws in India compliant with the TRIPS.
Prior to the 2005 amendment, only processes were patentable and not the end product
itself. Therefore, if a company chose to manufacture the same product but used a
different process, it could do so without violating Indian patent laws. This regime
naturally caused concerns to various companies, especially branded manufacturers, as
it did not protect their inventions fully and allowed others to manufacture the same drug,
which would have otherwise enjoyed patent protection in other jurisdictions.
With the 2005 amendment being enacted, product patents and process patents have
been permitted for a period of 20 year and special provisions have been introduced to
prevent ever-greening of patents.
The 2005 amendment is viewed as a milestone which substantially changed the

protection regime in India. However, patent disputed have regularly arisen in India,
recently in the context of compulsory licensing.
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 Locking horns on compulsory licensing
Though there was an overall improvement in patent protection in India, recent issues
such as granting of compulsory licenses have been contentious. Under Indian patent
law compulsory licenses can be awarded inter alia if:
 The reasonable requirements of the public with respect to the patented invention
have not been satisfied; or
 The patented invention is not available to the public at a reasonably affordable
price; or
 The patented invention is not worked in the territory of India.
In the pharma context, the conditions for grant of a compulsory license are aimed at
preventing a situation where the public health is prejudiced by the exclusively granted to
the patented project. Recently, the Supreme Court of India dismissed a Special Leave
Petition for reversing the compulsory license awarded to Natco Pharma. The Natco-
Bayer case was the first case on compulsory license, wherein Natco had been granted
a compulsory license for Bayer’s patented drug Nexavar, since all the grounds for
granting compulsory license under the Patents Act, 1970 had been met.
While compulsory license have been viewed in the developing world as a necessary
evil, they have also caused grave concerns in the industry due to the revenue loss that
compulsory license tend to cause. In a order by the Controller of Patents, it has been
held that granting a compulsory license should be the last resort and efforts for
obtaining a voluntary license should be made first. This order provides some comfort to
the industry, as it clarifies the legal position that so long as the patentee’s does not mett
the conditions for grant of compulsory license’s under the Patents Act, 1970, its patent
rights would not be interfered with.
Though there is a lure for short term decisions which bring relief to the public , but such
decisions should not prejudicially affect the pharma industry on the whole. There is a
dire need for carefully balancing the requirements of the public and the industry.
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 Stricter trademark enforcement
Another observable trend in the IPR sphere is the stricter enforcement of trademark
contraventions in India. In the pharma sphere this trend is comforting as trademark
contraventions may lead to use of wrong drugs.
The Indian courts have, through various judgements, taken a very strict view on issues
of passing off by using deceptively similar marks and even formulating criteria to
examine competing claims. A case in example is of Cadila Healthcare Cadila
Pharmaceutical Ltd, wherein it was held that in an action for passing off on the basis of
unregistered trade mark, for deciding the question of deceptive similarity inter alia the
following factors have to be considered:
 The degree of resemblance between the marks, phonetically similar and hence
similar in idea,
 The similarity in the nature, character and performance of the goods of the rival
traders, and
 The class of purchasers who are likely to buy the goods bearing the marks they
require, on their education and intelligence and a degree of care they are likely to
excerise in purchasing and/ or using the goods
Though trademark disputes are common in India, decisions such as Cadila judgement
have helped in bringing clarity to the legal scenario in India
The pharmaceutical industry is currently undergoing a period of very significant

transformation. The majority of “Big Pharma” companies are generating high returns
which provide them with excess cash for further rapid growth – whether organic, or
through mergers and acquisitions. In pharmaceutical industry size of the company on
its own is a significant advantage. Besides economies of scale in manufacturing,
clinical trials and marketing, bigger companies can get a competitive advantage by
allowing investments in more research and development (R&D) projects which in
turn diversify their future drugs portfolio and make them much more stable in the
long term. As the result, top-companies in the industry were active participants of
mergers and acquisitions (M&A).
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Another form of structural change in the industry was establishing of new strategic
alliances and joint ventures. So far as the research and development process for each
drug take many years and requires significant investments, and the outcome of these
investments of time and financial resources remains unclear until the final approval of
the drug, “Big Pharma” companies are constantly looking for synergies that they can
get from cooperation with their competitors.
For example, cooperation of Sanofi-

Aventis and Bristol-Myers Squibb resulted in production of Plavix, which is currently
one of the top-selling products for each of these companies.
Yet another trend is selling off low-profitability or non-core businesses. “Big

Pharma” companies in order to maintain strong sales growth and meet profitability
expectations of their shareholders actively engage in these activities. For example, in
2003 Merck sold its low-profitability Medico Health Solutions that helped to increase
its profitability margin.
 Domestic Market Attractiveness
The domestic formulations industry has grown at a CAGR of nearly 13 percent

from 2002-07. This market is expected to further grow at a CAGR of 16 percent
over the next five years . This growth will be spurred primarily by India’s expected
economic prosperity. The industry is also witnessing a gradual shift in the disease
pattern towards chronic ailments such as cardio vascular diseases , diabetes,
obesity, etc., reflecting the changing lifestyle of India’s urban population.
In the medium to long-term, a considerable share of the growth is expected to
come from the Tier II and III cities and rural markets ,in addition to Tier I cities.
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 Global Generics Opportunity
For Indian Pharma , generics has always been the mainstay of the industry . India
companies have transcended domestic boundaries and explored international
markets and in particular the U.S. and European countries . However , Indian
companies are now shifting focus and foraying in to new under-served and
emerging markets in Latin America, South Africa, Russia and other CIS nations
and Japan . Semi-regulated markets offer tremendous potential due to the
continuously improving economic , demographic and regulatory factors.
Almost all these generics markets are now set to report double-digit growth.
Currently , India has captured only 10 percent of the global generics industry.
However , it holds a dominant position in terms of the total Abbreviated New Drug
Application (ANDA) and Drug Master File (DMF) filings . Hence, Indian Pharma is
aggressively pursuing its growth strategy through acquisitions , marketing and
distribution alliances , increased focus on building niche therapeutic portfolios and
Para IV filings.
 Research and Development
With the introduction of product patents in India , pharma companies have

recognized NCE research as one of the key strategies for long term survival and
growth. The top Pharma companies are now shelling out as much as 7-9 percent of
their sales revenues towards conducting NCE and NDDS research . The impressive
growth and specialization achieved by India in this segment has also attracted the
attention of multinational innovator companies, which are increasingly partnering
With domestic companies through in-licensing and out-licensing deals.
another trend observed is that several players are hiving-off their R&D units into
separate entities in order to increase the focus on their research operations , scale
up operations , improve the scope of collaboration ,adopt effective funding models
and optimize resource mobilization and utilization.
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 Contract Research and Manufacturing Services (CRAMS)
India is also increasingly emerging as one of the most globally preferred

