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The Vision

(Private) Limited

2008

Business Scope
AGP Defines its business within the Pharmaceutical Industry. The Vision is to become the Market Leader in the Antibiotics and Pain Killer Segments by providing the highest quality Brands to customers. AGP has acquired Eli Lillys Antibiotic Product Line to market in Pakistan. AGP is progressing towards Export Business in Nairobi, Phillipines, Canada.

(Private) Limited

Competition
GSK Multinational Pharmaceutical Market Leader BMS Multinational with competing products in same market segments. Hilton National Pharmacetical Company with same product portfolio in Pain Killer Market Getz Largest Growing Pharmaceutical National Company in Pakistan

(Private) Limited

Company Introduction
Company Size = 1.46 Bil PKR Company Ranking in Pharmaceutical Industry = 11th Company Market Share : 2.14 % Business Units = 5 Target Segments = GPs, Gynae, Derma, Surgeons, Paeds/ENT National Distribution Network = AGnC Company

LOGO Branches in Pakistan : Khi, Hyd, Skr, Qta, Mux, Fsd, Gjw, Lhr, Rwp, Psw, DIK

Pharma Market
64.3 billion PKR Growing at 11 %
2.31 bil 15 %

J01D2

J01D1 2.44 bil


15 %

Pharma Market
M01A1 Others
3.36 bil 12 %

The Pharma Market


87934200 79220000 71370000 64350755 57722665 51212247 40160267 42414699 45271007

IMS QIV,1996- 2004

97606900

32815344 34588082

36179607

(+000)

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

No. of Companie s

482

489

507

522

542

571

550

583

586

590

602

614

622

Pakistan Total Pharma Market Code Major Therapeutic Class

Value in Billion Growth Units (+ 00) Value (+ 000)

64.3 11% Share % 25.6 20.5 11.3 7.9 6.9

J A N R C

Systemic Anti-Infectives Alimentary Tract & Metabolism CNS Respiratory System Cardiovascular System

1585155 12515684 1931218 10041243 846421 1348845 315153 5532062 3877881 3354425

Source : Archives 2002

Code

Category

Unit
(+ 00)

Value
(+ 000) 12515684 11155194 372946 11196 2539757 3585083 1799319 1785763 1791244

Share
% 25.6 22.8 0.8 0.2 5.2 7.3 3.7 3.7 3.7

Goly
% 13 13 6 15 16 18 18 17 11

J
J01 J01A J01B

Systemic anti-infectives Antibiotic systemic Tetracycline & Combs Chloramphenicols & Combs

1585155 1466165

20095 51043 421682 341295 157910 183385 121104

J01C Broad Spectrum Penicillin (Oral) J01D Cephalosporins & Combs J01D1 Oral J01D2 Injectables J01G Fluoroquinolones

Source : Archives 2002

Cephalosporins
Cephalosporins & Comb (J01D) Oral (J01D1) 7474216 6674000 5958400 5320000 4756733 4128542 3710841 3220076 2972966 2719102 2386699 2376939 2344370
(+000)

IMS QIV,1996- 2004

3839387 3428020 3060700 2444720 2732000

1224208 1316648

1378886 1481184

1502432 1621802

1860177

2119909

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

IMS Q-III,1996- 2004

Major Players in J01D1


800000 700000
619346 709751 663319 575000 523985

600000 500000
447691 417166

400000
336960

360937 310554

365229

377389

300000 200000 100000


(+000)

290671

171870

189048

171835

167513

191264 156238 152680 71267

204671

203359

213000

220000

225000

65949

66458

59764

79894 85089 88557

83519

99715

116000

141700

235000 200000 170000

0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Velosef

Ceporex

Keflex

About the Market Share & Growth


Year
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Mrkt J01D1
Size in Billion

BMS
% 25.2 23.8 24.1 24.5 23.5 23.2 22.0 21.9 21.0 20.2 19.3 18.5 % 15.8 -7.8 16.2 1.1 3.32 10.5 7.3 17 9.9 7.9 7.1 7.0 %

GSK
% 9.9 -9.1 -2.5 -6.7 -2.2 25.2 7 -0.6 4.9 3.2 2.27 4.4 % 14.1 13.1 11.2 10.4 9.5 10.6 10.0 8.5 7.8 7.1 6.5 6.8

AGP
% 0.7 -10.1 33.8 6.5 4.07 -19.5 17.1 19.39 16.7 22.1 19.9 17.6 4.9 4.5 5.3 5.7 5.5 3.9 4.1 4.1 4.2 4.5 4.8 5.2

% 11.1 -2.4 14.6 -0.4 7.5 11.9 13.2 17.4 11.1 11.1 11.1 11.1

1.31 1.37 1.48 1.50 1.62 1.86 2.11 2.44 2.73 3.06 3.42 3.83

IMS Q-III,1997- 2004

Which Indications

To Target ?

