PROJECT REPORT

ON

RETAIL PRESCRIPTION AUDIT OF CIPLA

PRODUCTS IN NOIDA

TABLE OF CONTENTS

S.N. CONTENTS PAGE NO.

1. INTRODUCTION 1

Indian Pharmaceutical Industry Overview 2

Research & Development Lifeline of the Pharma Industry 11

Indian Pharma R&D SWOT 14

Role of Pharmaceutical Industry in India 15

Market Value of Pharmaceutical Industry 21

Marketing Strategies and Business Promotion of the

Pharmaceutical Products in the Market

27

Patent and WTO Impact 38

Company Profile : Cipla 44

2. OBJECTIVES 55

3. RESEARCH METHODOLOGY 56

4. IMPORTANCE OF STUDY 61

5. ANALYSIS OF DATA COLLECTED 62

6. CONCLUSION 75

7. PROBLEM & RECOMMENDATION 76

8. BIBLOGRAPHY 77

9. APPENDIX 78

ACKNOWLEDGEMENT

I herewith take the opportunity to express my profound sense of gratitude

and reverence to all those who have helped and encouraged me towards

the commencement of the project.

I would specially like to thank the owner of Khashu Medical Agency, the

Distributor for CIPLA Ltd in Noida area.

Last but not the least I would like to thank the other staff members and

friends from Institute, who helped me in various ways, which enabled me

to complete the project successfully and without their support this project

would have been a tough task to fulfill.

INDIAN PHARMACEUTICAL INDUSTRYINDIAN PHARMACEUTICAL INDUSTRY

AN OVERVIEWAN OVERVIEW

The pharmaceutical industry has contributed to the nations growth in a

significant manner. It plays a very crucial role in building of a strong

human capital of a country which is essential for economic growth and

development. This is indicated by an analysis of several western

economies with wealthy human capital which have outperformed the

others.

Development of the Industry

The Indian pharmaceutical industry dates back to 1945, when multi

nationals entered the country. With free pricing the sector was operating

profitably. DPCO introduced by the govt. In 1970 and modifications

thereto reduced the profit margin forcing the MNCs withdrawing from the

many profitable product line. Indian enterpreneurs plugged this gap and

domestic pharmaceutical companies become stronger. The share of

Mncs dipped from around 70% of sale to under 40% between 1980 and

1985 and presently their market share is 30%.

India recognized only process patents during this period with the primary

and of providing wealth care to all at reversible rates. In this period,

domestic magnification is

Production Chain In the Indian Drugs and Pharmaceuticals Industry

Basic chemicals

Drug intermediates

Bulk drugs

Formulations

On the basis of production the focus areas of companies can be

bulk drugs, formulations intravenous fluids

Bulk Drugs Formulations Intravenous Fluids

1. Covers all

products and

preparations

used in the

production of

pharmaceutical

formulations

1. A medicine processed

out of one or more

bulk drugs. It also

contains other

ingredients like

binders for improving

cohesiveness and

fillers to provide

acceptable size. They

are usually in the form

of tablets, capsules

and injectibles.

1. They are critical life saving

pharmaceutical

preparations, where the

quality of production of

great significance. These

pharmaceutical

preparations and in

quicker replacement of

body threads reunite in

recovery of the patients

from various infections

2. The turnover of

bulk drugs industry

increased

tremendously in

1960s Rs. 18 cr to

Rs. 1822 cr in

1995-96. Despite

facing many

hurdles like

frequent regulatory

and strict quality

2. The number of varied

formulations produced

in the country has

reached a staggering

figure,over the last

decade. The cut-

throat competition in

this segment has

made it impossible for

companies to corner a

large chunk of the

2. The percent size of the IV

fluids market in India is 30

cr bottles per annum. Due

to the impending boom in

the healthcare services

and also the rising per

capita income, domestic

demend is likely to register

a high jump nearly 70

percent over the next five

years.

standards of drug

imports this

industry has

managed to

maintain its

position as a net

foriegn exchange

earner for the

country.

market share.

3. Despite the presence

of stiff competion

the fourmulationhas

been able to achive

reasonable margins

by concentrating on

high value added

products.Most of the

fourmulations have

integrated backward

to consolidate their

position and

improve profitability.

They have gone in

for the

manufacturing of

bulk drugs required

as inputs for their

formulation

3. Till the 1990s,

IV(Intravenous) fluids were

manufactured mainly by

small and medium scale

units .As a result, third

segment of the industry

was forced to adjust with

poor quality standards

resulting from antiquated

technologies and

inadequate facilities of the

small manufactures. The

large pharmaceutical

companies stayed away

from this vital segment

because of various

reasons like low demand

and price competition.

4. The operating profit 4. The main reason for this

margins of the

segment are quite

low at 13.5 percent.

The net profit margin

achieved by the

players operating in

this segment of the

industry have

averaged around 5

percent over the last

couple of years.

different in profitability is

the low value addition in

the case of bulk drug

companies, as the raw

materials cost account for

60-70 percent of this

value . Raw materials cost

as a percentage for sales

for companies in IV fluids

segment is only around

25-30 percent and thus,

the value addition on

inputs carried out by IV

fluids manufactures is

extremely high.

5. For the players in

this segment the raw

materials a major

item of expenditure.

It accounts for nearly

60% of the sales.

5. The operating and gross

profit margin achived are

much higher than those

achieved by bulk drug

manufactures and

formulators. This

comparision clearly bring

out the high profitability in

the IV fluides segment vis-

a-vis other-segment .

DOMESTIC MARKET

The existance of large number of product segment in the industry

makes it extremely difficult for any player to corner a significant share

of the total market. Most of the palyers concentrate on a few products

segments which have strong growth potential and try to attain top

positions in them.

In view of the fact that there exists a wide disparity in living standards

in India, which alos impacts the living conditions of majority of the

population, drug consumption is skewed in favour of anti infectives and

vitamins. International usage of therapeutics is more skewed towards

the cardio vascular, gastro intestinals and CNS categories.

Antibiotics are the largest selling products in India followed by

Vitamins. The other large segment in India are cough/cold therapy and

antiinflamatory/anti-rheumatics. Cardio vasculars account for about

6% of the market. Diabetology and oneology are still very nascent

segments in the country and posses miniscule market shares.

The overall pharma industry in the country has registered a growth rate of

around 15% per annum in 1996-97.

Therapeutic sales Breakdown (FY2000)

6%

18%

11%6%

5%5%

43%

3%3% Analgesic/Antiparasitic

Systemic Antibiotics

Vitamins/Mineral Supp.

Cough/Cold

Anti Inflammatory

Systemic Anti bactirials

Others

Cardiac Therapy

Tuberculostatics

Source : ORG Estimates

On the EXPORT front , the industry achieved a growth of 28.7% during

1996-97. The satisfactory export perfromance can be attributed to better

margins, lower domestic production cost, absence of price controls on

exports, less stringent GMP/Pollution control requirements and to a

certain extent the liberal patent laws.

GOVERNMENT REGULATIONS

DPCO : A key variable governing the profitability of the domestic

pharmaceutical sector is the DPCO, which fixes the prices of specified

bulk drugs and their formulations while retaining a fixed rate of return over

normative cost. DPCO currently covers about 76 formulations and around

60% of the turnover of the industry (as per the last revision in 1995). In

1995 the government brought some drugs for which there is significant

open market competiton under control.

DPCO has a fixed formula for determining the price of controled

formulations. The prices are reviewed if there are any major changes in

intput parameters or if individual companeis apply for a price revision.

