In terms of globalisation, Ranbaxy looks a lot ahead: Daiichi CEO

In their first interview after the culmination of the Ranbaxy acquisition, Daiichi Sankyo president and CEO Takashi Shoda and Ranbaxy CEO and MD Malvinder Singh, who has also taken over as the company���s chairman, speak to ET about their plans to put operational synergies in place. Excerpts:

Do you plan to merge your other wholly-owned subsidiary with Ranbaxy?

Shoda: Ranbaxy will continue to operate as an independent company. Although we have no plans to merge Ranbaxy with Daiichi, with our wholly-owned arm being so small, it is logical to merge it with Ranbaxy.

Singh: The plan is that whatever business Daiichi would have conducted through the subsidiary will now come to Ranbaxy. There will be no merger of the two entities or financial transaction (with the subsidiary). The business in India would be done through Ranbaxy.

How do you plan to tackle the slowdown in generic sales globally, especially the US?

Shoda: This is not an isolated challenge for us. Since medicine is a necessary item, there will be good demand for drugs in the long term.

Singh: In the past 3 years, we have focused more on emerging markets. We have witnessed a drop in medicine consumption of late though.

In the US, 30 of your drugs are banned.

Singh: We are working closely with the US FDA to resolve the issue. Once the issue is resolved, we will see good growth in the US market.

What are your R&D plans?

Shoda: One of the focus areas of Daiichi after buying Ranbaxy is to strengthen its R&D activities. Ranbaxy has drug development tie-ups with other innovator companies and they will continue. Besides, Ranbaxy can leverage Daiichi���s innovative R&D strength.

Singh: We already have a strategic partnership with GSK and Merck. Similarly, we see a significant partnership with Daiichi and will become part of their global R&D. We spend about $100 million a year on R&D.

Would you manufacture Daiichi Sankyo drugs in Ranbaxy���s facilities in India?

Shoda: Ranbaxy���s existing facilities in India are fully utilised and there is no chance of manufacturing additional drugs. Since India ushered in the patent regime in 2005, Daiichi Sankyo has been filing many patent applications. We plan to launch our hypertension drug (olmesartan) within a year.

Now that you have become the company���s new chairman, will there be any restructuring in the management team?

Singh: There is a board to govern the company and there will be no change in that due to the new shareholding structure. Decisions will continue to be taken the way we have.

Besides the cost advantage and the marketing reach, is there any specific advantage that you can gain from Ranbaxy?

Shoda: In terms of globalisation, Ranbaxy looks to me a lot ahead of Daiichi. So, we can use their expertise as we expand globally.