outsourcing / offshoring destinations for pharma . This trend can be largely
attributed to India’s inherent competencies in terms of low manufacturing cost,
highest number of U.S. FDA approved plants outside the U.S. ,vast talent pool
having excellent chemistry skills ; diverse patient pool ,strong support from
ancillary industries such as bio-informatics ,clinical data management ,etc.; and
favorable regulatory environment. Indian Pharma is now broadening the scope of its
service offerings by providing a wide range of services spanning the entire
pharma value chain
Alembic Chemical Works Co. Ltd. one of the oldest pharma companies in India,
was set up in Vadodara in 1907 , just six years after India’s first domestic
Pharmaceutical unit-Bengal Chemical and Pharmaceutical Works was setup in
Calcutta.Sarabhai Chemicals was started soon thereafter.
The industry had received strong support from the academic field. In 1940 , the
Drugs Laboratory in Vadodara was established , followed by L M College of
Pharmacy. Further in1989, the B.V.Patel Education Trust, Ahmedabad and
Gujarat Branch of Indian Pharmaceutical Association (IPA) – established the B.V.
Patel Pharmaceutical Education and Research Development (PERD) Centrein
Ahmedabad.
In the last few decades , the invested capital to labour ratio has risen significantly.
The employmental most doubled between 1979-80 and 1997-98. Over the years,
the industry has developed strong linkages with related sectors and industries
Such as chemicals , pharma machinery, information technology ,etc
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There are currently approximately 3,500 drug manufacturing units in Gujarat.The
State houses several established companies such as Torrent Pharma, Zydus
Cadila , Alembic ,Sun Pharma, Claris ,Intas Pharmaceuticals and Dishman
Pharmaceuticals, which have operations in the world’s major pharma markets.
Over the last few years, Gujarat’s contribution in the growth of India’s
Pharmaceutical industry has been significant .The state commands 42 percent
share of India’s pharmaceutical turnover and 22 percent share of exports.
Approximately 52,000 people are employed in Gujarat’s pharmaceutical sector,
which has witnessed 54 percent CAGR in capital investments over the last three
years.
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PESTEL Analysis
Political Factors:
 Many countries have a ‘monopsony’ where there is one powerful purchaser; the
government
 Governments have focused on pharmaceutical companies as easy targets in

their efforts to control rising health care expenditure. Methods include price or
reimbursement controls.
 Government price controls also created ‘parallel trade’. Single European Market
allows distributors to pocket difference after buying from low price market and
selling in high price market.
 European government has forever changing cost containment plans
 FDA perceived as too closely aligned with the industry
 South African government proposed legislation to allow generic imports of

branded drugs – 39 firms took legal action – not a good example of industry
relations
 Clear principles agreed on and adopted by many companies that they would
supply critical drugs to poor countries on a no profit no loss basis
 Japanese government calling for consolidation and globalisation of domestic

companies
 Free trade allows wholesalers to extract a large chunk from the value chain
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Economic Factors:
 New economic reality in 2006 where growth is shifting from mature markets to
emerging ones
 Reduce time in which R&D costs could be recouped
 Universal coverage systems, i.e NHS in UK too slow or unable to introduce latest
treatments and insurance funded systems i.e In USA some people can afford
treatments, but not all. 15.9% of US population without health insurance
 Methods imposed to control pharmaceutical spending
 Venture capitalists offering funding for new industry players like biotechnology
companies
 Pharmaceutical growth is aligned with GDP growth
 Companies costs for providing drug benefits to employees were increasing by up

to 20% annually.
 MCO’s asked consumers for increasing co-pays on branded versus generic

drugs
 Economic recession in Japan
 Slowing European economies
 Chinese government pouring money into new universities and science parks
 Acquisitions of biotechs
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 Product life cycle has shortened and R&D costs, in-licensing and marketing costs
have risen
 Emerging markets accounting for 50% of global GDP growth in 2005.
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Socio-cultural Factors:
 Regulators, payers and consumers more carefully weighing the risk/benefit

factors of pharmaceuticals
 Lack of public or political support for industry
 Ageing populations pressuring health care funding
 Increasing patient expectations
 Trend by payers to use generic drugs as first line treatment option, only switching
to patented drugs if they fail
 Litigious US consumers forced MCO attention on offering optimal rather than

cheaper care leaving the door open for genuine innovation
 Japan had worlds most rapidly ageing population, however in 2005 the
population itself began to decline
 Emerging markets have enormous populations with high levels of unmet need
 In 2006 companies realised that well informed patients were prepared to ask for
drugs by name and were becoming increasingly vocal, well informed, and
demanding.
 Consumers beginning to purchase across borders with no guarantees of drugs

being safe or even genuine
 Average life expectancy in developed countries increased dur8ihng 20 th century

by about 20 years
 Public perception of pharmaceutical companies was that they were greedy and
consumers and politicians lost trust
 More educated consumers
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Technological Factors:
 Expensive high technology solutions
 International convergence of medical science and practice under the influence of

modern communications technology and increased travel and information
exchange
 Pace of change outstripping the capabilities and powers of regulators
 New product adoption is not keeping pace with loss of patent protection
 Easy to purchase addictive painkillers and other potentially harmful drugs over
the internet and rogue websites offering miracle cures for aids cancer
 Opportunities in scientific and technological advances
 Chinese government pouring money into new universities and science parks
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Financial Analysis of Pharmaceutical Industry:
Financial analysis offers a system of appraisal and evaluation of a firm’s performance

and operations; it is the analysis of the financial statement of an enterprise. The
analysis of financial statement can be best done by various yardsticks of which, the
important is known as ratio or percentage analysis. Ratio is a numerical or an
arithmetical relation between two figures. It is expressed when one figure is divided by
another. Accounting ratios show interrelationship which exist among various accounting
data. Accounting ratio can be expressed in various ways such as, a pure ratio, a rate or
a percentage. Ratio analysis is certainly a very admirable device because it is simple
and it has a predictive value. Management and other users thus, rely substantially on
the financial ratios based on accounting data for making assessments and predictions
of past performance, present position and probable future potentials. One important way
for diagnosing the financial health is to measure the profitability, liquidity, activity and
solvency and the level of the bankruptcy of enterprise.
Profitability Ratio Profitability is a measure of efficiency. It also indicates public

