Feature

Natco Pharma's new growth formula

The US market remains choppy but Natco Pharma is becoming a compelling bet by rebooting itself with a new strategy

RA Chandroo

If you had asked anyone a decade ago, “Where do you want to spend your vacation?” the answer would be “Paris” more often than not. It was a time when everyone — from new couples and families to young men and women — wanted to visit the ‘City of Lights, Love and Romance’. Today, there are way too many options for anyone with wanderlust. You can take your family of four for a week-long trip to Phuket, Budapest or Istanbul without burning a hole in your pocket. And just the way tourists are getting picky, Indian pharma companies are too, when it comes to their Paris — the US market — a destination that has been a mainstay for our drug companies for a very long time. But as competition intensifies, the market gets crowded, players consolidate, prices erode and the USFDA gets tough, drug makers are not looking at the US with the same zeal anymore. 

Rajeev Nannapaneni CEO, Natco PharmaSo, when Natco Pharma’s CEO Rajeev Nannapaneni was asked about the US market in June 2018, he said that the market is extremely competitive and one needs to have unique generic products to make money. It sounds like just another pharma company coming to terms with reality in the US, but Nannapaneni was among the first to accept that Natco, like its peers, has over-relied on the US. The country contributes nearly 40% to its revenue. “You have to do the US, but you should not overdo it like all have done, including myself. I am not saying that I am somehow different from others, I have done the same thing too,” he said in an earnings call in 2018. Post that, the company has been charting a new path — trying to strike a balance between the US, India and the rest of the world. But will it be successful?

Same, but different 

By breaking down its financials, one can see that the Hyderabad-based company has seen st

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