AGP Prescription Audit


SSTI 6% Others 9%

RTI 85%

Rx Index, IMS, 2002

Prescription Share of BMS


Others 25%

SSTI 16% UTI 9%

RTI 50%

Rx Index, IMS, 2002

Prescription Share of GSK


RTI 77%

Others 9%

SSTI 7%

UTI 7%

Rx Index, IMS, 2002

Which Specialities

To Target ?

AGP Customer Audit


GPs 87%

RM O 9%

Phy 2% Paeds 2% S u rg 0%

Rx Index, IMS, 2002

BMS Share in Specialities

RMO 20%

GPs 64%

EENT 3% Gyn 2%

Surg 6%

Paeds 3%

Phy 2%

Rx Index, IMS, 2002

GSK Share in Specialtites

RM O 20% GPs 70% E ENT 2% D erm 1% Gyn 1% S u rg 1 %P a e d s P h y 4% 1%

Rx Index, IMS, 2002

Age Bracket

Rx Index, IMS, 2002

Prescription share in Age Groups


40 35 30 25 20 15 10 5 0 under 1 1 - 4 yrs 5-11 yrs 12-19 yrs 20-29 yrs 30-39 yrs 40-54 yrs 55-64 yrs 65+ yrs

(+000)

BMS

GSK

AGP

Competitor Analysis

Where We Are ??

Parameters Product Life Cycle Product Size Distribution Product Portfolio

BMS Mature 1.98 bil P.D.s

AGP Growth 1.46 bil


AGnC

GSK Mature 8.4 bil MnP

Antibiotics/Pain Antibiotics/ Vitamins/ Oncology/ Killers/Vitamins/ Pain Killers Antibiotics/ Pain Oncology / CNS / Killers/ CNS/ Respratory Cardio / Resp. GPs + Gynae + GPs + Gynae + RMO GPs + Paeds + Surg + RMO + ENT RMO + Gyne + + Paeds + Phy ENT + Dent

Customer Base

Marketing Operations Production Capacity Human Resource Deployment Financial Capabilities Brand Ownership

Lucrative Completely Utilized

Lucrative Under Utilized

Lucrative
Completely Utilized + 3rd Party Mnftg

260 SPOs High High


Experienced

190 SPOs High Mediocre


Fresh

430 SPOs High High


Experienced

Distribution Analysis
Outlets/100 Institutions)

(*Assuming total 300 W.S. & 1000 Retail

Channel

Product Mix

Outlet Coverage
No. of Outlets selling Product Mix Total no. of Outlets

Market Reach
Sale of Product Mix Sale of all brands

AGnC

Distributor to W. Sale Distributor to Retailer Distributor to Institutions Distributor to Consumer

AGP

83 % 50 % 2% 0%

3% 1.2 % 0.1 % 0% 32 % 24 % 18 % 1% 24 % 31 % 19 % 2%

MnP

Distributor to W. Sale Distributor to Retailer Distributor to Institutions Distributor to Consumer

GSK

85 % 75 % 56 % 2%

P.D.s

Distributor to W. Sale Distributor to Retailer Distributor to Institutions Distributor to Consumer

BMS

76 % 86 % 67 % 4%

Cost Analysis

Raw Materials

Operational Cost

Fixed Costs

Inventory Cost Logistic Cost

Distr. Cost

Selling Cost

Total

AGP

18 %

21 %

16 %

11 %

9%

4%

21 %

100 %

BMS

16 %

21 %

21 %

9%

11 %

8%

14 %

100 %

GSK

12 %

18 %

25 %

11 %

13 %

4%

17 %

100 %

To Predict Future
P L E S T olitical Affairs : Army Dominance in Institutions egal Issues : WTO Factor conomic Climate : Local Pharma Industry Revolution ocial Changes : Doctors getting personalized echnological Advancement : Research & Development

Consider the above parameters

Key Performance Indicators (KPIs)


