SPL

INTERNSHIP REPORT ON SANJIVANI PARANETRAL
MASTERS IN MANAGEMENT STUDIES Summer Internship Report
Name of Company: Sanjivani Parenteral Ltd
Address of Company: R-40, T.T.C. Indl. Area, Rabale, Thane-Belapur Road Navi Mumbai - 400701, Maharashtra
Phone No. +91-22-66888700
Email id www.sanjivaniparanteral.com Submitted by: Trilok Mishra (Roll No.019) Name of Coordinator: Prof. Patil
BESs Institute of Management Studies and Research (Approved by AICTE & Affiliated to University of Mumbai)
May 2012
BESs Institute of Management Studies and Research
Page 1
DECLARATION
I hereby declare that the Summer Internship Report submitted for the MMS Degree, BESs Institute of Management Studies and Research (Affiliated to University of Mumbai) is my original work and conducted in Sanjivani Parenteral Ltd. Company.
Place: Mumbai Date:
Signature of the Student
Page 2
ACKNOWLEDGEMENTS
I wish to express my gratitude to Mr. Mahendra kalwankar from the Sanjivani Parenteral Ltd. company for providing me valuable information.
I am grateful to BESs Institute of Management Studies and Research for giving me an opportunity to pursue MMS. I wish to thank Professor Vikram D. Shikhare, Director, BESs Institute of Management Studies and Research who has been a perpetual source of inspiration and offered valuable suggestions to improve my practical Knowledge.
I am indebted to my Coordinator Mr. Patil Professor, BESs Institute of Management Studies and Research, for abundant guidance, support, and encouragement throughout my internship Study.
I would like to express my thanks to various people from the Sanjivani Paranetral Ltd. Company for their support and direction.
Place: Mumbai Date: July , 2012
Signature of the student (TRILOK MISHRA)
Page 3
TABLE OF CONTENTS
Chapter No Title Page No
Table No
1.1 2.1 2.2 2.3 3.1 3.2 3.3 4.1 5.1 5.2 5.3 5.4 5.5 5.6 5.7 5.8 5.9 6.1 6.2 8.1 8.2 8.3 8.4 8.5
List of Tables
Leading Pharma players in India key executives of company Key products of company Manufacturing plants address Levels of managers in distribution process Prices of key products Global markets of SPL products No. of employees department wise Format of mfg. schedule Format of label used in each dept. Format of BMR making by production dept. Excess volume labeled Format of rejected products labeling Format of sorting report Format of writing batch mfg. on board Secondary packaging labels Defects in labeling procedure Temp. range of different dept. List of documents for dispatch of finished goods Criteria of CRISIL FINANCIAL Ranking Equity Capital Structure of SPL Financial turnover of SPL Shareholding pattern of SPL Financial performance of SPL 14 19 20-22 25 29 35 36 42 51 51 51 55 56 56 57 58 59 67 68 82 84 85 86 87
Page 4
8.6 8.7 8.8 8.9 8.10 8.11 8.12
Share market listing detail of SPL Monthly share price detail of SPL Last five year balance sheet of SPL Last five year profit & loss account of SPL Key Ratios OF SPL Last Five Year Cash Flow of SPL Competitors Sales
87 88 89-90 90-91 91-92 92-93 93
Fig No.
3.1 3.2 3.3 3.4 3.5 3.6 3.7 4.1 4.2 4.3 4.4 4.5 5.1 5.2 5.3 5.4 6.1 6.2
List of Figures
Distribution chain of parental products Sales & Marketing function PLC of Parenteral products Marketing Mix of SPL Export Market of SPL MR strategy of promotion Target of MR Organizational Structure Objectives of HRM in SPL HRP in SPL Selection Procedure Per formation Appraisal in SPL Layout of SPL Material movement in production area Store dept. layout Material movement in store department Receipt and handling of raw material Import at concessional rate of duty 28 30 31 33 36 37 38 39 40 41 43 47 49 50 64 65 66 69
Page 5
7.1 8.1 8.2 8.3 8.4 8.5 8.6
Granting of license Hierarchy of Accounts and Finance Department Purchase process Financial Planning Process in SPL share price fluctuation of SPL Graph of ratio representation of SPL Graph of Cash flow of SPL
77 80 81 83 89 92 93
C 1 1.1 1.2 1.3 2 2.1 2.2 2.3 2.4 3 3.1 3.2 3.3 3.4 4 4.1 4.2 4.3
List of Abbreviations
Pharmaceutical Industry - A perspective
114 9 9 9-11 12-14 18 19 22 23 24-25 28 29-30 31 32 33-38 39 40 41 42
Introduction Global Scenario Indian Scenario Sanjivani Parenteral Ltd. Company Profile Key Executives Key Products Management Message Locations of offices Marketing Department How does Sanjivani Parenteral sales & marketing function Sanjivani product lifecycle SWOT analysis of Sanjivani Parenteral Marketing mix of Sanjivani Parenteral ltd HRM Department Objectives of HRM in SPL Process of HRP Sources of recruitment
Page 6
4.4 4.5 4.6 4.7 4.8 4.9 5 5.1 5.2 5.3 5.4 5.5 5.6 5.7 5.8 6 6.1 6.2 6.3 6.4 7 7.1 7.2 7.3 7.4 8 8.1
Employees recruitment & selection Training & development Performance management Employees compensation & benefits Types of compensation & benefits Labour management relations Operation / Production Department Material movement in production area BMR (Batch Manufacturing Record) introduction to areas of production department Packaging department Packaging of Parenterals Labelling of Parenterals Quality control Storage section Dispatch and import export Department Warehouse Dispatch Import Export Regulatory Department Schedule `M of the Drugs and Cosmetics Act (1940) The Indian Patents and Designs Act, 1970 Patents (Amendment) Act, 1999 The Drugs (Prices Control) Order (DPCO), 1995 Finance Department Accounts department
43 44 44 45 46 47-48 49 50 51 52-58 58-59 60 61 61-63 63-65 66 66-68 68-69 69-71 72-73 74 75 77 78 78-79 80 80
Page 7
8.2 8.3 8.4 8.5 9 10 11 11.1 11.2 11.3 11.4 11.5 12 13 14 A-1 A-2 A-3 A-4
Ratings on Sanjivani Parenteral Bankers of SPL Capital Structure of the Company SPL Company Financial Analysis MIS/ IT Department Identification of Problems Department Wise Solutions of Problems with Merit and Demerit Financial solutions Production solutions Marketing solutions Human resources solutions Regulatory solutions Recommendations to Company Learning Outcomes Reference Section Bibliography Questionnaire Appointment Letter Company Certificate
82 83 84 94-95 96 99 102 102 103 103 104 105 106 108 109 109 110 112 113
Page 8
Chapter 1
Pharmaceutical Industry - A perspective 1.1 INTRODUCTION Health is defined both as cause and effect of economic development. Therefore, the pharmaceutical industry is specifically recognized in the UN Millennium Development Goals as an factor that can contribute to economic development. In addition, the pharmaceutical industry provides significant socio-economic benefits to the society through creation of jobs, supply chains, and through community development. The industry also plays an important role in technological innovation, which may reduce costs of economic activity elsewhere in the economy. Players in the pharmaceutical industry include: branded drug manufacturers, generic drug manufacturers, firms developing biopharmaceutical products, nonprescription drug manufacturers, firms undertaking contract research. In addition, there are also enablers of the industry such as universities, hospitals and research centers that play a role in R&D activities. 1.2 GLOBAL SCENARIO
Market Size Global pharmaceutical market is highly dynamic and is characterized by greater levels of R&D expenditure and extensive regulation of its products. Global pharmaceutical sales are estimated to be US$ 643 billion in 2006, a growth of 7% over the previous year. Sales have grown from US$ 334 billion in 1999 to US$ 643 billion in 2006, witnessing a CAGR of 10%. North America is the major pharmaceutical market accounting for around 48% of global pharmaceutical sales, followed by Europe (30%), Japan (9%). Leading therapy classes in world pharmaceutical market include lipid regulators (with a market share of 5.8%), oncologics (5.7%), respiratory agents (4%), acid pump inhibitors (4%), and anti-diabetics (3.5%).
I N T R O D U C T I O N
Research and Development

Research and Development (R&D) is the backbone of the pharmaceutical industry all over the world. Globally, USA is the major hub for pharmaceutical R&D. According to Pharmaceuticals Research and Manufacturers of America (PhRMA), USA, in the year 2005, has spent more than US$ 50 billion in pharmaceutical R&D. R&D spending in US pharmaceutical industry accounted for over 17% of total sales. Europe, with R&D expenditure worth more than US$ 25 billion, in 2005, stood at second position, followed by Japan (US$ 8 billion).
Page 9
Trade Share of pharmaceutical products in world exports has grown over the years. From a level of 1.7% share in world exports in 2000, export of pharmaceutical products in world exports increased to 2.6% in 2005. In the year 2005, world export of pharmaceutical products amounted to US$ 272 billion. European Union, as a bloc, is the largest exporter of pharmaceutical products accounting for 70% of total world exports in 2005. Of this, over 60% are traded intra-regionally. European Union, as a single bloc, is also largest importer Of pharmaceutical products accounting for 57% in world pharmaceutical imports. EMERGING TRENDS IN GLOBAL PHARMACEUTICAL INDUSTRY Changing Demographic Trend Developed countries have reached the era of demographic transition, where they are increasingly confronting with the phenomenon of ageing population. This has resulted in increasing pressure on the countries national healthcare system. Chronic diseases, particularly cardio-vascular diseases, have become more frequent cause of death in these countries. On the other hand, infectious diseases have remained more common cause of death in developing countries. In addition, lifestyle related diseases are going to be common among fast developing countries like China and India. All these factors would have major influence on the global pharmaceutical industry. Patented Drugs Going Off-Patent It has become a major concern for the large pharmaceutical firms that many of the blockbuster drugs will be going off-patent in the coming few years. It is estimated that in USA alone, blockbuster drugs going off-patent are valued at US$ 27 billion in 2007, and US$ 28 billion in 2008. These drugs are major sources of revenue for major pharmaceutical companies in the world. Production of generics in such products will put considerable Pressure on the profit margin of these companies. Lowering R&D Productivity R&D in pharmaceutical industry is a very expensive and time consuming process, as it involves a number of stages before a drug can be introduced in the market. Moreover, at any stage, the process may have to be abandoned if it is not showing desired results both in terms of effectiveness and safety. In the world pharmaceutical industry, although the R&D expenditure by firms have shown significant increase, R&D productivity has come down. All these factors have led to added pressure on the profit margin of the leading players and thus there is a pressing need to cut down the costs.
Page 10
Increasing Mergers and Acquisitions Mergers and Acquisitions (M&A) have been dominating the global pharmaceutical industry. In the year 2005, M&A activities in the pharmaceutical industry amounted to US$ 61 billion with the completion of nearly 700 deals. Major deals were in the generics segment. Drive to enhance the size and thereby attaining higher economies of scale has motivated such acquisitions. This trend is expected to continue with many firms from developing countries, particularly India, joining the race.
Increasing Marketing Cost As the competition amongst the pharmaceutical firms is aggrevating, many firms have started to get into retail business. In this model, drugs will be sourced directly from the manufacturers providing proximity with the end users. Such a model would provide benefits both to producers (better supply chain management) and consumers (lower price). Low Emphasis on Clinical Trials With an increasing share of generics in total pharmaceutical sales, leading pharmaceutical firms are changing their strategies from traditional blockbuster model to niche market players in the areas such as diabetes, cancer and lipid disorders. Many large firms are adopting strategies with long term investment commitments, scientific advancements, and strategic positioning of their drugs as part of a more comprehensive approach to medical treatment. Pricing Strategies Pricing has never been a key issue in global pharmaceutical industry as it is today. Global pharmaceutical majors are increasingly adopting varied pricing strategies in each therapeutic and geographic market, with the objective of optimizing share, revenue and profit. Increasing Patent Litigations With a number of branded drugs going off-patent, the market share of the generic producers in the world pharmaceutical market shows an increasing trend. However, the growth path of the generic players is witnessing turbulence with increasing number of IPR related litigations. Legal cost associated with challenging of patent infringement cases turns out to be very high for many pharmaceutical companies. Another angle of such litigations is prohibition to manufacture such drugs till the time the cases are settled. This has emerged as a major challenge, of late, for the generics manufacturers.
Page 11
1.3 Indian Scenario The Indian pharmaceutical industry currently tops the chart amongst India's science-based Industries with wide ranging capabilities in the complex field of drug manufacture and Technology. A highly organized sector, the Indian pharmaceutical industry is estimated to be Worth $ 4.5 billion, growing at about 8 to 9 percent annually. It ranks very high amongst all the third world countries, in terms of technology, quality and the vast range of medicines that are manufactured. It ranges from simple headache pills to sophisticated antibiotics and complex cardiac compounds; almost every type of medicine is now made in the Indian pharmaceutical industry. The Indian pharmaceutical sector is highly fragmented with more than 20,000 registered units. It has expanded drastically in the last two decades. The Pharmaceutical and Chemical industry in India is an extremely fragmented market with severe price competition and government price control. The Pharmaceutical industry in India meets around 70% of the country's demand for bulk drugs, drug intermediates, pharmaceutical formulations, chemicals, tablets, capsules, orals and injectibles. There are approximately 250 large units and about 8000 Small Scale Units, which form the core of the pharmaceutical industry in India (including 5 Central Public Sector Units). India's pharmaceutical market grew at 15.7 per cent during December 2011. Globally, India ranks third in terms of manufacturing Pharma products by volume. The Indian pharmaceutical industry is expected to grow at a rate of 9.9 % till 2010 and after that 9.5 % till 2015. The Indian pharmaceutical market is expected to touch US$ 74 billion sales by 2020 from US$ 11 billion. The market has the further potential to reach US$ 70 billion by 2020 in an aggressive growth scenario. Moreover, the increasing population of the higher-income group in the country will open a Potential US$ 8 billion market for multinational companies selling costly drugs by 2015. Besides, the domestic Pharma market is estimated to touch US$ 20 billion by 2015, making India a lucrative destination for clinical trials for global giants. Further estimates the healthcare market in India to reach US$ 31.59 billion by 2020. (A) Diagnostics Outsourcing/Clinical Trials According to the estimates, the Indian diagnostics and labs test services, in view of its growth Potential, is expected to reach Rs159.89 billion by FY2013. The Indian market for both
Page 12
therapeutic and diagnostic antibodies are expected to grow exponentially in the coming years. Findings from the report suggest that more than 60% of the total antibodies market is currently dominated by diagnostic antibodies. Some of the major Indian pharmaceutical firms, including Sun Pharma, Cadilla Healthcare and Piramal Life Sciences, had applied for conducting clinical trials on at least 12 new drugs in 2010, indicating a growing interest in new drug discovery research.
(B) Generics
India tops the world in exporting generic medicines worth US$ 11 billion and currently, the Indian pharmaceutical industry is one of the world's largest and most developed. Moreover, the Indian generic drug market to grow at a CAGR of around 17 per cent between 2010-11 and 2012-13. Union Minister of Commerce and Industry and Minister for Trade and Industry, Singapore, have signed a 'Special Scheme for Registration of Generic Medicinal Products from India' in May 2010, which seeks to fast-track the registration process for Indian generic medicines in Singapore. (C)Advantage India The Indian Pharmaceutical Industry, particularly, has been the front runner in a wide range of specialties involving complex drugs' manufacture, development and technology. With the advantage of being a highly organized sector, the pharmaceutical companies in India are growing at the rate of $ 4.5 billion, registering further growth of 8 - 9 % annually. More than 20,000 registered units are fragmented across the country and reports say that 250 Leading Indian pharmaceutical companies control 70% of the market share with stark price Competition and government price regulations. Competent workforce: India has a pool of personnel with high managerial and technical competence as also skilled workforce. It has an educated work force and English is commonly used. Professional services are easily available. Cost-effective chemical synthesis: Its track record of development, particularly in the area of improved cost-beneficial chemical synthesis for various drug molecules is excellent. It provides a wide variety of bulk drugs and exports sophisticated bulk drugs.
Page 13
Legal & Financial Framework: India has a 53 year old democracy and hence has a solid legal framework and strong financial markets. There is already an established international industry and business community. Information & Technology: It has a good network of world-class educational institutions and Established strengths in Information Technology. Globalization: The country is committed to a free market economy and globalization. Above all, it has a 70 million middle class market, which is continuously growing. Consolidation: For the first time in many years, the international pharmaceutical industry is finding great opportunities in India. The process of consolidation, which has become a generalized phenomenon in the world pharmaceutical industry, has started taking place in India. MAJOR PHARMACEUTICAL COMPANIES IN INDIA Some of the leading Indian players by sales (US$ million) Company name Cipla Ranbaxy Lab Dr Reddy's Labs Sun Pharma Lupin Ltd Aurobindo Pharma Piramal Health Cadila Health Matrix Labs Wockhardt Sales in US$ million 6,368.06 5,687.33 5,285.80 1,985.78 4,527.12 4,229.99 1,619.74 2,213.70 1,894.30 651.72 Year End March 2011 December 2010 March 2011 March 2011 March 2011 March 2011 March 2011 March 2011 March 2010 December 2011
Table 1.1 leading Pharma players in India
Page 14
Ranbaxy
Ranbaxy is among the predominant pharmaceutical companies in India and was founded in 1961. Ranbaxy is a research based Pharma giant and became a public limited company in 1973. Ranbaxy was recently ranked among the top 10 international pharmaceutical companies in the world have presence across 49 countries. Ranbaxy is also reputed for its 11 state-of-the-art manufacturing facilities in countries like China, India, Brazil, South Africa, and Nigeria. The company has also won several awards and recognitions for its pioneering initiatives in the developing markets of the world. Ranbaxy is also a member of the Indian Pharmaceutical Alliance and Organization of Pharmaceutical Producers of India. In the present scenario Ranbaxy commands more than 5% share of the Indian pharmaceutical market. Ranbaxys product portfolio is diverse and includes drugs that cater to nutrition, infectious diseases, gastro-enteritis, pain management, cardiovascular ailments, dermatology, and central nervous system related ailments. Ranbaxys operations in India are designed under as many as 9 SBUs which take care of the Various categories of medicines and drugs that are manufactured by Ranbaxy. The company is especially well-known for having the highest research and development (R&D) budget among pharma companies in the world which is as high as US$ 100 million. Ranbaxy India operations are handled by 2,500 employees and the companys market share in India is worth around US$6 billion.
Dr. Reddy's Laboratories