Recently the government has setup National Pharmaceutical Pricing

Authority (NPPA), which will review the coverage of drugs under control.

The government has specified certain conditions for a drug to satisfy to be

governed by DPCO. Formula for price fixation is as follows :

Raw Material Cost MC

+ Packing Materials PM

+ Packing Cost PC

+ Normative Conversion Cost CC ̀

Total Cost TC = MC + PM + PC + CC

Post Manufacturing Expenses MAPE 100% mark up

Retail price = TC + MAPE + ED

The DPCO is gradually loosing its importance due to the emergence of a

large number of manufacturer in the bulk drug industry. Because of this

stiff competition, the prices of several bulk drugs are reported below their

DPCO prices.

BUDGET PROPOSALS :

Reduction of import duty on bulk drugs from 42 % to 32% in the latest

budget has made imports cheaper.

The budget has also rationalised the excise tariff for bulk drugs by

increasing the excise duty on bulk drugs from 10% to 18% and cut raw

material duty from 20% to 18%. Though the higher excise duty can be

off set under MODBAT when the bulk drug is used to manufacture

formulations a higher working capital is required.

RESEARCH & DEVELOPMENT

The success of pharma players in India would depend largely on their

technological strength and the ability to take on global competitors in

terms of cost and research capcbilities. R & D has always taken a back

seat in Indian pharmaceutical industry, mainly because of liberal patent

laws that favour more of process patent than product patent. Low

investment in R&D is also due to over regulated conditions subject to

continuous surveillance and price control. The existing research is mostly

restricted to process improvements and development of drugs invented

abroad. To reorient them selves the Indian companies have to make a

large investment in R&D a long gestation period and the uncertainity of

confirm success in the discovery of a patenetd molecule.

To start up cost of a basic research company is estimated to be Rs. 100

crores and the entire process for discovering a new molecule takes 10 -15

years and cost Rs. 600 crores. Such heavy expenditure on R & D in the

exisitng scenario, on account of DPCO which puts a ceiling on overall

profitability as well as on product prices is a herculean task.

R & D carried out by Indian companies towards finding alternative

processes for patented products averages only around 1.8% of the total

sales as compared to 10-20 % in the develop countries.

RESEARCH AND DEVELOPMENT LIFE LINE OF THE PHARMA

INDUSTRY

After the Indian software industry, pharma R & D offers great potential for

Indian talent. However, only a few companies have progressed

sufficiently to realise this potential.

Hitherto, India R & D was largest concentrated on process development

for known bulk drugs albeit through novel and innovative process routes,

invariably substituting for expensive imported raw materials and

enhancing the productivity and efficiency of the processes, besides

research on formulations and known drug delivery systems. India’s R & D

forte has been in synthetic organic chemistry and process development. A

few new drugs, using conventional screening techniques, have merged

Indian R & D is concentrated on standardization of raw materials and final

products. A few companies are now using modern scientific methods and

biological screening as well as toxicity studies for validation of

formulations.

Industry’s fate hinges on R & D due to three alternatives

1. Introduce new chemical entities through discovery research

2. Collaborate to manufacture and market patented drugs and

3. Continue marketing older drugs which are not included in the patents

list. The third option is not desirable.

Companies will have to increase R & D spending from the present 2 per

cent of sales turnover to 5 per cent by 2005, i.e. the industry’s annual R &

D outlay will have to be raised from about Rs. 320 crore at present to

around Rs. 1500 crore.

R&D EXPENDITURE BY PHARMA INDUSTRY (In Rs. Crore)

IMPLICATIONS OF GATT

It is believed that the bigger issue facing the Indian drug industry over the

next 5-10 years is the imposition of intellectual property/patent rights by

2005. The stronger Indian companies are effectively addressing the risks

of patent acceptance through mix of marketing effectiveness, licensing,

increasing export presnece and capitalising process development

capabilities to tap the generics market. vertically integrated companies

like Cipla, Dr. Reddy’s and Cheminor Drugs shoudl emerge as winners in

this respect.

With respect to the pharmaceutical industry, there are essentially two key

aspects to patent cover which are recognised in all developed markets

and which are gradually being introduced in the developing/emerging

markets.

The first covers the actual molecular structure of a drug, while the second

covers the manufacturing/production process. It is also possible to get a

patent covering the use of particular product for a specific disease of

indication.

In the developed markets the authorities have tended to recognize the

validity of all these patents as a ‘reward’ for innovation, and enforcement

is normally, strict in the courts.

The GATT/patent related key issues are as follows :

There is likely to be a nearterm squeeze on new product flow from the

Indian companies which will result in proper financial performance in

3-4 time (unlikely, in our view)

In the post-GATT era, the assumption appears to be that the MNCs

are assured fo a steady flow of new, innovative medicines (partly true).

The advent of this new generation of patent-protected drugs will result

in a material change in consumption patterns and displace the existing

portfolios of domestic manufacturers.

INDIAN PHARMA R & D SWOTINDIAN PHARMA R & D SWOT

Strong Chemistry : (Strengths + Opportunities) > (Weaknesses + Threats)

Strengths

Mature industry with strong manufacturing base with capacity to produce

quality drugs at relatively lower costs.

A very rich base of traditional knowledge in therapeutics i.e. Ayurveda, Sidha

and Unani.

Well developed engineering base to produce wide range of pharmaceutical

equipment and machinery.

Abundance of S & T talent and infrastructure.

Successful experience in innovative process chemistry.

Access to brain bank of internationally acclaimed NRI, S & T professionals

Weakness

Sub-critical R & D investments.

Lack of innovative R & D culture in industry

Poor networking among constituents in the innovation chain.

Inadequate framework for clearance of new drug investigation and

registration.

A policy framework for testing on animals and their import that is not

facilitative.

Inadequate trained manpower in emerging areas.

Opportunities

Due to rising costs of R & D overseas, greater tendency towards outsourcing

and networking.

Expertise to blend knowledge of traditional medicines with modern science.

Increasing competence in molecular biology, immunology and biotechnology.

Early R & D wins boosting confidence (Readdy’s , Ranbaxy’s Dabur’s

Shanta Biotech’s).

Large numbers of patients covering wide range of diseases.

Potential for clinical research and initiating clinical trials

Opportunity to improve quality standards.

Threats

Inability to cope-up with the rapidly changing new drug discovery

technologies and processes at the global level.

Rapidly changing standards of quality and manufacturing at the international

level.

Lack of clearly articulated and facilitative national IPR policies.

Lack of strategy to bring convergence between aspirations of the small and

big players.

Distortion in priority and public concern on health and pharma issues.

Reducing tariff levels and dumping can be a threat to survival of products

and industry.

ROLE OF PHARMACEUTICAL INDUSTRY IN INDIA

The Pharmaceutical Industry plays a very crucial role in building a

strong human capital of a country. This in turn, is very essential for

economic growth and development. Over the years, an analysis of

several Western economies has clearly indicated that economies

with healthy human capital have outperformed others in terms of

growth. Thus, the contribution of the Pharma sector towards a

nation’s growth cannot be undermined.

The tremendous role played by this industry is explicitly revealed in

the improvement of major health indicators. Life expectancy has

risen from 41.2 years in the sixties to the present level of 65 years

and it is estimated that it will move closer to 70 by the year 2000,

while infant mortality has declined from 146 per 1000 to 74 per

1000. Moreover, the increased availability of medicines and health

care facilities has resulted in the decline of the death rate from 22.8

per 1000 in 1960 to 9.6 per 1000 in 1996.

