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W19005

CIPLA LIMITED: TAKING INHALATION THERAPY TO THE MASSES

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Servjaeta Verma wrote this case solely to provide material for class discussion. The author does not intend to illustrate either
effective or ineffective handling of a managerial situation. The author may have disguised certain names and other identifying
information to protect confidentiality.

This publication may not be transmitted, photocopied, digitized, or otherwise reproduced in any form or by any means without the
permission of the copyright holder. Reproduction of this material is not covered under authorization by any reproduction rights
organization. To order copies or request permission to reproduce materials, contact Ivey Publishing, Ivey Business School, Western

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University, London, Ontario, Canada, N6G 0N1; (t) 519.661.3208; (e) [email protected]; www.iveycases.com.

Copyright © 2019, Ivey Business School Foundation Version: 2019-01-11

In the second week of March 2014, Cipla Limited (Cipla), a leading pharmaceutical company in India,
was nearing the end of its financial year (FY) 2013–14. Debashis Sarkar, head of Cipla’s respiratory
division, had just concluded a meeting with his team members. The meeting’s agenda had included a
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review of the progress of the division’s sales and marketing objectives for FY 2013–14 and a plan for the
FY 2014–15 objectives. A performance assessment revealed that the division held a majority share in
most of the therapies under the respiratory umbrella. As a pioneer in inhalation therapy, Cipla was
globally acclaimed for its range of inhalers for obstructive airway diseases, including asthma and chronic
obstructive pulmonary disease (COPD). Taking inhalation therapy to the masses, especially in rural and
semi-urban areas, had been the prime objective of the respiratory division in FY 2013–14. That objective
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required strengthening its reach in the general practitioner segment (i.e., primary care physicians) and
extending optimal medical care to patients who were otherwise sub-optimally treated. The recent
employment of an extensive sales force, coupled with innovative promotional campaigns, had generated
promising results in the specialist segment. However, the division was still short of achieving the desired
impact in the general practitioner segment.

The team had proposed a further increase in sales and marketing expenditures, but the idea did not appeal
to Sarkar, who was known for his creative thinking and unconventional approach. Offering a different
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viewpoint, Sarkar instead proposed establishing a lateral structure of knowledge experts whose advice
would resonate well with the target audience and who would support the existing sales team in its market
expansion efforts. The thought was derived from his October 2013 experimental initiative in Delhi, where
he had appointed two doctors as respiratory therapy managers (RTM), working closely with Cipla’s sales
team. The initiative had quickly enhanced Sarkar’s business expansion efforts and had helped him
achieve his divisional objectives. However, his major dilemma was determining how to expand the plan
to apply it across all of India. The unconventional idea was currently not being practiced by any other
pharmaceutical company in India. Sarkar weighed the pros and cons of his plan, hoping to devise a
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blueprint for implementation and scaling up.

EXECUTIVES INVOLVED

Sarkar was a seasoned professional with more than 15 years of experience in the pharmaceutical industry
and a strong educational background. After achieving a postgraduate degree in mathematics, he had

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supplemented his professional education in management at the prestigious Indian School of Business in

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Hyderabad. Sarkar had been at Cipla since 2004, during which time he had held important strategic
portfolios such as head of marketing for chronic business and business head for the regions of East India,
Delhi, and Rajasthan. He had played an important role in establishing Cipla as a market leader in key
therapeutic segments, including the areas of urology and human immunodeficiency virus (HIV). With a
strong passion for marketing and strategy, he had spearheaded the launch of many brands that had

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eventually become leaders in their respective categories. As a member of the leadership team of Cipla’s
domestic business, he had contributed actively to key strategic decisions. He was known for his
innovative approach within the established business domain.

In addition to Sarkar, Cipla’s key decision makers were members of the respiratory division. Basant
Pachisia was in charge of the Breathefree team and was based in Mumbai. Other team members, who
were part of the Delhi sales team, included the divisional sales manager, Vijay Singh, and the regional

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managers, Farhan Pasha and Vishal Sharma.

BACKGROUND ON ASTHMA

Asthma was a medical condition in which a person’s airways became narrow and inflamed, causing
difficulty in breathing.1 It was usually associated with tightness in chest, cough, shortness of breath, and
wheezing. Although asthma affected people of all ages, children were most susceptible. Asthma was
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incurable and required lifelong medications; however, with proper management, an asthmatic patient
could lead a normal and active life.

