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Let me start by taking this opportunity to thank you for the support you have provided during my first year as Managing Director of your Company.
Among our most important decisions this year was a ‘reimagination’ of the larger strategy to shape the organization in a much more focused way around core customer needs.
Our business teams are now structured as Primary Care, Critical Care, Specialty Care, Vaccines, Inflammation and Immunology and Consumer Healthcare with focus on product portfolio, customer identification and go-to-market strategy that best addresses each of these segments. We believe that this approach will enable your Company to build very specific competencies on high priority therapy areas. Our strategy has received a strong endorsement from the global Pfizer organization, expressing and extending support of the global Pfizer community towards achieving our goals.
Our ‘remained’ strategy also opened up opportunities to review and strengthen the product portfolio. In this direction, we have taken some of the most impactful steps possible.
The respiratory portfolio was reviewed thoroughly during the year with an objective to launch new products that leverage the equity of our flagship brands while discontinuing those that did not align with our portfolio plans. As a result, we decided to discontinue the manufacturing of Corex Cough Syrup (Chlorpheniramine Maleate Codeine Phosphate) and introduced Corex T (Triprolidine Hydrochloride 1.25mg & Codeine Phosphate 10mg), a new offering, that will better address patient and Physician needs. I am proud to say that the launch of Corex T has been one of the most meticulous and successful launches in the recent history of your Company and will extend the equity of the Corex brand to a wider segment of prescribers. We have similarly built upon the strengths of our major brands with the launch of new products in the folic acid category and gastro-intestinal therapy area.
With the acquisition of Neksium and Meronem, we remain committed towards our strategy of both organic and inorganic growth. We continue to explore opportunities to bring our global brands to India.
The pharmaceutical operating environment has been challenging for some time now and the year under review was not different. Your unwavering support and trust in the Management has enabled us take important decisions in order to mitigate some of these operating challenges as best possible and set grounds for future growth.
Some of the key challenges faced by your Company along with the industry were
1. National List of Essential Medicines: The expansion of this list has had an impact on your Company this year. A large part of our portfolio in therapy areas such as Women Healthcare and Anti-infective, came under price control.
2. Fixed Dose Combinations: The year also saw continuing litigation on the Fixed Dose combinations ban imposed by the Government, causing loss of revenue due to the uncertainties around the future of these products. As we had stated earlier, we fully support the intent of removing irrational combinations from the marketplace, but not the process where products with due state and central approvals were also included in this list.
3. Demonetization: The policy decision to withdraw ''500 and ''1,000 currency notes had a short-term impact in the trade, thereby impacting our business in the months of November and December.
4. Medical Council of India (MCI) guidelines on generic prescriptions: The confusion around generic prescription prevails. The sudden announcement caught the industry by surprise. As a country, we are not yet ready for this and such regulations need deeper consideration before being implemented.
5. Goods and Services Tax (GST): As we started the new financial year, the implementation of GST led to significant down-stocking in trade channel and short-term revenue impact.
We do strongly believe that some of these reforms such as demonetization and GST will have a positive impact on the industry in the long-term. However, the short-term negative impact will need to be closely monitored and mitigated where possible.
PEOPLE AND CULTURE
As we progress, our greatest asset remains our People and Culture. Throughout the year, we have undertaken several initiatives to build and invest in these capabilities. Our focus on the Field Force continues through to the current year with several new initiatives to upgrade skills and develop talent in the field organization.
CORPORATE SOCIAL RESPONSIBILITY
I am happy to share that your Company continued to pursue an active Corporate Responsibility agenda during the year. Our flagship CSR initiative - the Pfizer IIT-Delhi Innovation and IP Program provided grants and resident incubation at IIT - Delhi to the first batch of indigenous healthcare innovators this year. These young individuals and start-ups are developing important new innovations that can address some of India’s pressing healthcare needs through novel products and solutions. Your Company has also initiated a comprehensive partnership program with key stakeholders to combat Anti-microbial resistance -one of the most significant challenges that India, and indeed the world, is facing today. Our Swachh Vidyalaya program grew from strength to strength this year with an expansion to new territories including Delhi, Lucknow, Haryana and Goa. Pfizer colleagues volunteered to build sanitation facilities in schools to provide this basic human right where it did not exist earlier.
In summary, FY 16-17 has been a year of laying foundations for success while navigating through an unpredictable and challenging operating environment. I am reassured of the resilience of your Company to face and succeed in a volatile environment as also its ability to spot and invest in growth opportunities. The focus remains on our business fundamentals i.e. product portfolio augmentation in core therapy areas, innovative go-to-market model, investing in building capabilities and culture. And while doing so, we will continue to be ethical and compliant as that is the core of our operating principle.
As always, I look forward and seek your support towards building your Company’s growth story.
S. SRIDHAR MANAGING DIRECTOR