‘Will consider US manufacturing if there’s strategic value’ – Times of India

Torrent Pharmaceuticals: Strategic Growth and Alignment with Sustainable Development Goals

1.0 Executive Summary

Torrent Pharmaceuticals, a flagship entity of the Torrent Group, has outlined a strategic growth plan centered on innovation, market expansion, and acquisitions. This strategy demonstrates a strong alignment with several United Nations Sustainable Development Goals (SDGs), particularly SDG 3 (Good Health and Well-being), SDG 8 (Decent Work and Economic Growth), SDG 9 (Industry, Innovation, and Infrastructure), and SDG 17 (Partnerships for the Goals). The company aims to address unmet medical needs in chronic therapies, expand into high-growth segments, and strengthen its global presence, thereby contributing to sustainable economic and health outcomes.

2.0 Innovation and Commitment to Global Health (SDG 3 & SDG 9)

Torrent Pharma’s core strategy is to drive growth through innovation, directly supporting SDG 3 (Good Health and Well-being) by improving access to essential medicines and addressing non-communicable diseases.

• Focus on Chronic Therapies: The company prioritizes addressing “unmet needs in chronic diseases,” a critical area for improving long-term health outcomes in populations, especially in India.
• Strengthening Core Portfolio: Continued development of market-leading brands such as Shelcal (vitamins) and Nikoran (cardiac drug) reinforces its contribution to managing chronic health conditions.
• Expansion into New Therapies: Foraying into new segments, including weight-loss therapies, shows a proactive approach to emerging global health challenges.
• Fostering Innovation: By investing in innovation and aiming for first-to-market launches, Torrent Pharma contributes to SDG 9 (Industry, Innovation, and Infrastructure), enhancing the technological capabilities of the pharmaceutical sector in India and Brazil. Approximately 70% of its future pipeline is dedicated to the chronic domain.

3.0 Growth Through Strategic Acquisitions and Partnerships (SDG 8 & SDG 17)

The company’s acquisition-driven strategy is a key pillar for expansion, fostering economic growth and creating robust industry partnerships, in line with SDG 8 (Decent Work and Economic Growth) and SDG 17 (Partnerships for the Goals).

3.1 Acquisition Timeline and Integration

1. Elder Pharma (2014)
2. Unichem (2017)
3. Curatio (2022)
4. JB Chem (2025): The second-largest acquisition in five years, this move enhances Torrent’s position in high-growth areas and the contract development and manufacturing organization (CDMO) segment.

3.2 Financial and Strategic Implications

• Economic Contribution: The acquisition of JB Chem is a significant financial undertaking, financed by debt of over Rs 12,000 crore, representing a substantial investment in the national and global pharmaceutical industry, thereby promoting SDG 8.
• Partnership Model: This acquisition-led approach exemplifies SDG 17, as it involves integrating diverse corporate entities and capabilities to achieve shared health and business objectives. The primary focus for the next one to two years will be the successful integration of JB Chem.

4.0 International Market Expansion and Economic Footprint (SDG 8)

Torrent Pharma is expanding its global presence, contributing to economic growth and enhancing medicine accessibility in key international markets, which supports the objectives of SDG 8.

• Key Markets: Besides India, significant markets include Brazil and Germany. Brazil is projected to become its largest market, surpassing the US, due to a steady growth trajectory and a first-mover advantage.
• US Market Strategy: The US market currently accounts for 10-11% of revenue (approx. $150 million) and is growing at 25%. The company is considering establishing a manufacturing base in the US if it offers long-term strategic value, particularly in complex products with low competition.
• Global Revenue Diversification: This international strategy diversifies revenue streams and strengthens the company’s role as a global player in the pharmaceutical industry, fostering sustained economic growth.

Analysis of Sustainable Development Goals in the Article

1. Which SDGs are addressed or connected to the issues highlighted in the article?

The article on Torrent Pharma’s business strategy and growth plans connects to several Sustainable Development Goals (SDGs). The primary connections are with goals related to health, economic growth, and innovation.