In 2012, India had approximately 24 million asthmatic patients, which represented 10 per cent of asthma
cases worldwide. India’s incidence of childhood asthma ranged from 2.1 per cent to 11.8 per cent.2
Statistics indicated that the overall prevalence rate of asthma had increased from 41.9 per 1,000 people in
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2004–2005 to 54.9 per 1,000 people in 2011–2012. Various factors contributed to the condition’s
disparity across regions (see Exhibit 1).3 Leading risk factors that led to the development of asthma were
high population density; damp environments; and exposure to indoor allergens, tobacco smoke, and
chemical irritants (see Exhibit 2). Lifestyle factors such as cooking in a closed environment and
concurrent use of biomass and solid fuels had the highest impact on women and children, although these
causes were least suspected.4 Statistics indicated that the sale of asthma prevention medicines in India had
increased by 43 per cent in a span of four years, but its use was still low in rural and semi-urban areas.5
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Inhalation therapy was considered the most effective method of asthma management worldwide.
However, various obstacles prevented the distribution of inhalers to the masses in India, both at the
practitioner and patient levels. Most primary care physicians in rural and semi-urban areas held education
degrees in alternative forms of medicine, such as bachelor’s degrees in Ayurvedic medicine and surgery

1
“Asthma,” National Heart, Lung, and Blood Institute, accessed September 20, 2018, www.nhlbi.nih.gov/health-topics/asthma.
2
Rupali Mukherjee, “India Contributes to 10% of the Global Burden of Asthma,” Times of India, April 30, 2012, accessed
September 20, 2018, https://timesofindia.indiatimes.com/India-contributes-to-10-of-the-global-burden-of-asthma-with-
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around-2-4-crore-of-its-population-being-asthmatic-Childhood-asthma-incidence-in-India-ranges-from-2-1-to-11-8-/articlesho
w/12934160.cms.
3
Prakash Kumar and Usha Ram, “Patterns, Factors Associated and Morbidity Burden of Asthma in India,” PLOS ONE,
October 26, 2017, accessed September 20, 2018, https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0185938.
4
“Bronchial Asthma,” World Health Organization, November 22, 2010, accessed September 20, 2018,
www.who.int/mediacentre/factsheets/fs206/en.
5
Sanchita Sharma, “World Asthma Day: India Chokes, Sales of Medicines Rise 43% in 4 Years,” Hindustan Times, May 2,
2017, accessed September 20, 2018, www.hindustantimes.com/health/world-asthma-day-india-chokes-sales-of-medicines-
rise-43-in-4-years/story-mt5V9Kdqv4yGF062ZOmC6I.html.

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(BAMS) or bachelor’s degrees in Unani medicine and surgery (BUMS). They had limited knowledge

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about the treatment protocols of modern allopathic medicine, so they mainly relied on oral and injectable
medicines instead of inhalation therapy, which meant that they were delivering sub-optimal treatment to
their patients. Moreover, most patients preferred oral medications to inhalers because they felt that there
was a social stigma associated with the use of inhalers. If they used inhalers, they tended to be secretive
about it. Patients had a misconception that inhalers were meant for serious diseases, and that once their

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use was started, it would be a lifelong commitment. Lack of adherence to inhalation therapy further
worsened the situation. Sarkar saw both a need and an opportunity to bring inhalation therapy to bottom
of the pyramid (BOP) consumers, as he explained:

Statistical data and field observations revealed that there was a huge untapped market for
penetration and expansion of inhalation practices in rural and semi-urban areas. The added
advantage was negligible competition in this sphere as leading pharmaceutical players were not

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focusing on the bottom of the pyramid. Being a pioneer in inhalation therapy, the need of the hour
was to convert this opportunity into a measurable business outcome.

Although most physicians and chest specialists in urban areas were active prescribers of Cipla’s inhalation
portfolio, the sales team had not been successful in generating the same impact at the general practitioner
segment. Due to low awareness about inhalation therapy at the practitioner’s end and the social stigma
attached to it, rigorous efforts and significant time were needed before an observable change could be seen.
Because the main focus of the sales team was generating sales, the team had invested little time in the BOP
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segment, with its relatively low business potential compared to that of chest physicians. Despite the
opportunity that a largely untapped market presented, Sarkar was unsure how to leverage the commercial
potential of the BOP segment. It appeared that innovative methods for market expansion were necessary.

OVERVIEW OF THE INDIAN PHARMACEUTICAL INDUSTRY

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In 2013, the value of the Indian pharmaceutical industry was estimated at US$12 billion.6 Globally, it
ranked third in volume and 14th in value. It was highly fragmented, with the top 10 companies
contributing approximately 41 per cent of total sales. Apart from domestic consumption, the industry
exported drugs, vaccines, and biopharmaceutical products to many regulated and semi-regulated markets.
Approximately 60 per cent of domestic sales were generated from metropolitan and Tier 1 cities, with the
remaining 40 per cent coming from the rest of the country. India’s urban regions had recorded annual
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growth of 10 per cent, whereas rural regions were growing at a rate of 14.5 per cent. This rate of growth
was primarily due to improved health care infrastructure and increased penetration of pharmaceutical
companies in these regions.7

BOTTOM OF THE PYRAMID MARKETS

The BOP segment was defined on the basis of an economic pyramid, where privileged populations
represented the narrow top of a pyramid and underprivileged populations represented the wide-ranging
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bottom. The BOP segment represented about two-thirds of the population. According to a report by the
World Economic Forum, in 2009, people with an income of less than $8 per day constituted the BOP
segment. Another report claimed that 70 per cent of India’s population earned an annual income of less
6
All currency amounts are in US$ unless otherwise specified.
7
Manish Panchal, Charu Kapoor, and Mansi Mahajan, “Success Strategies for Indian Pharma Industry in an Uncertain
World,” Business Standard, February 17, 2014, accessed September 29, 2018, www.business-standard.com/content/b2b-
chemicals/success-strategies-for-indian-pharma-industry-in-an-uncertain-world-114021701557_1.html.