At present, per capita annual consumption of drugs in India is about

Rs. 95 (US $ 2.7) and with the projected figures for 2000-2001, the

per capita consumption of drugs will move marginally to Rs. 160

(US $ 4.4) per year, which will still be one of the lowest in the

world, including developing countries. Progress of the

Pharmaceutical Industry in India.

GOVERNMENT DRUG PRICING POLICY

The Indian Governments liberalization and economic reforms have

not yet been fully extended to the pharmaceutical industry. The

industry is unable to attract fresh investment and the research –

based pharmaceutical industry is either withdrawing from India or

not expanding operations.

Since 1989, the Government has been reviewing changes in the

Drug Policy, and a new Drug Policy was promised for many years.

After a gap of almost five years, the Prime Minister cleared the New

Drug Policy in August and the Cabinet Committee on Economic

Affairs approved this, on September 15, 1994.

The new policy is an improvement over the existing policy.

However, price controls cover about 50% of industry sales from an

earlier ratio of 75%. There is no system allowing automatic increase

of prices to offset cost increases and inflation. The research-based

pharmaceutical industry has made an offer in “good faith” to the

Government of India to provide all drugs needed for the national

health program at “cost price” if the Government of India abolishes

price controls as defined through the DPCO. Our industry would

urge any new Government in India, which takes office in the wake

of the fall of the last Government on November 28, seriously to

consider abolishing the DPCO. The DPCO is neither in the interests

of the Indian economy nor of the Indian pharmaceutical industry,

nor-and most importantly-in the interests of Indian patients.

In the area of drug pricing, India imposes some of the most

stringent price controls in the world due to the rigid provisions of

the Drug Price Control Order. In the eyes of many research based

company managers in India, this strict pricing regime combined with

the lack of any meaningful patent protection make India virtually

non-viable for research based companies from a commercial

standpoint, especially if those companies were to consider placing

on the Indian market the latest and best innovative drugs. Foreign

companies also experience arbitrary NPPA (National

Pharmaceutical Pricing Authority) pricing norms, arbitrary local FDA

decisions, high (63%) total import duties and complex import

procedures.

PhRMA and its member companies in India desire that:

The Government remove the anomalies in the present Price

Control Order.

The Government take measures to adopt a system of free

pricing in India in the near-term 15% customs excise duty + 4%

special tax), Pharma urges U.S. negotiators to insist that tariffs

be brought down to the level of zero, the goal for GATT

signatories.

PROBLEM ASPECTS

While several important and authoritative voices have called for

improved intellectual property protection in India over the past year,

and while the World Trade Organization (WTO) has made clear in

three separate rulings that India should meet its minimal

requirements under the TRIPs principles of the WTO, there has

been no major change in the intellectual property situation in India

which remains one of the world’s worst offenders of patent rights.

The Indian press has even highlighted the findings of the recent

World Bank Development Report, which claims that “at least 25 per

cent of global chemical and pharmaceutical companies are

unwilling to invest in India as the protection offered to intellectual

property rights (IPR) by New Delhi is too inadequate to allow them

to transfer the latest and effective technologies.

Based on the refusal of the Government to provide pharmaceutical

patent protection, India has become a haven for bulk

pharmaceutical manufacturers who pirate the intellectual property

of the worlds research based pharmaceutical industry. The

achievement of effective Intellectual Property Rights should be

seen as necessary if India wants to attract foreign investment and

successfully implement its globalization plans.

Based on the Indian Patent Act of 1970, India only provides seven

years of process patents for pharmaceuticals. Given the lengthy

development time for pharmaceuticals (between 10 and 12 years),

due to mandatory regulatory requirements for safety, quality and

efficacy testing for drugs, a seven year process term, even if it were

acceptable, is so short that the patent “protection” would expire

even before the relevant product is ready for market launch.

In order to attract foreign direct investment and join the growing

group of developing and newly industrialized countries that have

decided to offer first- rate patent protection, India should adopt a

patent law which offers immediate product patent protection for

pharmaceuticals in the line with highest international standards,

and offering protection for all products not yet available in the

Indian market.

India wants to be seen as WTO compliant in bare minimials but has

weak political will. This sends wrong messages to Indian industry

with the result that the funds pumped by them are only 10% of

turnover which is no comparison to world leaders. In order to cover

for lost time the Indian industry should invest for future may be their

entire or 90% of gross profits.

The Indian Government has provided for Mail Box provisions and

EMR provisions as the base.

However, minimum control to meet its oblations under trips. Indian

provision is the antithesis of the “marketing exclusivity” called for in

Article 70.9, which requires a government to keep copied products

off the market administratively. This is generally accomplished by

the governments denial of marketing approvals to copied products.

As the GATT Secretariat explained in its January 1992 analysis, it

is “the Indian Government that would have the obligation to ensure

exclusive marketing rights for the owner of the U.S. patent. “A

marketing exclusivity scheme that leaves the enforcement of the

right to the patent holder and includes compulsory licensing falls far

short of that intent. It also should be emphasized that, while Article

70 requires a country to promulgate a Mailbox Provision in Indian

Law, that Mailbox in no way serves as a substitute for a valid patent

law.

PhRMA applauds and support the measures taken by the U.S.

Government last year to ensure that India properly implements its

TRIPs obligations, through its successful “suit” against India within

the WTO Dispute Resolution process. PhRMA believes that the

U.S. Government should continue to make the issue of India’s

failure to implement its TRIPS obligations a prominent element in

its ongoing bilateral contacts with India.

MARKET VALUE OF THE PHARMACEUTICAL INDUSTRY

The Indian Pharma market is valued at US $ 4.5 bn, representing

1.6% of the global size and growing at an average rate of 8-9%.

However, the annual per capita drug expenditure is amongst the

lowest in the world.

ANNUAL DRUG EXPENSE PER CAPITA

India is now a self-sufficient country for its pharma requirements.

From simple headache pills to sophisticated antibiotics and

complex cardiac compound including monoclonal antibodies, almost

every type of medicine is now made in the country. Infact more than

25% of formulations produced in the country (US$ 1.25bn) are

exported.

Currently, only process patents are recognized in India. However,

by virtue of India being a member of the World Trade Organisation

(WTO) and a signatory to the General Agreement on Tariffs and

Trade (GATT) it is bound to recognize product patents, latest by

2005. Thus the country is committed to free market economy and

globalization.

The process of consolidation, which is now, a generalized

phenomena in the global pharma market has started in India too.

The industry is witnessing a consolidation phase with Indian

pharma companies increasingly looking at stepping up growth by

acquiring companies/brands.

The drug price control order (DPCO) continues to be a menace for

the industry. The pricing authority arbitrarily sets prices of drugs

that fall within its ambit without giving due consideration even to the

costs of quality production. This has made the profitability of the

sector susceptible to the whims of the pricing authority. Companies

are resorting to aggressive new non scheduled product launches to

dilute DPCO effect. However, as per the latest Budget 2001-02

announcements, the current list of 74 drugs under DPCO is

expected to be relaxed. This is expected to increase profitability of

companies having relatively older portfolio’s, particularly MNC’s.

The average R & D spend in India inspite of growing at a CAGR of

18% over last five years is just 1.9% of sales as against 9-10%

spend by global pharma companies. Though miniscule in

comparison to global benchmarks, Indian companies are stepping

up their research activities to make themselves more self sufficient

in terms of product development ahead of the year 2005 deadline.

