Ahmedabad based pharma major, Cadila Healthcare (Zydus Cadila) is bullish on growing pharma markets of South Africa, Philippines, Mexico and Japan.
Companies like Zydus are set to gain in a big way as Japan, the world's second largest pharma market, has recently agreed to cut duties on import of Indian generic drugs. Zydus is present in the Japanese market since 2007 after it acquired Nippon Universal Pharma in Japan.
The country,which currently has a one per cent share in Zydus' overall revenues, is set to become a key market in the coming years. Zydus already has around 20 products in the Japanese market including three recent launches.
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Mexico, a fast growing emerging market (estimated size over $ 10 billion), has thrown up new opportunities as well after it recently eased certain regulatory restrictions.
The significant regulation which has been removed relates to setting up a manufacturing plant in Mexico for serving the market. This opens way for Indian firms to supply to Mexico from domestic facilities. Zydus plans to start commercial production in Mexico from 2013 and would launch 40 products by 2015.
Among other emerging markets, Zydus has presence in eight markets of Asia Pacific and Africa.
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The company said that it has put in place strong regulatory teams to increase product development activities. South Africa and Philippines are among the focus markets, Zydus said in a recent investors' presentation. All these initiatives are part of Cadila Healthcare's plans to touch a $ 3billion turnover by 2015.
Zydus plans to leverage the strengths of having a local manufacturing site in Brazil, bank on the cost advantage of manufacturing in India when supplying to the European countries. Around 35 per cent of its sales in the EU are drugs that are supplied from India. Zydus' revenues from the European markets touched Rs 298.3 crore during 2011-12. The company is the ninth largest in France and among the top 20 in Spain, it claimed.
Analysts feel the target set by the company is achievable. Sarabjit Kaur Nangra, vice president, research, Angel Broking, said, "The company might make a couple of more strategic acquisitions on the way to touch the $3 billion turnover target. Moreover, they are already focussing on regulated as well as emerging markets like the US, Japan and Asia Pac. Going by their track-record, it seems that they would not concentrate on any one market, but would equally focus on all the markets where it has presence."
Coming back to the domestic market, apart from formulations, the company plans to focus on five key areas; wellness portfolio, animal healthcare, active pharmaceutical ingredients (APIs), biosimilars, and new technologies in the transdermals, vaccines, and injectables space. This apart, with a target of becoming a research based pharma company by 2020, Zydus is increasing its focus on adding more new chemical entities (NCEs) in the pipeline to drive growth. Pulling up its socks, Zydus is planning to improve backward integration capabilities to meet captive API requirements. It saw an 18 per cent drop in revenues from APIs in 2011-12.