acceptance of the product and shows that the firm can produce competitively. The
profitability ratios measure the performance of profit of an enterprise. In other words the
profitability ratios are designed to provide answers to questions such as what is the rate
of profit?. What is EPS? What is the rate of investment? What is the rate of equity? Is
the profit earned by the enterprise adequate? What is the dividend payout ratio? What is
retention ratio and so on? The analysis of the profitability ratio is important for the
shareholders, creditors, prospective investors, bankers and the government alike. Gross
profit margin ratio, return on investment, net profit margin ratio and operating profit ratio
can be used to measure the liquidity position of the enterprise.
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Liquidity Ratio The liquidity ratios measure the ability of an enterprise to meet its short-
term obligations and reflect the short-term financial strength of an enterprise. Liquidity is
a pre-requisite for the very survival of an enterprise. Analysis of liquidity is very
important in knowing the liquidity status, movement of funds, idle fund (if any) which will
not only help financial management to keep the liquidity position of the company in
order but also make sure of payment to short-term creditors, interested in short-term
solvency of the company. Liquidity ratios reveal the rate at which fixed European
Journal of Business and Management www.iiste.org ISSN 2222-1905 (Paper) ISSN
2222-2839 (Online) and working assets are being converted into cash and the time
when the cash will be required. Current ratio, quick ratio and working capital to total
asset ratio can be used to measure the liquidity position of the enterprise.
Activity Ratio Activity ratios indicate the effectiveness of an enterprise with which
different assets are managed and utilized in a business. The efficiency in assets
management is measured by activity ratio which involves the comparisons between the
level of sales and investment in various assets accounts, inventories, bill receivable,
fixed assets and others. The activity can be measured by the use of activity ratios such
as inventory turnover, fixed assets turnover and total assets turnover.
Solvency Ratio The long-term solvency of a company is an important aspect to the

present and future long-term creditors, banks, debenture holders etc. Before
sanctioning loan or buying a debenture or preference share, they are interested to see
whether the company has ability to pay the interest regularly as well as repay the
installment of the principal on due date or in one lump sum at the time of maturity. The
long-run solvency of a company can be measured by the use of solvency ratios named
debt to total assets, the time interest earned and retained earning to total assets.
39 | P a g e
Michael Porter’s Five Force Model
Barriers
to
entry
Bargaining Bargaining
power Industry power
of Competition of
buyers suppliers
Threat
of
substitutes
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(a) Industry Competition
Pharmaceutical industry is one of the most competitive industries in the country with
as many as 10,000 different players fighting for the same pie. The rivalry in the
industry can be gauged from the fact that the top player in the country has only 6
%(2006) market share, and the top 5 players together have about 18 %(2006) market
share.
Thus, the concentration ratio for this industry is very low. High growth prospects
make it attractive for new players to enter in the industry. Another major factor that
adds to the industry rivalry is the fact that the entry barriers to pharmaceutical
industry are very low. The fixed cost requirement is low but the need for working
capital is high.
The fixed asset turnover, which is one of the gauges of fixed cost requirements, tells
us that in bigger companies this ratio is in the range of 3.5-4 times. For smaller
companies, it would be even higher. Many small players that are focussed on a
particular region have a better hang of the distribution channel, making it easier to
succeed, albeit in a limited way.
An important fact is that, pharmaceutical is a stable market and its growth rate
generally tracks the economic growth of the country with some multiple (1.2 times
average in India). Though volume growth has been consistent over a period of time
value growth has not followed in tandem.
The product differentiation is one key factor which gives competitive advantage to
the firms in any industry. However, in pharmaceutical industry product differentiation
is not possible since India has followed process patents till date, with loss favouring
imitators.
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Consequently product differentiation is not a driver, cost competitiveness
is. However, companies like Pfizer and Glaxo have created big brands over the years
which act as product differentiation tools.
Earlier it was easy for Indian pharmaceutical companies to imitate pharmaceutical

products discovered by MNCs at a lower cost and make good profit. But today the
scene is different with the arrival of the patent regime which has forced Indian
companies to rethink its strategies and to invest more on R&D. Also contract research
has assumed more importance now.
(b) Bargaining power of buyers
The unique feature of pharmaceutical industry is that the end user of the product is
different from the influencer (read doctor). The consumer has no choice but to buy
what doctor says. However, when we look at the buyer’s power, we look at the
influence they have on the prices of the product. In pharmaceutical industry, the
buyers are scattered and they as such do not wield much power in the pricing of the
products. However, government with its policies, plays an important role in regulating
pricing through the NPPA (national pharmaceutical pricing authority).
(c) Bargaining power of suppliers
The pharmaceutical industry depends upon several organic chemicals. The chemical
industry is again very competitive and fragmented. The chemicals used in the
pharmaceutical industry are largely a commodity. The suppliers have very low
bargaining power and the companies in the pharmaceutical industry can switch from
their suppliers without incurring a very high cost.
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However, what can happen is that the supplier can go for forward integration to become
a pharmaceutical company. Companies like Orchid Chemicals and Sashun Chemicals
were basically chemical companies who turned themselves into pharmaceutical
companies.
(d) Barriers to entry
Pharmaceutical industry is one of the most easily accessible industries for an

entrepreneur in India. The capital requirement for the industry is very low; creating a
regional distribution network is easy, since the point of sales is restricted in this
industry in India. However, creating brand awareness and franchisee among doctors is
the key for long term survival. Also, quality regulations by the government may put
some hindrance for establishing new manufacturing operations. The new patent
regime has raised the barriers to entry. But it is unlikely to discourage new entrants, as
market for generics will be as huge.
(e)Threat of substitutes
This is one of the great advantages of the pharmaceutical industry. Whatever happens,
demand for pharmaceutical products continues and the industry thrives. One of the
key reasons for high competitiveness in the industry is that as an ongoing concern,
pharmaceutical industry seems to have an infinite future. However, in recent times the
advances made in thee field of biotechnology, can prove to be a threat to the synthetic
pharmaceutical industry.
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Conclusion of the model
This model gives a fair idea about the industry in which a company operates and the
various external forces that influence it. The industry seems to be operating in
monopolistic market structure. However, it must be noted that any industry is not
static in nature. It’s dynamic and over a period of time the model, which we have used
to analyse the pharmaceutical industry may itself evolve.
Going forward, we foresee increasing competition in the industry but the form of
competition will be different. It will be between large players (with economies of
scale) and it may be possible that some kind of oligopoly or cartels come into play.
This is owing to the fact that the industry will move towards consolidation. The larger
players in the industry will survive with their proprietary products and strong
franchisee.
In the Indian context, companies like Cipla, Ranbaxy and Glaxo are likely to be key
players. Smaller fringe players, who have no differentiating strengths, are likely to
either be acquired or cease to exist.
The barriers to entry will increase going forward. The change in the patent regime has
made sure that new proprietary products come up making imitation difficult.
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SWOT Analysis
Strength
· Availability of Cheap raw material.

