In a bid to ramp up presence in the over-the-counter drug space, Piramal Enterprises’ Consumer Products Division has acquired five trademark rights for India from Organon India and MSD BV for ₹92 crore.
“In line with our strategy, we aim to be among the top three players in the OTC market by 2020 and the addition of this portfolio of brands will help us move swiftly towards that objective,” said Nandini Piramal, Executive Director, Piramal Enterprises.
The acquisition includes mainly the brands Naturolax, Lactobacil and Farizym, which Piramal intends to continue in the gastrointestinal segment through the OTC route.
In an interview with BusinessLine , Kedar Rajadnye COO – Consumer Products Division, Piramal Enterprises, said the acquisition is a part of the consumer product division’s strategy to grow organically and inorganically to become a ₹1,000-crore brand by 2020. The division had revenues of ₹360 crore in fiscal 2015.
The domestic OTC market is approximately ₹15,000 crore in size growing at 13-14 per cent. Rajadnye said Piramal is currently addressing only about ₹3,500 crore of this market, but growing at 18-20 per cent.
“In order to achieve the ₹1,000-crore revenue target by 2020, we expect to grow at 22-24 per cent through organic and inorganic means,” Rajadnye said.
Four-fold strategy Piramal is applying a four-fold strategy to achieve this growth. The first is to expand its presence to 2,200 towns from the existing 481 towns. Rajadnye said the company will be able to do it and enter large number of towns with population over 20,000 by June 2016.
Second, Piramal will be looking at extending its existing brands by offering newer variations and flavours. “For example, Saridon is currently available only as a pill for headache. We might extend the brand to offer pain relief medicine or even a balm that can be applied on the body instead of popping a pill,” Rajadnye said.
Thirdly, focus on launching new brands. In August, the company launched anti-allergy tablet stopAllerG to enter the fast growing segment. Rajadnye said the company will launch more such products in the coming months and may enter areas such as cough and cold, pain reliever, multi-vitamins and supplements.
Finally, Piramal will continue to look at acquiring new brands, which can help it enter newer geographical markets or product segments. “We have enough money to look at even large acquisitions of up to ₹100 crore as long as the brands are big enough in their category. We would typically look at a brand that is already number one or number two in its category,” Rajadnye said.
Piramal Enterprises shares closed up 0.6 per cent at ₹948 on the BSE.