Dr. Reddy's Laboratorie is one of the popular pharmaceutical companies with base in more than 100 countries. The medicines of Dr. Reddy's Laboratories Limited are easily available all across the globe. Dr. Reddy's Pharmaceutical Company is very much customer friendly. It takes care of the fact that maximum people get benefited by the products of this pharmaceutical company. It
Page 15
commercialized various treatments so as to provide high tech treatment to the masses. It tries to meet the medical needs of the people. Though Dr. Reddy's Laboratories is located in various parts of the world, it has its headquarters in India. The subsidiaries of this company are found at various countries like US, Germany, UK, Russia and Brazil. 16 countries have the representative offices of Dr. Reddy's Laboratories Limited. 21 countries have third party distribution.
Cipla
Cipla was founded by Khwaja Abdul Hamied in 1935 and was known as The Chemical, Industrial and Pharmaceutical Laboratories, though it is better known by the acronym Cipla today. Cipla was registered in August, 1935 as a public limited enterprise and it began with an authorized capital of Rs. 6 lakh. Though set up in 1935, it was only in 1937 that Cipla began manufacturing and marketing its pharmaceutical products. Today, the company has its facilities spread across several locations across India such as Mumbai, Goa, Patalganga, Kurkumbh, Bangalore, and Vikhroli. Apart from its strong presence in the Indian market, Cipla also has an extensive export market and regularly exports to more than 150 countries in regions such as North America, South American, Asia, Europe, Middle East, Australia, and Africa. For the year ended 31st March, 2007 Ciplas exports were worth approximately Rs. 17,500 million. Cipla is also considerably well-known for its technological innovation and processes for which the company received know-how loyalties to the tune of Rs. 750 million during 2006-07.
Sun Pharmaceuticals
Sun Pharmaceuticals was set up in 1983 and the company started off with only 5 products tocure psychiatric illness. Sun Pharma is known worldwide as the manufacture of specialty Active Pharmaceuticals Ingredients and formulations. However, the company is also concerned with chronic treatments
Page 16
such as cardiology, psychiatry, neurology, gastroenterology, diabetology, and respiratory ailments. Active Pharmaceuticals Ingredients (API) include peptides, steroids, hormones, and anti-cancer drugs and their quality is internationally approved. The international offices of Sun Pharmaceuticals Industries Ltd. Are located in British Virgin Islands, Russia, and Bangladesh. In India, the offices are in Vapi, Silvassa, Panoli, Ahmednagar, and Chennai. There are 3 major group companies of Sun Pharmaceuticals Industries are: Caraco Pharmaceuticals Laboratories (based in Detroit, Michigan) Sun Pharmaceuticals Industries Inc. (Michigan) Sun Pharmaceuticals (Bangladesh)
Aurobindo Pharma
Aurobindo Pharma, an India-based private pharmaceutical company having presence around the world. Aurobindo Pharma was set up in the year 1986 and started its operations in 198889 in Pondicherry, India. Now, the company is headquartered at Hyderabad, India. Aurobindo Pharma is one of the most respected generic pharmaceuticals and active pharmaceutical ingredients (API) manufacturing company of the world. Aurobindo Pharma operates in over 100 countries across the world. Further, the pharmaceutical major markets over 180 APIs and 250 formulations throughout these destinations. This Indian pharmaceutical major has filed over 110 DMFs and 90 ANDAs for the USA market. So far, Aurobindo has received 45 ANDA approvals (both final and tentative) from USA alone. Aurobindo Pharma products cover segments like Antibiotics, Anti-Retro Virals CVS CNS Gastroenterological Anti-Allergics
Page 17
Chapter 2
COMPANY PROFILE: Parenteral: The dosage form for conveying a drug by means of injection through the skin or mucous membranes. Parenteral drugs are administered directly into the veins, muscles or under the skin, or more specialized tissues such as the spinal cord. Circumvented the highly efficient first line body defense that is skin and mucus membrane. Thus they should be free from microbial contamination and should have high purity.
Incorporated as a public limited company in Oct.'94, Sanjivani Parenteral is jointly promoted by Anami H Khemka and a team of professionals in various fields of pharmaceutical industry. The company is setting up a plant at Taloja, Maharashtra, to manufacture high grade anti-biotics and life saving injectibles used in various infections, pre- and post-operative. Sanjivani Parenteral and pharmaceutical plants are located on beautiful environmentally clean 30,000 sq. ft. facility at navi Mumbai. Today Sanjivani employs over 250 people and sales field force of over 100 executives and managers and has a sales turnover of 690 million contributed by a range of modern medical products which are sold all over India & abroad.
Page 18
The installed capacities for its products will be, 150 lac pa each for liquid vials and powder vials and 73 lac pa for its ampoules, taking the total capacity to 375 lac pa. The company came out with a public issue in Jan.'96 to part-finance the project. The promoters have received firm enquiries from reputed pharmaceutical companies like Merind, Lupin Laboratories and USV for the first year' production of liquid vials and ampoules. During the year 1998-99, the Company has been approved by the WHO GMP Certificate. The Company is hoping for export of its products in Africa, Europe & Latin America. The Company has also tied up with Cadila Ltd., Alkem Ltd., Indian Immunologicals Ltd for marketing its products. During the year 1999-2000, the company has tied-up with India's first ranked pharmaceutical giant Ranbaxy for manufacturing its products. 2.1 Key Executives Chairman & Managing Director Director Director Director Ashwin Khemka Narmdeshwar R Chaube Mahendra Kalwankar Vinod R Goyal Table 2.1 key executives of company The company has grown many folds and aspires to be a respected research-based company. With its diverse product portfolio, it is rapidly expanding its reach to the global marketplace, riding on its success in India and in the worlds emerging and developed markets. After establishing itself in India, Sanjivani has extended its reach globally by entering the markets of Asia, Europe, Africa and Latin America. The company has active presence in countries like Russia, Ukraine, Uzbekistan, Turkmenistan, Fiji, Vietnam, Sri Lanka, Nepal, Malaysia, Thailand, Nigeria and Peru, to name a few. Sanjivani Parenteral has also got its plant approved by the registration authorities of Congo, Sudan and Sri Lanka. It is making its presence felt in the world market now, through leveraging its manufacturing capacity, quality of products and international alliances.
Page 19
International business contributes about 30% of the companys revenue and is set to grow to more than 50% in the coming two years. This includes the sales of Sanjivanis own brands and the revenue from the contract manufacturing services that the company provides to its overseas clients. The company is in the making of a strong base to broaden its horizons. Sanjivani has been a regular supplier to the armed forces hospitals in India. Furthermore, many government and private hospitals have availed of the products and services offered by Sanjivani across the country. The company also has its own marketing operations in India and boasts of over 1000 distributors all over India. Dehradun The company has recently started an oral solids plant in Dehradun and has begun manufacturing tablets and capsules. The facility has a capacity of manufacturing 80 million tablets per month and 25 million capsules per month. In continuation with the companys policy of having young and dynamic personnel, the plant boasts of a young team of scientists, pharmacists and technicians, who are committed to the success of the new venture. 2.2 Key Products

Therapeutic Products Animal Products Key Products Oral Solids
Animal Products
Animal Products Sr.No 1. 2. 3. 4. 5. 6. 7. Brand Name SANTROPIN Composition Atropin Sulphate Strength 1 mg 2 mg 100mg/ml Presentation Vial Vial 30 ml, 50 ml Vial
BROADCURE Amoxycillin + Cloxacillin SANROFLOX SANMYCIN GOVICEF DEDRON SANFOS Enrofloxacin Gentamicin Sulphate Ceftriaxone Sodium Dexametasone Sodium Phosphate Toldimfos Sodium
80 mg/2ml 10 ml, 30 ml Vial 2 gm 4 mg/ml 200 mg/ml Vial 30 ml Vial 30 ml Vial
Page 20
8. 9.
SANMECTIN MULTIVET
Ivermectin Vitamin A (as Palmitate)
10mg/ml 250000 IU
10 ml, 30 ml Vial 10 ml Vial
Table 2.2(a) Key products of company
Key Products
Sr.No 1. 2.
Key Products
Composition Ceftazidime Cefoperazone Sodium + Sulbactum Sodium Ceftriaxone Sodium Cefpirome Sulphate Cefuroxime Sodium Amoxycillin Sodium + Clavulanate Potassium Piperacillin Sodium + Tazobactum Sodium Cefotaxime Sodium Meropenem Trihydrate Strength 250 mg, 500 mg, 1 gm 1 gm, 2 gm Presentation Vial Vial
Brand Name
SANTAZID CEFROBACTAM
3. 4. 5. 6. 7.
BROADCEF CEFPH SANROXIME SANCLAV SANTAZ
250 mg, 500 mg, 1 gm, 2 gm 1 gm 750 mg, 1.5 gm 600mg, 1.2 gm 2.25 gm, 4.5 gm
Vial Vial Vial Vial Vial
8. 9.
SANOCEF PENEM
250 mg, 500 mg, 1 gm 500 mg, 1 gm
Vial Vial
Page 21
10. 11. 12.
CILASPENE S-PIME BROADCEF - T
Imipenem + Cilastatin Sodium Cefepime Hydrochloride Ceftriaxone Sodium + Tazobactum Sodium Ceftriaxone Sodium + Sulbactum Sodium Cefotaxime Sodium + Sulbactum Sodium Thiamine Hydrochloride Riboflavin Sodium Pyridoxine Hydrochloride Cyanocobalamin Calcium Pantothenate
500 mg 500 mg, 1 gm 1.125 gm
Vial Vial Vial
13.
BROADCEF S
375 mg, 750 mg, 1500mg 750 mg, 1500 mg
Vial
14.
SANOCEF - S
Vial
15.
MERINEURON
10 mg 0.5 mg 2 mg 300 mcg 1000 mcg 10 mg 2 mg 2 mg 100 mg 5 mg 2.5 mg 2.5 mg
2 ml Amber Ampoule
16.
VITAMIN B COMPLEX
Thiamine Hydrochloride Riboflavin Pyridoxine Hydrochloride Niacinamide D-panthanol Thiamine Hydrochloride Riboflavin Sodium Phosphate
2 ml, 3 ml Ampoule, 10 ml Vial
17.
MONOVIT
200 ml Syrup
Table 2.2(b) Key products of company
Page 22
2.3 Management Message Since its inception, Sanjivani has chosen to build on a vision to become a key player in the global pharmaceutical market. Working towards this vision, Sanjivani has, in the extent of 11 years, notched up an impressive presence in over 15 countries of the world. All this is thanks to a vast marketing and distribution network and a work force capable of and equipped for international marketing challenges. Their core strengths are :

1. Manufacturing capability 2. Focus on Technology and Quality 3 .In-house research activity
These strengths give them an edge in the market, since very few companies have this combination of capabilities. Having laid the groundwork for growth, the company looks forward to picking up greater growth momentum from the years ahead, a time that all of us look forward to with excitement and anticipation. Primary Focus Areas They provide solutions by focusing on three extremely fundamental areas that enable us to provide better products. Focus on Quality The famous management guru Peter F. Drucker once quoted, Quality in a product or service is not what the supplier puts in. It is what the customer gets out and is willing to pay for. A product is not quality because it is hard to make and costs a lot of money, as manufacturers typically believe. This is incompetence. Customers pay only for what is of use to them and gives them value. Nothing else constitutes quality. That sums up their quality policy. Focus on the Customer Customer is at the core of their values. Customer satisfaction is primary objective. They ensure that all the customer requirements are met at the time of providing a product or service. They would credit their customers for the growth of the company, who have trusted them for their quality, recommended areas of improvements, whenever required and boosted our business over the years. Their Complaint Handling Cell is very efficient. They communicate to the concerned party in less than 48 hours of hearing from them and the issue
Page 23
gets resolved at the earliest. This demonstrates their commitment to the customer and quality of service.
Focus on Us They believe in their experience and expertise in manufacturing pharmaceutical products and offer them to government agencies, hospitals, NGOs, other types of organizations and Individuals. Their customers are offered highest quality and affordable products to fulfill their requirements. They constantly work to provide the best possible solutions to their esteemed customers, through research, technological innovation & up gradation and in-house and out-bound training programmes. Corporate Governance Corporate Governance reflects the quality of the management in a company. It is a mirror image of the organizations culture, policy and the method in which the organization deals with various stakeholders. Sanjivani is committed to high standards of Corporate Governance and ethical business practices. Information Sharing is the key to Corporate Governance. Apt and precise disclosure of information regarding a financial position, accounting policies, business performance, ownership and governance of the company is an important part of Corporate Governance. Corporate governance is critical to boost and preserve investor trust. Sanjivani has developed Corporate Governance guidelines to empower the Board to evaluate and review the performance of the Company. 2.4 LOCATIONS OF OFFICES Sanjivani Parenteral corporate office is present in Bhandup while Manufacturing Plant is present in Rabale and Dehradun. The addresses of these offices are as below:
Page 24
Corporate office: Sanjivani Pharmaceuticals 205,P.N.Kothari industrial Estate, L.B.S. Marg; Bhandup (West) Mumbai-400 078 Phone:+91-22-67290900/67974270 Manufacturing Plants: Mumbai Plant R-40 , TTC Industrial Area Rabale , Navi Mumbai 400 701 Maharashtra , India Phone : +91-22-66888700 Dehradun Plant Plot No. 323/1 , Near Central Hope Town Camp Road , Selaqui Dehradun- 248197 Phone : 0135-2698691
Table 2.3 manufacturing plants address 2.5 COMPANYS BUSINESS DIVISIONS: Sanjivani Parenteral ltd. Manufacturing Plant is at Rabale (Mumbai) where production of various injectibles, sterile powder and suspensions is done whereas at Dehradun Plant production of tablets and capsules for domestic market as well as for Export.
Different departments working in the head office are 1. Marketing and Sales 2. Human Resources 3. Financial Accounting & Revenue Assurance
Page 25
4. Administration 5. Procurement & Logistics 6. Quality Control 7. Quality Assurance 8. International Business (Exports) 9. Maintenance 10. Production 11. Regulatory Research & Development A special emphasis is put on research activities at Sanjivani. A team of scientists work continuously for new product development and technical advancement activities. They take care of the Research & Development activities for Sanjivani. It is in the vicinity of the production plant, so that the production and research teams can continuously work in tandem. It helps the company with the patent drafting and filing, regulatory support for APIs and formulations and finding various techniques for reducing the cost of the products, so that the end-user gets benefitted by it.
The facility has well established Analytical Laboratories equipped with sophisticated analytical instruments such as Liquid Chromatographs and Gas Chromatographs. The laboratory provides cost reduction, regulatory and patent drafting & filing services to other companies as well. A strong and reliable platform of confidentiality has been created for intellectual property protection.
Quality Process & Assurance

