If you have considered starting a business in pharmaceuticals, there’s no time like now to begin. The Indian pharmaceuticals market is the third largest in terms of volume and thirteenth largest in terms of value, as per a report by Equity Master. India is the largest provider of generic drugs globally, with the Indian generics accounting for 20 per cent of global exports in terms of volume. Now that’s a huge number. Not to mention, Indian homegrown pharmaceutical firms have established dominance and distinction in a once prominently multinational niche.
A business model for a pharmaceutical company is usually quite diverse in scope. From establishing competent production lines to affiliating with an accomplished league of medical practitioners to associating with a selection of chemists and stockists, the logistics spread is wide and uneven. Starting any business is a challenge and you need to have the right resources, the right documents and the right people assisting you. So, here are a few helpful tips that can get you started on your journey to building a flourishing pharmaceutical company:
Research your playing ground
Before you start any business, let alone a pharmaceutical one, you need to study the current market and what it holds. Know your competitors well because they are the ones you will be competing against on a day-to-day basis. Find out what it is that you can contribute to the market that isn’t in existence yet. Which location would be ideal to establish your factory? If the time comes to franchise, jot down the different places that would serve your business better. Study the big players and what it is that they are doing right.
Make a hard-hitting business plan
A business plan will not only help others get a clear idea of your business but also give you a clear roadmap. Make a step-by-step plan, chalking out how you intend to take the company ahead. Start with what your company is all about, what you are going to deal with, what will you manufacture or sell, where you are going to be located, who your competitors are, what makes you different from the rest, what will you look to achieve, your mission and vision, your company’s goals etc.
Regulations and Registration
Getting your company registered should be put high up on your list of things-to-do. You will require license or registration from the Drug Department that ensures quality standards for the industry. Keep in mind that different types of licenses are issued by the drug department for the manufacture of drugs/cosmetics. So find out which ones you will need to apply for. You also need to apply for GST (Goods and Services Tax) identification number. All pharmaceutical ventures must comply with both, the Factory Acts regulation and the Current Good Manufacturing Practice regulations. Approval from various health authorities form part of the registration process, and may vary from state to state. One must also secure a trademark registration from the Department of Industrial Policy and Promotion, as this is crucial to establishing a distinct brand identity.
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Look into the production details
Pharmaceutical firms can either set up independent units or source vendors to manufacture their products. Third party or contract manufacturing allows a firm to employ and aggregate various specialized productions under a brand name. Product, if generic, must comply with the FDA requirement of falling within acceptable bioequivalent range of its branded counterparts, i.e. must be identical in dosage, strength, route of administration, quality, performance and intended use. New or branded drugs must pass clinical trials and tests satisfactorily and find approval with the Central Drugs Standard Control Organization.
Marketing and Distribution
If you need to distribute your product to the end consumer, you need to partner with chemists and pharmacies. For this, it is necessary to factor in effectiveness, need and other competitors in the same space. Make sure pharmacists are cued in on your product and make it memorable so it stays on the top of their mind when the order comes in. Produce ample products that you can use as a promotional tool when approaching pharmaceutical reps and practitioners alike in order to acquire visibility amidst close competitors. While the consumer market is vast and robust, entering it involves groundwork that demands significant expenses and expertise.
Join hands with the right people
There is no business that can flourish without a competent team to take your ideas ahead. Hire a team of professionals who can overlook different departments. You need a team of scientists, technicians and other specialists to come together and represent virtually all the sciences, along with the contribution made by the management executives, lawyers, accountants, engineers, system analysts etc. You also need a marketing team to handle promotions as well as a distribution team to supervise the output. Apart from these designations, you need to partner with the people who share your vision and will function as team leaders to guide employees in the right direction.
Read Also: Effective ways to grow your business online
Invest in your business well
In the pursuit of sound investment, you need a compelling pitch; one that evaluates the industry and places your company in the right space. The proposal must also touch upon an operational plan that elaborates developmental practices in the laboratory, the setting up of manufacturing units and administrative offices and the scope of equipment that would constitute product manufacturing. Also, you need to note that capital expenses in a pharma business commonly run into unexpected hikes. Outlays involve production costs, licensing fees, doctors’ reimbursem*nts and monthly expenses. There is considerable lag between commencing operations and earning regular revenue in the market, so initial investments must cover payments well into production and distribution stages. This is where business loans give you ultimate ease and convenience in smooth business banking. You can avail a dedicated Relationship Manager at Kotak Mahindra to manage your funds and guide you with the right products & services.
Now that you are well versed with starting your pharmaceutical business, look out for articles in this series that will guide you to run your pharmaceutical business successfully.
