The Hindu Business Line : Dr Reddy’s scouting for buys

Hyderabad, Sept. 2 Pharma major Dr Reddy’s Laboratories is scouting for acquisitions as part of its strategy to handle economic slowdown, according to Mr G.V. Prasad, Vice-Chairman and CEO.

Responding to a question from a participant at a panel discussion on ‘Indian economy - Is it really slowing down’ at Indian School of Business (ISB) here on Tuesday, Mr Prasad said the company “is looking at inorganic growth and phasing of capex investments as the valuations are very attractive.”

On the impact of the global economic slowdown on Indian pharmaceutical industry, he said the industry was facing significant challenges. “As pharmaceutical industry is a global industry, exports’ revenues are important,” he said.

The growth of health insurance has come down in the US. “There also drug holidays and people are postponing even surgeries,” he said.

‘conservative’ approach

The ‘conservative’ approach of the US Food and Drug Administration would also impact the pharma industry and the new drug approvals have come down, significantly, he added.

The high input costs in China and high crude oil prices were impacting the industry adversely and it should focus on the core strengths and use the opportunities for inorganic growth, he opined.

Dr Subhashis Gangopadhyay, Advisor to Finance Minister, said, “We need to get more disaggregate and focus on micro economics. The industry should develop markets that generate income for the poor.” The panel discussion was organised by the CEO’s Club.

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