Caring for patients runs in our DNA, say Cipla's Samina Hamied, Umang Vohra

Cipla was at the forefront of the pharmaceutical industry’s response to the Covid-19 pandemic, whether by tying up with MNCs for products like remdesivir or tocilizumab, or ramping up production of drugs that are more common but still necessary. Having won the Company of the Year Award for 2020-21, Cipla’s executive vice-chairperson SAMINA HAMIED and managing director and global chief executive officer UMANG VOHRA spoke with Sohini Das about their experience of the pandemic and their plans for inorganic growth. Edited excerpts:

Tell us about how you were mentored by YK Hamied and MK Hamied when you joined Cipla.

Vohra: Dr Hamied continues to mentor us today as well.

Samina: When I joined the company, it was at an inflection point for transformation. We made the decision that we wanted to be promoter-led, but professionally run. That was the inflection point for Cipla. We looked at our strategy and tried to understand what has worked for us for 75 years. We looked to the future and asked what it would take to create the next 75 years of magic.

It was at this point that I joined the company. I benefited from great mentorship from both Dr YK Hamied and Mr MK Hamied — they shared the wealth of knowledge that they had created over the last 45 years. The most critical decision I took was hiring Umang. He joined us and changed the face of Cipla.

What are the things they told you to focus on?

Vohra: When I joined Cipla, Samina had me meet Dr Hamied in London. He told me that after I joined he would lay down a few things for me. He wanted me to be clear about three things — first, he built this organisation for patients, and not for anyone else. “So, if you come back to me and say that our Ebitda is now 25 per cent, but I have lost the soul of the company in doing it, I am not going to be happy. Numbers are important — quarters come and quarters go, but I created this organisation for patients and it is going to remain that way,” he told me.

Second, he told me not to not worry about the quarters — there are bad ones and then there are good ones. Third, he said not to do anything stupid that would force him to sell the company — never to bet on the firm. “Never bet on what I and Muku have created. Our objective is to serve patients,” Dr Hamied had told me.

Therefore, caring for patients runs in our DNA, and that’s why our team members came forward to save lives during the pandemic.

Why is Cipla such a late entrant in the US market?

Vohra: In my last organisation we used to buy products from Cipla and sell them in the US market. I used to wonder why Cipla itself was not there in the US market, and why it has gone on expanding in the African continent. When I spoke with Samina, I understood that she wanted to protect that legacy. But, somehow, the huge potential was getting truncated, and was not being transformed into action on the ground. She has a very high empathy quotient, and she can very well understand what each of us is thinking.

You also consolidated the business.

Vohra: When I joined it was relatively clear that we were going through a rough patch — the Ebitda margin had gone down to 14 per cent. Because of the richness of the last 85 years, Cipla has so many capabilities that for anything we need to do, we say we can do it. We wanted to create biosimilars, stem cells, and so on.

We had to stop and think, how much can we truly afford? Is there a space for this consolidation that we need to focus on? I had conversations with Samina, and then with both Dr Hamied and Mr Hamied, and we tried to understand what was the right thing to do at that point of time.

We started building a US business. We decided that if we want to build this market, some of the smaller businesses should go, and that is the discipline we brought in.

Both Dr Hamied and Mr Hamied were very supportive — they gave us the freedom to do what we wanted to do.

Samina: Cipla was an India-focussed company that had grown organically. Until I joined, the company had not hired a single MBA, or done a single inorganic transaction. We were built purely organically. We had these B2B organic partnerships across the world, and that’s why our slate had become so wide, rather than deep. In the last few years we have changed that; we put in our front-end in the US, and did lots of mergers and acquisitions.

So, now are you open to more inorganic buyouts?

Vohra: We have always wanted to buy, and India is a big market for us. We are No. 3 in this market. The only thing about India is that there is so much duplication — everyone is doing similar things.

Now we have a clear focus, and we do want to acquire. You will have brands and products on sale, not entire companies. We are clear that if there is a need to deploy capital, we will for our inorganic mission. We are impatient to acquire, just as everyone else is. We want to solidify our position.

Tell us about your experience during the pandemic, when you launched so many products.

Vohra: We never asked anyone to come to the office, or even to the plant during the pandemic. But we saw huge amounts of people wanting to make a difference. People went that extra mile.

We could have been a top-down organisation, but in Covid-19, we became a bottom-up organisation. We never realised that we had so many surf-boarders in this organisation who could ride these waves so well. In our last board meeting we discussed this culture and how to keep this intact.

Our outlook to innovation has changed, and this has happened globally. We were reticent or conservative about how we deployed capital around innovation, but now we are a lot more aggressive.

Samina: The way pharmaceutical companies came together and put up a unified front — we had conference calls every morning — was just amazing. We coordinated about logistics, about freight, and a zillion other things. It was incredible, because we came across as partners and not competitors. Industry and government have been part of the same WhatsApp groups — never before has this happened.

Vohra: Once we had to send our people to Hyderabad where we were doing some research on remdesivir. Transport was not available, and there was no way to go. They took a car and drove all the way from Mumbai to Hyderabad. We did not even ask them to do so.

Samina: During the days of the remdesivir crisis, there were times when our supply chain and distribution people did not sleep for days together. We got calls throughout the day. Some of the calls were from our competitors — a non-Cipla person got treated on a par with a Cipla person.