Quality Policy Quality has been the forte of Sanjivani since its beginning in 1997. It has been one of the biggest factors for growth. Total commitment to quality, coupled with international exposure & expertise of technology, helps us in our efforts to grow globally. At the core of our Quality
Page 26
Philosophy is the commitment to achieve a level of perfection that matches the highest international standards. Sanjivanis high-tech laboratory set up is equipped with facilities for chemical and instrumental analysis. Capable of undertaking the most comprehensive tests, the laboratory has equipment sourced from internationally renowned suppliers. This facility is validated as per international regulatory authorities' expectations. A dedicated validation team works continuously to achieve the highest levels of quality in production and ensures the same.
Quality Assurance There are separate teams for quality assurance (QA) and quality control (QC) to achieve quality throughout the production process. These teams ensure that the core value of the company, of providing the highest standards of quality, is protected.
Page 27
Chapter 3
COMPANYS MARKETING & DISTRIBUTION: Sanjivani Parenteral follows push strategy with robust distribution system as follows:
Figure 3.1 Distribution chain of parental products The sale generated by company to distributor is termed as Primary sales. Cost of the distribution from manufacturing plant till the stockiest is borne by the manufacturer. Price to Stockiest (PTS) , Price to Retailers (PTR) are the terms used in the industry. Sub stockiest would get the stock from stockiest and operate on 8% commission till they establish themselves as a big player and qualify for getting a stockiest license from manufacturers. Retailers get 15 20% margins based on type of drugs, generic/branded/price controlled and even more on counterfeit drugs.
Page 28
Sanjivani doesnt believe in advertisement. It has aggressive and vibrant field force to promote their products in the market especially to stockiest, retailers as follows:
Table 3.1 Levels of managers in distribution process The sale generated via this channel is termed as Secondary sales.
3.1 HOW DOES SANJIVANI PARANTERAL SALES & MARKETING FUNCTION Pharmaceutical Sales and Marketing processes can be classified under three main categories: Business-to-Business Marketing Sales
Page 29
B2B: The burden of winning large deals lies on B2B sales. B2B specialists constantly work with large hospitals, clinics, managed care, and ILTC facilities to build and sustain long-term relationships and negotiate multi-million dollar contracts. Marketing: Pharmaceutical marketing is a strategic function. The marketing efforts vary from campaigning for a new product launch to conducting Direct-to-Customer road shows promoting patient awareness. The organic growth of the internet and google-ization (extensive internet searches using engines such as Google) of masses has made the consumer highly informative and curious about patient treatment. The traditional DTP route of marketing the drug to the doctors has gradually yet significantly shifted to innovative DTC marketing. The pharmaceutical consumer marketing in itself is more challenging than conventional
Figure 3.2 Sales & Marketing function DTC. As shown in Figure consumer marketing is any intervention that influences consumer attitude/behavior towards an Rx product. This makes it more complex as compared to marketing in other industry sectors. The subtle marketing channels such as gaining interest of various thought leaders to generate favorable ideas on a drug are being employed by almost all pharmaceutical majors.
Page 30
Sales: Pharmaceutical sales force is perhaps the most dynamic work force across all verticals. Sales function today is not just about sampling and detailing the drugs to the doctors. It has taken a whole new dimension in using the latest technology and multimedia to target the most influential physicians and converting them into high volume prescribers. 3.2 SANJIVANI PRODUCT LIFECYCLE Pharmaceutical marketing activities depend largely on the stage in which a particular product is within the product lifecycle. Following represents a generic product lifecycle of sanjivani. (Products may vary greatly and the lifecycle stages may not manifest uniformly for all products) Product Name (PENEM) 1. Introduction Stage: Penem is introduced to the physicians cures a disease in a different manner than existing products. At this stage, sales future is uncertain and direct competition is very low. 2. Growth Stage: This new product receives widespread acceptance from the medical community and number of competitors increase. Promotion activities at this stage focus on advocating their own brands and sales volumes increase. 3. Maturity Stage: The effectiveness of the product is well established at this stage and promotional activities focus on selling the product to large volume buyers. Competition on the product line reaches an all time high
Figure 3.3 PLC of Parenteral products
4. Saturation Stage: The product is typically used for all indications it is found useful for at this stage. A number of product variants such as dermatological, tablets, capsules etc. appear and promotional activities focus on adding extra value. 5. Decline: Decline may or may not happen and is primarily caused by identification of certain areas where the product was thought to be effective but is not. Some competitors leave the market at this stage.
Page 31
3.3 SWOT ANALYSIS OF SANJIVANI PARENTERAL
Strength
Well-qualified and established entrepreneurs Easy and cheap workforce availability Locational Advantage Strategically well placed, connected to other states by road, rail and air Availability of number of Financial Institutions, Banks etc Industrial City and Commercial Capital of India Availability of Educational/Technical Institutions/Collages/University Low R&D Costs Easy availability of Raw material and other related material manufacturers/suppliers/service providers
Weakness
Trust level in the cluster is very low Old and Traditional Technology /manufacturing processes in most of the units affecting productivity Under utilization of financial facilities Poor coordination with Government bodies and other related Organizations Presence of Number of Associations Low level of strategic planning for future and also for technology forecasting No strong linkage between industry & academia One of the least penetrated markets in the world. Mainly rely on exports because of slow growth
Opportunities
Having good number of Hospitals and Doctors, opening avenues for direct supply Availability of MNCs Good opportunity for loan licensees Growth in the emerging branded generic market Contract manufacturing arrangements & globalization will act as additive for easier international trading Spreading attitude for soft medication (OTC drugs) There is a huge potential for the development of India as a centre for international clinical trials Better utilization of Trade House Dawa Bazaar for domestic market
Threats
Implementation of WHO GMP norms Stiff competition due to WTO norms and arrival of MNCs Commencement of Product Patent law in near future Dependency on Government Supply Shortage of water and electricity Capturing market by other countries at low cost with good quality High Cost of discovering new products and fewer discoveries Stricter registration procedures Spike in raw material prices, Accelerated generalization & intensified competition The MRP based excise duty regime poses a threat to the existence of many small players.
Page 32
3.4 MARKETING MIX OF SANJIVANI PARENTERAL LTD. Marketing is the task of creating, promoting and delivering goods and services to consumers and businesses. Organizations identify and profile distinct group of buyers who might prefer or require varying products and marketing mixes. The customer seeks for value and satisfaction. The organizations can increase the value of the customer offering in several ways e.g. raising benefits, reducing costs etc. marketing mix is a set of marketing tools that the firm uses to pursue its marketing objectives in the target market. These marketing tools are known Figure 3.4 Marketing Mix of SPL as 4 ps of marketing.
To identify the customer needs and fulfilling hem is the basic objective of an organization. Marketing is not just satisfying your customers, you have to delight them and this can be done by acting upon this phrase. Sanjivani provides a winning combination of products to its prime customers. It is one of the countrys small scale parenteral, but which ensures complete Aspetic,Sterile and quick actionable in all injecteble products. PRODUCTS A product is anything that can be offered to a market to satisfy a want or need and a service is an act or performance that is essentially intangible and does not result in the ownership of anything. What products have to be offered to the target market depends on the market requirement and also the organizations profits. The organization will offer those products, which result in maximum profits and minimum costs. Sanjivani offers a diversified line of products to its customers. The unique products offered by Sanjivani are as follow:
Page 33
PRODUCT
PREVENTING DIESEASE INJECTABLE RANGE Septicemia, Pneumonia (HAP/VAP) Neonatal sepsis, Nosocomial infections, Febrile Neutropenia Surgical prophylaxis, Intra abdominal infections, Pre-post operative conditions Typhoid , Meningitis Surgical prophylaxis , SSIT Peri-operative cases, Gynecological infections,UTI Acute sinusitis , Pharyngitis, Tonsillitis Acidic conditions Septicemia , UTI Febrile neutropenia TABLET/CAPSULE RANGE Pneumonia , Tonsillitis UTI , Typhoid , RTI Ulcer , prevent injury of stomach Heart burn , GERD Post operative pain PID , Diarrhead dysentery Arthritis , Osteoporosis LIQUID RANGE RTI , SSTI Productive cough Anaemia in pregnancy Pregnancy & Lactation Hypocalcaemia
PACK
PENEM SANTAZ
1 gm , 0.5 gm , 125 mg 4.5 gm , 2.25 gm , 1.125 gm 1 gm , 500 mg , 250 mg
BROADCEF-T
BROADCEF CEFROBACTUM SANCLAV PRAZOSAN SANMICA
250 mg , 1000 mg 2 gm , 1.5 gm , 1 gm , 500 mg 1.2 gm 40 mg 500 mg , 250 mg , 100 mg
SANCLAV ZUCAF-CV PRAZOSAN-DSR PRAZOSAN TYDOL SANFLOX-O SANCALVIT ZUCAF-CV dry syrup SANCORIL HEVIT Iron Tonic MONOVIT Vit-B Syrup SANCALVIT SYRUP
625 mg 325 mg 1010 cap 40 mg 1010 Tab 1010 Tab 1010 Tab 50 ml 100 ml 200 ml 200 ml 200 ml
Page 34
PRICE The prices and the margins of drugs for the wholesaler and retailers are largely decided by the National Pharmaceutical Pricing Authority (NPPA), which varies depending on whether the active constituent of the product is a scheduled drug or a nonscheduled drug. Scheduled drugs are price controlled whereas nonscheduled drugs are not. The NPPA is an organization of the government of India established to fix or revise prices of controlled bulk drugs and formulations. Companies must keep drug prices affordable to the general public. To keep medicines within reach of the poor population, the government has covered 76 scheduled drugs. Hospitals and large institutions sometimes directly negotiate with the manufacturing company and get the drugs in their pharmacy at lower costs. Stockiest compete with each other in a given city. Generally, hospitals order large quantities and can negotiate with stockiest, who provide payment terms, credit periods, and margins. Further, retailers and distributors form associations locally and nationally, and manufacturing companies must comply with their terms. For example, in many states when a company launches a new product (either branded or generic), to make that product available in the pharmacy, the company has to pay commissions to the chemist (pharmacy) association. On receiving the commission the association will issue a no-objection certificate, which is mandatory for any company to make their product available in the market. PRODUCT PRICE (Rs) PRODUCT PRICE (Rs) PENEM-1gm SANTAZ-4.5gm BROADCEF-T 1.2 gm BROADCEF-1000 mg CEFROBACTUM SANCLAV-1.2 gm PRAZOSAN 40 mg SANCLAVIT-(10 tab) ZUCAF-(10 tab) PRAZOSAN-40 mg HEVIT Iron Tonic-200 ml 1100 308.0 145.0 62.40 124.80 130.0 54.00 28.00 81.90 54.00 58.00 Table 3.2 prices of key products MONOVIT Syrup-200 ml SANCALVIT SYRUP SANZOLE-10 ml RITONE-4.5 ml SANPON-200 ml 58.00 60.00 22.50 170.0 62.00
Page 35
PLACE SPL has the strongest domestic distribution network for smoothing distribution of medicines to North parts of the country. Currently it has 9 depots all over the country. Those are situated at Maharashtra, Patna, Cuttack, Raipur, Ranchi, Agra, Varanasi, Lucknow, and Indore. It uses own transport system to deliver its Product to the stockiest and retailer. SPL also exports its products to 12 countries
Present export market covers:

Russia Ukraine Uzbekistan Turkmenistan Fiji Vietnam Sri Lanka Nepal Malaysia Thailand Nigeria Peru Table 3.3 global markets of SPL products
Figure 3.5 Export Market of SPL
Page 36
PROMOTION Public advertisement for medicine, especially POM drug is strictly prohibited in India. But it may be done for OTC medicine to some extent. However, no pharma company in India is engaged in such advertisement. SPL heavily depends on personal selling through rapport building and maintaining. A team of sales representatives, called MR have been employed to meet with physicians to explain the merits, demerits, indication, contraindications, etc. of the medicine with the help of literature, brochure, pad, booklet, leaflet, gift item etc. That is, the Medical Representative the companies product to doctors front with the help of different promotional materials. If a new drug is to be more expensive, then it needs to demonstrate that its superior performance is worth it. Its promotional activities can be illustrated as follows: Promotional compliance includes: Advertisements and mailings Detail Aids, brochures and others Internet sites Exhibition panels, videos and others Gifts, samples and others Reprints and others Hospitality Representatives Meetings/Symposia Public Relations Any other communication Figure 3.6 MR strategy of promotion
Page 37
SPL Company has 16 divisions based on therapeutic area and the sales force structure is common for most of the prescription drugs Sales force functions based on the therapeutic area. Each representative has to make 10 visits to a doctor in a day, 240 visits in month. The below image depicts a sample function of a Scientific Business Officer from company SPL working for Urology Division in Mumbai.
Figure 3.7 Target of MR SPL also launch schemes and offer gifts for brand promotion. The sale in scheme period may sometime go up by 3-4 times (at times much more) than the usual monthly sale. It precedes and succeeds by a much lower sale due to drying up and over filling of the stock pipeline. Promotional activities exclude: Medical Information o Responses to specific enquiries Shareholder/business communications o Prescribed Information Patient Information Leaflets o Price Lists
Page 38
Chapter 4
STRUCTURE OF THE HUMAN RESOURCE DEPARTMENT ORGANIZATIONAL STRUCTURE:
CEO
HR Manager
Production Head
Marketing Manager
Finance Executive
Product Devt. Head Liquid Dept. Head Packaging Dept. Head
Powder Department Head
Regulatory Leads
QC Lead
QA Team Lead
Excise Head
Store Dept.
Microbiology Lab Maintenance Dept. Purchase Dept.
Logistics & Distribution
Chemists
. Figure 4.1
Page 39
4.1 Objectives of HRM in SPL The general objective of HRM is to contribute towards the realization of the organizational goals. The specific objectives of HRM may be listed as follows: To achieve and maintain good human relationship within an organization. To enable each person to make his maximum personal contribution to the effective working of the organization. To ensure respect for human personality and the well being of each individual. To ensure maximum individual development of personnel. To ensure satisfaction various needs of individuals for achieving the maximum contribution towards organizational goals.
Figure 4.2
Page 40
All manufacturing units are staffed with adequate number of Professionals related to Pharmaceutical sciences in accordance with WHO guidelines in order to produce good quality, safe and effective drugs and pharmaceuticals. Adequate number of other supporting trained and skilled technical personnel is employed for smooth functioning of the manufacturing plant. SPL has a dedicated team of adequate professionals for smooth functioning of the company 4.2 PROCESS OF HRP: SPL use the information which was gathered from external environmental scanning and assessment of internal strengths and weaknesses is used to forecast HR supply and demand in light of thee objectives and strategies. Forecasting in SPL contains information from the past and present to identify expected future conditions. Because of the rapid changes in the political, economical & global changes, SPL mainly emphasize on short term forecasting usually of 4 to 6 months durations. Despite the availability of vary sophisticated techniques, forecasting in SPL is still objective judgment. The facts are some times evaluated and weighed by knowledgeable individuals, such as managers and HR experts, and some times not.
SPL Objectives & Strategies
External Environment Scanning
Internal Environment Scanning
Forecasting
Survey Of Employees Needed
Survey Of Employees Available
SPL HR Plans
Figure 4.3 HRP in SPL
Page 41
SPL uses surveys to find out the present employees, their strength and experience and then find out the no of required employees in near future. This gives the organization the ability to cope with future need of employees. But the same is not true for high level employees such as Pharmacists, Chemists, Analysts, Officers & Managers. SPL does not have a valid planning for higher level officers. As a result there is always a shortage of skilled, technical & experienced top level officers as indicated by the following table.
No.
1 2 3 4 5 6 7 8 9 10
Ranks
Dept. Heads Chemists Purchase dept. staff Ware House Officers Accounts Sections Maintenance Staff Inventory Control Logistics Officers Analysts Manager Total Officers
Available Required
07 06 02 02 06 07 02 01 08 01 42 10 07 03 03 06 02 06 02 07 02 48
Table 4.1 No. of employees department wise 4.3 SOURCES OF RECRUITMENT: INTERNAL RECRUITMENT: Internal recruitment seeks applicants for position from those who are currently employed. Internal sources include present employees, employees referrals, former employees and former applicants. EXTERNAL RECRUITMENT: i. Advertisement: These constitute a popular method of seeking recruits as many recruiters prefer advertisement because of their wide reach. Advertisement is local or national newspapers and
Page 42
trade and professional journals is generally used when qualified or experienced personnel are not available from other sources .Most of the senior position in industry are filled by this method when they cannot be filled from within. ii. Educational Institutional: Direct recruitment from pharmaceutical colleges for jobs which require pharmacy qualification has become a common practice a close liaison between the company and educational institutional helps in getting suitable candidates to main various positions. iii. Internet: Job sites like naukri.com can be used to reach certain type of job applications such as skilled workers. They provide 20,000 resumes in 5000rs. 4.4 EMPLOYEES RECRUITMENT & SELECTION:
SELECTION PROCEDURE
Once the forecast is developed and approved from the top management, the HR department of SPL start Recruitment & Selection process to fill the vacancies. Like all good plans, HR Manager of SPL builds employment plans on premises. Basic assumptions for employment requirement by forecasting contain three important things: The supply of inside candidates; Personnel needs;
The supply of outside candidates according to their company requirements. The overall aims of the recruitment and selection process in SPL are to obtain, at minimum cost, the number and quality of employees required to satisfy the needs of staff requirement. The three stages of recruitment and selection in SPL are: Defining requirements: Figure 4.4 Preparing job descriptions and specifications; deciding terms and conditions of employment; Attracting candidates: Reviewing and evaluating alternative sources of applicants, inside and outside the company, advertising; Selecting candidates: Sifting applications, interviewing, testing, assessing candidates, offering employment, obtaining references; preparing contracts of employment.
Page 43
4.5 TRAINING & DEVELOPMENT: Training is one of the most important tool any organization using to cope with the rapid change in technology and way of doing business. HR department of SPL is responsible for the training and Development of existing as well as new coming employees. The difference between the training of new and existing employees are orientation and SPL culture. When a new employee is selected, an orientation of the new employees is conducted. Production Manager is responsible for the orientation of new employees. Orientation is basically a one to two hour activity in which the new employees are informed about the organizational structure, term & conditions of employment, the duties of incumbent, the ethical & behavioural requirement for the new employee and the so. This activity is only design for the officers and managers. Workers & employees of lower level are exempted from orientation. As a result most problems are observed at this level during day-to-day transaction. New or Existing employees are trained in HR Department via two methods. Employees Handbook Training by concerned department Manager. The period of training is not specified, some times it covered in a week some times it is extended up to 6 months. 4.6 PERFORMANCE MANAGEMENT: Employees job performance is an important issue for all employers. A performance management system consists of the processes used to identify, encourage, measure, evaluate, improve, and reward employee performance at work.
SPL encourage their employees to achieve high level of excellence i.e. in
Page 44
Quantity of output Quality of output Timeliness of output Presence at work Cooperativeness
These excellences are appreciated by the management at their monthly meeting with their employees and in the form of shields and awards. However all these activities are qualitative in nature. The activities of employees are recorded on the basis of observation made by the management officials from time to time. There is also maintenance of performance log. However critical incidents are recorded on rough pages for the future need.
4.7 EMPLOYESS COMPENSATION & BENEFITS: SPL Pharmaceuticals currently Lower compensating there employees with respect to other industries present in Mumbai. SPL have a different pay structure for different level of employees and also employees of same level. i.e. Head of two departments are paid two different type of compensation. HR department is responsible for pay and pay related issues. It was also found that salary determination in SPL is a matter of bargaining. i.e. SPL pay 9500 Thousand to an analyst while at the same time pay 15000 to other analyst working in a same post. SPL creates 2 categories for their employees. Exempt & Non-Exempt. SPL pay overtime to its non-exempt employees who work in excess of 8 hour and are one & half times there base pay. Almost all officers, managers, directors & executives are exempt from overtime allowance. There is also shift premium and night allowance for workers. The pay structure changes in SPL with that of based on seniority and not on performance.
Employees Categories Exempt Employees Non-Exempt Employees
Page 45
4.8 TYPES OF COMPENSATION & BENEFITS: There are only one type of pay structure is available for the lower level employees. i.e. base pay. No other direct & indirect pay & benefits are provided to the employees. For the lower level employees SPL is giving time base pay i.e. every employee have to work for at least 9 hours a day after which he has subject to receive his pay at the end of month. No portion of the pay is directly or indirectly associated with the pay. As a result motivations of the employees are low.
Indexation Allowance
Basic Salary Composition of Salary
Attendance Allowance
Cost of Living Allowance
Overtime
The composition of salary of lower level employees consist of : Basic Salary Overtime Indexation allowance (For workers having salary less than 2500 rs/month)
Page 46
SPL pay a higher wage to his high level employees. The composition of the salary given to these employees consists of: Gross Salary Basic Salary House Rent Transportation Allowance ( usually between 300 to 500 rs/day) Cost of Living Allowance Internet Allowance (300 rs/day) Medical Allowance Bonus (8.33% of salary) Education Allowances
Deductions Benefits The following benefits are being paid. Loans The employee is given loans as per the loan policy mentioned in the Service Rules. The employees submit their application for loan approval to HR department after the approval of the Managing Director the loan is granted to the applicant Loan Instalments Provident Fund (12% of basic) ESIC
ESIC --------------------------------4.75 % of wages Advance against salary------------- up to one third of salary (For all employees) Medical allowance ----------------- 4% of Salary
Figure 4.5 Performation Appraisal in SPL
4.9 LABOUR MANAGEMENT RELATIONS: Labour-Management relation in SPL is an ideal one. The employees are just satisfied the management style. Thus we can say that the organization keeps normal relations with its employees. There are two-way communications methods in SPL. Several features of LaborManagement relations are
Page 47
Every employee has the right to come to meet his immediate BM for his problem. If his BM cannot satisfy the employee, then employee can go to HR department for his problem. Some Department held meeting on monthly basis in which head of Dept and first line BM, ABM & RM meet to employee and discuss about the previous performance of Dept & individual performance. At the end the decisions are made to enhance the individual performance by facilitating the employees. The company treats all employees with respect and dignity, no employee is subjected to any gesture, language and physical contact that are sexually coercive, threatening, abusive or exploitative. Discipline Procedure:
Warning are addressed to the employees verbally and in written through their immediate RM. The warning referred to the contraventions committed by the employee and served to remind the employees the he/she abide by the company rules and regulations in performing his/her work, and that this contravention should not be repeated in future. A written letter addresses to the employee describing the contravention committed. The employee is also notified that a higher penalty may be inflicted on him in the contravention is repeated in future. The warning letter is then registered in the employees personal file. Issuance of written warning can be recommended by the respective supervisor and Head of Department. It will be issued by the HR department after approval of Chief Executive Officer. The employee may be suspended from performing his or her duties for a period of time as conveyed in written. Unauthorized absence of more then two times in Six month can result in termination of employment. An employee who is absent from the job with out satisfactory explanation and necessary proof is considered to be an unauthorized unpaid absence. Discrimination, intimidation and harassment based on sex, race, religion, age, color, disability, sexual orientation and cultural background is prohibited at the workplace.
Page 48
Chapter 5
Operation and Production Production is a functional area responsible for turning inputs into finished outputs through a series of production processes. The production manager is responsible for making sure that raw materials are provided and made into finished goods effectively. Lay out:
Figure 5.1 Layout of SPL
Page 49
5.1 Material movement in production area:
Figure 5.2 Chemist room It is an area where all workers, machine operators and officers meet daily at the starting time of their respective shift to plan complete schedule and allocate work activities. In the room one white board displays 1 month projected manufacturing schedule of production department in following format.
Page 50
Sr, no. 1 2
Mfg. date
Filling date 15/05/2012 16/05/2012 16/05/2012 16/05/2012
Product name Emtec 2ml Sanmycin 2ml
Batch no. SRA 205 SGT 206
Batch size Remarks 200 liter 150 literr Domestic Export
Table 5.1 Format of mfg. schedule All officers have been affix label on glass window of concern area, to demonstrate current operation of area in following fix format. BATCH IN PROCESS DATE:__/ __/ 201_ PRODUCT NAME BATCH NUMBER BATCH SIZE MANUFACTURING SIZE EXPIRY DATE STAGE CHECKED BY Table 5.2 Format of label used in each dept. 5.2 BMR (Batch Manufacturing Record) It is a file which contains all the details of batch starting from raw material receiving to finish good dispatch. BMR preserved for 1 year more than expiry date of batch Content of BMR: Sr. no. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. Title Sr. no. Title
Product name 13. Washing of PPM Generic name 14. Mfg process detail Strength 15. Filtration detail BMR status 16. Filling detail Effective date 17. Sterilization detail Supersedes 18. Calculation CC no. 19. Accountability % Batch size 20. Yield % Material pick up list 21. Visual inspection record Master formula 22. History date Signature log 23. Cycle time Verification sheet 24. Packaging & labeling Table 5.3 Format of BMR making by production dept.
Page 51
5.3 Introduction to areas of production department a. De cartooning area Here primary packing materials like ampoules and vials are received. Workers arrange ampoules or vials into perforated plate which are directly sent to washing area through hedge. There would be normal pressure and room temperature would be maintained. b. Ampoules / Vials washing area In this area ampoules and vials are being washes in two step process 1. Inner wash: by help of purify water, water for injection and compressed air one by one.
2. Outer wash: by help of purify water & water for injection one by one. Temperature of washing area should NMT 27o C & pressure NLT 0.4 mm of WC. (WC = water column) 23 PROCESS Water is sprayed onto the ampoules. Turned to an angle of 180 degree with their mouth downward to remove water. Finally the ampoules are filled with compressed air to remove residual water. Certain machines have a high temperature zone meant for killing any bacteria. c. Equipment washing area Here parts of equipment or tanks has to be cleaned with help of purify water and then water for injection. Temperature of washing area should NMT 27o C & pressure NLT 0.4 mm of WC (= water column)
Page 52
d. Dress washing area Equipment has capacity to process 30 pairs of dress at once. Normal room temperature and humidity would be maintained here. e. Autoclave & DHS (Dry Heat Sterilization) area
Material or equipments used for preparation of parenteral products must pass through autoclave or DHS, for sterilization. This process leads to denaturation of protein of bacteria, results in death of bacterias. Autoclave wiil lead to coagulation of protein of bacteria. It has temperature NMT 27o C & humidity NMT 55%. Temperature will be automatically recorded and printed at regular interval of 3 minutes. f. Manufacturing area Here active ingredients & recipient of final product have been mixed according to procedure of BMR. Manufacturing area has to send in process sample of 30 ml for approval of QC department. In this area temperature, humidity, pH order of mixing and other parameters has to be followed strictly.
Page 53
g. Filtration area Bulk solution or suspension is filtered through membrane or cartilage filter by help of nitrogen gas with pressure of 0 to 2 Kg/cm2. Efficiency of filter is calibrated by bubble point test. h. Filling and capping area In filling area Product is filled in respective containers. There are 3 different types of filling tube Stainless steel, Glass & Silicon. Tubes have been washed by ultrasonic machine. (By help of vibration) Initial 5 vials or ampoules have been discard in following cases: Initial machine startup. Completion of maintenance work. Replacement of syringe & needle. Shift change. Each & every carton contain FO number (Filling operation) FO number will be changed in following cases: Any interruption. Take more than 1 day for filling Power failure of more than 30 minutes. Change in filling syringe. Breakdown for more than 120 minutes. Change in fill volume. In the filling process control limit (Standard of company) is +/- 1.5% and tolerance limit (Standard of industry) is +/2%.
In UTL, excess amount of drug is filled than labeled volume in pharmaceutical industry as follows:
Page 54
Sr. no. 1. 2. 3. 4. 5. 6. 7. 8. 9.
Labeled size (ml) 0.5 1 2 2.5 3 4 5 10 20
Recommended excess volume Mobile liquid (ml) Viscous liquid (ml) 0.1 0.12 0.1 0.15 0.15 0.25 0.17 0.3 0.20 0.35 0.25 0.4 0.30 0.5 0.50 0.7 0.60 0.9 Table 5.4 Excess volume labelled
i. Visual inspection area In this area each & every ampoules or vials have been checked by trained workers manually. Each worker gets target to complete within one shift, target is depend on type of product. Visual department require minimum 22 workers.
Each worker has to be submitting eye report from government hospital. Each worker gets 20 minute break after every 2 hours. Workers have to be properly trained properly for 1 week. Company takes on test for 100 ampoules, in which qualifying criteria is 97% accuracy. Up to one week 100% cross checking is takes place. Workers are generally reject products having following errors:
Page 55
Fiber NMT 2 Black particle White particle
Low dose High dose Black oil
Improper sealing Without seal Without rubber stopper
Damaged bottle Melt cake Others
Table 5.5 Format of rejected products labeling

At the end of visual of any batch, area has to prepare statistical sorting report in following format: Container No. of Inspected Sample No. of Sorted by Types of Remark no. units by qty. rejection rejection
1 2
294 294
DJV SRV
3 3
Nil Nil
SAM SAM
NA NA
NA NA
Table 5.6 Format of sorting report
Temperature measurement record. Sequential log sheet. Daily visual inspection record. Manpower attendances register. Training record file.
j. Freeze dry area It works on principle of Lyophilization & Sublimation This process has capacity to remove moisture from product by converting moisture in ice and then directly convert to vapor by passing liquid stage. Freeze dryer company. is from Lyovac
Product has been load at 5 0C at loading temperature. In first stage freeze dryer lower temperature up to -40 0C, so moisture in product will be converting to ice. Silicon oil is used to lower and
Page 56
maintain temperature up to -40 0C, because structure of silicon oil will remain same from -56 0C to +260 0C. Now in second stage temperature will increase at uniform rate. Vacuum of 0.05 millibar will be applied to remove vapor of moisture. Cycle time & temperature will vary with types of product. This freeze dryer has 200 liter capacity. EX: Lupride depot is freeze dried product; UTL is only Manufacturer Company in India. FD area has planning schedule on the board in following format: Sr. No. 1 2 Product name Diclomine Netlisan FD load date 08/5/12 10/5/12 FD unload date 10/5/12 15/5/12 Batch no. SDC 205 STT 206 Batch size 200 ltr. 175 ltr. Remark Primary NA
Table 5.7Format of writing batch mfg. on board k. Quarantine area after completion of visual inspection, products are placed in this area. from this area, packing department will receive products for labeling & secondary packing with help of Batch transfer note. there are different To Be Checked Labels for different stages of products.
Purpose of this Labels is to identify product at each & every stage and to avoid a mix up of materials. l. Crushing area: Once in 15 days, all non-recoverable rejected final products have been crushed here. Production area is responsible for maintaining records of crushing activity.
Page 57
m. Sanitizing Activity:
Each & every area of production department sanitize regularly by different solution. Even company sanitizes each drain point by using 2.5 liter of sanitizing solution daily. Company has to change sanitizing solution after every week, because of Development of resistant in microorganism
n. Media plate: sterility of area. If sterility is not proper then, growth of microorganism in media will be observed. o. Particle counter: Once in month, QA department check particle count in area A, by help of particle counter machine. 5.4 PACKAGING DEPARTMENT There are 6 different types of packing line in packing department for secondary packing. Secondary packing includes following boxes.
Sr. No. 01 Line name Glass bottle packing line Use Glass bottle Work stations 9 Machines Labeling done by manually
02
Vial packing line
Vial
14
03 04
Ampoule packing line (2 line) Single pack show box over wrapping line Multi pack show box over wrapping line
Ampoule Single show box Multi show box
14 8
Labeling machine Check weigher machine (Techno four company) Online coding machine (PIC electronics) Same as Vial packing line Single wrapping machine Check weigher machine (Techno four company) Multi wrapping machine Check weigher machine (Techno four company)
05
Table 5.8 Secondary packaging labels
Page 58
there are mainly 2 types of products.

