Moneycontrol
Nov 29, 2017 06:57 PM IST | Source: Moneycontrol.com

Cipla Health to expand consumer health biz with new launches and acquisitions

The company is developing a pipeline of products in child nutrition, an area dominated by multinationals such as Abbott, GSK, Kraft Heinz and Mondelez International.

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Cipla Health, the consumer healthcare arm of Cipla, plans to revitalise its over-the-counter (OTC) consumer business through more in-house launches and brand acquisitions in the coming quarters.

“We are looking at switching Cipla’s prescription products into consumer products and organic launches wherever there is a huge unmet need of it like the immune-boosters that we launched now,” said Anantha Nayak, Chief Executive Officer of Cipla Health.

“We are also actively looking at any kind of inorganic growth through mergers and acquisitions,” Nayak added.

He said the company is looking at new product launches in segments such as gastrointestinal, pain and analgesic, cough and cold and nutritional supplements.

The company recently launched kids nutritional supplement ActivKids Immuno Boosters developed by Cipla’s in-house research and development team.

Nayak said Cipla Health is developing a pipeline of products in child nutrition, an area dominated by multinationals such as Abbott, GSK, Kraft Heinz and Mondelez International.

“I am keen on the kids immunity space,” Nayak added.

The 82-year-old company spun off its consumer health business and named it Cipla Health in 2015 to give it a FMCG-like focus. Subsequently, private equity (PE) firm Eight Roads Ventures India (formerly Fidelity Growth Partners) bought a minority stake in Cipla Health for Rs 145 crore.

Cipla holds 70.20 percent in the subsidiary while the remainder is held by Eight Roads Ventures India.

Cipla Health had sales of around Rs 100 crore for the year ended March 2017.

Cipla Health OTC portfolio includes nicotine replacement therapy gum Nicotex and cough lozenges Cofsil.

The USD 5 billion Indian consumer health company is poised for higher growth as people shift towards wellness from illness.

“When we benchmark it against other developing markets – India's wellness market is very small and is at an inflection point,” Nayak said.

Nayak said he expects the government to take a decision to switch more prescription medicines (Rx) to OTC category.

“This will help open up the Indian consumer market,” Nayak added.

Cipla competes against Sun Pharma that has India’s largest consumer health business, which it acquired through its purchase of Ranbaxy in 2014.

Sun Pharma sells analgesics, dietary supplements and antacids.

Large drug makers are increasingly diversifying into the consumer health segment to insulate themselves against competition and price caps in the Indian drug market.
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