Two stories of grit and glory that serves as exemplars for the lifesciences industry
Founder and erstwhile Apple CEO Steve Jobs had once stated, “The biggest innovations of the 21st century will be at the intersection of biology and technology.” It seems his prophecy is coming true.
Biologics or biosimilars are revolutionising the treatment of several health conditions, thereby reducing disability and improving the quality of life for many.
Similarly, the pharma industry, in its quest to discover and develop new drugs to treat complex diseases, is rapidly adopting innovative technologies that will help them ramp up research and development, enhance their manufacturing and analytical capabilities and enable them to be competitive and compliant. Advancements in these areas are disrupting existing models and processes to accelerate discovery, enhance productivity and enable regulatory compliance in the pharma industry.
In such a scenario, the role of pharma services providers takes on magnified importance. It is upto them to help the players in the pharma industry stand out in the domestic market and carve their niche in the global ones.
Therefore, Express Pharma, in this issue, features two leading services providers – ACG and Gansons – who have evolved with the industry and is shaping its future with their offerings.
At the first glance, one is likely to see the similarities in the two ventures. Both are family-run businesses, built by the grit and determination of two pairs of brothers and have withstood the test of time to become globally recognised firms.
Yet, their business models and modus-operandi differs. Each firm has paved individual paths to progress. Let’s trace their success stories and examine their future.
Gansons’ genesis and growth
It all began with Ganendra Nath Banerjee, a nationalist who set up Gansons just four days after independence on August 19, 1947. His family members inform that he believed India’s progress as an independent nation would largely depend on its ability to be self-sufficient and the entrepreneurs of the country would play a mammoth role in driving the economic engine of the new nation. Gansons was born out these ideals and ideas. In the face of considerable opposition and scepticism, Gan Banerjee started this company and initially began with the manufacture and distribution of laboratory and other equipment. It has several firsts to its credit including the first Bunsen burner, the first laboratory gas plant and the first ampoule cutter, among many others.
After Gan Bannerjee, his second son NN Banerjee steered Gansons towards the manufacturing of larger equipment to serve India’s emerging process manufacturing industries. Gradually, over the years, Gansons diversified its business dealings and ventured into manufacturing of larger equipment to meet the needs of India’s emerging process manufacturing industries including chemicals, fertilisers, food, beverages, personal care products, pharmaceuticals and others.
Currently, the company, helmed by NN Bannerjee’s children, Ashis Banerjee and Subrato Banerjee, is one of the leading suppliers of pharma solid dosage manufacturing equipment.
Evolving with the industry
Ashis Bannerjee and his brother, Subrato Bannerjee recount how different decades saw the pharma industry going through different phases and reminisce about Gansons’ efforts to fulfil the requirements of the sector, right from the year of independence. Citing an example, they narrate how Ranbaxy, one of the first big pharma companies in India, several decades ago was looking at commencing the manufacture of APIs. Dr Parvinder Singh, the company’s leader, was looking at setting up a process and needed the equipment to put the system in place. Right from identifying the optimal process to actually designing the equipment, Gansons was involved in each step of this activity and their engagement was multi-faceted. Highlighting that this was need of the erstwhile years, they point that as cost was a huge issue, hand-holding pharma companies through each step was essential as there wasn’t much scope for trial and errors and it was necessary to get the systems and equipment that serve the purpose right in the first attempt itself.
Ashis Bannerjee also talks about the various challenges that the industry faced in different decades and Gansons’ struggles to mitigate them to spur progress in the life sciences industry. For instance, in the 50s there was an embargo on the import of equipment, so there was a need to maintain, replicate or improve on the equipment indigenously. The 70s saw companies set up processes right from scratch, including the production of raw materials. Thus, the challenges were different and the company had to keep reinventing itself to be a preferred partner for pharma companies.
Partnering for progress
Over the years, Gansons has built strong partnerships with global firms to strengthen its portfolio and maintain the growth momentum. Companies like Quadro (particle size reduction), Klenzaids (containment solutions), Innojet (fluid-bed processing), and Resodyn (acoustic resonance mixing), Hanningfield (processing and containment solutions) have been some of Gansons’ partners in progress and growth.