.
after completion of batch, final products are transferred to store of company. Layout of packing department quarantine:
In packing department following defects have been observed:
Double label Twisted label Tip break De shaped ampoule
Improper label Torn label Dirty label Cartoon without bottle
Damaged cartoon Partial printing Missing leaflet
Table 5.9 Defects in labeling procedure
Page 59
5.5 PACKAGING OF PARANTERALS Containers:Parenteral preparations are supplied in glass ampoules, bottles or vials, plastic bottles or bags, and prefilled syringes, which are coloured in the case of light-sensitive substances. Except where otherwise indicated in individual monographs, these containers are made from material that is sufficiently transparent to permit the visual inspection of the contents. They should not adversely affect the quality of the preparation, allow diffusion of any kind into or across the material of the container, or yield foreign substances into the preparation. Closures:Closures for Parenteral preparation containers should be equipped with a firm seal to prevent entry of microorganisms and other contaminants while permitting the withdrawal of a part or the whole of the contents without removal of the closure. They should not be made of components that react with the contents, nor should they allow foreign substances to diffuse into the preparation. Plastic materials or elastomers of which the closure is composed should be sufficiently firm and elastic to allow the passage of a needle with the least possible shedding of particles. Closures for multidose containers are made sufficiently elastic to allow the puncture to reseal when the needle is withdrawn and protect the contents from airborne contamination. A tamper-evident container is fitted with a device that reveals clearly whether it has ever been opened.
Page 60
5.6 LABELLING OF PARENTRALS Labelling:Every pharmaceutical preparation must comply with the labelling requirements established under Good Manufacturing Practice. The label of a Parenteral preparation should include: (1) The name of the product; (2) The name(s) of the active ingredient(s); INNs should be used wherever possible; (3) The amount of the active ingredient(s) in a suitable dose volume and the volume in the container; for powder for injections: the amount of the active ingredient(s) in the container; (4) the batch (lot) number assigned by the manufacturer; (5) the expiry date and, when required, the date of manufacture; (6) any special storage conditions or handling precautions that may be necessary; (7) directions for use, warnings, precautions that may be necessary; and and
(8) the name and address of the manufacturer or the person responsible for placing the product on the market. For Parenteral preparations that are solutions or dispersions, the concentration of the active ingredient(s) should be given in terms of mass or biological activity per volume. For concentrated solutions, labels should state the composition and the dilution to be carried out before use. 5.7 QUALITY CONTROL The quality control section of the company involves the processes of striving to produce a perfect product by a series of measures requiring an organized effort by the entire company to prevent or eliminate errors at every stages in production. The in-process quality control for Parenterals is as follows:-
Page 61
1) Checking the bulk solution, before filling, for drug content, pH, color & completeness of solution. 2) Checking the filled volume of liquids or filled weight of sterile powders for injection in the final containers at predetermined intervals during filling. 3) Testing for leakage of flame-sealed ampoules. 4) Subjecting the product to physical examination for appearance, clarity & particulate contamination. 5) Examining the sterility indicator placed in various areas of the sterilizer for each sterilization operation. Submitting the product for sterility testing to establish the safety & other parameters of the product. The following quality control tests are performed in the quality control section of the company:1) LEAKAGE TEST:Any leakage in the ampoules may cause entry of micro-organisms in the ampoules or the drug content may leak outside & spoil the appearance of package. Thus, this test is carried out to check the leakage of ampoules. Leakers are detected by producing a negative pressure within an incompletely sealed ampoule in a vacuum chamber, while ampoule is entirely submerged in a deeply colored dye solution (0.5% methylene blue). Some amount of dye is entered into the ampoule from opening. This is visible after the ampoule has been washed externally to clear it of dye.
Page 62
2) CLARITY TEST:It is practically impossible to prepare a lot of a sterile product so that every unit of that lot is perfectly free from visible particulate matter, i.e.,30 to 40 m & larger in size. The visual inspection of a product is done by individual human inspection of each externally clean container under a good light, baffled against a black & white background, with the contents set in motion with a swirling action. The care must be taken to prevent entry of air bubble. A moving particle is easier to see than that of stationary particle. It is necessary to invert the container to see the heavy particles as the final step in inspection. 3) LAL TEST:The presence of pyrogens in the preparation can be detected by an in-vitro test method for pyrogens. This method utilizes the gelling property of the lysate of the amebocytes of Limulus polyphemus (the horseshoe crab). A firm gel is formed within 60 min in the presence of pyrogenic endotoxins from gram negative bacteria when incubated at 37 . This test is commonly known as LAL test. 4) STERILITY TEST:The sterility of the preparation can be determined by incubating the small volume of preparation in an agar plate at 37 for 48 hours. If the growth of micro-organisms occurs in the agar plate after 48 hours, then that preparation will be discarded.
5.8 STORAGE SECTION The powdered & liquid injectibles filled in vials/ampoules are then packed into cartoons. These cartoons are stored in a cold place. The light sensitive pharmaceutical products are stored in the absence of sunlight. The region where these cartoons are placed should be neat & clean. The pharmaceutical products should be
Page 63
stored carefully in order to prevent the breakage of containers and the spoilage of the drug. These cartoons should well label. STORE DEPARTMENT The store department is responsible for stocking all the necessary tools, spares, raw materials and equipments which required for manufacturing process. When source is unreliable, buffer stocks will need to be kept and the use of computerized stock control systems helps keep stocks at a minimal but necessary level for production to continue unhindered. Store department is further divided into following 4 sub units:
Figure 5.3 Store dept. layout
Store department is currently using FIFO (First in First out) method. Store department has facility of cold room to store products at 20C to 80C
Page 64
Material movement in store department: It is a link between industry and external environment market. Store is only department which deals with acceptance of raw material for production and dispatch of finished goods. Store department is also responsible for storage of raw materials and finished products as per requirement in suitable environment.
Figure 5.4
Page 65
Chapter 6
DISPATCH AND IMPORT EXPORT
6.1 WAREHOUSE All the activities in the warehouse can be shown in the form of a diagram given below. RECEIPT AND HANDLING OF RAW MATERIAL On receiving intimation from gate by security in-charge regarding any receipt of raw material, the following matters/details are required to be verified on the basis of suppliers bill challan. Then suppliers bill/challan would be checked, whether the material is for our location, if yes then material would be allowed inward. Security will take entry in inward register and allow vehicle inside the factory. The security in-charge will put the reference of the inward entry on the backside of the suppliers bill/challan/LR (lorry receipt)
Figure 6.1
Page 66
STORAGE OF RAW MATERIAL Checks and precautions
Storage all the liquid raw materials on the lower most rack. Store the heavy containers at lower level of rack. All the raw materials are to be stacked in proper rows, so that movement of the materials at the time of issuance is easy.
Quarantine area Store QUARANTINE materials in this area which are identified by yellow colored border dedicated area/covered with nylon net/yellow rope (if applicable) with Quarantine coupon. Try to store single consignment on one pallet, if consignment is large, use required number of pallets ensuring proper segregation. Use separators in between for stacking different material on single pallet. Approved area Store all approved materials in this area, which are identified by green colored Approved label. Rejected area Store all rejected materials in this area which are identified by red colored Rejected label Storage area Store all the raw materials in the area with respect to their storage conditions as per the list given by QC. The various storage area available are Temperature range Storage area
Less than 2o C Less than 25o C Room temperature Cold storage/refrigerator/cooling cabinet A.C. store room Respective location/ store room
Table 6.1 Temp. range of different dept.
Page 67
Depending on the status of materials like Quarantine/approved/rejected transfer the material to its respective location. Whenever any non compliance is observed at any stage, inform the QC department for defacing the approved label and affix the HOLD label if required In such cases where the non-compliance is observed for limited packs / containers instead of whole lot, the same should be transferred to Quarantine area after affixing HOLD label. Necessary entries should be updated in ERP for the same. After shifting the raw material to their respective location, update the locator code in the ERP system and thereafter also whenever material is shifting from one location to another or one rack to another, update the ERP system likewise. Whenever any material (in-out) from (2o to 8o) refrigerator and (-14oC to -25oC) deep freezer like for dispensing or sampling or any reason to be note down the entry in log book register. 6.2 Dispatch At the Unimed a standard procedure for dispatching is being followed strictly. This procedure ensures the quick dispatch of finished products into the market within very less time after the manufacturing of product. Warehouse receives RFC (Rolling Forecast) every month from the corporate. RFC is a list of products to be dispatched in the month. The same RFC is also sent to the production department for manufacture planning during the month. Meanwhile the dispatching process proceeds, documentation process will also proceeds simultaneously. The list of required documents is given below.
Details of documents for dispatch of finished goods:

Name of document 1 2 3 4 5 6 7 Excise bill in duplicate Stock transfer note Form 402 Form AR-2 for state excise product Lorry receipt Original and triplicate of out pass Form ARE-1 / ARE-2 / AR-4 for export Document source ERP ERP Printed form Printed form MS Excel / open Office, signed by excise inspector Transporter Warehouse
Printed form MS Excel / open Office, signed by excise inspector wherever applicable Table 6.2 List of documents for dispatch of finished goods
Page 68
Dispatch procedure Authorized officer prepares the list of products to be dispatched with full details as per shown below. Item code Description of the item Rate of excise duty to be charged while billing Batch no. Total quantity Total no. of boxes Quantity in loose boxes Retail price per unit
6.3 Import The wide portfolio of Unimed products requires large variety of raw materials from India and IMPORT AT CONCESSIONAL RATE OF DUTY Foreign. Company imports various raw materials on regular basis from renowned organizations of Europe, America and some other countries. Import procedure is very difficult which includes typical documentation and approval procedure from many different government authorities at the different stages of import. As import procedure became a regular practice at Unimed Company always apply for import at concessional rate of duty So general import is known here as import at concessional rate of duty. Here the flow chart of the whole import procedure is produced in order to present the difficult import procedure in simple form.
Figure 6.2
Page 69
Import Process:
1. Registration: A manufacturer intending to avail of the benefit of an exemption shall obtain a registration from the assistant commissioner of central excise having jurisdiction over his/her factory. The registration shall contain particulars about the name and address of the manufacturer, the excisable goods produced in his factory, the nature and description of imported goods used in manufacture of such goods. Then the assistant commissioner of central excise or deputy commissioner of central excise will issue a certificate to the manufacturer indicate the particulars referred above. 2. Application by the manufacturer to obtain the benefit: A manufacturer who has obtained a certificate and intends to import any goods for use in his/her factory at concessional rate of duty, shall make an application to the assistant commissioner of central excise or deputy commissioner of central excise indicating the estimated quantity and value of such goods to be imported. Applicant shall also provide details of port of import. The manufacturer may at this option, file the application either in respect of a particular consignment or indicating his estimated requirement of such goods for a quarter. The manufacturer shall also give undertaking on the application that the imported goods shall be used for the intended purpose only. The application shall be countersigned by the assistant commissioner or deputy commissioner of central excise who shall certify there in that the manufacturer is registered in his office and has executed a bond to his satisfaction in respect of end use of imported goods in the manufacturers factory and indicate the particulars of such bond. 3. Procedure to be followed by AC / DC of customs: On the basis of application countersigned by assistant commissioner or deputy commissioner of central excise, the assistant commissioner or deputy commissioner of customs at the port of import shall allow the benefit of the exemption notification to the importer. Provided that where the importer has field the application in respect of his estimated requirement for a quarter, that said assistant commissioner of customs or deputy commissioner of customs shall debit in the said application, the quantity and value of import made under a particular consignment, also indicating particulars of the bill of entry, before allowing the benefit of the exemption notification to the importer.
Page 70
The assistant commissioner or deputy commissioner of customs will forward a bill of entry containing the particulars of import, the amount of duty paid and other relevant particulars to the assistant commissioner or deputy commissioner of central excise. 4. Procedure to be followed by AC / DC of central excise: The assistant commissioner or deputy commissioner of central excise shall acknowledge the receipt of intimation received from the assistant commissioner or deputy commissioner of customs. 5. Manufacturer to give information regarding receipt of imported goods and maintain records: The manufacturer shall give information of the receipt of imported goods in his factory, within two days (excluding holidays, if any) of such receipt, to the superintendent of central excise having jurisdiction over his factory. The manufacturer shall also maintain a simple account indicating the quantity and value of goods imported. The quantity of imported goods consumed for the intended purpose and the quantity remaining in stock, bill of entry wise. The organization has to present this account as and when required by the assistant commissioner or deputy commissioner of central excise. 6. Recovery of duty in certain case: The AC/DC of Central Excise shall insure that the goods imported are used by the manufacturer for the intended purpose and in case they are not so used take action to recover the amount equal to the difference between the duties liviable on such goods but for interest, at the rate fixed by notification issued under section 28AB of the customs act, 1962 for the period starting from the date of importation of the goods on which the exemption was availed and ending with the date of actual payment of the entire amount at he difference of duty that he is liable to pay.
Page 71
6.4 EXPORT Whenever any goods produced in the factory anywhere in India leaves the factory premise, it is liable to excise duty. But in order to promote the export government provide 100% exemption on duty paid by exporter. This way exporter gets relief from 5% basic excise duty 2. 2% of basic duty as education cess
3. 1% secondary and higher secondary education cess Unimed exports its products in countries like, Guyana, Thailand. Mauritius, Netherlands, Algeria, Peru, Russia, South Africa etc. Export process: In exercise of the powers conferred, the Central Government hereby, directs that rebate of whole of the duty paid on excisable goods (hereinafter referred to as materials) used in the manufacture or processing of export goods shall, on their exportation out of India, to any country . (1) Filing of declaration. - The manufacturer or processor shall file a declaration with the Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise having jurisdiction over the factory of manufacture describing the finished goods proposed to be manufactured or processed along with their rate of duty leviable and manufacturing/processing formula with particular reference to quantity or proportion in which the materials are actually used as well as the quality. The declaration shall also contain the tariff classification, rate of duty paid or payable on the materials so used, both in words and figures, in relation to the finished goods to be exported. (2) Verification of Inputoutput ratio. The Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise shall verify the correctness of the ratio of input and output mentioned in the declaration filed before commencement of export of such goods, if necessary, by calling for samples of finished goods or by inspecting such goods in the factory of manufacture or process. If, after such verification, the Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise is also satisfied that there is no likelihood of evasion of duty, he may grant permission to the applicant for manufacture or processing and export of finished goods. (3) Procurement of material. The manufacturer or processor shall obtain the materials to be utilized in the manufacture of the finished goods intended for export directly from the registered factory in which such goods are produced, accompanied by an invoice under rule
Page 72
11 of the Central Excise Rules, 2002: Provided that the manufacturer or processor may procure materials from dealers registered for the purposes of the CENVAT Credit Rules, 2002 under invoices issued by such dealers. (4) Removal of materials or partially processed material for processing. The Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise may permit a manufacturer to remove the materials as such or after the said materials have been partially processed during the course of manufacture or processing of finished goods to a place outside the factory (a) for the purposes of test, repairs, refining, reconditioning or carrying out any other operation necessary for the manufacture of the finished goods and return the same to his factory without payment of duty for further use in the manufacture of finished goods or remove the same without payment of duty in bond for export, provided that the waste, if any, arising in the course of such operation is also returned to the said factory of the manufacture or process; or (b) for the purpose of manufacture of intermediate products necessary for the manufacture or processing of finished goods and return the said intermediate products to his factory for further use in the manufacture or process of finished goods without payment of duty or remove the same, without payment of duty for export, provided that the waste, if any, arising in the course of such operation is also returned to the factory of manufacturer or processor; (c) Any waste arising from the processing of materials may be removed on payment of duty as if such waste is manufactured or processed in the factory of the manufacturer or processor. (5) Procedure for export. - The goods shall be exported on the application in Form A.R.E. 2 specified in the Annexure to this notification and the procedures specified in Ministry of Finance (Department of Revenue) notification No. 42/2001-Central Excise (N.T.), dated the 26th June, 2001 shall be followed. (6) Presentation of claim of rebate. The claim for rebate of duty paid on materials used in the manufacture or processing of goods shall be lodged only with the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise having jurisdiction of the place approved for manufacture or processing of such export goods.
Page 73
Chapter 7
COMPANYS REGULATORY STRUCTURE: There are various legislations that govern the manufacture and sale of drugs and Parenterals in India. There are also rules framed under the provisions of these laws. The following are the laws that are currently in operation in the country: 1. The Poisons Act, 1919 2. The Drugs and Cosmetics Act, 1940 (this was amended various by Drugs (Amendment) Acts in 1955, 1960, 1962, 1964, 1972, 1982 and 1986) 3. The Drugs and Cosmetics Rules, 1945 4. The Pharmacy Act, 1948 5. The Drugs and Magic Remedies (Objectionable Advertisement) Act, 1954 6. The Medicinal and Toilet Preparations (Excise Duties) Act, 1956 7. The Narcotic Drugs and Psychotropic Substances Act, 1985 8. The Drugs (Prices Control) Order, 1995 General legislations that have a significant bearing on pharma industry in the country. 1. The Industries (Development and Regulation) Act, 1951 2. The Trade and Merchandise Mark Act, 1958 3. The Indian Patents and Design Act, 1970. From among these legislations the following four play a critical role in the development of the industry: (a) (b) (c) (d) Schedule M of the Drugs and Cosmetic Act 1940 The Indian Patents and Designs Act, 1970 Patents (Amendment) Act, 1999 The Drugs (Price Control) order (DPCO), 1995
These legislations are briefly described so as to appreciate their likely impact on and response from the manufacturers and others concerned.
Page 74
7.1 Schedule `M of the Drugs and Cosmetics Act (1940) The Schedule M classifies the various statutory requirements mandatory for all drugs, pharmaceuticals and medical disposable industry relevant as per current good manufacturing practices (CGMP). Schedule M was last revised in 1986, when the concept of GMP was first introduced. The Central Government is now revising the Schedule M to get it harmonized with that of the various developed and developing countries and also to the level of the well established international organizations such as the World Health Organisation (WHO). WHO guidelines on GMP for pharmaceutical products urge that: All manufacturing processes are clearly defined, systematically reviewed, and shown to be capable of consistently manufacturing pharma products of the required quality that comply with their specifications; All necessary facilities are provided including qualified trained personnel, adequate premises and space, suitable equipment and services, correct materials, containers and labels, approved procedures and instructions, suitable storage and transport and adequate personnel, laboratories and equipments for in process controls; Instructions and procedures are written in clear and unambiguous language; Operators are trained to carry out procedures correctly; Records are made (manually and/or by recording instruments) during manufacture to show that all the steps required by the defined
Page 75
procedures and instructions have actually been taken and that the quantity and quality of the product are as expected and any significant deviation fully recorded and investigated; Records covering manufacture and distribution are retained in a comprehensive and accessible form; A system is available to recall any batch of product from sale or supply; and Complaints about marketed products are examined, the causes of quality defect investigated, and appropriate measures taken.
A special sub committee constituted by the Government of India has proposed revamping of the Schedule M, covering specifications such as general requirements in case of buildings and premises, personal sanitation and hygiene, training, production and operation controls, quality control and assurance, stability and validation studies, documentation, complaints and self-inspections; and special requirements for individual formulation categories. Among other things, the amendment calls for the following: To maintain a ratio of 1:2 between the constructed area and surrounding premises to prevent environmental pollution; To install a validated water system to aid monitoring and control of bio-burden levels; To have a good disposal system, in the absence of which to have arrangements to recycle rejects; To have proper environmental control, with emphasis on buildings, till the primary packaging is complete;
Page 76
To ensure supply of filtered air in all production areas to prevent environmental pollution; To have specifically designed areas for production, quality control, storage and ancillary areas; To take adequate precautions to segregate the manufacture of highly potent drugs to avoid cross contamination; To design adequate operational and process controls to ensure reproducible quality of drugs; To ensure total quality control from raw materials procurement till the retail counter; To undertake detailed stability studies to establish the quality of drugs in different climatic and storing conditions; and To evolve clear and realistic documentation procedures. Patents and
7.2 The Indian Designs Act, 1970
This Act aims at protecting inventions. The term of patent granted is in respect of an invention claiming the method of process of manufacture of a substance. For a medicine or drug the protection is given for a period of five years from Figure 7.1 Granting of license the sealing of the patent or seven years from the date of patent, whichever period is shorter. The Controller of Patents, Designs, and Trade Marks appointed under the Trade and Merchandise Act, 1958 is the Controller of Patents.
Page 77
7.3 Patents (Amendment) Act, 1999 After signing the GATT agreement, India needed to change its patent law from process patent regime to a product patent regime. Developing countries are given time till 2005 to change their patent legislation. Since January 1, 1995, India has begun to accept applications for product patents, which go into a black box. This box is to be opened in 2005 to establish right of priority before granting patent. From January 1, 1995 to October 31, 1999, 2994 product patents have been filed for pharmaceutical products. Meanwhile for each such patent application that has been accepted, exclusive marketing rights (EMR) have to be granted for a period of five years. The Controller of Patents examines the applications to ascertain whether there is a violation of the relevant provisions of Patent Act. The government can not only fix the price of the product covered under EMR, but also reserve the rights to grant compulsory license or revocation of patent. Provision is made to ensure that EMRs are not granted for substances based on Indian System of Medicines where the products are already in public domain. 7.4 The Drugs (Prices Control) Order (DPCO), 1995 The DPCO provides for ceiling prices for medicines, the lists of which are reviewed periodically. Over the years substantial changes have been made in the DPCO in terms of reduction in the number of drugs under price control and simplification of application procedures. The DPCO, 1995 allows for exemption from price control for new bulk drugs which have not been produced elsewhere and which are developed through indigenous R and D.
Page 78
On the recommendation of the Hathi Committee (1973), the Government of India created a Drug Price Equalization Account (DPEA) under the DPCO. This equalization is done on the basis of a weighted price average determined by the government. Any company that sells the product at higher margins on account of cheaper sourcing of inputs is held liable to pay up the overcharged amount to the government. WTO Product patent regime 2005: From January 2005 product patent regime come into existence replacing existing process patent regime because of that the companies cannot manufacture products, which have registered patent for a period of seven years. This makes Pharmaceutical manufacturers to invest money in R&D and develop their own drugs and patent them. SPL who have R&D facilities will not face any problems and end up as jobbers to the big market players.