· Availability of professional manpower with good technical expertise.
· Low cost of production.
· Large pool of installed capacities.
· Efficient technologies for large number of Generics.
· Large pool of skilled technical manpower.
· Increasing liberalization of government policies.
Weakness
· Bad brand image of Indian Pharmaceutical Products in USA, UK & other western
countries which is hampering exports
· Lack of Research & Development (R&D) orientation of Indian Pharmaceutical
Companies
· Fragmentation of installed capacities.
· Low technology level of Capital Goods of this section.
· Non-availability of major intermediaries for bulk drugs.
· Lack of experience to exploit efficiently the new patent regime.
· Very low key R&D.
· Low share of India in World Pharmaceutical Production (1.2% of world production but
having 16.1% of world's population).
· Very low level of Biotechnology in India and also for New Drug Discovery Systems.
· Lack of experience in International Trade.
. Low level of strategic planning for future and also for technology forecasting.
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Opportunity
· Very lucrative high profit making market with high chances of growth
· Increased awareness amongst people about Health Prodcuts
· Aging of the world population.
· Growing incomes.
· Growing attention for health.
· New diagnoses and new social diseases.
· Spreading prophylactic approaches.
· Saturation point of market is far away.
· New therapy approaches.
· New delivery systems.
· Spreading attitude for soft medication (OTC drugs).
· Spreading use of Generic Drugs
· Globalization
· Easier international trading.
· New markets are opening
Threats
. Entry of other foreign competitors in the Indian market

· Other Business Risks
· Containment of rising health-care cost.
· High Cost of discovering new products and fewer discoveries.
· Stricter registration procedures.
· High entry cost in newer markets.
· High cost of sales and marketing.
· Competition, particularly from generic products.
· More potential new drugs and more efficient therapies.
· Switching over form process patent to product patent
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Future outlook
The pharmaceutical industry showed high sales growth rates in the recent past, and a
number of factors suggest that this trend will continue in the future. Some of these
factors are:
1. Due to numerous advancements in science and technology, including those in
the health care industry, life expectancy in the developed countries has been
steadily growing. As the result, growing proportion of elderly people promises
further growth of demand for healthcare products.
2. According to various studies, a significant portion of elderly population in the

United States and other countries does not receive proper treatment. For
example, only about one third of the U.S. population who requires medical
therapy for high cholesterol is actually receiving adequate treatment. As it is
expected, the Medicare Prescription Drug Improvement and Modernization
Act starting from the beginning of 2006 will increase access of senior citizens
to the prescription drug coverage, thus increasing pharmaceutical sales.
3. Although developing countries at the moment have a small portion of world

pharmaceutical sales, these countries also have a significant potential for the
pharmaceutical industry in the future. Fast growing economies in Asia, South
America and Central & Eastern Europe suggest an increasing solvency of
population and make these markets more and more attractive for “Big
Pharma” companies. Further reforms of legislation systems in the countries of
these regions, especially regarding patent protection issues, will inevitably
result in growing pharmaceutical sales.
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Part II – Company Study
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Torrent Pharmaceutical Ltd.
Torrent Pharmaceuticals Ltd (TPL), the Rs. 1665 crore (USD 363 million) flagship
company of the Torrent Group, is ranked among the top pharma companies of India. It
is a dominant player in the therapeutic areas of cardiovascular (CV) and central nervous
system (CNS) and has achieved significant presence in gastro-intestinal, diabetology,
anti-infective and pain management segments. Right from pioneering niche marketing in
India to earning the sobriquet of ‘the Company with the most first launches’, Torrent
Pharma has always remained ahead of its competition.
Torrent Pharma’s competitive advantage stems from its world-class manufacturing

facilities, advanced R&D capabilities, extensive domestic network and a widespread
global presence.
Its manufacturing facilities comply with WHO, cGMP, MHRA and TGA norms and have
received ISO 9001, ISO 14001, OHSAS 18001 (Occupational Health and Safety
Management System) and ISO/IEC- 17025 (NABL) certifications. The formulations and
API manufacturing facilities at its Indrad plant in Gujarat has received the USFDA
approval. Attainment of such standards have opened the key to gaining footholds in
regulated, lucrative markets like the US and EU. It second manufacturing plant at Baddi
in Himachal Pradesh primarily caters to the Indian markets. The facility has the capacity
to manufacture 3.2 billion tablets, 300 million capsules and 17 million Oral Liquid
bottles, per annum. Torrent Pharma has also entered into an agreement with
Novo Nordisk to establish a new, dedicated formulation and packaging facility for
Insulin. This new state-of-the-art facility, set up at the Indrad plant, is designed to meet
the expected increased demand for Insulin, in view of the burgeoning diabetes
population of India. The domestic formulation complies with the stringent quality norms
as practiced across the world by Novo Nordisk. Torrent is the sole manufacturer of
Insulin Formulations for Novo Nordisk in India.
Torrent Pharma is also amongst the few Indian pharma majors to recognize the
49 | P a g e
importance of research and development in the post 2005 GATT era. Set up at an initial
investment of US $ 40 million, its modern and well-equipped R&D Centre is ranked
amongst the best in the country. It has nearly 630 highly qualified scientists, with a
combined experience of over 4200 scientific man-years, working on various Drug
Discovery and Development projects. Torrent Pharma’s quest for becoming a research-
based enterprise has resulted in earmarking about 8%-9% of sales year-after-year for
R&D advancement. The R&D Centre has received ISO-IEC 17025:1999 by National
Accreditation Board for Testing and Calibration Laboratories (NABL), OECD Standards
of Good Laboratory Practices Certificate from Dutch Health Ministry and authorization
for conducting Bioequivalence Studies at Torrent R&D Centre from Brazilian Sanitary
Surveillance Agency (ANVISA).
Presently, it has eight discovery projects in pipeliner. Of the 340 patents filed for NCEs
in all major markets worldwide, the patent offices of USA, Japan, Europe, Czech
Republic, Australia, Hong Kong, Russia and India have granted / accepted 144 patents
so far. It has to its credit the discovery and patenting of the AGE (Advanced
Glycosylation End Product) Breaker Compound, which has the potential to treat heart
diseases and diabetes, related complications.
Thus, Torrent Pharma has readied the two most important dimensions of its business,
manufacturing and research & development, to world-class standards.
The domestic operations of the company are controlled through eight well-segregated
marketing divisions, strategically structured on specific therapeutic areas. Together,
these divisions spearhead the company’s dominant position in the various therapeutic
segments that it operates in. It has a vast field force of over 2400 well-trained field staff
catering to over 2 lakh doctors across the country and a strong network of 200000
retailers and 1400 stockists.
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Torrent Pharma has a strong international presence spanning over 50 countries across
five continents with over 1000 product registrations. The international business of
Torrent Pharma has been broadly divided into five zones- USA, Latin America, Russia
and CIS, Western Europe and CEE and Rest of the World (ROW) that includes the
countries of Asia-Pacific and Africa. It has wholly owned subsidiaries in USA, Brazil,
Mexico, Germany, Russia, Japan, Philippines and Australia. These wholly owned
subsidiaries spearheads the company’s entry into several new regulated and semi
regulated international markets. Torrent’s presence in the EU markets received a shot in
the arm when it acquired the Pfizer group company, Heumann Pharma GmbH, giving it
a strong presence in the German and European generics markets.
Today, Torrent Pharma, with its state of the art manufacturing and research facilities
and a global presence, is all poised to carve a niche for itself in the international pharma
arena. It is well set on an exciting growth phase in all directions.
Mission
We commit ourselves to total customer care by delivering world-class products and
services.
Vision
To be the leader in the pharmaceutical industry.
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Core values
We as Torrentians hail from diverse backgrounds and cultures. Each of us have