Ashis and Subrato Bannerjee apprise that these partnerships have helped the company tremendously in effectively leveraging the prowess of world-class technology to deal with increasingly complex challenges faced by the pharma industry. These partnerships have also facilitated an environment of innovation which has always been at the core of their success. The company management also updates that a strong innovation pipeline is the most important factor when Gansons looks at global partnerships. Even the financial stability of the partner company is secondary to its investment in innovation. Unless there is something to learn and new ideas to work with, we don’t enter into a partnership, say the Bannerjee brothers.
Now, the company is training its focus towards Japanese players as its management believes that the Eastern country has lot of technological clout that can be very beneficial to the pharma industry.
Making in India for the World
Ashis Bannerjee says, “We are one of the truly Make in India companies, since the last 70 years. We buy into the concept and that’s what works for us. We are investing a lot in developing R&D to develop our own technology.” With all their manufacturing bases in India as well, it makes in India for the world. Though the company serves several global pharma companies across the world, it is first and foremost an Indian company with Indian ethos.
As per the company management, this model of working helps them with better forecasting of outcomes, enable more local jobs, assure consistent production quality, more efficient use of limited resources, and achieve better economies of scale, thereby emerging as truly ‘Make in India’ champions. Even in the near future, the company doesn’t have plans to set up manufacturing units outside and intend to continue operating from India itself. Yet, it is a major supplier of equipment and technology for pharma companies in over 30+ countries and definitely aims to expand its footprints in developed and developing markets such as Latin America, North and West Africa, Middle East, Western Europe, North America, Russia etc.
Their growth strategy too is closely aligned with this idea. Ashis and Subrato Bannerjee tell us that value innovation is at the crux of their growth strategy. This, according to them, is the most important factor as the Indian pharma industry will slowly metamorphose from a volume-driven to a value-driven sector, a change which is crucial to its survival and success. The company wants to partner the industry as it undergoes this transformation and is thereby focussing on inward-looking strategies for growth.
With strategic investments in R&D, technology and most importantly, people, Gansons wants to ensure that they support their customers though each step of their operations and activities.
The company wants be an end-to-end solutions provider for the pharma industry. In the next three years, it is looking to provide holistic and comprehensive offerings which would help their clients avert operational flaws, manual errors and technical glitches. This, in turn, enable adherence to regulations, enhance product and process quality, reduce time and effort as well as offer them a competitive edge over their peers.
Thus, the Bannerjee brothers inform that their plan is to not only to provide short term gains to their clients but also to ensure that their capabilities are enhanced with an aim to empower them as they strengthen their foothold in the global arena.
Gearing for the future
The Bannerjee brothers predict that the industry will be more innovation-driven in future and technologies that drive innovation will have significant roles to play in the sector’s growth. Hence, their message to the pharma industry is to plan carefully for the future, do their risk-assessment thoroughly and invest wisely to be future-ready.
ACG’s advance and ascent
ACG (earlier known as ACG Worldwide) came into being in 1964, as a capsule shells manufacture. Daljit Dharam Singh, serial entrepreneur and the father of the company’s current leaders, Ajit Singh and Jasjit Singh started the business. Yet, he passed away before the business could be established and his sons were left with the responsibility of making his latest venture work with a huge debt to repay. However, the Singh brothers’ perseverance and resolve ensured that the company not only became profitable, but also grew to become one of the largest manufacturers of empty hard-shell capsules as well as films and foils used for blister packaging of medicines.
Yet, it was no bed of roses. Before liberalisation in 1991, the business environment and government policy both were not completely conducive for growth and progress. Many challenges came their way, but the Singh brothers handled all the tough situations with tact and out-of-the-box solutions. For instance, there is an anecdote that when the Singh brothers were thinking of downsising in the 70s, without causing labour unrest. However, this required them to first appease trade union leader Datta Samant whose power and influence was immense in those days. Therefore, they met him at his office and presented them with a comic book which highlighted the threats and liabilities to their business. Pleased with their fresh and original approach, he supported the company’s strategy to reallocate the workers and settle them. This, in turn, saved the company from facing huge losses.