Page 79
Chapter 8
FINANCE DEPARTMENT The Financial Department is responsible for budgeting, accounting, employee wages, money distribution and financial reports. Each year the Financial Department receives an annual budget from the CEO. This annual budget is based on the economic situation in the region as well as the available Federal programs and initiatives. It also handles fundraising work to attract corporate sponsors and donors. It helps to manage members donations and support received from private sources. The Financial Department consists of three full-time employees: the Financial Manager, the Chief Accountant and the Assistant Accountant. Together they are responsible for reporting to the CEO and are accountable for fundraising and managing the income generated from memberships in the Company. It deals with the financial matters of the company. It collects the revenues and makes different payments and maintains proper record of the financial performance of the companys business to show the net result in the form of either profit or loss. Finance department consist of Management Accountants Cost Accountants Accounting MIS Department Figure 8.1 Hierarchy of Accounts and Finance Department
8.1 ACCOUNTS DEPARTMENT The job of the department is to maintain books of accounts. There are following main activities of accounts. Issuance of purchase vouchers for raw material, plant and machinery and general store items Check payment of payroll to employees including wages, overtime, bonuses etc. Handling of monthly tax statements.
Computerized general ledger system is working and shows the result of each transaction up to balance sheet and income/profit and loss statement. Processing and Recording Check/ Cash Disbursement After a certain period of time when the date becomes matured for the liability the payment is made by SPL. The matured date has been calculated in the aged payable report for each
Page 80
vendor. The mode of payment is usually per numbered check. In most cases the payment is made by A/C payee only check. In some cases the payment may be made by cash or by bearer check or paid in advance fully or partly . The total process of Local Purchase has been presented briefly in below:
Figure 8.2 Purchase process
Page 81
8.2 Ratings on Sanjivani Parenteral downgraded to CRISIL BBB-/Stable/CRISIL A3 CRISIL has downgraded its ratings on the bank facilities of Sanjivani Parenteral Ltd (Sanjivani) to CRISIL BBB-/Stable/CRISIL A3 from CRISIL BBB/Stable/CRISIL A3+. The downgrade reflects expectation of continued pressure on Sanjivanis financial risk profile, particularly debt protection metrics and gearing, because of its large working capital requirements and its plans of strengthening its market position in the highly competitive export and direct marketing segment. Rs.85 Million Term Loan Rs.400 Million Cash Credit Rs.40 Million Proposed LongTerm Bank Loan Facility Rs.40 Million Letter of Credit CRISIL BBB-/Stable (Downgraded from 'CRISIL BBB/Stable') CRISIL BBB-/Stable (Downgraded from 'CRISIL BBB/Stable') CRISIL BBB-/Stable (Downgraded from 'CRISIL BBB/Stable') CRISIL A3 (Downgraded from 'CRISIL A3+')
Rs.35 Million Bank Guarantee* CRISIL A3 (Downgraded from 'CRISIL A3+') Table 8.1 Criteria of CRISIL FINANCIAL Ranking As on March 31, 2011, Sanjivanis interest coverage ratio and gearing deteriorated to 1.65 times and 1.83 times respectively, from 2.29 times and 1.60 times respectively as on March 31, 2010. The companys liquidity has weakened because of stretch in receivables cycle resulting in increase in working capital requirements in 2010-11 (refers to financial year, April 1 to March 31); as on March 31, 2011, debtor level was high at around 158 days. Sanjivanis bank line utilization is high at about 100 per cent. Furthermore, Sanjivanis operating margin declined to 7.4 per cent in 2010-11 from 8.6 per cent in 2009-10, because of significant increase in employee and selling costs, driven by the companys strategy to strengthen its market position in the export and direct marketing segments in order to mitigate risks associated with significant dependence on institutional sales. The companys profitability is expected to remain moderate over the medium term, given the intense competition in its target business segments, where ability to profitably scale up operations will depend on the extent of acceptance of Sanjivanis products and its marketing capabilities.
Page 82
The ratings continue to reflect Sanjivanis strong market position in the institutional segment and the extensive experience of its promoters in the pharmaceutical industry. These rating strengths are partially offset by the companys modest profitability and debt protection metrics and constrained liquidity. Outlook:Stable CRISIL believes that Sanjivani will maintain its strong market position in the institutional segment and gradually improve its market position in its target business segments, and will prudently manage its working capital requirements. The outlook may be revised to Positive if Sanjivani improves its profitability, debt protection metrics, and working capital cycle. Conversely, the outlook may be revised to Negative in case of less-than-expected cash accruals, no improvement in margins, inability to renew large tenders, or deterioration in capital structure due to large, debt-funded capital expenditure. 8.3 Bankers of SPL Axis Bank Ltd Shamrao Vithal Co-op Bank
State Bank of India Financial Planning Process in SPL
Figure 8.3
Page 83
8.4 Capital Structure of the Company SPL The capital structure includes Funds received from the owners of the business i.e. the Shareholders and therefore called as Share holders fund Proprietore fund Owners fund The share holders fund are further classified into Share Capital: Equity and Preference Reserves and Surplus: General reserve, etc Fictitious assets: Preliminary expenses,etc The capital structure also includes Borrowed Funds which are further divided into Secured Loans (Bank loans, debentures, etc) Unsecured loans ( loans from friends and relatives) The Result of which is The Capital employed i.e. The total long term funds supplied by the creditors and owners of the firm.It can be computed in 2 ways. First as mentioned above the non-current liabilities plus owners equity. Alternatively its is equal to net working capital plus fixed assets. Year Authorised Issued Subscribed 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 7.00 7.00 7.00 7.00 7.00 7.00 6.00 6.00 6.00 5.90 5.90 5.90 5.90 5.90 5.90 4.85 4.85 5.05 5.90 5.90 5.90 5.90 5.90 5.90 4.85 4.85 5.05 Called Up 5.90 5.90 5.90 5.90 5.90 5.90 4.85 4.85 5.05 Paid Up 5.90 5.90 5.90 5.90 5.90 5.90 4.85 4.85 4.96 4.96
6.00 5.05 5.05 5.05 Table 8.2 Equity Capital Structure of SPL
Page 84
Financial Turnover (Annual Results of SPL) Particulars Gross Sales Other Income Total Income Total Expenditure PBIDT Interest PBDT Depreciation Tax Deferred Tax Reported Profit After Tax Extra-ordinary Items Adjusted Profit After Extra-ordinary item EPS (Unit Curr.) EPS (Adj) (Unit Curr.) Calculated EPS (Unit Curr.) Calculated EPS (Adj) (Unit Curr.) Calculated EPS (Ann.) (Unit Curr.) Calculated EPS (Adj) (Ann.) (Unit Curr.) Book Value (Unit Curr.) Dividend (%) Equity Reserve & Surplus Face Value Non-Promoter Holding Shares Non-Promoter Holding (%) PBIDTM(%) PBDTM(%) PATM(%) Mar-12 (Rs.Cr) 150 1 151 138 13 8 4 1 1 0 3 0 3 4.3 4.3 4.3 4.3 4.3 4.3 0.0 0.0 6 0.0 10.0 5,010,396 84.95 8.39 2.81 1.68 Mar-11 (Rs.Cr) 144 1 145 134 12 7 4 1 1 0 2 0 2 3.8 3.8 3.7 3.7 3.7 3.7 0.0 0.0 6 22.5 10.0 5,034,501 85.36 8.00 3.11 1.53 Mar-10 (Rs.Cr) 139 1 140 127 13 5 7 1 2 0 5 0 5 8.0 8.0 8.0 8.0 8.0 8.0 0.0 0.0 6 18.5 10.0 5,042,948 85.50 8.98 5.07 3.41
Table 8.3 financial turnover of SPL
Page 85
Share Holding Pattern Particulars Mar-12 Dec-11 Sep-11 No of No of No of % % % Shares Shares Shares Holdings Holdings Holdings (Mn) (Mn) (Mn) Promoter & Group 0.00 0.00 0.00 0.00 0.00 0.86 0.86 0.00 14.66 14.66
Foreign Sub Total Indian Sub Total Total ShareHolding
0.89 15.05 0.87 14.69 0.89 15.05 0.87 14.69 Non Promotors / Public Shareholding 0.00 0.00 0.00 0.00 1.16 0.02 0.00 0.00 0.00 0.00 19.60 0.41 0.00 0.00 0.00 0.00 1.13 0.02 0.00 0.00 0.00 0.00 19.12 0.42
Institution Financial Institutions / Banks Foreign Institutional Investors Mutual Funds / UTI Sub Total Non Institution Bodies Corporate NRIs/Foreign Individuals/Foreign Nationals Individuals holding nominal share capital in excess of Rs. 1 lakh Individuals holding nominal share capital up to Rs. 1 lakh Sub Total
0.00 0.00 0.00 0.00 1.15 0.02
0.00 0.00 0.00 0.00 19.46 0.42
1.92
32.51
1.92
32.56
1.91
32.37
1.83 5.01
31.00 84.95
1.88 5.03
31.86 85.31
1.88 5.03
31.92 85.34
Shares held by Custodians and against issued Depository Receipts ADR GDR Other Custodians Total Shares Grand Total 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 5.90 100.00 5.90 100.00 Table 8.4 shareholding pattern of SPL 0.00 0.00 0.00 0.00 5.90 0.00 0.00 0.00 0.00 100.00
Page 86
Sanjivani Parenteral reports net profit of Rs 0.01 crore in the March 2012 quarter Sales decline 10.84% to Rs 32.97 crore Sanjivani Parenteral reported net profit of Rs 0.01 crore in the quarter ended March 2012 as against net loss of Rs 1.91 crore during the previous quarter ended March 2011. Sales declined 10.84% to Rs 32.97 crore in the quarter ended March 2012 as against Rs 36.98 crore during the previous quarter ended March 2011. Particulars Sales OPM % PBDT PBT NP Quarter Ended Year Ended Mar. 2012 Mar. 2011 % Var. Mar. 2012 Mar. 2011 % Var. 32.97 36.98 150.25 144.10 -11 4 6.37 -1.11 7.99 7.12 674 12 0.49 -1.09 4.22 4.48 LP -6 0.26 -1.34 3.27 3.53 LP -7 0.01 -1.91 2.52 2.21 LP 14 Table 8.5 financial performance of SPL
For the unaudited full year, net profit rose 14.03% to Rs 2.52 crore in the year ended March 2012 as against Rs 2.21 crore during the previous year ended March 2011. Sales rose 4.27% to Rs 150.25 crore in the year ended March 2012 as against Rs 144.10 crore during the previous year ended March 2011. Listing in Share Market BSE NSE ISIN NAP/E Market Cap Face Value Book Value Industry 531569 NA INE860D01013 6.80328 [Rs.Cr.] 17 .1395 [Rs.] 10 [Rs.] 52.42 Pharmaceuticals - Indian - Formulations
Table 8.6 share market listing detail of SPL
Page 87
Monthly Share Prices Year May-12 Apr-12 Mar-12 Feb-12 Jan-12 Dec-11 Nov-11 Oct-11 Sep-11 Aug-11 Jul-11 Jun-11 May-11 Apr-11 Mar-11 Feb-11 Jan-11 Dec-10 Nov-10 Oct-10 Sep-10 Aug-10 Jul-10 Jun-10 May-10 Apr-10 Mar-10 Feb-10 Jan-10 High(Rs.) Low(Rs.) Close(Rs.) P/E High P/E Low P/E Close 39.00 42.30 34.25 32.35 27.45 26.10 33.00 35.00 34.85 36.30 38.75 37.40 38.65 47.80 45.20 52.50 56.00 54.00 65.00 70.90 63.50 51.00 50.60 46.90 57.70 63.50 59.35 62.75 39.15 27.10 29.00 25.55 25.00 23.00 21.80 23.10 29.65 27.50 26.35 32.00 29.75 29.25 37.40 36.55 41.50 41.45 36.75 45.00 53.85 44.30 40.00 42.20 39.50 39.80 48.00 41.50 29.90 26.80 28.40 10.89 37.00 12.02 31.05 10.58 28.65 8.73 26.50 7.45 Share Prices Of 2011 24.05 7.38 24.45 9.00 31.65 9.72 32.50 9.96 30.00 10.30 34.95 10.56 32.25 11.10 34.65 10.63 38.05 14.68 38.75 12.69 43.15 8.88 44.50 9.88 Share Prices Of 2010 51.35 9.07 51.40 11.15 61.05 12.37 58.55 10.93 43.60 8.99 44.80 8.81 43.50 8.04 40.70 9.87 56.60 11.12 49.60 10.80 59.35 13.18 28.75 8.21 6.86 7.47 5.83 6.42 5.87 5.82 5.83 7.90 7.15 6.51 8.54 7.63 7.61 9.96 9.04 6.26 6.33 4.90 6.00 8.29 7.20 6.23 6.87 6.09 6.38 7.25 6.24 5.15 4.96 7.58 9.88 8.29 7.65 7.08 6.42 6.53 8.45 8.68 8.01 9.33 8.61 9.25 10.16 10.34 7.07 7.29 8.42 8.43 10.01 9.59 7.14 7.34 7.13 6.67 9.28 8.13 11.79 5.71 Mkt Cap. (Rs. in Cr.) 16.76 21.83 18.32 16.90 15.64 14.19 14.43 18.67 19.18 17.70 20.62 19.03 20.44 22.45 22.86 25.46 26.26 30.30 30.33 36.02 34.54 25.72 26.43 25.67 24.01 33.39 29.26 35.02 16.96
Table 8.7 Monthly share price detail of SPL
Page 88
Figure 8.4 share price fluctuation of SPL BALANCE SHEET (Rs. in Crores) Particulars Mar-11 Mar-10 Mar-09 Mar-08 Mar-07 Mar-06 SOURCES OF FUNDS : 5.90 5.90 5.90 5.90 5.90 5.90 Share Capital 22.51 22.09 18.49 15.54 11.96 8.81 Reserves Total 28.41 27.99 24.39 21.44 17.86 14.71 Total Shareholders Funds 51.15 44.48 33.91 21.37 17.09 15.63 Secured Loans 0.72 0.36 0.44 0.00 0.00 0.00 Unsecured Loans 51.87 44.84 34.35 21.37 17.09 15.63 Total Debt 80.28 72.83 58.74 42.81 34.95 30.34 Total Liabilities APPLICATION OF FUNDS : 22.10 21.79 12.26 12.03 11.85 11.52 Gross Block 6.42 5.48 4.67 4.14 3.62 3.12 Less : Accumulated Depreciation 0.00 0.00 0.00 0.00 0.00 0.00 Less:Impairment of Assets 15.68 16.31 7.59 7.89 8.23 8.40 Net Block 0.00 0.00 0.00 0.00 0.00 0.00 Lease Adjustment 0.70 0.44 11.06 5.14 4.27 4.60 Capital Work in Progress 0.05 0.05 0.05 0.06 0.01 0.01 Investments Current Assets, Loans & Advances 17.31 16.51 11.10 14.49 11.54 13.06 Inventories 62.70 55.24 50.32 38.51 18.93 18.66 Sundry Debtors
Page 89
0.73 0.59 0.67 1.34 Cash and Bank 3.75 5.79 3.14 0.93 Loans and Advances 84.49 78.13 65.23 55.27 Total Current Assets Less : Current Liabilities and Provisions 16.90 19.52 21.65 21.79 Current Liabilities 1.16 0.00 2.11 2.30 Provisions 18.06 19.52 23.76 24.09 Total Current Liabilities 66.43 58.61 41.47 31.18 Net Current Assets 0.00 0.00 0.00 0.00 Miscellaneous Expenses not written off 0.00 0.00 0.00 0.04 Deferred Tax Assets 2.58 2.58 1.43 1.50 Deferred Tax Liability -2.58 -2.58 -1.43 -1.46 Net Deferred Tax 80.28 72.83 58.74 42.81 Total Assets 0.09 0.09 0.03 0.03 Contingent Liabilities Table 8.8 Last five year balance sheet of SPL Profit & Loss (Rs. in Crores) Particulars INCOME : Sales Turnover Excise Duty Net Sales Other Income Stock Adjustments Total Income EXPENDITURE : Raw Materials Power & Fuel Cost Employee Cost Other Manufacturing Expenses Selling and Administration Expenses Miscellaneous Expenses Less: Pre-operative Expenses Capitalised Total Expenditure Operating Profit
0.37 2.68 33.52
0.11 0.66 32.49
7.64 2.13 9.77 23.75 0.00 0.00 1.31 -1.31 34.95 0.04
12.93 0.63 13.56 18.93 0.00 0.00 1.60 -1.60 30.34 0.02
Mar-11 Mar-10 Mar-09 Mar-08 Mar-07 Mar-06 145.20 1.10 144.10 1.26 0.14 145.50 126.69 0.74 1.52 0.85 4.14 0.03 0.00 133.97 11.53 140.39 1.22 139.17 0.77 -0.05 139.89 120.38 0.73 1.06 0.76 4.05 0.41 0.00 127.39 12.50 103.36 0.00 103.36 0.52 -0.09 103.79 91.40 0.48 0.73 0.49 1.94 0.04 0.00 95.08 8.71 91.80 0.02 91.78 0.14 0.19 92.11 80.97 0.36 0.71 0.25 1.58 0.09 0.00 83.96 8.15 69.44 0.32 69.12 0.00 0.02 69.14 59.94 0.38 0.55 0.34 1.17 0.14 0.00 62.52 6.62 54.36 0.38 53.98 0.11 0.12 54.21 47.69 0.47 0.35 0.40 0.85 0.08 0.00 49.84 4.37
Page 90
Interest Gross Profit Depreciation Profit Before Tax Tax Fringe Benefit tax Deferred Tax Reported Net Profit Extraordinary Items Adjusted Net Profit Adjst. below Net Profit P & L Balance brought forward Statutory Appropriations Appropriations P & L Balance carried down Dividend Preference Dividend Equity Dividend % Earnings Per Share-Unit Curr Earnings Per Share(Adj)Unit Curr Book Value-Unit Curr
7.05 4.48 0.95 3.53 1.32 0.00 0.00 2.21 0.00 2.21 0.00 16.76 0.00 0.00 18.97 0.00 0.00 0.00 3.75 3.75 48.15
5.45 7.05 0.81 6.24 1.50 0.00 1.14 3.60 0.00 3.60 0.00 13.16 0.00 0.00 16.76 0.00 0.00 0.00 6.10 6.10 47.44
3.60 5.11 0.53 4.58 1.63 0.02 -0.02 2.95 -0.02 2.97 0.00 10.21 0.00 0.00 13.16 0.00 0.00 0.00 5.00 5.00 41.34
2.79 5.36 0.52 4.84 1.10 0.01 0.00 3.73 0.00 3.73 -0.14 6.62 0.00 0.00 10.21 0.00 0.00 0.00 6.32 6.32 36.34
1.72 4.90 0.50 4.40 1.53 0.01 0.00 2.86 0.00 2.86 0.29 3.47 0.00 0.00 6.62 0.00 0.00 0.00 4.85 4.85 30.27
1.35 3.02 0.51 2.51 0.19 0.01 0.00 2.31 0.00 2.31 -0.60 1.76 0.00 0.00 3.47 0.00 0.00 0.00 3.92 3.92 24.93
Table 8.9 Last five year profit & loss account of SPL Key Ratios Years Debt-Equity Ratio Long Term Debt-Equity Ratio Current Ratio Fixed Assets Inventory Debtors Interest Cover Ratio PBIDTM (%) PBITM (%) PBDTM (%) CPM (%) APATM (%) Mar-11 1.7 0.3 1.3 6.6 8.6 2.5 1.5 7.9 7.3 3.1 2.2 1.5 Mar-10 1.5 0.3 1.3 8.3 10.2 2.7 2.1 8.9 8.3 5.0 3.1 2.6 Mar-09 1.2 0.2 1.3 8.5 8.1 2.3 2.3 8.4 7.9 4.9 3.4 2.9 Mar-08 1.0 0.0 1.2 7.7 7.1 3.2 2.7 8.9 8.3 5.8 4.6 4.1 Mar-07 1.0 0.0 1.1 5.9 5.7 3.7 3.6 9.5 8.8 7.1 4.8 4.1
Page 91
ROCE (%) RONW (%) PE EBIDTA DivYield PBV EPS
13.8 17.8 7.8 13.8 10.3 8.1 11.5 12.5 0.0 0.0 0.8 1.1 3.8 6.1 Table 8.10 Key Ratios OF SPL
16.1 12.9 2.3 8.7 0.0 0.3 5.0
19.6 19.0 3.6 8.2 0.0 0.6 6.3
18.8 17.6 6.1 6.6 0.0 1.0 4.9
8 6 4 2 0 2007 2008 2009 2010 2011 Current Ratio Interest Cover Ratio EPS Debt-equity Ratio
Graph 8.5 ratio representation of SPL
Cash Flow
Particulars Profit Before Tax Adjustment Changes In working Capital Cash Flow after changes in Working Capital Cash Flow from Operating Activities Cash Flow from Investing Activities Cash Flow from Financing Activities Net Cash Inflow / Outflow Opening Cash & Cash Equivalents Cash & Cash Equivalent on Amalgamation / Take over / Merger Mar 2011 Mar 2010 Mar 2009 Mar 2008 Mar 2007 35.30 70.97 -88.44 17.83 -1.69 -5.67 8.76 1.39 5.86 0 62.43 57.35 -151.01 -31.23 -67.36 10.94 55.60 -0.82 6.68 0 45.78 37.62 -107.78 -24.38 -42.78 -61.74 97.81 -6.71 13.39 0 48.35 31.73 -66.28 13.80 4.44 -10.95 16.23 9.73 3.66 0 44.01 21.15 -59.94 5.22 4.18 -0.06 -1.53 2.59 1.07 0
Page 92
0 0 0 Cash & Cash Equivalent of Subsidiaries under liquidations 0 0 0 Translation adjustment on reserves / op cash balalces frgn subsidiaries 0 0 0 Effect of Foreign Exchange Fluctuations 7.25 5.86 6.68 Closing Cash & Cash Equivalent Table 8.11 Last Five Year Cash Flow of SPL
0 13.39
0 3.66
2011 2010 2009 2008 2007 0 20 40 60 80 Closing Cash PBT
Graph 8.6 Graph of Cash flow of SPL Sanjivani Parenteral Ltd. The manufacturer of therapeutic products comprising antibiotic, anti-emetic, anesthetic, analgesic, anti-malarial, psychotropic, sedative, steroid, cardiovascular, and cold therapy products and more; is trading at Rs 17Cr Mar Cap. And look at the peers.
Companies Sales (In Rs mn)# Market Cap. (In Rs mn)* Price (In Rs)*
Plathico Pharmaceutical Ltd. Amrutanjan Health Care Ltd Bliss GVS Pharma Ltd Zenotech Laboratories Ltd Sharon Bio-Medicine Ltd Sanjivani Paranteral Ltd
4741 12,753.40 898.8 2325.6 1688.8 2118.7 66 1568.6 4965 2756 1399.42 170 Table 8.12 Competitors Sales
374 776 20 45 260 29
Page 93
# - Sales in year 2009-10 * - Date 26-08-2011