Companies like Dr. Reddy’s and Ranbaxy have already achieved

reasonable measure of success in their R & D efforts.

Another peculiar feature of the domestic R & D initiative is a lack of

facilities and resources to develop a molecule, conduct trials and

then launch the product. Indian companies will thus have to depend

on their international peers to undertaken the more expensive

clinical trials and product development.

The pharma industry saw a spate of mergers and acquisitions

during the year. Nicholas Piramal’s controlling stake of Rhone

Poulenc and cadila’s acquisition of German Remedies are only

some of the recent examples. Pharma: Season of weddings.

Besides there ere a number of brand acquisitions in the sector,

prominent among them being Ranbaxy’s acquisition of brands from

Guific, Cross lands and Vorin Labs. The trend of acquisition of

companies/brands is likely to continue as the industry reshuffles

before the 2005 deadline. Apart from that, the companies are inking

several marketing tie-ups to limit competition and increase market

penetration. For e.g. Ranbaxy has tied up with Cipla, Glaxo and

Hoechst for marketing new dry delivery once a day Ciprofloxacin.

A significant breakthrough for the pharma industry has been in the

area of research. Dr. Readdy’s licensing of two of its new anti

diabetic molecules to Novo Nordisk and Ranbaxy licensing NDDS

to Bayer AG in return for milestone payments were some of the

landmark events in the history of Indian pharmaceutical industry.

The pharma industry is expected to have grown by 8-9% in FY01.

While top 5 domestic companies have grown at 14%in FY01, top 5

MNC’s have grown at a slower rate of 7.2%. The slow growth in

sales of MNC’s is because of their relatively older product portfolio.

As in the past MNC’s continued to shy away from launching new

products in the domestic markets.

NEW PRODUCT INTRODUCTIONS-LOCAL Vs MNC’s

PROSPECTS

Growth in traditional therapeutic segments such as antibiotics is

stagnating and competition is increasingly getting stiffer. The price

war is so intense that companies have in-fact started promoting

unbranded versions of formulations (alternatively called as “generic

generics”) against their own branded formulations, to generate

growth. However, life style segments such as cardiovascular, anti-

diabetes, anti-ulcer and anti-depressants are lucrative and fast

growing. Growth in domestic sales in the future will depend on the

ability of companies to launch/shift products in relatively fast-

growing therapeutic segments. These are likely to be the key

earnings drivers. Volumes may, however, continue to come from

traditional segments such as anti-invectives, vitamins, tonics and

mineral supplements.

The Indian Pharmaceutical Industry is a vibrant, high technology

based and high growth oriented industry –attracting attention the

world over for its immense potential to produce high quality drugs

and pharmaceutical formulations. The Pharmaceutical Industry is

among the most highly R & D intensive industries. In fact, other

than drug discovery, marketing has been the most important

function in the pharmaceutical industry.

The pharmaceutical marketing environment is perhaps the most

challenging one on the Indian Industrial scene today. As it

approaches a new millennium it is faced, on the one hand, with new

opportunities and new prospects, and on the other, with the

emergence of a radically ordered Pharmaceutical order.

THE INDUSTRY IS TYPICALLY CHARACTERIZED BY

Very intense competition with about 24,000 companies large,

big, medium and small fighting for their own place under the Sun

in a more than 17,000 crore market.

Continuous drug discovery and rapid introduction of new

products.

The seemingly ever-increasing and almost never ending

governmental regulations and policy changes.

Stifling price controls, eroding profits and consequently a

vanishing bottom-line.

Rigorous controls on formulations and an absence of

international patent protection resulting in a me-too maze of

products with little or no product differentiation.

Increasing health awareness among the people and importance

given to mediclaim.

Increasing dominance of trade associations and their constant

demand for increase in trade margins.

MARKETING STRATEGIES AND BUSINESS PROMOTION OF THE PHARMACEUTICALS PRODUCTS IN THE MARKET

Marketing:

Market is probably one of the most commonly used words by

people all over the world. The key word in all the meanings and

definitions of the market is opportunity. Market can be defined as

individuals power, desire and authority to buy products. Like

everything else in marketing it “depends”. It depends on what

products or services one has to offer and to whom one wants to

offer them. Thus the question of MOA (Market Opportunity

Analysis) comes in. Here, a look at the many dimensions of the

market is essential. Looking at the market from its various

dimensions would enable one to measure it more accurately.

Looking at the market from different angles would certainly give on

a better idea as regards its breadth, width and depth so that one

can plan more comprehensive, meaningful and innovative

strategies to defend and increase the share of the prospective

markets.

The various dimensions of the Pharmaceutical market are:

1. The Demographic Dimension

This comprises geographical proximity of customer and some

shared socio-economic traits such as age, sex, educational level

and family size.

2. The Generic Dimension

This comprises the generic equivalents present in a number of

formulations. One examples is that all formulations containing

“rifampicin” will add up to the total “rifampicin” market and not

necessarily to the total anti-T.B. market.

3. The Therapeutic Group Dimension

This comprises all the products aimed at relieving, treating and

curing the same symptoms or diseases. For example, all products

aimed at relieving, treating and curing “asthma” come under one

“anti-asthmatic” therapeutic group.

4. The Competitive Dimension

Apart from the size of the market, the extent of competition (the

number of competitors), their share of the market, and their growth

rate, all these are important in determining the attractiveness or

unattractiveness of the market. Of course it is certainly worthwhile

to enter the market if one has a distinctly superior dosage form or

greater safety margin etc. Furthermore, continuous monitoring of

competitors activities is crucial for success in the marketplace.

5. The Fifth Dimension

Timing is the Fifth dimension. All those lucky winners in various

therapeutic categories are those products that have been

introduced at the right time. It is not enough if one has a good

product. One has to be in the market with the best product (with the

best benefit package). Timing is also important for planning product

deletion and harvesting strategies. One should also be aware of the

stage and rate of product obsolescence in the marketplace.

THREE MAJOR SEGMENTS

There seem to be three major segments in the Pharmaceutical

market.

1. One is the “consumer market” or the “prescription market”

which consists of individuals and households that go to a

practicing doctor for the treatment of their ailments.

2. The other is the “institutional market” that is made up of the

large hospitals in the public and private sectors that buy the

products for distribution among their employees and the

government hospitals including medical college hospitals that

provide free treatment to the poor.

3. The third on the list is “the industrial market”, which comprises

the bulk drugs that are used in formulations.

PHARMACEUTICAL MARKET SEGMENTATION

The characteristic feature of the pharmaceutical marketing is that

one reaches the end consumer (patient) through a customer (the

physician who advises the end customer through a prescription).

We can see from the figure that the two major potential target

groups are patients (consumers) and doctors (customers). They

have different needs. Segmentation is at the consumer level (the

patient). The second logical step is at the customer level (doctor),

where he is a general practitioner or a hospital doctor, he is the

influencer.

Implications for the marketer

The needs of a physician who is a user and another doctor who is a

non-user are obviously different.

PATIENT

G.P.

PRESCRIPTI

HOSPITAL DOCTOR

PHARMACIST/RETAIL

NURSES

PHARMACIST

PATIENT

The physician who is a user is currently satisfied with the product

and its benefits. The company doesn’t have to sell the advantages

of product to the physician. What he requires at the moment is a

continuous reassurance that choosing the company’s product over

other has been a right decision for the physician and it is worth

continuing for him. The company’s objective is to ensure continuous

usage through positive reinforcement.