• SDG 3: Good Health and Well-being: The core business of Torrent Pharma, as described in the article, is directly related to health. The company’s focus on developing and providing medicines for “chronic therapies,” its leadership in the vitamins category with “Shelcal,” and its portfolio including a “cardiac drug Nikoran” all contribute to ensuring healthy lives and promoting well-being. The plan to address “unmet needs in chronic diseases” is a central theme.
• SDG 8: Decent Work and Economic Growth: The article details the company’s economic activities, including its status as an “over Rs 11,500-crore company,” its acquisition-driven strategy, and its expansion into international markets. These activities contribute to sustained economic growth. The financing of acquisitions through “global banks” for “over Rs 12,000 crore” and revenue growth in markets like the US (“growing at 25% this year”) are clear indicators of economic activity.
• SDG 9: Industry, Innovation, and Infrastructure: A key strategy for Torrent Pharma is to “drive growth by focusing on innovation.” The article emphasizes the development of “complex products,” investing in “first-to-market launches,” and the belief that “we will see a lot more innovation coming from India.” This aligns with building resilient infrastructure, promoting inclusive and sustainable industrialization, and fostering innovation.
• SDG 17: Partnerships for the Goals: The company’s strategy involves multiple partnerships. This includes large-scale acquisitions (“Elder Pharma in 2014, then Unichem in 2017, then Curatio in 2022 and JB in 2025”), financing deals with “global banks,” and operating in a global marketplace with significant presence in India, Brazil, Germany, and the US. These actions reflect the mobilization of financial resources and global partnerships for sustainable development.

2. What specific targets under those SDGs can be identified based on the article’s content?

Based on the article’s discussion of Torrent Pharma’s strategies, several specific SDG targets can be identified:

1. Target 3.4: By 2030, reduce by one-third premature mortality from non-communicable diseases through prevention and treatment and promote mental health and well-being.
   • Explanation: The article explicitly states that the company’s “inherent strength has been in the chronic disease segment” and its focus is on addressing “unmet needs in chronic diseases.” Chronic conditions like cardiac issues (addressed by the drug Nikoran) are major non-communicable diseases. By innovating and providing therapies in this area, the company directly contributes to this target.
2. Target 3.b: Support the research and development of vaccines and medicines for the communicable and non-communicable diseases that primarily affect developing countries…
   • Explanation: Torrent Pharma’s plan to focus on “innovation” and create a “future pipeline” of “first-to-market launches” for chronic diseases, particularly with a focus on the “Indian population,” directly supports R&D for non-communicable diseases affecting a major developing country.
3. Target 8.2: Achieve higher levels of economic productivity through diversification, technological upgrading and innovation…
   • Explanation: The company’s strategy to expand into “high-growth segments” like “weight-loss therapies” and focus on “complex products” represents diversification and technological upgrading. The emphasis on “innovation” as a primary growth driver is a direct alignment with achieving higher economic productivity.
4. Target 9.5: Enhance scientific research, upgrade the technological capabilities of industrial sectors in all countries, in particular developing countries…encouraging innovation…
   • Explanation: The article highlights a shift towards greater innovation within India’s pharmaceutical industry, stating, “Over the next five to 10 years, we will see a lot more innovation coming from India than we’ve ever seen.” Torrent’s commitment to this trend by investing in a pipeline of new products enhances scientific research and upgrades the technological capabilities of the pharmaceutical sector in India.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

The article provides several quantitative and qualitative indicators that can be used to measure progress towards the identified targets:

• Indicator for Target 3.4 & 3.b (Access to Medicines): The article provides specific sales figures for key products that treat or prevent non-communicable diseases. For example, the “Rs 500-crore brand Shelcal (plus variants)” (vitamins) and the “cardiac drug Nikoran with sales of Rs 245-crore.” These figures serve as a proxy for the number of people accessing these essential medicines. The development of a “future pipeline” of “first-to-market launches” in the chronic domain is a qualitative indicator of future contributions.
• Indicator for Target 8.2 (Economic Performance): The article contains several financial metrics that indicate economic growth and productivity. These include the company’s total size (“over Rs 11,500-crore company”), revenue from specific markets (“The US accounts for about 10-11% of our revenue, around $150 million”), and revenue growth rate (“growing at 25% this year” in the US). The value of acquisitions, such as the “Rs 12,000 crore” outgo for the KKR stake in JB Chem, also indicates significant economic activity.
• Indicator for Target 9.5 (Investment in Innovation): While a specific R&D budget is not mentioned, the strategic intent is a strong implied indicator. The statement that “the ability to invest today in innovation is much higher than it was before” and the focus on developing “complex products” and “first-to-market launches” imply a significant allocation of resources towards research and innovation. The article mentions that “About 70% of these [launches] would be in the chronic domain,” which is a specific measure of the focus of innovation efforts.

4. Table of SDGs, Targets, and Indicators

Source: timesofindia.indiatimes.com