British multinational drug major GlaxoSmithKline Pharmaceuticals has sold eight to 10 tail-end brands in 2018-19 (FY19), including its Vitamin C brand Celin and anti-infective brand Septran, as it focuses on paring the number of brands in India to about 20 over the next one year.
The firm’s FY19 annual report shows that it fetched Rs 5 crore during the year from the sale of brands. A GSK Pharma spokesperson confirmed that the firm had sold Celin and Septran to Koye Pharmaceuticals in January this year.
He did not give details about the other brands sold, but admitted that those were tail-end brands. Annaswamy Vaidheesh, vice-president, South Asia and managing director, GSK Pharma, said in the annual report: “We optimised our product portfolio, identifying key brands behind which we put resources to actively promote.”
GSK noted that it had adopted a new commercial model to deliver in its strategy to put energy where it matters for accelerated sustainable profitable growth. “As part of this new model, our product portfolio has been optimised to ensure our priority therapy areas get greater attention,” the annual report reads.
In an interaction with Business Standard, Vaidheesh had explained: “We have decided to have less number of brands, to reduce complexities. This simplifies our operations and enables us to put our energy where it matters. Each brand launch takes up a lot of time and resources (from legal approvals to marketing push).” The top 10 brands of GSK Pharma roughly contribute to over 50 per cent of its revenues — mature brands like Augmentin (antibiotic), Zinetac (antacid), Calpol (paracetamol), T Bact (antibiotic topical ointment), and Betnovate (topical corticosteroid) continue to clock double-digit growth.
Celin is a three-decades-old marquee brand with huge recall, but, Vitamin C salts were brought under the National List of Essential Medicines. Vitamin manufacturing in India is largely dependent on import of active pharmaceutical ingredients (APIs) from China. Fluctuations in the prices of API push the raw material cost up for companies, while they have not been able to pass it on to consumers for drugs that are under price control.
Data from AIOCD pharmasofttech AWACS, a market research firm, shows that the market share of Celin (tablets) has fallen in June 2019 to 10.6 per cent, from 17.4 per cent in June 2018. It had annual sales (moving annual turnover) of Rs 7.7 crore as of June 2019.
Septran (antibiotic) has a fair share of the market in its category (trimethoprim and Sulfamethoxazole molecule) — in the range of 20 per cent and 26 per cent across various dosage forms (for adults and kids). The market leader in that category is Abbott’s Bactrim, with a 33 per cent share.
Anti-infective sales growth has been in the slow lane. It is still one of the largest therapy areas, about 13.5 per cent of the domestic pharma market. Analysts say growth rate in this segment has been slower than that of the general Indian pharma market over recent years, down from 10-12 per cent annually to 7-8 per cent.
The sales are now mostly seasonal (cold and flu season, etc). Companies are thus, moving away from tail-end or end of lifecycle brands in this space.