Suresh Pareek, Managing Director, Ideal Cures tells Viveka Roychowdhury that though their US expansion will be on hold currently due to the COVID-19 pandemic, they do not see any long term implication on their business. He gives more details on how his company is coping with choked supply chains, whether India can take China’s place in the API business and his learnings as a leader
Now that the 21 day national lockdown for COVID-19 has been extended to May 3, are pharmaceutical companies and allied sectors like ingredient manufacturers such as Ideal Cures, able to achieve some semblance of continuity?
In terms of manufacturing, we have been functioning at diminished capacity since 3rd April but there are challenges on movement of goods and commute for staff and workers. We are expecting things to get better post April 20 when some restrictions are relaxed.
What is the status at your manufacturing sites in India, in terms of production, etc?
We have four sites in India, and all are functioning. Our Sikkim site is working at almost full capacity. To incentivise we are paying an additional Rs 300 per day to workers and a suitable incentive to staff.
Have you been able to deliver as per orders booked before the pandemic?
We have not been able to dispatch all orders booked before the pandemic, however the urgent orders have been dispatched. As on today, our team is trying their best to process urgent orders.
What about exports?
Exports have been badly hit as a lot of material that was dispatched before the lockdown is still at the ports.
How has the pandemic thrown the business cycle, both domestic and global, out of gear? How long will last?
The business cycle has been thrown totally off the gear. It is a vicious cycle. We are not able to get raw material from our suppliers and in turn we are not able to supply to our customers and so forth. However, the pharma industry has been least hit as we are an essential service provider.
What are the changes that Ideal Cures had to make in the manufacturing plants, offices to adhere with the government regulations to cope with COVID-19?
We have implement Work From Home (WFH) for sales and marketing team and other desk jobs like QA and accounts. Some plants workers are staying at the factory. SOPS on santisation and health safety of staff and workers have also been put in place.
What is your company’s business strategy to recoup post COVID-19?
Our US expansion will be on hold currently. We don’t see any long term implication on our business.
How much will the COVID-19 situation impact your company’s revenues in this fiscal? At an industry level, by how much will the sector slide this fiscal?
The situation right now is conductive to business, but personally I don’t see much implications on our revenues. The pharma sector might see a reasonable growth.
How has your role as a leader changed since COVID-19 struck?
I have learnt a lot during this crisis. We have had to make dynamic changes to the way we function, these changes had to be made overnight. As a leader, it is my duty to motivate and reassure my team in this hour of crisis. As a company, we principally decided that in this hour, it doesn’t matter how our revenues or profits look. We need to focus on serving our nation and humanity by making sure that there is no shortage of medicines in the country.
Could you name three practices implemented due to COVID-19, that you feel should outlast the pandemic?
E-meetings will be the way forward in the future. I also feel that WFH norms need to be established for those companies who haven’t been practicing this. Luckily, we had a disaster management plan in place and we have used this opportunity to smoothen the edges but every company must have such a plan in place.
Will China recover faster than India?
China’s recovery will largely depend on how the world perceives China right now. Since the economy is mostly dependent on exports and people may avoid non-essential Chinese goods.
Does India stand a good chance to gain from the learning to diversify the supply chain, especially when it comes to key ingredients?
India has a good opportunity to develop key ingredients. Indian companies will be able to develop APIs and excipients to diversify the supply chain.
What do you feel about the government’s stimulus package for the pharma sector, i.e. to invest in common facilities in bulk drug parks etc?
If it takes off this will be a very good initiative because it will ease dependence. A bulk drug park will also ease compliance levels. But this is still in a very early phase, so I wish this happens quickly.
If you had to summarise the learnings from COVID-19, both on a personal front as well as a founder/entrepreneur/business leader, what are your top three learnings?
Embrace change and adapt quickly.
To operate with minimum resources.
To invest and utilise digital platforms more.