Whereas the physician who is a non-user, is yet to be convinced

about the benefits of the product the company offers. He does not

believe that the product can provide the satisfaction he is seeking

for his patients. He needs more information with substantial

evidence.

Then there is also the case of the past user of the product. The

product has been coming up to the physician’s expectations in the

past, but currently he is not using the product. What he needs is not

just information and evidence of the product.

There can be various reasons for the physician’s discontinuing the

use of the product of the company.

1. Competitive pressure

2. Negative experience with the product

3. Non-availability of the product.

Research in India shows that non-availability is one of the major

reasons why doctors give up prescribing products easily.

The pharmaceutical marketers can use segmentation strategy

creatively to:

1. Clearly identify the target group

2. Focus the promotional efforts to maximize gains cost effectively

3. Create a strong positive product image to offset competition.

Avoiding pitfalls in segmentation

While segmenting the essential criteria for effective segmentation

should be kept in mind in order to avoid mistakes.

1. Choosing the wrong segment, which is not viable, too small, less

attractive and declining.

2. Choosing the segment that is too small, overcrowded with

competition; such a market is a rather fragmented one.

3. Positioning the product as a last resort, an alternative when the

leading brands fail or as second line of treatment. That would

however mean limiting the usage of the product. That is because

one can position a product/brand as an essential replacement to

the brand leader but not as a an alternative.

4. Entering over-crowded segments when one cannot clearly,

unambiguously and perceptibly differentiate one’s product.

THE INDUSTRY STRUCTURE:

The pharmaceutical Industry is very aptly described as a ‘Life-line’

industry. In plays a vital role in alleviating the sufferings of millions

of people and controlling various ailments that afflict human beings.

The present day pharmaceutical industry has 3 main sectors:

1. The public sector

2. The Indian private sector

3. The foreign sector.

There are presently 24,000 firms engaged in the production of

drugs and pharmaceuticals.

THE BUYING PROCESS

The following pattern summarizes the process by which a doctor prescribes a product:

Unawareness

Awareness

Interest

Where doesyou productstand?

Evaluation

Trial

Usage

Repeat usage

If course, the marketing strategy will need to vary depending upon

the stage of the buying process.

WHAT MAKES US TICK?

What are the driving forces that may urge a doctor to prescribe one

product in preference to another? Among other factors, these

include general human needs, as described by A. H. Maslow:

1. Physiological – Food and shelter

2. Safety – Security for home and work

3. Social – Need for supportive environment and social acceptance

4. Esteem – Status and having the respect of others

5. Self Actualization – The need to realize one’s potential.

Maslow’s Hierarchy of Needs

Self Actualization

Esteem

Social

Safety

Physiological

On achieving one goal, the next goal is sought. Since marketing

essentially involves satisfying customer need, it is worthwhile to

recognize that customer psychographics may be related to the

hierarchy of human needs described by Maslow.

Incidentally, Maslow’s hierarchy of human needs is also linked to

the motivational status of organizational staff- and this would

include pharmaceutical marketers as well.

THE MARKETING MIX

Marketing involves 5 Ps: Product, People, Place, Price and Promotion.

Product

Positioning 5 ‘P’S of Marketing

Features Product

Quality People

Image Place

Packaging Price

Service Promotion

People

Salespersons

Doctors

Categories

Number

Trade

Place

Geographic location

Distribution

Outlets

Inventories

Sales territories

Price

Level

Sensitivity

Discounts

Promotion

Communication

Selling strategy

Advertising

THE PRODUCT LIFE CYCLE

All products have a life cycle, going through the stages of

Introduction, Growth, Maturation and Decline.

Stage 1: Introduction

Slow growth may be due to lack of customer awareness. During this

phase, emphasis must be placed on achieving customer

awareness, acceptance and usage.

Stage 2 Growth

Rapid acceptance is reflected in good sales growth and

improvement in profit.

Stage 3: Maturity

The product is well accepted but increasing competition slows down

the growth rate.

Stage 4 : Decline

Competitors, including new molecules, capture customers. Decline can be arrested or reversed by

targeting new market segments, changing the product positioning and advocating new uses.

Sa

les

New Markets

New Uses

New product Features

Status quo

Introduce Growth Materials Declines

Product life cycle

PATENTS AND WTO IMPACT

PATENTS

Patents and their protection is the cornerstone of a healthy and dynamic

research environment in any country. Patents can be classified into two

types – product patents and process patents. Product patents prevent the

newly developed drug from being copied by other competitor and sold in

the markets since the product patent holder has done all the research on

the drug and is therefore logically entitled to the revenue arising from the

sale of such a drug. Process patents, on the other hand, protects the

process or the route by which a particular drug is developed countries

adhere to process patents only. This permits local companies to device

newer methods of producing existing drugs with a change in process

from that adopted by the originators of the drug. Once the patents regime

arrives in Jan. 2005, the Indian Pharma Industry will have to watch every

step and adhere to international guidelines. One of the outcomes of this

change will be that unless Indian pharma companies invest heavily in R

& D and develop their owm molecules, they will either have to shut shop

or remain ancillaries to global giants.

WTO PATENT LAW (TRIPS)

The Indian patents act recognizes on process patents and not product

patents. This allows Indian companies to manufacture the patented drug

at a fraction of its original cost using reverse engineering techniques i.e.

Manufacturing using alternate process Indian industry achieved

handsome growth in this manner for many years. MNCs governed by

patent laws in their home countries could not do so and lost their

competitive edge in the Indian market to domestic players. MNCs saw

their largest selling brands being produced and marketed in India at

ridiculously low prices.

India is now a signatory of the WTO, which includes the TRIPS

clause. The major provisions of TRIPS are that

1. Intellectual Property Rights (IPR) is right of the originator of an

innovation, idea or product to hold sole international commercial rights

over “intellectual property”.

2. India will have to change its patent laws to recognize product patents.

Product patents will apply to drugs whose discovery is registered after

Jan 1, 1995 in any country, which is a signatory to the WTO.

3. India has a ten-year transition period for implementation of TRIPS.

During this transition period new molecules discovered are given

recognition and protection.

4. India is also required to grant exclusive marketing rights (EMR) for a

drug to the patentee during transition for a maximum period of five

years from the marketing date of approval. This EMR is granted

provided the following process is followed:

a) Applicants must obtain a valid patent after Jan 1, 1995 in any

country signatory of the WTO.

b) Grant to news drug registration on the basis of approval tests (e.g.

FDA approval).

c) Approval to sell or distribute the drug in the same country where

the first two criteria are fulfilled.

As the commercial launch of a drug based on a newly discovered

molecule takes 7-8 years in the home country and 2-3 years overseas no

applications for EMR are expected in the near future. Hence in the short

term, it is unlikely that any company will get EMR for drugs before 2005.

Also by the time WTO becomes operational 85% of the drugs sold in India

will be off patent (currently 92%).

IMPACT OF IPR ON DRUG PATENTS IN INDIA

1. Full cover for pharmaceutical products post 2005-9(product patents to

be introduced).

2. A patent term of 20 years (from 5-7 years in the past) from the date of

filling (to be implemented by Jan 1, 2000).

3. Import of drugs considered as working of the patent.

4. A patent holder to have monopoly to market products for the first five

years.

5. In case of infringement burden of proof shifts to the accused.

IMPACT OF IPR ON PRICES

Prices of drugs may increase due to the increasing amount spent on

research, marketing and distribution, but the increase will not be too

drastic because: -

1. 92% of the drugs are currently off patent and any one can compete in

this segment. This will lead to an increase in price competition and will

keep prices down.