KPIs Standard Where we are 5 lac Improvement Plans I II III Expand portfolio Open new Specialties Open new Specialties Incentives Out House Training Increase Branches

SPO Yield

10 lac

Increase Dr Reduce on List Territory Size Launch new Products Expand Coverage Expand Coverage Hierchy On Job Training

Double Digit Growth Standard Minute Value


(Productivity Time)

25 %

7%

Rs. 1000 per Rs. 633.5 Increase minute per minute working time in Field 0% No Limit MnP 15 % Mediocre AGnC Training Training Workshops

Employee turnover Skill Development Strong Distribution

Increase Field Increase Vans Force

Confrontation Matrix

Strengths

6 sigma Organization Positive Work Climate Aggressive Attitude towards Growth Production Capacity Growing Phase

Weaknesses

Weak Distribution Inexperienced Managers Lack of Branding Power No RnD

HIGH RISK

After Improvement

PROMISING

Opportunities

Threats

New Product Segments New Customer Base Institutional Business Expansion of Field Force Managers Training

Loss of Sales because of Substitution Majorly Driven by GPs Customer Base Likely entry of Competition

The Customer : Basis of our Business


What do Customers want ?

MOST IMPORTANT ASPECTS How do we Score ?


Key Strengths & Weaknesses

Whats the Competition upto ??

Relative Importance of Factors


Factors Absolutely Critical Quality Efficacy Safety Convenience Regular Reminder Presentable SPO Marketing gimmickry You scratch my back & I will scratch yours Availability Discount Price 90 % 90 % 100 % 50 % 75 % 50 % 35 % 35 % 35 % 20 % 20 % 20 % 25 % 10 % 5% 20 % 20 % 10 % 20 % 5% 5% 15 % 20 % 5% Very Important 5% 10 % Importance Range Quite Important 5% Not so Important Not Important Dont want it Total 100 % 100 % 100 % 100 % 100 % 100 % 100 % 100 %

90 % 25 % 95 %

5% 10 % 5%

5% 25 % 25 % 15 %

100 % 100 % 100 %

Performance Rating Against Customers Buying Criteria


S. No
1 2 3 4 5 6

Product Related
Quality Efficacy Safety Convenience Discount Price

Weightage
10 % 10 % 15 % 10 % 3% 10 %

Velosef
10 % 10 % 15 % 10 % 2% 7%

Ceporex
10 % 10 % 15 % 5% 1% 8%

Keflex
10 % 10 % 15 % 5% 2% 8%

S. No
1 2 3 4 5

Service Related
Regular Reminder Presentable SPO Marketing gimmickry You scratch my back & I will scratch yours Distribution TOTAL 10 % 5% 10 % 2% 15 % 100 % 5% 5% 5% 15 % 85 % 5% 5% 5% -% 15 % 79 % 8% 2% 7% 1% 5% 73 %

Phillips Relative Performance Rating Matrix


Keflex Vs. Velosef & Ceporex

Good Same Bad

Quality Efficacy

Safety

Discounts Convenience Price

Regular Reminder

Mrktg Gimmicks Deals

Distrib.

Presentable SPO

Sir,
That completes the first part of this presentation

Market Dynamics Internal Analysis Confrontation Matrix Customer Demand Our Position in Customers Eyes

Now
THE PATH TOWARDS 2008

The Mission

Strategic Intent
Nothing but the Best !!
Core Values Core Purpose
Core Values: Quality Pharma Products Core Purpose: We Value Life Business Vision: Market Leader in J01D1 BHAG: 200 mil in 2008

Business Vision

Big, Hairy, Audacious Goals

How will we grab Velosef share ??

Hit its 500mg Strength

Velosef Line Contribution


250m g C ap s 13%

25 0 S u sp 16 % 500m g C ap s 57%

125 S u sp 14%

IMS, Q IV 2004

Keflex Line Contribution (In 2004)


250mg C apsules 5%

500m g C ap sule s 15%

125m g S usp 33% D ro ps 31%

250m g S u sp 16%

IMS, Q IV 2004

Keflex Line Contribution (In 2008)


2 5 0 m g C a p s u le s 8%

5 0 0 m g C a p s u le s 25%

D ro p s 26%

125mg Susp 26% 250m g Susp 15%

Ceporex Line Contribution


250mg Caps 13% 250 Susp 20% 500mg Caps 28%

125 Susp 29%

Drops 10%

IMS, Q IV 2004

Where do we see ourselves ??

