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Madhumathi D.S.

The company has zeroed in on Uttaranchal to set up its branded formulations unit to take advantage of the excise concession as part of a Rs 32-crore expansion plan.

Bangalore , Aug. 8

AT a time when acquisitions are the order of the industry, Bal Pharma says its decision to sell its Pune unit is in tune with a growth plan linked to the consolidation of its branded and lifestyle disorder products.

With this, Bal has also put on hold its plan for a bigger play in the ophthalmic segment, according to its MD, Mr Sailesh Siroya.

The Bangalore-based company had been toying with the idea of launching a full ophthalmic range until the MRP-based excise duty regime forced a change of strategy and made it seek offsets such as re-focus on the more lucrative branded and lifestyle segment. "We were planning to launch a full range of about 10 specialty eye drops and products and also form a marketing team exclusively for the ophthalmic products. That has been put in abeyance," perhaps for 12-18 months, Mr Siroya told Business Line.

The company has retained the portfolio in Pune, which includes IV fluids and eye drops, and continues to sell them under its brand name.

Mumbai-based Sunways India is to acquire the Pune unit in a Rs 5-crore deal, subject to shareholder approval. Bal Pharma itself acquired the unit in 1996-97 as Miaami Pharma; and the unit last year contributed a business of Rs 7 crore.

To be a significant player in the eye care game would have meant launching specialised brands, investing on suitable machinery and also facing competition from established MNC players that are focussed on the ophthalmic segment. The Rs 75-100 crore domestic ophthalmic field is alive with big names such as Allergan, Alkem and FDC who have diminished the size of regional players. "We will now focus on branded formulations and lifestyle products (to treat diabetes and cardiovascular problems)," Mr Siroya said. This will also make good any dent in the generics business that is happening across the industry due to the excise norm.

Bal Pharma has zeroed in on Uttaranchal to set up its branded formulations unit to take advantage of the excise concession as part of a Rs 32-crore expansion plan. It wants to quickly establish itself in the branded generics area. It is also putting up an active pharma ingredients plant in Bangalore.

The bulk drugs and branded products strategy is also yielding results and Bal Pharma is expecting a revenue of Rs 85 crore for the current fiscal.

The consolidation in lifestyle drugs has been on, with two new recent additions and four more to come in September-October for cardiovascular problems and diabetes.

The company in May completed a rights issue to raise Rs 11.75 crore to part-finance its expansion plan. The new facilities will be aimed at exports to the regulated Western markets.

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