2. A lot off-patent therapeutics equivalents are available which will keep

the prices of patented drugs down in the medium term (10 to 12

years).

3. Most of the drugs, which are covered under patents at present, will be

off patent in the coming four to six years. The current generics market

is worth $15 billion; additional fort molecules are expected to go off

patent in the next five years, opening up a new market worth $12-14

billion. Once these drugs come off patent, Indian companies can

reverse-engineer to produce these drugs at lower costs thus keeping

the prices low. However in the long term since the term of patents will

extend to 20 years, Indian companies will find it increasingly difficult to

reverse-engineer due to non-availability of products which are off

patent.

4. Product patents are mandatory only after 2005. As it normally takes

10-12 years to launch a drug commercially in the international market,

the commercial launch of a drug discovered in 1995 will take place

only after 2005 in India. Thus in the short term WTO has no effect on

the profitability of growth of existing Indian companies. In the long run

also the effect might be limited as the share of patented products may

not exceed 25% of the total market even in 2025 (currently 8%).

IMPACT OF IPR ON THE STRUCTURE OF THE DOMESTIC

INDUSTRY

1. The barriers to entry in the high margin products will increase

gradually.

2. There will greater spending on R&D thereby favoring larger and better-

capitalised firms over the smaller ones.

3. The small manufacturer will shift to manufacturing of non-patent

products leading to a fall in the profitability in these sectors.

PROBLEM WITH PHARMAECEUTICAL INDUSTRY

The major players in this industry are facing a lot of problems due to

Patent Law along with Ranbaxy. Now coming to the constraint followed by

Ranbaxy due to patent laws were enormous. They were as follows:-

1. The most molecules were basically developed in the European and

American laboratories and their patent lied with themselves.

2. Before this patent law Ranbaxy used to manufacture the drugs which

were basically developed by the European and American countries.

3. The total exports as well as the imports were declining due to this

Patent Law.

Government Policy: Capacity licensing requirements were abolished for

all but five basic drugs, mainly vitamins, Barriers to foreign competition

were reduced by removing restrictions on foreign investment as well as

lowering tariffs on imports, Foreign stake of up to 51% was allowed in

Indian pharmaceutical operations.

The company has a separate strategy for both the domestic market

and the global market.

Domestic market:

1. Sustain its market share by leveraging on its brand strength

2. Continously keep on increasing its product line

3. Focus on its marketing of niche products

4. Expanding through lucrative acquisitions

Global market:

1. Target branded generics

2. Focus on value added formulations

Build up affiliates ( networks) world wide.

COMPANY PROFILE: CIPLA

CIPLA race for the Horizon started with the country’s march for freedom.

The FOUNDER, Dr. K.A. HAMID a great freedom fighter and had thrown

himself into Mahatma Gandhi’s civil disobedience and movements. He did

Doctorate in Industrial chemistry from Germany, came back and started a

humble venture dedicated to the science of healing.

CIPLA has achieved leadership in the rational sector of pharmaceutical

industry. It is cleared from the data published by the magazine FORTUNE

INDIA.

Year ended 1998 (IInd Quarter)

Sales Rs 482.90 Crores.

Net Profit Rs. 100.87 Crores.

Earning per share Rs. 50.5

Dividend 55% of net Proceeds.

The above data shows that Cipla has remarkable market value with its

reasonable sales and N.P. CIPLA has more prospective investor

customer is Rs. 50,5. CIPLA Pays more proportion (55%) of its N.P. as

dividend and keep larger for reserves, which is quite good for its market

value.

CIPLA bought new life saving days for the first time to our people basic

manufacture; a nation wide distribution; exports to U.S.A., U.K. and other

countries, CIPLA was the first Company to develop a well process to

synthesize NIKETHAMIDE and most this vital cardiac drug available is

our people. Other first in innovation technologies in CIPLA programme of

self reliance include :-

Basic manufacturer of Anti-Cancer drug - FTORAFUR, VINBLASTIN,

VINCRISTINE.

Basic manufacture of Diosgenin and steroids.

Large scale manufacture of Rauwolfica Alkaloid, in early 50’s.

Basic manufacturing in salbutamol.

Pioneer in the Aerosel technology, which is backed by the === of more

then 5,00,000 people using CIPLA Aerosol every month.

The drugs manufactured by CIPLA includes:

1. Anti-AIDS

2. Anti-Amoebics

3. Anti-Arthritis

4. Anti-Asthmatics

5. Anti-Bacterial

6. Anti-Cancer

7. Anti-Emetic

8. Anti-Helmintics

9. Anti-Hypertansive

10.Anti-Inflamatory

11.Cardiac Drugs

12.Steroids and Harmones

13.Tranquilisers

14.Vasodilators

PRODUCTION PLANT AND FACILITIES

Mumbai Central :

Pharmaceutical Formulations

Bangalore :

Bulk Drugs

Natural Products

Pharmaceutical Formulations

Vikhroli :

Bulk Drugs

Pharmaceutical Formulations

Patalganga :

Bulk Drugs

Pharmaceutical Formulations

Kurkumbn :

Bulk Drugs

Pharmaceutical Formulations

CIPLA went basic early and now manufactures nearly 70% of it’s bulk

drug requirement :-

A bulk to formulation ratio is 1 : 3, which puts it among the leaders in this

core sector.

CIPLA : Basic Manufacturer of Qualify bulk Drugs

Acyclovir USP

Albendazole USP

Albutanol Sulphate USP

Alprazolam USP

Calcium Sennoside A & B

Camptothecin

Cetrizine Dihydrochloride

Ciprofloxacin HCI USP

Danazol USP

Enrofloxacin (Vet.)

Etoposide USP

Febantal (Vet.)

Felodipine

Fenbendazole USP

Free Sennoside A & B (70% - 80%)

Ketorolac

Mebendazole USP

Metoprolol Tartrate

Mitoxantrone HCI USP

Nifedipine

Norfloxacin USP

Omeprazole

Ondansetion HCI Dihydrate

Oxtendazole BP (Vet.)

Oxibendazole (Vet.)

Pefloxacin Mesylate Dihydrate

Pentoxyfylline

Salbutamol Sulphate BP

Slametrol Xinafoate

Seleqiline HCI

Sennoside USP

Terbutaline Sulphate USP

Vinblastine Sulphate

Vincristine Sulphate

Zidovidine

RESEARCH AND DEVELOPMENT

research and Development is the backbone of CIPLA’s operations.

CIPLA’s R & D division, with it’s three R & D centres, is the fountain head

for the drugs of the future. Apart from several molecules, CIPLA’s

technology innovation extends to sophisticated drugs delivery system. In

addition to intense in-house R & D efforts, CIPLA continues to be activity

associated with the national Institutes like the council of Scientific and

Industrial Research and its laboratories - the National Chemical

Laboratory in Pune, the Central Drug Institute in Lakhnow and the

regional research laboratory in Hyderabad and Jammu, in the persuit of

new drug development.

Research on medicinal properties of plant is done at the Agronomy

Research Centre on a 33 acre near Bangalore. Dioscorea, basic to the

manufacture of Steroids was successfully domesticated by CIPLA, for the

first time Internationally at Bangalore.

The accomplishment in the vital area of drug production is reflected in the

approval of CIPLA’s bulk drug manufacturing facilities by the U.S. FDA.

