Lupin Limited is a multi-national pharmaceutical company that is headquartered in Mumbai. The company that was set up in 1968 by Desh Bandhu Gupta, was a family-owned business during the days of its inception. The company which gets its name from the flower Lupin was established with the vision to fight against infectious and deadly diseases.
Today, Lupin has grown to become the seventh largest company by market capitalization and is ranked at number 10 in terms of revenue from generic drugs. The company has a fast-growing presence in the USA and is ranked fifth in the list of generic pharmaceutical brands in the country.
Lupin Limited started gaining importance in the pharmaceutical industry after the discovery of tuberculosis drugs and slowly went on to become the world leader in TB drugs.Today the company has drugs in cardiovascular diseases, diabetes, asthma, pediatrics, geriatrics, NSAID and anti-infection drugs.
Strengths in the SWOT analysis of Lupin Limited :
Strengths are defined as what each business does best in its gamut of operations which can give it an upper hand over its competitors. The following are the strengths of Lupin Limited :
- Market leadership in various drug categories: The company is a market leader in anti-tuberculosis drugs and cephalosporin. The company also has a significant presence in Central Nervous System (CNS), Oncology, Cardiovascular, diabetes, asthma, pediatrics, geriatrics, NSAID, and anti-Infectives.
- Market leadership in various markets: The company is ranked at number 2 in the pharma industry in India. It is the 4th largest company in the USA in terms of prescriptions with a market share of 5.3 % and the 6 th largest pharma company selling generic drugs in Japan.
- Focus on strategy: Lupin Limited was set up with the vision of making drugs affordable to all so that world would be free of diseases. The company continues to be focused on its vision and could churn out a pipeline of healthy drugs accessible to all.
- Series of successful acquisitions: Lupin made a series of acquisitions the past financial year out of which the most significant one was that of the branded product portfolio from Shionogi in Japan which gave them complete control of more than 21 long-listed drugs in Central Nervous System (CNS), Oncology, Cardiovascular and Anti-Infectives. Other recent acquisitions include Gavis, Medquimica and Temmler have also helped the company widen their portfolio of drugs.
Weaknesses in the SWOT analysis of Lupin Limited :
- Higher dependence on foreign markets: Lupin Limited looks up to the US for almost 84 percent of its revenue and in the country, there is a sharp decline in same of generic drugs which is the key ingredient of Lupins portfolio.
- Adherence to regulation: The Company is in a sector which is subject to a very strict regulatory framework with the result that adhering to this can be a costly and challenging affair. There is also an added risk of dealing with prohibited compositions.
- Labour overheads: The pharma business is a research-intensive domain and therefore labor intensive. The core team comprises a group of highly qualified professionals and managing them is no easy task.
- Excessive importance to low growth segments: Most of the drugs of Lupin are in low-growth areas such as Central Nervous System (CNS), Cardiovascular and Anti-Infectives. The company was also into TB research where the market has slowed down as many countries have almost eradicated the disease through mass vaccination drives.
Opportunities in the SWOT analysis of Lupin Limited :
Opportunities refer to those avenues in the environment that surrounds the business on which it can capitalize to increase its returns. Some of the opportunities include:
- Policy reform: Donald Trump has put the Patient Protection and Affordable Care Act (ACA Act) under review and experts believe that the new set of reforms will favor pharma companies dealing with generic drugs. If this speculation is true, it could open up a whole new gamut of avenues for Lupin whose prime market is the USA.
- Growing demand for biosimilars: There will be a growth spurt for biosimilars which will catapult the focus from smaller molecules to biosimilars. This is an opportunity that can be used in the company’s favor if adequate research is undertaken.
- Patient-driven health care: Technology trends indicating that medical treatment will start being more patient-centric with the growth in demand for wearable biometric devices and telemedicine. This will empower the patients with the right information and this, in turn, will increase their engagement levels as well as their role in the treatment process prescribed by the doctor.
Threats in the SWOT analysis of Lupin Limited :
Threats are those factors in the environment which can be detrimental to the growth of the business. Some of the threats include:
- Competition: With lowered barriers to entry, the pharma industry is growing by leaps and bounds and the company faces stiff competition from Ranbaxy and Cipla in the Indian market.
- Change of government policy: With every new government, regulatory framework and policies change, with the result that pharma companies have to readjust their research norms as well as drug compositions. This creates a lot of monetary challenges.