Volume 11 | Issue 1 | Year 2008

Mexican pharmaceuticals firm Dr Reddy’s sees quality, commitment and costumer service as the keys to future growth as it seeks to build on an 18 percent increase in its installed capacity over the last five years, in addition to a 12 percent expansion in its product portfolio, says logistics coordinator Eduardo Castañeda.
The company aims to leverage its quality and service commitment to grow its product portfolio another 15 percent over the next three years by forming more strategic relationships with leading international sector players.

Dr Reddy’s has a plant located in an industrial park in Cuernavaca, Morelos state where it produces 1 million kilos a year of an analgesic anti-inflammatory called sodium naproxen, a product sold in the USA under the Aleve brand name. “We have all that it takes to be the not only the biggest producer of this drug, but also the technology to produce the best kind of naproxen. We are really proud that this plant is an international excellence center for the production of naproxen and that this is the biggest production plant of this drug,” says Castañeda.

The 125,000-square-meter plant can produce of 3,350 tons per year of active pharmaceutical ingredient products including steroids, non-steroids and high quality chemical products that are manufactured using sophisticated chemical synthesis and cryogenic phases amongst other processes, generating annual sales of $55 million.

Over $50 million has been invested in the plant over the last five years including $30 million for biologically active drugs production. “This building is one of our prides as it is a high containment building specifically constructed so no molecule gets out. It has to be like that for the health of our employees and the surroundings environment,” he says.

Part of the company’s success is due to agreements it has formed to supply active pharmaceutical ingredients to global pharmaceutical firms such as Roche, Pfizer and Bayer. Under such agreements the Cuernavaca plant is one of the handful of global manufacturing facilities that it uses to produce specific products, which helps explain why it exports about 90 percent of its production. “We have business with companies in twenty different countries such as Japan, Turkey and European countries,” he says, adding that the company plans to expand into other markets as well. “The owners are always looking for opportunities to expand their business and new places to invest. They are looking for companies to buy in Asia and Europe,” he says.

The company is now in negotiations with global pharmaceutical firm GlaxoSmithKline with a view to collaborating in another strategic partnership. “We are in the middle of a negotiation in order to expand our business and expand our client portfolio, and we are looking forward to working with them,” he says.

The Cuernavaca operation has seen several different owners in recent years as it changed hands from an American firm, to a European firm before being purchased by Indian pharmaceutical company Dr Reddy’s for $59 million, a company that has since invested $7 million in the plant. “It is really different to work with Indian people as the Swiss turn off their cell phones because they do not want to be disturbed during their time off, and they disconnect their lives from their work over the weekends. Indians live for their jobs and are always thinking about new ways to improve and new ways to expand their companies, and they do not care if it is weekend. They are always ready for work,” says Castañeda.

The parent company was established by Dr. Anji Reddy in Hyberabad, India in 1984 with capital of $150,000 with the aim of providing accessible medicines for his countrymen. It now has global sales of about $1.5 billion with operations in over 20 countries, and is the leading pharmaceutical producer in India. It competes in the global pharmaceutical market through the manufacture of generic drugs using leading edge equipment from Germany, the USA and Japan such as pneumatic transportation systems and reactors from Pfaudler, tanks and filters from Rosenmund and Pall, Heinkel centrifuges, and Hosokawa dryers.

Dr Reddy has been so successful that it is now investing in primary research to discover and develop new molecules with pharmaceutical potential. “The company has invested a lot of resources in the discovery and development of new molecules and we expect to find our first molecule in a matter of two or three years,” he says.

That research effort is driven by the company philosophy of “helping people to have healthier lives,” as the company seeks to be a world leading pharmaceutical company based on research. “We thrive for excellence in all we think, say, and do, and our values are quality, respect for each person, constant innovation and learning, collaboration and team work, with business practices guided by the highest ethic standards of truth, integrity, and transparency,” says Castañeda.

These values are reflected and maintained by the company’s personnel and the team ethos that permeates the firm. “We value our staff. We really care about our people as this is one of our competitive advantages. We really work as a team and all we achieve is because we are a team. We have proven right the saying that two heads think better than one, and we believe that ten think better than two,” he says.

This approach to business has seen Dr Reddy’s pick up a number of awards over the last five years including Corporate Excellency Award, Best Initiative and best Quality (2006), Roche Integral Responsibility Recognition (2002-2005), and Clean Industry Certification (Profepa) (2000-2008). Such awards build on top of the continual process of certification. The plant has been certified by the Food and Drug Administration for over 35 years and by other national and international organizations, which has processes and systems that fulfill Good Manufacturing Practice requirements in addition to environmental regulations.

Teamwork, investment and strategic relationships with leading industry players are the basis for future growth in international markets and expanding the product range for Dr Reddy in Mexico as it seeks to join the ranks of the world’s leading pharmaceutical companies.

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