QUALITY ASSURANCE

exacting standards are upheld by ongoing quality assurance audits

coupled with continuos update of technology. The U.S. Pharmacopeial

Convention has accepted CIPLA’s amendments to several product’s

monograph - yet another reflection of advanced technological capabilities.

All CIPLA’s bulk drug units and the corporate quality control laboratory

have had U.S. FDA approval for nearly a decade.

Stringent control system and procedure ensure compliance with current

GMP i.e. Good Manufacturing Practices have also been approved by the

U.S. FDA (Food and Drug Administration).

CIPLA : A Recognised Body

CIPLA have five factories and Twenty One sales offices in India. All of it’s five plants Approved

by several national and International Organisations.

LOCATION MANUFACTURING APPROVED BY

Mumbai Central Bulk Drugs and

Formulations (Tablets

Capsules)

WHO and National institute of

Pharmacy, Hungary (for

formulations)

Vikhroli (Mumbai

Suburban Area)

Bulk Drugs and

Formulations (Liquid

Oral, Aerosols) R & D

Unit

MCA, UK, WHO, National

Institute Pharmacy, Hungary

(for formulation)

Bangalore Bulk Drugs and

Formulations (Tablets)

US FDA (for bulk drugs); WHO

Patalganga (near

Mumbai)

Bulk Drugs and

Formulations

US FDA (for bulk drugs); MCA,

UK, MCC, South Africa (for

formulations); and National

Institute of Pharmacy, Hungary

(for formulations); TGA,

Australia (for formulation)

LOCATION MANUFACTURING APPROVED BY

Mumbai Central Bulk Drugs and

Formulations (Tablets

Capsules)

WHO and National institute of

Pharmacy, Hungary (for

formulations)

Vikhroli (Mumbai

Suburban Area)

Bulk Drugs and

Formulations (Liquid

Oral, Aerosols) R & D

Unit

MCA, UK, WHO, National

Institute Pharmacy, Hungary

(for formulation)

Bangalore Bulk Drugs and

Formulations (Tablets)

US FDA (for bulk drugs); WHO

Patalganga (near

Mumbai)

Bulk Drugs and

Formulations

US FDA (for bulk drugs); MCA,

UK, MCC, South Africa (for

formulations); and National

Institute of Pharmacy, Hungary

(for formulations); TGA,

Australia (for formulation)

INTERNATIONAL MARKETING

Cipla exports its drugs to various countries. During 1992-93 its exports were Rs. 123 Crores and in year 1997-98 it touches the figure of Rs. 72 Crore.

BULK DRUG COUNTRIES TO WHICH EXPORTED

ALBENDAZOLE Thailand, France, Denmark, Turkey, Mexico, Ireland.

ALPRAZOLAM U.S.A. , Canada.CETIRIZINE Australia, Switzerland, Mexico.CIPROFLOXACIN Hongkong, Thailand, Iceland, Singapore, Germany,

Italy, Switzerland, Indonesia, Spain.DANAZOL Switzerland, Ireland, Poland, Korea, Australia, U.K.,

Germany, Canada.ETOPOSIDE Australia, Netherlands, France.FELODIPINE Iceland.MEBENDAZOLE Bangladesh, New Zealand, Taiwan, U.KMETHOCARBAMOLE U.S.AMETOPROL GermanyNORFLOXACIN Italy, Germany, Canada, U.K.OMEPRAZOLE Iceland, Hongkong, Bangladesh.PEEFLOXACIN Korea, Thailand, Switzerland.BULK DRUG COUNTRIES TO WHICH EXPORTEDPENTOXYFILLIN Italy.SALBUTAMOL Bangladesh, Switzerland, Malta, Thailand, Turkey,

U.S.A., Malaysia, Hongkong.SELEGILINE Germany, Italy, Israel, Singapore.TERFENDINE U.S.A.VINBLASTINE Australia, Netherlands, Mexico.VINCRISTINE Amsterdam, Netherland.

NEW ARRIVALS

Brand Salt Strength

Cefoprox Cefpodoxime proxetil 100 mg tab

200 mg tab

2 Dry Syrup

Doxacard Doxogosine maleate 1 mg, 2 mg, 4mg

Carloc Carvedilol 12.5 mg, 25 mg, 6.25

mg, 3.125 mg

Oxyspas Oxybutanin 2.5 mg, 5 mg

OBJECTIVE

The primary objective of the project is “PRESCRIPTION AUDIT OF

CIPLA PHARMA PRODUCTS IN NOIDA”.

FACTORS TO CONFIRM THE OBJECTIVITY

India’s second largest pharmaceutical company, CIPLA Limited, is

today well positioned in its quest to become a research-based

international pharmaceutical company.

This Project Focuses on the following key aspects determining the

market share of CIPLA PHARMA Products based on the Prescription

Audit. The project survey was carried out in geographical area of Noida.

The main inputs were from Medicine Retail Outlets and Whole sellers of

Medicine (Khashu Medical Agency). The projects findings are based on

the following aspects:

Priscription Flow for Cipla products.

Availability for Cipla products.

Representative visits to Drs and Retailers.

Market analysis of Cipla products.

How are efficient are the promotional activities of Cipla Pharma

in comparison with other brands?

Who are the major external competitors for its products?

This Project Report contains the detail analysis within the provided time

and resource on the all above queries. It gives an overview of the current

market scenario for Cipla Pharma’s Range of Cipla products with

illustrations and inputs from the market itself.

RESEARCH METHODOLOGY

Research is an activity and as such the term should be used in a technical

sense. Research comprises defining and redefining problems, formulating

hypothesis as suggested solutions; collecting, organising and evaluating

data; making deductions and reaching conclusions; and at last carefully

testing the coclusions to determine whether they fit the formulating

hypothesis.

REASERCH DESIGN

Statement of Problem in a General Way

First of all the problem was stated in a broad general way, keeping in view

either some practical concern or some scientific or intellectual interest.

The problem stated contained various ambiguities which were resolved by

thinking and re-thinking of the problem. At the same time the feasibility of

the probable solutions were also considered.

Understanding The Nature of the Problem

The next step is to understand the given problem jso that its natue and

origin can be studied clearly. The best way is to discuss the problem with

the guide in order to find out how the problem originally came about and

with what objectives in mind.

Surveying the Available Literature

All the available subject matter related to the problem was studied so that

it can help further in solving and coming up with a feasible solution.

Developing the Idea Through Discussions

In order to produce useful information, various discussions concerning the

problem were done with colleagues and otehrs who had significant

experience in the working area.

Rephrasing the Research Problem

Finally the research problem was rephrased into a working proposition. By

rephrasing the research problem, it was been put into specific terms as

possible so that it could become viable.

SAMPLING

Sampling is a phase of project to obtain requried data as efficiently as

possible when combined with the other perspectives of the project. There

are three objectives of sampling that are of the key importance in meeting

the requirements of management.

Those are:

# That the data are representatives of the population.

# Sufficient accuracy in the sample to provide stable results.

# Chosing research resources as efficiently as time

requirements permit.

Keeping in view these objectives of sampling resorted to Probabilistic

sampling. For the research a sample size of 100 companies was covered.

THE SURVEY

The survey was conducted in the field with help of a questionnaire. The

questionnaire conducted a series of questions which was a great aid while

conducting the personal interviews. Personal intervierwing tends to be of

the greatest oportunity for gathering abundant information. The survey

was conducted in whole of the geographical area of Noida. First, telecalls

were made to the prospect respondents and after fixing a time and place

they were contacted.

