Founded in 1983, India's largest pharma company Sun Pharma saw some of its toughest times between 2014 and 2018 as intense pricing pressure in the US market hit the company hard. It also encountered FDA-related issues such as warning letters, quality control and manufacturing deficiencies, and product recalls in the US. However, under Dilip Shanghvi, Sun Pharma saw a turnaround
Business Today Magazine uncovers how under Shanghvi, Sun Pharma became India’s biggest pharma company in 2015 with the acquisition of Ranbaxy Laboratories a year prior. In FY23, Sun Pharma recorded its highest-ever consolidated revenue of Rs 43,279 crore and net profit of Rs 8,474 crore in FY23. Shanghvi’s renewed strategy of boosting the specialty drugs business, which grew 29% in US dollar terms in FY23, led the way
Under Dilip Shanghvi's leadership, Sin Pharma's revenues have jumped from Rs 26,065.9 crore in FY18 to Rs 43,278.9 crore in FY23. A look at other milestones
According to BT Magazine Immersive, the top five growth drivers for Sun Pharma in the past five years have been Innovation & Technology-led Strategy, Increased contribution from specialty business, Good growth in India business, Focus on cost and operation efficiencies, and Growth in core geographies within EMs
Dilip Shanghvi’s formula for success in the specialty business is markedly different from his strategy for traditional, non-specialty businesses such as generics, where he has no qualms about squarely facing up to bigger rivals. “Even as the global specialty business nears a billion dollars in annual revenue, Sun Pharma would remain a small player in that business. It gives us the ability to compete as a nimble small player with an ability to move faster,” he told BT Magazine
Talking about his vision for Sun Pharma, Shanghvi said, "Our focus has always been that each of our businesses should focus on improving its performance over what we did last year... We’ve been making large investments in the specialty business over the past five years, and we are at a position where it will start contributing to the profitability and future growth of the company in a much more meaningful way."
Sharing details of Sun Pharma's mergers and acquisitions (M&As) and strategic partnerships, Dilip Shanghvi said, "We are currently in the process of integrating Concert Pharmaceuticals that we’ve recently acquired in the US. The first priority is to find a way to make a USFDA filing for Deuruxolitinib (used to treat hair loss), at the earliest."
Answering how Sun Pharma plans to differentiate itself in competitive markets, Dilip Shanghvi said, "Each of our products addresses an unmet patient need and produces patient benefits, which justifies the investment that we make in developing novel products." He added that currently, the company is not looking to expand the segments beyond what it already has—that is dermatology, ophthalmology and onco-dermatology. However, they are looking at opportunities in ophthalmology
Sharing Sun Pharma's plans for India, Dilip Shangvi said, "In India, we have leadership position in terms of share of prescriptions in 12 specialty segments and the idea is to find a way to increase our share of business in these specialties. And find a way to cumulatively grow our business in such a way that we are able to grow our market share. Last year, we witnessed good growth across multiple therapy areas in the chronic and the sub-chronic segments. Hopefully, we should be able to continue to do that in the future."
Discussing US market strategy, Shanghvi said, "The US market is very large, so rather than trying to compete all over, we have chosen ophthalmology and dermatology and identified niche products that will help us establish the company with the doctors. As we become more known and established in specialty, it will enhance our ability to introduce more products as well as succeed in getting a greater share of those products when we launch them."
When asked about how he sees the pharma industry evolving in the coming years, Shanghvi said, "The importance of good health and the ability of drugs to help patients lead as normal a life as possible and also the increase in life expectancy across the world means that drug consumption will continue to increase. And that increases the importance of competitive costs and high-quality products being available. I see a big opportunity for Indian companies, including Sun Pharma, to play an important role in the world as we continue to evolve."
Rather than taking over his father's wholesale medicine shop, Dilip Shanghvi decided to make medicines himself by founding Sun Pharma. In 2015, he was India’s richest man for a brief period. Even today, he is among the country’s 10 richest men. However, he is distinctly uncomfortable with any reference to his riches. An anecdote, from his biography 'The Reluctant Billionaire', narrates how his fame ensures he’s no longer able to visit a small south Indian restaurant to partake his favourite idli