different upbringing that influences our views, opinions, preferences, prejudices, beliefs
etc. This diversity is our strength. We need to constantly build upon this strength,
harnessed by our core values. .
These core values, you will agree, help us develop a sense of trust, ownership and
pride amongst each of our stakeholders who are associated with Torrent. It guides us in
building a sustainable organization that can withstand the test of time.
Integrity
When truth is paramount
Thoughts and actions entail doing the right thing at all times and in all circumstances;
whether or not anyone is watching. This requires inner courage and conviction, no
matter what the consequences are. It is honoring one's commitments and being
accountable for one's actions, end-to-end.
Excellence
When best is not enough
Passion for excellence means not doing extra-ordinary things, but doing ordinary things
in all pursuits exceedingly well. Passion and excellence are forces that fuel each other
on the exclusive path to leadership. As we are what we repeatedly do, excellence then
becomes not an act, but a habit.
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Customer and family first
When customer comes first, they last
The guiding principle behind caring for customers and family is being honest in building
and nurturing relationships. Our mantra in customer service is ‘Turrant’. We believe in
setting high standards when it comes to maintaining relationships.
Teamwork
Teamwork makes the Dream work
An ideal organisation facilitates participation and involvement of each of its members in

various decision making processes. It not just leads to commitment but also ensures
ownership of the end result by each member. Team to us is something that facilitates
mutual brainstorming resulting in accomplishing the assigned task.
Constant learning
Life is a continuous learning experience
Continuous learning is the key skill that ensures growth and sustainability of any
organization. Continuous upgradation of one’s knowledge and competence will surely
give a competitive edge to us. You will agree, our organization provides platform for
continues learning that not only enhances knowledge but also evolves all of us into
matured Torrentian.
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Responsibility
When every smile matters
Concern for Society & Environment is a sense of responsibility and contribution to

society that defines our existence. It entails making a difference in the quality of lives
and environment surrounding us. It is important to encourage fellow-members on
collective as well as individual basis to fulfill the responsibility of leaving behind a world
abundant in flora and fauna, rich in time tested values & ideals and above all wealthy in
social fervor for our future generations.
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Product Profile
Acyclovir
This medication is an antiviral agent, prescribed for herpes simplex, genital herpes,
herpes zoster and chickenpox. It slows down the growth and spread of the herpes virus.
Acyclovir is also sometimes used to treat eczema herpeticum, herpes infections of the
skin, eyes, nose, and mouth in patients with human immunodeficiency virus (HIV), and
to treat oral hairy leukoplakia a condition that causes hairy white or gray-colored
patches on the tongue or inside of the cheek.
Albendazole
This medication is an anthelmintic, prescribed for tapeworm infections, hydatid cyst

disease, cysticercosis or neurocysticercosis, capillariasis, cutaneous larva migrans,
giardiasis, microsporidiosis including Septata intestinalis infection, intestinal parasites in
immigrants, strongyloidiasis, trichinosis, trichostrongyliasis.
Alprazolam
This medication is a benzodiazepine, prescribed for anxiety and panic disorders.
Ambroxol
This medication is a mucolytic agent, prescribed for various respiratory diseases such
as emphysema with bronchitis pneumoconiosis, chronic inflammatory pulmonary
conditions, tracheobronchitis (respiratory tract inflammation), bronchiectasis, bronchitis
with bronchospasm asthma.
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Amiodarone
This medication is used to treat life-threatening irregular heart rhythms (arrhythmias)

and to maintain a normal heart rate in patients who have not responded to other
medications. It is an antiarrhythmic drug.
Amitriptyline
This medication is a tricyclic antidepressant, prescribed for depression. It is also

prescribed for migraine and nerve pain.
Amlodipine
This medication is a calcium channel blocker, prescribed for high blood pressure and
chest pain. It widens blood vessels and improves blood flow by not making the heart
pump harder.
Aspirin
This medication is an analgesic and antipyretic, prescribed for pain, heart attack and
fever. The drug decreases the substances that cause pain and inflammation.
Aspirin
This medication is an analgesic and antipyretic, prescribed for pain, heart attack and
fever. The drug decreases the substances that cause pain and inflammation.
Atenolol
Atenolol blocks beta-1 receptors, which are present on the heart. This prevents the
action of nerve chemicals adrenaline and noradrenaline on the heart. As a result, heart
beats at a slower rate and with lesser force, and thus pumps out lesser blood into blood
vessels. This action of atenolol reduces blood pressure in the hypertensive patients.
Since the heart treated with atenolol beat slowly and with less force, it uses lesser
energy thus relieving pain in angina and also reduces the risk of heart attack.
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Atomoxetine
This medication is a selective norepinephrine reuptake inhibitor (SNRI), prescribed for

Attention deficit hyperactivity disorder (ADHD).
Atomoxetine
This medication is a selective norepinephrine reuptake inhibitor (SNRI), prescribed for

Attention deficit hyperactivity disorder (ADHD).
Atorvastatin
This medication is an HMG-CoA reductase inhibitor, also known as "statin”, prescribed

for hyperglycemia.
Azithromycin
This medication is a macrolide antibiotic used for various bacterial infections such as
infections of the middle ear, throat, bronchus, sinuses, skin and soft tissue. It is also
useful in treating pneumonia, typhoid, gonorrhoea, granuloma inguinale and chancroid.
It prevents bacterial growth.
Calcium Carbonate
This medication is a dietary supplement, prescribed for calcium deficiency state which
may occur in diseases such as decreased levels of parathyroid hormone (acute and
chronic), postmenopausal osteoporosis, rickets and osteomalacia (softening of the
bones). It is also used as an antacid.
Capecitabine
This medication is an antimetabolite, prescribed for breast cancer and colorectal cancer.
It prevents the growth of cancer cells.
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Carvedilol
This medication is an alpha- and beta-blocker, prescribed for heart failure and high
blood pressure.
Carvedilol
This medication is an alpha- and beta-blocker, prescribed for heart failure and high
blood pressure
Cefadroxil
This medication is broad-spectrum antibiotic, prescribed for certain types of bacterial