DATA COLLECTION

a) Collection of Secondary Data:

Secondary data pertaining to the problem at hand was collected from

various sources like available reports of the company, various other

publication in books, magazines, newspaper, journals gathered from the

library or CII and internet. Factors like reliability, suitability and adequacy

of data wfere kept in mind while collecting the data.

b) Method Used in Collecting the Primary Data:

Since there are many methods of data collection available, some factors

wfere considered before selecting the appropriate tool. These were:

Nature, Scope and Object of the Study

Availability of Time

Precision Required

Sample Type and Size

After going through the above considerations the method selected to

collect data was, SCHEDULES.

The schedules are vey much like questionnaires except that they are filled

in by the enumerator. For this purpose, firstly a questionnaire was

developed. The factors that wfere kept in mind were :

General Form: The general form of the questionnaire was structured to

present the questions in exactly the same order and wordings to every

respondent.

Question Sequence: In order to make the questionnaire effective and to

ensure the quality of the replies received a proper sequence was

maintained.

Qustion Formulation: With regard to this aspect of questionnaire it was

kept in mind that each questions had to be very clear, any sort of

duplication was avoided. The questions were kept simple, and concrete

and they confirmed to the respondents way of thinking.

Form of Questions: Concerning the form of questions, out of the two

principle forms; open ended, and closed ended, a right blend of both was

incorporated. The multiple choice or close ended questions were

designed to permit a free response from the respondents. Such questions

gave the respondents considerable latitude in framing the replies.

IMPORTANCE OF STUDY

The Market trend for Cipla Products specially Ciplox, Norflox,

Novamox and Forcan can be estimated.

The demand and the supply chain of the Cipla products.

How competent are Cipla products in the Medicine market in relation

with other brands in same category.

The trend of prescription made by the Doctors in Noida area for Cipla

products.

The drawbacks and the limitations of the marketing division of Cipla

products.

The scope of further improving the brand image and market share of

Cipla Pharma products can be realized.

LIMITATIONS

Though the groups or segments selected for the analysis was

predetermined, there were certain factors which posed difficulties for

successful completion of the project. Due to these limitations, at times, I

had to re-accumulate all my energy and stamina to overlook all the

hurdles and work with new zeal. Without external support and

encouragement the following limitations might have proved fatal for the

project health. These are:

Scope of Project

The scope of project was only restricted to RANBAXY PHARMA’S range

of Antibiotics and analgesics.

Time constraint

Someone has rightly said that “Time and Tide wait for none”, so keeping

this in mind, it was seen that the given work was finished in the stipulated

time instead of extending it.

Sampling technique

Collecting the names, addresses and contact numbers of the prospects

was very trohlesome. This took me too much time but at last, I was able to

make a list of them and selected the sample.

Reliability

Last but not the least the data collected by mean of this sample cannot be

totally relied upon because some of the respondents might have disclosed

biased information which may not be true and thus the conclusion

generated from this study may not actually be correct.

ANALYSIS OF DATA COLLECTED

Graphical analysis is the graphical representation of the data collected

through the survey which was gathered, sampled and grouped according

to the range and category. The graphs and charts are based on the inputs

of collected data. It gives a complete and easy picture of finding and

analysis. It makes the reader to understand the current market trend and

the market scenario for Cipla’s Pharma Range of surveyed products

SHOPS DEALING IN CIPALA PHARMA PRODUCTS

NUMBER OF PRESCRIPTION IN A WEEK FOR MAJOR PHARMA COMPANIES

WEEKLY SALES OF CIPLA PHARMA RANGE OF SURVEYED PRODUCTS

MINIMUM AMOUNT OF STOCK MAINTAIN FOR CIPLA PHARMA’S RANGE OF SURVEYED PRODUCTS

MINIMUM DURATION FOR DELIVERY OF SUPPLY

FREQUENCY OF COMPANY REPRESENTATIVE’S VISIT

BEST PROMOTIONAL ACTIVITIES BY COMPANIES ACCORDING TO MEDICAL SHOP OWNERS AND DOCTORS

COMPARATIVE ANALYSIS OF CIPLOX

COMPARATIVE ANALYSIS OF NORFLOX

COMPARATIVE ANALYSIS OF NOVAMOX

COMPARATIVE ANALYSIS OF FORCAN

CONCLUSIONS

On the basis of findings in the survey carried out, the following

conclusions were inferred:

Most of the medical retail outlets deal in Cipla Pharma products.

The major competitors are Ranbaxy, Wythlederle, FDC and

Cadila.

Despite the fact that CIPLA is the second largest,

Pharmaceutical company still maintaining the first position in

particular market.

Major competitors for Ciplox is Cifran.

Major competitors for Norflox is Norbid.

Major competitors for Novamox is Mox.

Major competitors for Forcan is Zocan.

Generally the stock kept by the retailer lasts for a week or 10

days.

There is constant visit by the medical representative from most

of the Companies.

BIBLIOGRAPHY

Website: http//www.cipla.com

Website: http://www.indianpharmaceuticals.com

Website: http://www.economictimes.com

Website: http://www.indiatimes.com

Magazines:

Business Today

Business World

Business India

Books:

Marketing Research ( by Boyd, Jr. Westfall, Stasch)

Business Research Methods ( By Cooper, Schindler)

QUESTIONNAIRE

I am a student of Apeejay Institute of Technology Greater Noida, pursuing

MBA. I am working on a market research survey on “Prescription Audit of

Cipla Products (Ciplox, Norflox, Novamox and Forcan) in Noida. I would

request you to extend your kind cooperation in filling up the questionnaire.

I assure that your answers will be kept completely confidential. It is purely

academic purpose.

1. Do you sell Cipla products ?

a) Yes

b) No

2. If Yes, what are the popular products for Cipla Pharma Division

prescribed by the Doctors?

Name of the Doctors. Brand

3. Which are the major competitors for Cipla products given below?

Ciplox a) ……….. b) ………. C) ………

Norflox a) ……….. b) ………. C) ………

Novamox a) ……….. b) ………. C) ………

Forcan a) ……….. b) ………. C) ………

4. What must the weekly sales of Cipla Products from your shop

particularly for those above given brands?

5. What is the minimum amount you keep as stock for Cipla

products?

6. What is minimum duration of your placing the order and receiving the

supply?

Placing Order:

a) 1 day

b) 2 days

c) 3 days

d) A week

e) More than a week

Receiving Supply:

a) 1 day

b) 2 days

c) 3 days

d) A week

e) More than a week

7. What is the frequency of visit of medical representative of Cipla to your Store ?

a) once a week

b) once in fortnight

c) once a month

d) more than a month

8. 8. What is the frequency of visit of medical representative of other competitor products?

a) once a week

b) once in fortnight

c) once a month

d) more than a month

Q.9 How do you like the company promotional activity done in the field ?

a) Excellent

b) Good

c) Poor

Q.10 Which company has the best promostional activity according to you ?

PROBLEMS AND RECOMMENDATIONS

Company should constantly watch out for new intent as they are more likely

to threatening there brand leaders such as Ciplox and Norflox and to take the

corrective major to prevent the loss of market share for their product.

The sales for Cipla ltd. should constantly upgrade the information award the

new technology and product to the doctors, retailers, and wholesalers.

The synergies through horizontal and vertical integration of Cipla will create

better results.

They should give some incentives in the form of bonus offer to the retailer so

to increase the stock at the retailers counter.

Company also requires to more and emphasis on their field force means they

should more concern about their employees.

They should also try to find out new indication for their existing product as

they are in saturation stage.