Ranbaxy, Daiichi to leverage on brand strength for global markets

NEW DELHI: In a bid to strengthen their hybrid business model, drug major Ranbaxy Laboratories and its parent firm Daiichi Sankyo will project only one of them as the face of the group in different global markets depending on their respective strengths.


"In the front end, depending on the markets whichever company has the strength will be the face to the market," Ranbaxy CEO and Managing Director Arun Sawhney told PTI.

As per their hybrid business model, Ranbaxy primarily focuses on generic medicine research both for itself and its parent firm, while the new drug discovery programme is undertaken taken up by Daiichi Sankyo.

Elaborating further, he said: "...for example, in India even the future Daichii pipeline products will come through Ranbaxy and say, for example in Japan, Ranbaxy generic products will be taken to the Japanese market by Daiichi Sankyo. So, we will leverage the strengths of each company to grow the business of both the companies."

The two firms will synergise across each segment of pharmaceutical value chain starting from R&D, sourcing, manufacturing, distribution, sales and marketing, he added.

When asked if the Indian firm would get into new drug development on the lines of Daiichi Sankyo, Sawhney said: "No that is not the inference. Ranbaxy would benefit from innovation of Daichii Sankyo in taking innovative products to markets where it is strong."

Ranbaxy will synergies with Daiichi Sankyo with its back-end in development, distribution and sourcing to strengthen both the companies, so there would be across the value chain areas of co-operation identified, he added.

"Under the hybrid business model, we will be leveraging the strengths of both the companies. So, benefits will accrue to Ranbaxy and benefit will also accrue to Daiichi Sankyo," Sawhney said.

The companies are currently leveraging their strengths in various countries, including Brazil, Mexico, Thailand, Venezuela, Romania, Italy and Kenya among others.

When asked if this synergy would be extended to new markets, he said: "This is a constant evaluation, so every month, every quarter, we will keep evaluating what are the best business options, what is in the interest of both the companies and we will keep taking rational decisions that mutually benefit both the companies."

Ranbaxy became a part of the Daiichi Sankyo Group in 2008 after the Japan's third largest drug maker bought a majority stake for Rs 22,000 crore.