infections such as urinary tract infection, skin and soft- tissue, pharynx (throat) and
tonsils (tonsillitis). This medication fights against the bacteria present in the body.
Cefdinir
This medication is a cephalosporin antibiotic, prescribed for pneumonia, acute

exacerbations of chronic bronchitis, ENT and skin infections.
Citalopram
This medication is a selective serotonin reuptake inhibitor (SSRI), prescribed for

depression. It works by increasing the amount of serotonin, a natural substance in the
brain that helps maintain mental balance.
Clonazepam
This medication is an anticonvulsant, muscle relaxant, prescribed for Lennox-Gastaut

syndrome, panic disorder and seizures.
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Clopidogrel
This medication is an anti-platelet agent, that is, a drug that inhibits the ability of
platelets to clump together as part of a blood clot. This medication is prescribed either
alone or with other medications for prevention or treatment of stroke and heart attack
(which are usually caused by blood clots) in persons who are at high risk.
Deflazacort
This medication is a glucocorticoid, prescribed for anti-inflammatory conditions, and

used as an immunosuppressant.
Dipyridamole
This medication is a coronary vasodilator, prescribed for blood clot events.
Divalproex
This medication is an anticonvulsant, prescribed for bipolar disorder, epilepsy and to

prevent migraine headache.
Dobutamine
This medication is a sympathomimetic compound used in the treatment of heart failure

and cardiogenic shock. It stimulates the heart muscle.
Domperidone
This medication is an antidopaminergic agent, used in treating nausea, vomiting,

gastrointestinal problems and Parkinson’s disease.
Donepezil
This medication is a cholinesterase inhibitor, prescribed for dementia of Alzheimer's

disease.
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Duloxetine
This medication is a serotonin-norepinephrine reuptake inhibitor, prescribed for

depression, anxiety disorder, and also used for managing pain caused by fibromyalgia
and diabetic peripheral neuropathy (DPNP). It maintains the mental balance and stops
the movement of pain signals in the brain.
Dydrogesterone
 Menstrual disorders: Since the drug supports normal growth and shedding of
the uterine lining, it is used for treating menstrual disorders like absent or
irregular menstruation, painful menstruation, secondary amenorrhea and
premenstrual symptoms.
 Prevent miscarriage: Since the drug helps in maintaining integrity of the
endometrial lining in a pregnant womb, it is used for preventing habitual and
recurrent abortion.
 Endometriosis: Dydrogesterone relieves the pain during menstruation due to
endometriosis without inhibiting ovulation.
 Infertility: The drug is used during IVF (in-vitro fertilization) cycle to achieve
successful implantation.
 In combination with hormonal replacement therapy (HRT): Dydrogesterone
prevents thickening of the uterine lining in the patient taking HRT.
Enoxaparin
This medication prevents blood clots in patients who are on bed rest or who are having
orthopedic surgery of the hip replacement, knee replacement, or large intestinal
surgery. It is also used alone or in combination with warfarin to prevent and treat blood
clots in the leg. It is a low molecular weight heparin. It stops the formation of substances
that cause clots. It is also used in unstable angina and heart attacks.
60 | P a g e
Escitalopram
This medication is an antidepressant of the selective serotonin reuptake inhibitor (SSRI)

class, prescribed for major depressive disorder, generalized anxiety disorder, social
anxiety disorder, or panic disorder(significant behavioral change). It increases the
amount of serotonin, a natural substance in the brain that helps maintain mental
balance.
Escitalopram

class, prescribed for major depressive disorder, generalized anxiety disorder, social
anxiety disorder, or panic disorder(significant behavioral change). It increases the
amount of serotonin, a natural substance in the
Esomeprazole
This medication is a proton pump inhibitor (PPI), prescribed for gastroesophageal reflux
disease (GERD). With amoxicillin and clarithromycin it is used for treatment of
Helicobacter pylori infection and duodenal ulcer. It is also used to aid in reduction in
occurrence of gastric ulcers associated with continuous NSAID therapy, and in
Zollinger-Ellison syndrome. It blocks the production of stomach acid.
Etodolac
This medication is a non-steroidal anti-inflammatory agent(NSAIA), prescribed for

inflammation of joints (rheumatoid arthritis), degenerative joint disease (osteoarthritis),
or mild to moderate pain. It prevents the production of certain chemicals that cause pain
and inflammation in the body.
Etoricoxib
This medication is a non-steroidal anti-inflammatory drug (NSAID), prescribed for

osteoarthritis, rheumatoid arthritis and gouty arthritis.
61 | P a g e
Fenofibric Acid
This medication is used to reduce the cholesterol in patients with obesity problem. It is a
HMG-CoA reductase inhibitor (statin). It slows the production of cholesterol in the body.
Fluconazole
This medication is an antifungal agent, prescribed for vaginal candidiasis, pneumonia,

meningitis and fungal infections of the mouth, throat, liver, kidneys, heart, urinary tract
and abdomen.
Fluconazole
This medication is an antifungal agent, prescribed for vaginal candidiasis, pneumonia,

meningitis and fungal infections of the mouth, throat, liver, kidneys, heart, urinary tract
and abdomen.
Flunarizine
This medication is a calcium channel blocker, prescribed for migraine occlusive

peripheral vascular disease, vertigo of central and peripheral origin and as an adjuvant
in the therapy of epilepsy.
Flurazepam
This medication is a benzodiazepine, prescribed for sleep disorder.
Fluvoxamine
This medication is an antidepressant, prescribed for psychiatric disorders such as

obsessive-compulsive disorder, social phobia and depression. It inhibits the uptake of
serotonin (a neurotransmitter) by nerve cells.
62 | P a g e
Gabapentin
This medication is an anticonvulsant, prescribed for postherpetic neuralgia, and

epilepsy.
Gatifloxacin
This medication is an antibiotic, prescribed for certain types of bacterial infections such
as conjunctivitis, sinusitis, skin and skin structure infections, cystitis. It kills the bacteria
that cause infection.
Gatifloxacin
This medication is an antibiotic, prescribed for certain types of bacterial infections such
as conjunctivitis, sinusitis, skin and skin structure infections, cystitis. It kills the bacteria
that cause infection.
Gefitinib
This medication is a chemotherapy agent, prescribed for non-small cell lung cancer.
Gemcitabine
This medication is a nucleoside analog used in chemotherapy for treating certain types
of cancer (like lung cancer, pancreatic cancer, breast cancer, ovarian cancer). The
medication inhibits the progress of cancer cell growth in the body.
Gliclazide
This medication is an oral hypoglycemic (anti-diabetic drug), prescribed for type 2