Today, ACG is a global conglomerate with over 4,500 employees and presence in over 100 countries. It has a research affiliate with about 150 scientists, technologists and technicians. The company is a prominent supplier of products and services to most leading pharma giants, in India and globally. Its manufacturing sites are located in different countries of the globe. The company’s diversified businesses include manufacturing equipment for granulation, tableting, tooling, etc. ACG is also an end-to-end packaging solutions provider with an inspection vertical that offers world-class track-and-trace solutions. Ajit Singh and Jasjit Singh helm and steer this company towards further progress as the Chairman and Vice Chairman of ACG.
Tracing a continuous growth path
Since its inception, ACG has continued to grow very rapidly over the years, and Ajit Singh believes that it is their commitment to continuous innovation that helped them set a strong and steady growth momentum.
ACG was the answer to the need of Indian pharma companies who were looking for a solutions which helped them achieve quality with quantity at affordable rates. Without much reliance on foreign technology, the company emerged as a fast growing group known for manufacturing quality capsules, advanced pharma machinery and sophisticated pharma packaging films, with over 20 factories, offices and warehouses in various countries. As Ajit Singh, Chairman, ACG divulged in an earlier article carried in Express Pharma, “By the fourth year of our production, when the output had reasonably stabilised, we were producing about 50 million capsules per year. We are now producing about a 100 billion capsules a year. It is difficult to comprehend, but this amounts to a growth of 200,000 per cent over these few decades.”
Today, with over 40 patents, ACG is among the world’s largest integrated pharma consumables and machinery supplier in solid dosage forms. Singh informs that their efforts have helped the entire lifesciences sector, including the public sector procure world-class products at affordable prices.
Rise as an Indian MNC
ACG is a company with a major focus on exports. Over 50 per cent of its production is exported to more than 100 countries across the world. Thus, its productivity and innovation has helped the company maintain a leading position in the world, and make profits each year for reinvestment and fast growth. Moreover, the next gen leader of the company, Karan Singh is also a part of the company’s growth trajectory as its Managing Director.
Now the company’s strategy is to magnify its global presence and entrench itself as a strong player in regulated markets such as the Europe and the US. It believes in being where the customer is and therefore it is establishing facilities in Eastern Europe and South America. Karan Singh, MD, ACG, in an earlier conversation at CPHI India had outlined the company’s vision and informed that manufacturing facilities in the markets that ACG serves is part of their global strategy and will help strengthen and consolidate the company’s footing and position in these markets. He had also divulged that a facility to manufacture capsules and films will soon be inaugurated in South America.
Singh says, “It is a mix of both, greenfield and brownfield projects, to be near our customers and provide them with value.” The company’s management is of the opinion that local manufacturing in the markets will offer them myriad benefits such as flexibility, being closer to their customers, improved and opportune information, more motivated managers and employees, and the advantage of low labour costs in different areas. Another rationale is that in case protectionist policies and import duties makes trade difficult in coming times, then ACG would have already established its presence in major pharma hubs of the globe.
Investing in people
Another of the company’s strategies to aid and support its global expansion has been the appointment of experts and veterans from different countries in several key positions of the organisations. Their experience and learnings have paved the path for ACG’s progress and lent the wings to its global ambitions.
To cite some examples, Richard Stedman, the Group CEO of its engineering division is a seasoned professional of South African origin, He has extensive experience across multidisciplinary functions. Roy Cook is the CEO and VP of Scitech Center, ACG’s R&D facility. Ettore Cucchetti, CEO at ACG Inspection Systems is someone who is adept at the design and the delivery of strategy for markets and products with high technology contents.
At the same time, leaders of Indian origin help the company understand the needs and requirements of the Indian market and fulfill them effectively. Thus, ACG has maintained a very fine balance of Indian and international expertise which is very central to its growth strategy.
Seeking new horizons
Now, ACG is looking at different avenues for growth. For instance, the company has plans to make biotech and biosimilars in capsule form. Similarly, technology is another of its focus areas. It plans to leverage the huge potential of emerging technologies in the lifesciences sector to bring in new paradigms in the industry. ACG has a team working on projects that leverage AI, virtual reality etc. One such example was demonstrated at CPhI India this year. It also underwent a major rebranding exercise wherein the company consolidated their diverse businesses into four major verticals. With this move, the management intends to streamline and improve their processes and bring in more co-operation and collaboration between different verticals. Thus, the home-grown pharma services giant is on a rapid growth trajectory.