RBXLF.PK: Ranbaxy is an Indian hq'd primarily generic pharma. McKinsey produced a blurb on it which follows. Does anyone have an opinion on its prospects, and whether it is worth buying OTC shares?
"Ranbaxy: Affordable pharma
Ranbaxy is a good example of how companies develop distinctive capabilities in emerging markets. Before signing on to the World Trade Organization regime, at the beginning of this year, India protected only process patents—not product patents—for drugs, hoping to make them as affordable as possible for the country's poor people. In essence, Indian companies could produce any drug in the world if the chemical synthesis of the manufacturing process differed from the one that the original manufacturer used. As a result, hundreds of Indian drug companies sprang up to make drugs as soon as they were introduced in the United States or Europe and to sell them as cheaply as possible in India.
Soon Ranbaxy distinguished itself by setting up sophisticated laboratories and hiring hundreds of world-class chemists. It also invested heavily in state-of-the-art factories that could bring the manufacture of a drug up to optimal scale quickly. The distinctive advantages of the company soon proved to be its ability to identify new processes for synthesizing patented drugs and to scale up manufacturing quickly thereafter.
By the early 1990s, Ranbaxy realized that it could exploit these strengths by quickly synthesizing drugs that were going off patent in developed markets and selling them there. To pursue this strategy, it acquired Ohm Laboratories in the United States in 1994 and entered the US generics market. In the past decade, Ranbaxy has rapidly expanded its business in the United States and other international markets and currently ranks among the world's top ten generics manufacturers. It has annual revenues of $1.2 billion—78 percent from outside India, including 36 percent from the United States. The company has globalized so successfully that more than 400 of its employees now work in the United States, and more than 18 percent of its total workforce is non-Indian."