diabetes.
Glimepiride
This medication is a sulfonylurea antidiabetic agent, prescribed for type 2 diabetes.
63 | P a g e
Haloperidol
This medication is a tranquilizer, prescribed for schizophrenia.
Hydrochlorothiazide
This medication is a thiazide diuretic, prescribed for high blood pressure (hypertension)
and edema.
Indapamide
This medication is an oral antihypertensive/diuretic, prescribed for hypertension and

edema.
Insulin
This medication is a hormone produced in the pancreas, prescribed for type 1 diabetes.
It is also used for type 2 diabetes.
Isosorbide
This medication is a nitrate, prescribed for angina pectoris due to coronary artery
disease.
Ivabradine
This medication is a cardiotonic agent, prescribed for angina pectoris.
Ketoconazole
This medication is an anti-fungal agent, prescribed for jock itch, athlete's foot and other
infections.
Ketoprofen
This medication is a non-steroidal anti-inflammatory agent (NSAID), prescribed for mild

to moderate pain, fever and inflammation.
64 | P a g e
Lacosamide
This medication is an anticonvulsant, prescribed for partial-onset of seizures.
Lamotrigine
This medication is an anticonvulsant agent, prescribed for epilepsy and bipolar disorder
either alone or combined with other medications. In epilepsy it is used for partial
seizures, primary generalized tonic-clonic seizures, and generalized seizures of
Lennox-Gastaut syndrome. It stabilizes electrical activity in the brain.
Levetiracetam
This medication is an anticonvulsant, prescribed for partial seizures. It works by

reducing the activity in the brain. It can be used alone or with other antiepileptic
medications.
Levosulpiride
This medication is an antipsychotic and prokinetic agent, prescribed for dyspepsia,

gastro-esophageal reflux disease, and irritable bowel syndrome.
Liothyronine
This medication is a thyroid hormone, prescribed for myxedema.
Liothyronine
This medication is a thyroid hormone, prescribed for myxedema.
Lisinopril
This medication is an angiotensin converting enzyme (ACE) inhibitor, prescribed for

high blood pressure.
65 | P a g e
Losartan
This medication is an angiotensin II receptor blocker (ARB), prescribed for high blood
pressure. It is also used for prevention of stroke, and diabetic nephropathy.
Mecobalamin
This medication is a cobalamin, prescribed for peripheral neuropathy, megaloblastic

anaemia, and as a preliminary treatment for amyotrophic lateral sclerosis.
Metformin
This medication is an oral antidiabetic agent, prescribed for type 2 diabetes. It helps
control blood sugar levels.
Mosapride
This medication is a gastroprokinetic agent, prescribed for acid reflux, irritable bowel
syndrome and indigestion.
Nebivolol
This medication is a beta-blocker, prescribed for hypertension and also for left
ventricular failure either alone or combined with other medications. It decreases the
amount of blood pumped out from heart. This helps to decrease blood pressure, helps
the heart pump more efficiently, and reduces the workload on the heart.
Nicotine
This medication is a stimulant and detoxifying agent, prescribed for smoking cessation.
Nifedipine
This medication is a calcium channel blocker, prescribed for angina (chest pain), high
blood pressure and abnormal heart rhythms.
66 | P a g e
Oxaliplatin
This medication is an antineoplastic agent, prescribed for colorectal cancer either alone
or with other medications.
Oxcarbazepine
This medication is an anticonvulsant, prescribed for partial seizure disorders in epileptic

children and adults, either alone or with other medication. It reduces anxiety and mood
disorders. It also controls benign motor tics (sudden movements in body lasting for a
short period of time). It slows down the abnormal nerve impulses in the brain.
Paracetamol
This medication is a non-opiate, analgesic and antipyretic, prescribed for headache,

pain (muscle ache, backache) and fever either alone or combined with other
medications.
Paroxetine
This medication is an SSRI antidepressant, prescribed for major depression, obsessive-

compulsive disorder, panic disorder, social anxiety and generalized anxiety disorder.
Pefloxacin
This medication is a fluoroquinolone antibiotic, prescribed for the treatment of

uncomplicated gonococcal urethritis in males and for gram-negative bacterial infections
in gastrointestinal system and genitourinary tract.
Perindopril
This medication is a long-acting ACE inhibitor, prescribed for high blood pressure, heart
attack and heart failure.
67 | P a g e
Piperacillin/Tazobactam
This combination medication is an antibacterial agent, prescribed for various infections

such as Nosocomial pneumonia. It blocks the bacteria's cell wall growth, which kills the
bacteria. Tazobactam inhibits the action of bacterial beta-lactamases. It is added to the
extended spectrum beta-lactam antibiotic piperacillin. It broadens the spectrum of
piperacillin by making it effective against organisms that express beta-lactamase and
would normally degrade piperacillin.
Pregabalin
Pregabalin is an anticonvulsant used as an additional treatment of partial seizures. It is

also effective against nerve-related pain as it decreases the number of pain signals sent
out by the damaged nerves in the body. It is used in the management of postherpetic
neuralgia (nerve pain caused by the chicken pox virus), painful peripheral neuropathy
due to diabetes, nerve-related pain due to spinal cord injury and fibromyalgia (a
condition where the patient has muscle and connective tissue pain). It is also used in
the treatment of generalized anxiety disorder.
Pyrimethamine- Sulfadoxine
This medication is an antimalarial agent, prescribed for treatment of falciparum malaria,

resistant to chloroquine. It blocks the formation of folinic acid within the malaria
organism, which kills the parasite.
Rabeprazole
This medication is a proton pump inhibitor, prescribed for duodenal ulcer, gastro
esophageal reflux disease (GERD), and Zollinger-Ellison (gastric acid hyper secretion)
syndrome. It works by decreasing the amount of acid made in the stomach.
Racecadotril
This medication is an oral enkephalinase inhibitor, prescribed for diarrhea.
68 | P a g e
Ramipril
This medication is an angiotensin-converting enzyme (ACE) inhibitor, used alone or in

combination with other medications to treat high blood pressure. It is also used to
reduce the risk of heart attack and stroke in patients at risk for these problems and to
improve survival in patients with heart failure after a heart attack.
Repaglinide
This medication is a meglitinide antidiabetic, prescribed for type 2 (non-insulin-

dependent) diabetes.
Rosuvastatin
This medication is used to reduce the cholesterol in patients with obesity problem. It is a
HMG-CoA reductase inhibitor (statin). It slows the production of cholesterol in the body.
Roxithromycin
This medication is a semi-synthetic macrolide antibiotic, prescribed for respiratory tract,

urinary and soft tissue infections.
Secnidazole
This medication is an antiamoebic agent, prescribed for giardiasis and amoebiasis.
Selegiline
This medication is a selective and irreversible monoamine oxidase inhibitor (MAOI),

