Interview

Mutual opportunities for Dow and Indian pharma industry

Though Dow Chemical International is known world wide for its chemical business it has contributed to pharma sector as well. Sachin Jagdale analyses more in discussion with Atul Marathe, Sales Director, South Asia, Chemicals and Performance Chemicals

What are the benefits of joint ventures (JV)?

Globally Dow is a big corporation and offers more than three thousand chemicals and products to its customers. To begin with, each JV has some strategic objective and key drivers, such as technology, access to markets, cost synergies, etc. There are many reasons why JVs are formed. To name a few, JVs help get access to particular markets. If your partner is operating in a certain geography, it makes your entry comparatively easy. To have a tie up with a company which has access to competitive cost feed stock and energy, can help manage the cyclicality of the chemical industry. It will also help reduce volatility in the chemical industry which is due to fluctuating prices.

What are the hurdles in forming JVs?

Hurdles are part of the business. Whenever companies decide to form JVs, experts come together to understand possible risks, There is never a situation where we have zero risks and efforts are taken to minimise these risks without hampering the business model. It is necessary to compare the risk with the benefit. As long as there is a balance between the two, it is worth going ahead with joint ventures so long as environment, health and safety are not compromised.

Your vision is to be the largest, most profitable and respected chemical company in the world. How far have you come in this quest?

The above stated is a vision of the Dow Chemical Company. It is an on going journey and there is no full stop. Dow achieves something and then looks at the future - new growth opportunities and challenges. Today, Dow is one of the largest chemical companies in the world. Dow has succeeded for 110 years and to achieve the same in future it will have to evolve. Milestones never stop coming. With every achievement, Dow goes a step higher and raises the bar, otherwise the journey will come to a halt.

Are you satisfied with whatever Dow has achieved?

Satisfaction is momentary. Every year goals are set and with a constant endeavour to achieve them, if not go beyond.

What are your offerings to pharmaceutical industry in India?

In the pharma industry in India Dow mainly offers excipients (like METHOCEL, ETHOCEL and POLYOX) and actives such as PEGs, chemical intermediates such as nitromethane and solvents like methylene chloride. Technologies such as Hot Melt Extrusion and Foam Granulation are being offered to many pharma companies. Dow is also active with PFENEX Expression technology for the biotechnology industry and FORTEFIBER soluble dietary fiber which works well with the nutraceuticals and health supplement markets.

All these put together help us understand and address the needs of the Indian pharma industry across the value chain (from actives to formulations) and cater to them as their preferred partners.

How will you differentiate Indian pharma market from the foreign pharma markets in terms of opportunities and growth?

Today, the pharma industry in India is a global industry. The trends and needs are global in nature. Indian pharma industry which started its global journey with a foray in generics is no longer restricted to generics. The growth momentum comes from its global vision and its ability to expand into areas like New Durg Delivery Systems (NDDS).

The opportunities for a global company like Dow and the Indian pharma industry are mutual and are mainly two-fold: one to work for domestic markets and two to develop footprints in the global market. Another key differential is the decision making ability of many Indian companies. This means one can partner with them and bring a concept to market much quicker.

Have you come up with any special plan for the Indian market?

Dow's sales strategy is three-fold. These are;

To Develop Market Franchise - Here we will look at expanding our customer base, develop relationships with industry captains and build a network of customer contacts and industry associations to increase our reach and build our regional sales organisation.

Addressing customer and market needs is the nucleus of our growth momentum - For this we have again have a three-fold strategy;

i) Application Centers - The Angus & Biocides Center in Kalwa or the R&D Center in Pune will provide on the ground technical service to our customers with a global perspective and yet 'Indianise applications' to suit local markets.

ii) People - Absorb local talent with industry expertise eg. pharma, food, epoxy at the same time develop and nurture talent to create bench strength.

iii) Ease of doing business - Creating local stocks and tank farms, promoting various Dow processes like myaccount@dow for accessing shipment details and using Six Sigma methodology to address customer issues and needs.

Implement Market Facing Business (MFB) strategy in India to bring value addition to customers

Through various Dow stand alone businesses like Coatings, Fabric and Surface Care, Building Solutions etc we intend to understand customer needs in totality and then bring solutions based on products or systems.

What is your turnover in India?

The company has performed well in last financial year and has crossed the $500 million mark.

What are your future plans for pharma industry?

The pharma industry and healthcare market in general is very important for Dow. We have a good current platform of our participation which we hope to expand even further in coming years.

sachin.jagdale@expressindia.com