Job cut worry for Ranbaxy sales team

Even as corporate India cheers the Sun Pharma-Ranbaxy merger, an association of medical representatives has cautioned against job cuts in the case of Ranbaxy's sales representatives, estimated at 5,000.

Though Sun hasn't announced any plan to cut jobs, the association feels often, job losses accompany mergers.

Vishwanathan, president, Federation of Medical and Sales Representatives' Associations of India (FMRAI), the largest medical sales representative body in the country, with 65,000 members, said, "Issues relating to sales force come up after each merger & acquisition in India. The agreements state all sales representatives must be kept with the target company, but buyers often change their words after a deal is completed, citing various reasons."

RANBAXY'S REPS

• 5,000-strong team of sales representatives associated with Ranbaxy
• 3,000 of which are members with the Federation of Medical and Sales Representatives’ Associations of India (FMRAI)
• 65,000 members of FMRAI make it the the largest medical sales representative body in India

"We are approaching both Sun Pharma and Ranbaxy managements to seek clarity over the sales force integration."

Without disclosing the details, a Sun Pharma spokesperson said, "We are working to ensure a smooth transition, with the interests of all employees in mind."

Queries to the Ranbaxy and Daiichi Sankyo managements did not elicit any response.

A total of 3,000-5,000 of Ranbaxy's sales representatives are FMRAI members. "We will stand with our members and try our best to protect their jobs," said Alok Banerjee, secretary, FMRAI.

Last month, FMRAI had approached the high court here against Torrent Pharma and Elder Pharma, alleging these companies didn't comply with the buyout agreement, especially on terms of sales force integration. According to FMRAI, Torrent Pharma, which had acquired Elder's India formulations business, refused to hire all sales representatives at the divisions concerned, which was against the agreement signed.

Kewal Handa, former managing director of Pfizer Ltd, said, "The major concern in each merger is the overlapping of products and therapeutic areas. There might be teams with each company for the same molecules. Overlapping of customer segments such as doctors and hospitals should also be avoided in post-merger integration."

Experts say for Sun Pharma and Ranbaxy, a substantial number of products in the cardiovascular, psychiatry, gastroenterology and orthopaedic segments overlap.

Ranbaxy manufactures and market about 500 molecules and their combinations in multiple dosage forms, with leadership position in various therapeutic areas including anti-infectives, cardiovascular, pain management, central nervous system, gastrointestinal, respiratory, dermatology, orthopaedics, nutritional and urology.

In India, Sun Pharma has a 3,300-member sales team, which markets about 500 products through 18 speciality marketing divisions built around chronic therapy areas. Sun, which accounts for four per cent of the Rs 85,000-crore Indian pharma market, enjoys leadership positions in the key chronic therapy areas of neuropsychiatry, cardiology, gastroenterology, orthopaedics and ophthalmology. The company is one of the top five for drugs relating to diabetology, respiratory, pain, cancer and gynaecology.