prescribed for Parkinson’s disease either alone or with levodopa as an adjuvant. It
prevents the breakdown of dopamine in the brain, thus improving the symptoms of
Parkinson’s disease.
69 | P a g e
Sertraline

class, prescribed for major depression, obsessive-compulsive disorder, panic attacks,
and social anxiety disorder. It increases the amounts of serotonin, a natural substance
in the brain that helps maintain mental balance.
Telmisartan
This medication is angiotensin receptor blocker (ARBs), prescribed for hypertension.
Terazosin
This medication is an alpha-blocker, prescribed for high blood pressure and benign
prostatic hyperplasia (BPH).
Trifluoperazine
This medication is a tranquilizer, prescribed for schizophrenia (emotional and mental

conditions).
Valproic acid
This medication is an anticonvulsant, prescribed for epilepsy, bipolar disorder, and

rarely for depression.
Valsartan
This medication is an angiotensin II receptor blocker, prescribed for hypertension,

congestive heart failure and myocardial infarction (heart attack).
Verapamil
This medication is a calcium channel blocker, prescribed for high blood pressure, chest
pain, abnormal heart rhythm, and headache.
70 | P a g e
Vitamin E
This medication is an antioxidant, prescribed for Vitamin E deficiency, cystic fibrosis. It

is a dietary supplement.
Voglibose
This medication is an alpha-glucosidase inhibitor, prescribed for diabetes mellitus.
Ziprasidone
This medication is an antipsychotic agent, prescribed for schizophrenia (a mental illness

that causes disturbed or unusual thinking, loss of interest in life, and strong or
inappropriate emotions). It regulates certain chemical activities in brain, which is
responsible for thinking and behavior.
Zonisamide
This medication is a sulfonamide anticonvulsant, prescribed for partial seizures.
71 | P a g e
SWOT Analysis
Strengths
 Asset leverage
 Effective communication
 High R&D
 Innovation
 Loyal customers
 Market share leadership
 Strong management team
 Strong brand equity
 Strong financial position
 Supply chain
 Pricing
 Reputation management
 Unique products
Weaknesses
 Bad communication
 Diseconomies to scale
 Over leveraged financial position
 Low R&D
 Low market share
 No online presence
 Not innovative
 Not diversified
 Poor supply chain
 Weak management team
72 | P a g e
Opportunities
 Acquisitions
 Asset leverage
 Financial markets (raise money through debt, etc)
 Emerging markets and expansion abroad
 Innovation
 Product expansion
 Takeovers
Threats
 Competition
 Economic slowdown
 External changes (government, politics, taxes, etc)
 Exchange rate fluctuations
 Lower cost competitors or imports
 Maturing categories, products, or services
 Price wars
73 | P a g e
Conclusion
The project concludes that as the pharmaceutical industry is developing, it is both an

opportunity and threat to the new pharmaceutical companies. Torrent with its employee
oriented HRM policy has managed to maintain its position in the market by keeping
both, employees and customers, happy and satisfied. Till date it has managed to move
forward and in future too it has the potential to grow further.
74 | P a g e

HRM Policies Help Torrent Pharmaceutical Sustain in Competitive Market

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PROJECT REPORT

HRM Policies of Torrent Pharmaceuticals

In partial fulfillment of the requirement of the award for

the degree of Bachelor Of Management (BM)

( Semester VI of Master of Management – MAM )

Gujarat Technological University

Under the guidance of

Prof. Nikita Mcquin

Enrollment no. 137290585019

Gujarat Technological University

Sr. No. Particulars Page No.

Name & signature of Guide Date of submission

Name & Signature of Professor in charge / Director of the Institute.

Stamp of the Institute with Date.

Date: (Name of Student)

Indian Pharmaceutical industry has been witnessing phenomenal growth in recent

In India, modern system of medicine is a 20th century phenomena, though the

A significant increase in the production of bulk drugs and formulations is observed

1. Sun Pharmaceutical Industries Ltd.

Among all pharmaceutical companies in India, Sun Pharmaceutical Industries Limited is

Market Capitalization: Rs 1,89,139 Crore (As on 16th January 2016)

Market Capitalization: Rs 76,613 Crore (As on 16th January 2016)

Market Capitalization: Rs 50,102 Crore (As on 16th January 2016)

4th position on this list is occupied by Cipla, a leading pharmaceutical company

Headquartered in Mumbai, Cipla is a swiftly growing pharma company and employ

Cipla is a globally recognized Indian pharmaceutical Giant. It ensures to provide

Market Capitalization: Rs 48,788 Crore (As on 16th January 2016)

Aurobindo is a big pharmaceutical company with 6 manufacturing units in India and

Aurobindo Pharma founded in 1986 by Mr. Ramaprasad Reddy, Mr. K. Nityananda

Market Capitalization: Rs 47,578 Crore (As on 16th January 2016)

Cadila Pharmaceuticals Limited with a market capitalization of Rs 38,677 Crore is next

Cardiology, Respiratory, Gastroenterology and Neurology are some of the therapeutic

Cadila Pharmaceuticals Ltd. headquartered at Ahmedabad, Gujarat, is one of the

Market Capitalization: Rs 31,541 Crore (As on 16th January 2016)

Market Capitalization: Rs 28,609 Crore (As on 16th January 2016)

GlaxoSmithKline (GSK) Pharmaceuticals Limited, a leading pharma company is the

Headquartered in Mumbai, GlaxoSmithKline Pharmaceuticals Limited was established

GlaxoSmithKline Pharmaceuticals Ltd. is one of the oldest and renowned

Market Capitalization: Rs 26,954 Crore (As on 16th January 2016)

Winner of Best Pharma Company in Emerging Markets Award, Glenmark

Market Capitalization: 23,410 Crore (As on 16th January 2016)

10th position of this list is occupied by Torrent Pharma, a pharmaceutical company

Market Capitalization: Rs 22,392 Crore (As on 16th January 2016)

o CFAs: These organizations are primarily responsible for maintaining storage of

Replenishment based supply chain

Association of druggists and stockists

Retail pharmacy chains

IPR: A changing face

 Better patent protection

The 2005 amendment is viewed as a milestone which substantially changed the

The pharmaceutical industry is currently undergoing a period of very significant

For example, cooperation of Sanofi-

Yet another trend is selling off low-profitability or non-core businesses. “Big

 Domestic Market Attractiveness

The domestic formulations industry has grown at a CAGR of nearly 13 percent

 Research and Development

With the introduction of product patents in India , pharma companies have

India is also increasingly emerging as one of the most globally preferred

 Governments have focused on pharmaceutical companies as easy targets in

 European government has forever changing cost containment plans

 FDA perceived as too closely aligned with the industry

 South African government proposed legislation to allow generic imports of

 Japanese government calling for consolidation and globalisation of domestic