Nandini Piramal
Credit: DH photo
Hyderabad: In the global pharmaceutical industry India holds the position of being the 13th largest in terms of value and the 3rd largest in terms of volume, spanning generic drugs, OTC medicines, bulk drugs, vaccines, contract research & manufacturing, biosimilars and biologics. The country aspires to have its pharma industry grow to $130 billion by 2030 and $450 billion by 2047. Part of this ecosystem, Piramal Pharma Ltd (PPL), is betting big on its contract development and manufacturing to drive its growth. The company’s chairperson Nandini Piramal, who was in Hyderabad to attend BioAsia’s 21st edition, spoke to DH’s SNV Sudhir on their growth strategy and broader aspects of the industry. Edited excerpts:
How has your company fared in the current financial year?
In the second half, we have seen mid-teens growth, and we should see a significant improvement in EBITDA. The reason we are actually doing reasonably well is that we have seen a lot of conversion of our innovative phase work to commercial. And that’s giving us, in a way, a good lift. Our focus over the last few years was on innovators…big innovators, as well as bio-techs. But, now the bio-techs funding environment, as you know, has slowed down. But we have seen, correspondingly, the innovators have also started outsourcing more. So we have seen a good uptick in business from that in our CDMO (contract development and manufacturing organisation) business. So, overall we are looking at mid teens growth at the end of the year.
How do you propose to move forward next year?
Overall, going forward, I think, the company, as a whole, is focusing on organic growth. I think we are aiming for at least 15% revenue growth year-on-year. Last year and so far this year, we were at 14% in the first half. We have done a fair amount of capacity expansions in the last two years that we want to fill. We think that our focus is on revenue growth which will be from innovative products going commercial, on patent innovation, integrated projects. And the other focus is obviously to continue operational improvement, cost management. You get fixed cost leverage also in this business. So that benefit actually will lead to improvement in EBITDA margins. And we want to continue reducing debt.
How is the experience of working with big innovator companies?
We work with innovator companies, whether it’s big pharma or biotech. And I think what they like is the fact that we have manufacturing both in the East and West. In the West, they often want to do the high value with small volume things. And in India, they quite often want to do the large volume, where price becomes a little bit more of a consideration. And the benefit (they get from us) is that we can give them whatever they want. Our quality record is actually, second to none.
What do you make of the focus on AI and data for pharma and life sciences?
A lot of AI is being used in pharma right now. Even in R&D. Because you don’t have to validate it three times. In manufacturing, it hasn’t got there yet. But I think there’s a lot to learn from even data, traditional AI and machine learning. There’s a lot to be learned from data sciences…even in manufacturing. We have just begun putting analytics in place and especially in operational excellence and manufacturing. I think that’s where we are spending. I think we have only begun the journey and it’s a long journey.