Granted company is concentrated on institutional sales and sells to state government but so huge a discount? The promoters (only 14.64 % ) in company have given the following performance. Sanjivani 2011-10 2010-09 2009-08 2008-07 sales PAT 1452.7 27.3 1399.42 47.43 1038.76 29.26 921.6 57.5
*all in Rs. million

The recently woken up management has `strategized` that Sales Force is what they need and hiring aggressively, doubling the sales expenditure to Rs 4.2 Cr.
8.5 Company Financial Analysis According to the individual - Audited financial statement for the Year of 2011, total net operating revenues increased with 3.90%, from INR 139.9 tens of millions to INR 145.36 tens of millions. Operating result decreased from INR 11.73 tens of millions to INR 11.53 tens of millions which means -1.71% changes. The results of the period decreased -38.61% reaching INR 2.21 tens of millions at the end of the period against INR 3.6 tens of millions last year. Return on equity (Net income/Total equity) went from 12.86% to 7.78%, the Return On Asset (Net income / Total Asset) went from 4.77% to 2.75% and the Net Profit Margin (Net Income/Net Sales) went from 2.57% to 1.52% when compared to the same period of last year. The Debt to Equity Ratio (Total Liabilities/Equity) was 282.58% compared to 269.42% of last year. Finally, the Current Ratio (Current Assets/Current Liabilities) went from 4.00 to 5.00 when compared to the previous year. Sanjivani Parenteral Ltd. reported unaudited earnings results for the third quarter and nine months ended December 31, 2011. For the quarter, the company reported net sales of INR 381.478 million compared to INR 348.533 million a year ago. Profit from operation before other income, interest & exceptional items was INR 31.189 million compared to INR 39.1 million a year ago. Net profit was INR 7.64 million or INR 1.30 per basic and diluted share, compared to net profit of INR 16.823 million or INR 2.85 per basic and diluted share, a year ago. For the year to date, the company reported net sales of INR 1,172.741 million compared to INR 1,071.123 million a year ago. Profit from operation before other income, interest & exceptional items was INR 91.799 million compared to INR 99.732 million a year ago. Net profit was INR 25.087 million or INR 4.25 per basic and diluted share, compared to net profit of INR 41.233 million or INR 6.99 per basic and diluted share, a year ago.
Page 94
Sanjivani Parenteral Ltd. announced unaudited earnings results for the fourth quarter and full year ended March 31, 2012. For the quarter, the company reported net sales were INR 329.75 million against INR 369.84 million a year ago. Profit from ordinary activities before tax was INR 2.62 million against loss of INR 13.44 million a year ago. Profit was INR 0.122 million against loss of INR 19.13 million a year ago. Basic and diluted earnings per share before and after extraordinary items were INR 0.02 against loss per share of INR 3.24 a year ago. For the year, the company reported net sales were INR 1,502.49 million against INR 1,440.96 million a year ago. Profit from ordinary activities before tax was INR 32.71 million against INR 35.3 million a year ago. Profit was INR 25.21 million against INR 22.1 million a year ago. Basic and diluted earnings per share before and after extraordinary items were INR 4.27 against INR 3.75 a year ago.
Page 95
Chapter 9
MIS OR IT DEPARTMENT Information is the basis for every decision taken in an organization. The efficiency of management depends upon the availability of regular and relevant information. Thus it is essential that an effective and efficient reporting system be developed as part of accounting system. the main object of management information is to obtain the required about the operating results of an organization regularly in order to use them for future planning and control. The old techniques like intuition, rule of thumb, personal whim and prestige, etc. are now considered useless in the process of decision taking. Modern management is constantly on look out for such quantitative and such information, which can help in analyzing the proposed alternative actions and choosing one as its decision. thus, modern management functions are informationoriented more popularly known as management by information. and the system through which information is communicated to the management is known as management information system (mis). the management needs full information before taking any decision. good decisions can minimize costs and optimize results. Management information system can be helpful to the management in undertaking management decisions smoothly and effectively. The management information system was started in SPL company in the year 1994. In the initial stages the computers were not used for the system it was manually done. The system was being computerized in the year 1997 with just use of 2 computers. In 2000 all the computers in the system were upgraded with the better technology. at present it has a base of about 20 computers and 5 servers.computers and 5 servers with the best technology available in the market. At present the company has about 20 computers connected with the help of large area network (LAN). It has 5 servers connected to this LAN. It also has various other communication hardwares like fax machines, etc. company uses the
Page 96
custom made software called trio. This software has been developed by the company with the help of various engineers, which is just used within the organization. This software helps the organization in the best possible manner as it is being developed as per the workers needs. The main advantages of this software are as follows: It helps in invoice printing. It helps in inventory control. It is also equipped with accounting procedures. It follows the way that the worker wants to make follow. It helps to make the comparison charts, which very less programmes have.
The main source of the data for preparing the reports is the servers that are connected to all the computers in which the data is being feed. All the data is being stored in the servers hence it is easier and faster to find the data as and when required. All the computers including the servers are being gives the access to internet. There is no extranet present in the organization. Internet (e-mail) is used for sending the information to its customers, suppliers, its manufacturing plant, etc. majority of times reports are being sent to the board through internet. this is the best advantages it saves time and money of the organization also the decisions can be taken very fast. There are various processes in the organization, which are being computerized such as accounting, research and development, stock and inventory control, quality control, data analysis, etc. about majority of the processes are being computerized in the organization. Thus it helps in the better performance of the organization. The company also maintains a database of all the information on the basic information of the organization as well as the solution to all the problems that are being faced by the company since last 7 years. This one of the best thing that can be found in this organization. The management information system helps the organization in number of ways:
Page 97
Speed: it is the main objective of using the computerized MIS. The reports that are being required to be prepared can be prepared within no time. Accuracy: it is also one of the important advantages of using the system. the reports that are being prepared are very much accurate providing the information input is correct.
Storage: MIS system helps in storing the information that can be used in the future. our organization being having computerized mis requires very much less space for storing the information. MIS reports: with the help of MIS it is easy to prepare reports required by the management such as comparative statements, fund flow statements, ratio statements, stock analysis, sales and production analysis, etc. Decision making: mis reports help in taking faster decisions as the reports and information is easily available which helps the organization avoiding losses due to faulty decisions. No repetition: mis system helps saving time of the employees because all the statistical data input at one place automatically gets at all the places hence avoiding the worker to do tedious work. The company does not use any readily available software in the market. Separate software is being developed with the help of programmers according to the requirement of the organization. Different type of softwares is being used for the different activities as follows: APS AND FAS : financial accounting MIS : stores and purchase TOTAL QC : quality control EXIIM : export and import PAYROLL : personnel Different type of special softwares is being used to cater different type of needs. This special type of software helps to get the best possible solution for the related problems. As all the softwares are being developed as per the needs of the organization, they get the better control over the programs. All the softwares are made so that they can be easily integrated with each other. Antivirus software from Norton and IBM is currently installed for security reasons.
Page 98
Chapter 10
IDENTIFICATION OF PROBLEMS OR ISSUES 10.1 Marketing Problems of SPL After analyzing its present market expansion strategies, the following problems have been found in it: 1. It seems that SPL pursuing prescription for profit strategy for market penetration. It is partially good, but may not be perfect as the completion is very hard. There are some other parties who have the scope and ability to act as opinion leader and to motivate the buyer. These potential opinion leaders are remaining unexploited. SPL has enough resources to let them add value to the company. 2. I didnt find SPL adopting any strategy to create brand loyalty. But client is more profitable than customer in terms of both transaction as well as positive word-of-mouth communication. He himself can be an opinion leader. 3. Holding the heaviest product portfolio should not be the ultimate goal at all. Emphasis must be given on how early a new product can be launched in the market place than the competitor. 4. At present, SPL gets only 20% raw materials from its rabale plant and the rest are to be imported. It increases product cost. 5. Market should not be segmented only on the therapeutic drug basis. 6. Pharmaceutical value chain is a bit different from traditional value as it includes an additional step in the start Discovery. This step is a vital strength of any pharmaceutical company. SPL lacks this component in its value chain. 10.2 HR Department Problems of SPL During my stay, I have found following main problems which I discussed with HR Manager. Serious shortage of employees in some production departments and sections.
Page 99
In Sanjivani, interviews are not conducted for lower level employees. There are no formal training programs for new incumbent. Strict beurucratic style of management. Short term planning for human resource. Forecasting of human resource need is based on subjective judgment. Orientation & training period of new incumbent are very short and new employee has to learn everything from his mistakes. Promotion policy of Sanjivani is not clear. There is job dissatisfaction and very low motivation on the staff 10.3 Production Department Problems of SPL In production department, most critical part is filling of BMR. Because it requires great attention and accuracy also. But as I seen generally officers are so much busy with their work (instructing to operators and workers).
Multitasking continuously affects work. Lower level workers are not properly divided into different departments. Few peoples are only are machine operators their absence effects production flow. In night shift only two chemists handle the work.
10.4 Finance Department Problems of SPL Working on the financing procedure of SPL was an interesting issue. The following problems are made on the basis of research work: Yearly increment of salary is one of the major issues of labor rate increasing. Sanjivani provides salary increment every year. Therefore, the cost of direct labor is increased. Time consuming decision making process. Lack of asset management and debt. Minimum profit in comparison with others. The long-term creditors are not interested in company's ability to repay Payments are not coming properly. SPL heavily depend on local financial resources and are frequently the victims of exploitation by the money lenders. Delayed payment of dues to them or locking up of their capital in unsold stocks.
10.5 Regulatory Department Problems of SPL Inadequate regulatory expertise and testing facilities to implement uniform standards
Page 100
Need for greater thrust on institutional support to SPL to enable speedy implementation of Schedule M up gradation and standardization of drug quality Proliferation of spurious and substandard drugs in the Indian market Dual licensing mechanism acts as a deterrent to uniform implementation of regulatory procedures Lack of transparency in licensing procedures. Inadequate adoption of good manufacturing practices to meet global regulatory standards.
10.6 IT Department Problems of SPL Lack of adequate expertise, training for technological up gradation. Limited adoption of information technology techniques in production and processes. Shortage of IT staff. SPL have not their own logistics software.
Page 101
Chapter 11
Solutions 11.1Financial solutions SPL tries to ensure better quality and better management. The staffs demonstrate their knowledge and experience with sheer professionalism. Despite these efforts some shortcomings may remain and there is always an opportunity to overcome those. Throughout my study I have found that they have some opportunity that they can take being taking proper steps. On the basis of my understanding and observation I am proposing the following solutions of problems to the Sanjivani Pharma: Factory Overhead, Selling and Administrative overhead: Factory overhead, selling and administrative overhead is increasing year to year. The increasing trend is totally straight. Company should control the overhead properly. We know that company has no direct control over raw material prices. In the increasing raw material every company will be sufferer but company can properly control the overhead. The control of overhead is totally under the decision of the management. Management should proper analysis of the overhead cost on the basis of this analysis they should prepare budget. Company should not prepare the budget on the basis of the requirement of the department demand. Cost manager should have proper knowledge about the all departments functions and activities properly. Petty Cash Expenses: Sanjivani distributes their goods through stockiests. They gets commission for their activities. Stockiest takes their expenses from daily cash collection for expenses of distribution. With the working with the petty cash sections I have shown that depot of the stockiest overstate their expenses. For these activities the overhead cost is increasing day by day. Proposed Policy: Sanjivani Pharma should make budget for the daily expenses. Through proper budgetary control and research on that will minimize the expenses. SPL should set out daily allowance of the depot of stockiest on the basis of the proper study and observation.
Page 102
Management should emphasis to reduce the differences between Average collection period and average payment period. It wills results liquidity of the company. Management should try to boost up its quick and current rations & the earnings per share.
11.2 Production solutions As I discussed that BMR is not accurate, So I suggest that company has to use on line BMR program, which has following benefits: Increase accuracy. System properly followed. Save time of officers. Easy to preserve for (2 to 3 years) long time. Easy to retrieve data from any BMR. All statistical calculation became automatic. Also help to planning activities of different areas. In my project duration, I observe so many waste or misuse of stationeries; employees blindly print material which they want.
11.3 Marketing solutions Sales agents are expected to market themselves and their brand in a way that is convincing to physicians in order to gain the sale. For this reason, agents' attention also extends to nurses and administrative staff who can assist with scheduling and physician communication. To get your foot in the door and win over potential clients, use simple yet believable marketing techniques. Meal Meetings
Hosting a dinner meeting for physicians and nurses to give information about your products is a convincing way to market. Organize a catered dinner meeting at a local restaurants separate dining room, and give an informational presentation. Make use of this time by providing plenty of information in an organized folder or notebook that can be given to attendees. This is an opportune time to provide samples for physicians to take back to their offices or schedule meetings to discuss their needs.
Page 103
Informative Handouts
Prepare information packets with detailed information regarding your product and its uses. The documents you present should be clear and professional. Each packet should be consistent and professionally produced to represent a professional image of your brand. Have enough materials handy for nurses and unconfirmed arrivals to your meetings and appointments.
Promotional Items
Get promotional items such as pedometers, stress balls and pill boxes that have your logo on them. Hand these out as you encounter potential clients and to accompany your sales packets. Pharmaceutical promotional supply company Pharma-Insight, Inc. specializes in medical-related gifts and promotional items that can be used to market your brand. The company focuses on handy products that have health care staff in mind including pill splitters, medicine measurers and thermometers.
Fairs, Expos and Conferences
Attend health related fairs, expos and conferences. These events are frequented by medical professionals, as the hosts of these events, exhibitors and attendees. Coordinate with event producers to secure a spot to present a specialty workshop or host after-hours events for targeted physicians at a local restaurant or private hotel dining area. If the conference is at a resort property, book a suite where you can host an information reception or networking mixer in your room to entice potential clients about your brand. This will build rapport and brand recognition.
11.4 Human resources solutions The belief Great People Create Great Organizations has to be at the core of the Company's approach to its people. Their employees are most important assets and source of competitive advantage. Company success depends entirely on the strength of talent pool which they have to build by fostering an environment and continually investing in them to enable them to deliver superior performance. Human Resources strategy is aimed at talent acquisition, development, motivation and retention. SPL has to focus on following steps: Hiring People: Hiring right is the first step, often by tapping into the networks of existing members.
Page 104
Energizing Existing People: Engaging and energizing the existing work, building a pipeline for the future and creating an exciting work place. Reviewed Policies: The focus was to make the policies employees friendly keeping in view employees specific needs. The HR policies are being reviewed and benchmarked with world class organizations. Accountability: Team Leaders review the results and act on the opportunities identified to improve engagement. Everyone responsible for own task. Employees Relations: A healthy Employee Relations environment was maintained across the organization in line with the Company's business goals and mission. 11.5 Regulatory solutions SPL has to adopt prudent risk management measures and mechanism to mitigate environmental, operational and business risks. Price Control: Risk: - The domestic market is subject to price control under Drug Price Control Order (DPCO), 1995. In the event Government reduces the prices of Company's products under DPCO or introduces price control on products currently not subject to such control, the profits margins could be significantly affected. Concern: - The Company has to manage its product portfolio so as to minimize the product weightage of drugs under price control. Prudent procurement strategies and forecasting systems will help the Company to sustain its profitability. Intellectual Property Right (IPR) Regime: Risk: - Patent laws in respect of pharmaceutical product have been changes effective 1st January, 2005. This would mean that pharmaceutical product patented after1st January, 1995 can no longer be copied through process re-engineering. This has narrowed the choice of new product which the company can introduce in the market. Indian market being price sensitive is less likely to see significant penetration of patented molecules. Concern: - Generic versions of out-of-patented life cycle.
Page 105
Chapter 12
Recommendations 12.1 NEW CATEGORY OPINION LEADER Doctors are the only opinion leader in SPLs present strategy. It may be partially good, but cannot be perfect as the completion becomes more intense day by day. There are some other parties who have the scope and ability to act as opinion leader and to motivate the buyer. These potential opinion leaders are remaining unexploited. SPL has enough resources to let them add value to the company. Hereby I am proposing a hypothetical model to correct this strategyIn this model, Retailers have been selected as new opinion leader, besides the doctors & physicians. In return, they will enjoy above average profit margin
by selling SANJIVANI product.
12.2 KEEP PACE WITH THE RACE Todays world is changing very rapidly, in every sphere. Therefore, updating production plant alone is not enough to cope with the new environment. SPL has to have a keen eye if there is any change in HR development, transport, information technology, consumer relation management, medical science and so on. 12.3 SEGMENT THE CURRENT MARKET SEGMENT SPL is in need of more segmentation tools in an ongoing effort to establish close and sustainable relationships with customers.
Page 106
12.4 CUSTOMER ONCE, CLIENT FOR EVER Client is more profitable than customer in terms of both transaction as well as positive wordof-mouth communication. He himself can be an opinion leader. So, I am suggesting to adopt some programs that will let its customers be transformed into clients. The following model would better describe this concept: SPL has a strong brand image in pharmaceutical industry. It will facilitate this strategy. I am citing some instances here which may be useful for this strategy: a. Use of penem in ICU. b. Health awareness program in rural area. c. Modernization of educational institute or public hospital etc.
12.5 INTEGRATE GREATLY SPL imports 80% raw materials of its total requirements. This is an weakness if it wants to consistently expand its market. So it require either more API plants or increase in present production capacity. 11.6 DISCOVER THE UNDISCOVERED Pharmaceutical value chain is a bit different from traditional value as it includes an additional step Discovery. in the start This step is a vital strength of any pharmaceutical company. SPL lacks this component in its value chain.
Page 107
Chapter 13
Learning from IP Working at SPL has provided me with an invaluable experience of how the Production matters are run and solved. I had chosen to go into this field because of the interest I have in operation. From the entire above project I have gained a lot of practical experience of the work. I saw how work is done practically in organizations. I saw practical application of my theoretical knowledge. It was a great learning experience, but I observed something which I feel not a good practice. Basic pay of line workers disappointed me the most. There are many things that are still in books and remain in books. I think, organizations, in the process of reducing costs and competing globally, should not forget basic ethics, which are the essence of a good organization. During my stay in SPL, I have analysed their existing human recourse system and seen that how they are applying the Recruitment & Selection process (from job analysis to selection of employees) and I have seen that company recruit all those persons who are eligible to his criteria whether they are internal or external. It was also observed that layoff, termination, demotion and retirement polices are not clear as a result the moral of key employees were found at low level. Apply knowledge learned in the classroom. Again, theres a big difference between learning about strategies and tactics and actually applying them. Interning for an organization helps me learn how their classroom knowledge applies to real situations and reinforces concepts taught in classes. Gain valuable work experience. In most fields, no longer can a college graduate land an entry-level job with merely a bachelors degree and no prior work experience. Internships help me to get this real-world experience while still in college. Internship programs are a great way to generate more work samples for us professional portfolio and give us accomplishment stories for our resume and online profiles. Develop and build upon skills. Learning new skills in an internship will help me in future employment opportunities and might give me a leg up on competition in future application processes.
Page 108
Chapter 14 Reference Section

Appendix 1 BIBLIOGRAPHY JOURNALS

Dun & Bradstreet. 2007. Report on Emerging Pharmaceutical SMEs in India Pradhan, JP. 2007. New Policy Regime and Small Pharmaceutical Firms in India. ISID Working Paper Pradhan, JP. 2006. Global Competitiveness of the Indian Pharmaceutical Industry (Accessed at website: http://mpra.ub.uni-muenchen.de/12340/). MPRA Paper No. 12340. Posted on December 23, 2008. Sahu, PP. 2006. Adoption of Improved Technology in Indias Small Scale Industries. ISID Working Paper Planning Commission of India. 2006. Report of the Working Group on Drugs and Pharmaceuticals: Eleventh Plan. Annual Reports of Sanjivani Parenteral Ltd.
BOOKS Prof. Krishan Murthi. (2008). A Handbook of Employees Relations and Labour Laws in India. (1st ed.). Mumbai, India: NAD International Press. David A. Decenzo & Stephen P. Robbins (2004). Fundamentals Of Human Resource Management. (8th ed.) Marketing research By N.K Malhotra financial management - I.M. Panday
Websites: http://www.sanjivani.co.in www.pharmainfo.net http://biotechindia.wordpress.com/2008/02/22/an-overview-of-the-indianpharmaceutical-industry/ http://ezinearticles.com/?Impact-of-Product-Patent-on-FDI-in-Indian-PharmaceuticalIndustry&id=89594) http://www.rediff.com/money/2004/aug/27pharma.htm
PERSONS Ashwin khemka, Prashant Parab , Pramod Singh, Pramod Sharma , Hitesh Khona,Mahendra Kalwankar , Priya Sukhdeve, Aakash Patil , Sachin Shinde etc..
Page 109
Appendix 2 QUESTIONNAIRE Name: Name of shop: Contact no. : .. ..
1. Which drugs do you have for a ICU? (Give the name of 3 main drugs) 1. 2. 3
2. Do you have Penem and Prazosan? Yes No
3. Which brands are available in your shop and also mention the price of drug? Meropenem 1 2 3 4 Cefrobactum 1 2 3 4 ( ( ( ( ( ( ( ( Rs. ) ) ) ) Rs. ) ) ) )
Page 110
4. Which doctors are prescribing these medicines? (Write name with specialization area of doctor) Name 1. Dr.. 2. Dr 3. Dr.. 4. Dr.. 5. Dr. Specialization ( ( ( ( ( . ) ) ) ) )
5. Which drug is selling mostly? 6. Give reasons for your answer. 1.... 2.
7. What is present situation of Dr. Reddys products? Very good Average Good Below avg. Above avg. Bad
8. What are the reasons for this situation? 1 2 9. Any opinions for company to raise the products market share. 1 2 3 4..
Page 111
Appendix 3 APPOINTMENT LETTER
Page 112
Appendix 4 COMPANY CERTIFICATE
Page 113
List of Abbreviations
AC / DC ANDAS API APS BM BMR CAGR CNS CVS DHS DMFS DTC DTP EMR FAS FO GATT GMP ICU ILTC IPR LAL MMS NGOS, NLT NMT NPPA OTC PATM PBIDTM PTR PTS RFC SPL UN UTL WHO ASSISTANT COMMISSIONER OR DEPUTY COMMISSIONER ABBREVIATED NEW DRUG APPLICATION ACTIVE PHARMACEUTICALS INGREDIENTS ADMINISTRATIVE POLICY STATEMENTS BRANCH MANAGER BATCH MANUFACTURING RECORD COMPOUND ANNUAL GROWTH RATE CENTRAL NERVOUS SYSTEM CARDIOVASCULAR SYSTEM DRY HEAT STERILIZATION DRUG MASTER FILES DIRECT-TO-USERS DIRECT-TO-PHYSICIAN EXCLUSIVE MARKETING RIGHTS FINANCE PROCEDURAL STATEMENTS FILLING OPERATION GENERAL AGREEMENT ON TRADE AND TARIFF GOOD MANUFACTURING PRACTICES INTENSIVE CARE UNIT INTERMEDIATE AND LONG-TERM CARE INTELLECTUAL PROPERTY RIGHTS LIMULUS AMEBOCYTE LYSATE MASTER IN MANAGEMENT STUDIES NON-GOVERNMENTAL ORGANIZATION NOT LESS THAN NOT MORE THAN NATIONAL PHARMACEUTICAL PRICING AUTHORITY OVER THE COUNTER PROFIT AFTER TAX MARGIN PROFIT BEFORE INTEREST DEPRECIATION AND TAX MARGIN PRICE TO RETAILERS PRICE TO STOCKIEST ROLLING FORECAST SANJIVANI PARENTERAL LTD. UNITED NATION UNIMED TECHNOLOGIES LTD WORLD HEALTH ORG.
Page 114
Page 115
Page 116

SPL

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

SPL

Uploaded by

Copyright:

Available Formats

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

MASTERS IN MANAGEMENT STUDIES Summer Internship Report

Name of Company: Sanjivani Parenteral Ltd

Phone No. +91-22-66888700

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

Place: Mumbai Date:

Signature of the Student

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

Place: Mumbai Date: July , 2012

Signature of the student (TRILOK MISHRA)

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

8.6 8.7 8.8 8.9 8.10 8.11 8.12

87 88 89-90 90-91 91-92 92-93 93

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

7.1 8.1 8.2 8.3 8.4 8.5 8.6

114 9 9 9-11 12-14 18 19 22 23 24-25 28 29-30 31 32 33-38 39 40 41 42

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

Research and Development

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

Table 1.1 leading Pharma players in India

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

Dr. Reddy's Laboratories

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

Therapeutic Products Animal Products Key Products Oral Solids

80 mg/2ml 10 ml, 30 ml Vial 2 gm 4 mg/ml 200 mg/ml Vial 30 ml Vial 30 ml Vial

BESs Institute of Management Studies and Research

INTERNSHIP REPORT ON SANJIVANI PARANETRAL

Ivermectin Vitamin A (as Palmitate)

10 ml, 30 ml Vial 10 ml Vial

Table 2.2(a) Key products of company

BROADCEF CEFPH SANROXIME SANCLAV SANTAZ

Vial Vial Vial Vial Vial