Supply Chain Management at Nicholas Piramal India
Case Study
Noemie Bisserbie, ET Intelligence Group, Oct-Nov 2006
Supply chain management (SCM) is one of the leading cost saving and revenue
enhancement strategies in use today. Pharmaceutical companies are increasingly
using this technique to improve the entire functional process. SCM has also helped
companies enhance their efficiency in managing resources and improving
relationships.
In the case of Nicholas Piramal, SCM has proved to be one of the most powerful engines of
business transformation. Since the company’s decision to enter the high growth contract
manufacturing and research services (CRAMS) segment, SCM has become key to the
company’s strategy. After the acquisition of Avecia (UK) in 2005, and more recently, Pfizer’s
UK Morepeth facility, the company’s ability to integrate over seas businesses and ramp up of
supplies becomes key to the profitability it’s CRAMS business.
Background
Three years ago, India’s fourth largest pharmaceutical company, NPIL, came up with a total
restructure plan. Post patent regime, the company identified CRAMS as a major growth
opportunity. With a slowdown in patented drugs sales and drying R&D pipelines, global
pharmaceutical companies are increasingly exploring low cost options for outsourcing research
and manufacturing. According to industry sources, the global pharmaceutical outsourcing
market, which currently stands at $24 billion, could reach $53 billion by 2010. Low cost
manpower and a large base of FDA approved plants, positions India high on the outsourcing
list, Suven Lifesciences, GVK Biosciences, Jubilant Organosys, Nicholas Piramal and Shasun
Chemicals & Drugs now featuring among the leading In ...