Product Line Development

Keflex 125mg Susp


60000
52000

50000
45000

40000
32378

40000 35154 26382 20517 11976 22608 22721 27666

30000 20000 10000 0 1996


(+000)

7685

10090

1998

2000

2002
Keflex 125 Susp

2004

2006

2008

IMS Q III, 1996 to Q III, 2004

Keflex 250mg Susp


30000 25000
22200 25000 29000

20000
15785

19100

15000 10000 5000 0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Keflex 250 Susp
(+000)

9119

10065 8584 8119

11160

12472 10550

12549

IMS Q III, 1996 to Q III, 2004

16000 14000 12000 10000 8000 6000 4000 2000 0

Keflex 250mg Caps


15000 12000

9000

5259 3524 3537

5793

5728

6140 5279 3855 4053 5283

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Keflex 250 Cap


(+000)

IMS Q III, 1996 to Q III, 2004

Keflex 500mg Caps


60000
52000

50000
41000

40000
30000

30000
20000 14763 9147 10506 15406

20000
14131

18684 18336

10000

8314

0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Keflex 500 Cap
(+000)

IMS Q III, 1996 to Q III, 2004

60000

Keflex Drops
52000 47000 40500 34693

50000

40000
29662 24994 30862

30000
24018 19016 21331 19397

27257

28745

20000

10000

0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Keflex Drops
(+000)

IMS Q III, 1996 to Q III, 2004

Tactical Plan
2006
Increase Doctor Coverage in Local Cities Base SPOs in Hospitals Tap Local Potential & Gynae Segment Include in Hospital Formularies

2007
Deploy SPOs in Potential Towns Increase Coverage in Peripheral Areas Expand into Surgery Segment Grab Tender Business

2008
Government Institutions Street Business Hospital Business Tender Business

Segments of GPs, Gynae, Surgery should be our domain. We should enter into Hospitals, Government Institutions & dominate Streets

Competitive Innovation
Increase Field Force Size
SPOs = 85 RSMs = 17 SMs = 3

Till 2008

Expand Specialities
GPs Gynae Surgery RMOs Paeds

3 Zones 13 Regions 19 Deployed SPOs

2005

3 SMs 13 RSMs 60 SPOs

In 2006

Increase Field Force


Karachi Hyderabad Sukkur Quetta Multan Bahawalpur Gujranwala Lahore Faisalabad Rawalpindi DIK Peshawar SPOs = 16 SPOs = 6 SPOs = 5 SPOs = 2 SPOs = 5 SPOs = 4 SPOs = 3 SPOs = 10 SPOs = 5 SPOs = 8 SPOs = 3 SPOs = 6
SPOs = 72

/ / / / / / / / / / / /
/

RSM = 2 RSM = 1 RSM = 1 RSM = 1 RSM = 1 RSm = 1 RSM = 1 RSM = 2 RSM = 1 RSM = 1 RSM = 1 RSM = 1
RSMs = 14

Total

Strategic Drift
Doctors on List = 140 GPs = 70
A4 = 45 A3 = 15 A2 = 10

Surgery = 10
A4 = 5 A3 = 5 A2 = 0 Daily Calls = 18

Gynae = 35
A4 = 20 A3 = 10 A2 = 5

Paeds = 2
A4 = 2 A3 = 0 A2 = 0

RMOs = 15
A3 = 5 A2 = 10

Others = 8
A3 = 3 A2 = 5

Working Behavior
Morning = 12 Calls
Morning starts
OT Reminder Ward Working Hospital OPDs GPs Working Discharge Slips

Evening = 6 Calls
GPs Working Consultant Calls

Daily Chemist Calls = 6

Meeting Schedule

Weekly Meeting

Every Monday - 3:00 PM to 5:00 PM Regional Meeting - 9:00 AM to 5:00 PM Zonal Meeting - 2 days Pakistan Level - 3 Days

Quarterly Meeting

6 Monthly Meeting

Annual Meeting

For Expansion Strategy, consider the following parameters

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12.

The Costs of Gaining Share & ROI Knock On Effect Changing Loyalty of Customers from Competition involves higher investments Organization Intent to Grow PLC Increase in Share is attractive from less appealing and less profitable segments Monopoly Legislation Competitive Fight Short Term Gain Competitive Retaliation Brand Equity Dont Fall in No Mans Land

Take Risks BUT Take Calculated Risks !!

Wish us Good Luck !!

Thank You