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than $4,000 and therefore belonged to the BOP segment. Of that group, 78 per cent lived in rural areas.8

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Rural India, which held 67 per cent of the country’s population, consisted of about 600,000 villages. In
2010, these markets accounted for 17 per cent of total industry sales.9 The Indian BOP health market was
significant because it consisted of approximately 155 million households, with $26.6 billion in total
annual health spending.10

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A closer look at these markets revealed that BOP populations were largely underserved in terms of basic
necessities, especially health care. The limited availability of health care was characterized by a huge gap
between demand and supply. These markets had poor health care infrastructure and a doctor-to-patient ratio
of 1:20,000 in comparison to urban areas, where the ratio stood at 1:2,000. Literacy levels were low, and
people lacked awareness about various diseases and their treatment. The first contact care providers for
these groups were primary care physicians located nearby, who focused mainly on acute diseases. BOP
patients also visited primary health care centres,11 which essentially consisted of government-established

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single physician clinics that provided only basic facilities. These populations relied mostly on alternative
forms of medicine, such as Ayurvedic and Unani practices. Some price-sensitive BOP households delayed
treatment until health conditions became more serious before choosing to contact heath care providers.

Despite various challenges related to accessibility and affordability, the BOP populations represented a
largely untapped market with significant unfulfilled demand. The main reasons were an increasing
incidence of disease, an increasing ability to pay, an absence of a viable business model, and a failure to
expand the existing infrastructure.12 However, penetrating BOP markets required both pursuit of social
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responsibility and adaptation of current marketing strategies.

COMPANY OVERVIEW

Cipla was incorporated in 1935 with the motto “Caring for Life.” Headquartered in Mumbai, it was a
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leading global pharmaceutical company with an annual turnover of US$2.36 billion (see Exhibit 3). With
an employee base of more than 25,000 employees, it had a presence in more than 80 countries. It had over
43 state-of-the-art manufacturing facilities that manufactured a product portfolio of more than 1,500
products consisting of branded and generic medicines. The products were available in over 50 dosage
forms across various therapeutic categories. Over a span of eight decades, Cipla had been instrumental in
introducing many novel molecules and combinations. The company followed a patient-centric approach.
Its main aim was to make high-quality medicines accessible to patients at affordable prices. The company
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operated in multiple therapeutic areas, including women’s health, children’s health, infectious diseases,
critical care, cardiovascular care, diabetes, respiratory health, HIV, hepatitis, and oncology. Cipla was a
strong competitor in the multiple therapies segment and the market leader in most categories under the
respiratory umbrella. The company’s strong research and development department focused on developing
new products and improving existing products.
8
Boston Analytics, India’s Rising Bottom of the Pyramid: A Perspective from Boston Analytics, accessed October 6, 2018,
www.bostonanalytics.com/images/The-Rising-Bottom-of-the-Pyramid-in-India.pdf.
9
PricewaterhouseCoopers, India Pharma Inc: Capitalizing on India’s Growth Potential, 2010, accessed October 6, 2018,
www.pwc.in/assets/pdfs/publications-2011/pwc_cii_pharma_summit_report_22nov.pdf.
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10
Allen L. Hammond, William J. Kramer, Robert S. Katz, and Julia T. Tran, “The Next 4 Billion: Market Size and Business
Strategy at the Base of the Pyramid,” The World Bank, March 26, 2007, accessed October 06, 2018,
http://documents.worldbank.org/curated/en/779321468175731439/The-next-4-billion-market-size-and-business-strategy-at-
the-base-of-the-pyramid.
11
Ministry of Health & Family Welfare, Government of India, Indian Public Health Standards (IPHS) Guidelines for Primary
Health Centres Revised 2012, January 1, 1970, accessed October 6, 2018, https://archive.org/details/GuidelinesPHC2012/page/n7.
12
G.V. Ravishankar, “Rural India Looking for High Quality Healthcare,” Economic Times, February 3, 2012, accessed
October 6, 2018, https://economictimes.indiatimes.com/industry/healthcare/biotech/healthcare/rural-india-looking-for-high-
quality-healthcare/articleshow/11734837.cms.

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Inhalation Therapy and Cipla

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Medicine was inhaled directly through an inhaler for fast relief. With a growing number of patients with
respiratory disorders, the market for inhalation therapy was constantly increasing. According to statistics
from IMS MAT, as of March 2013, the market for respiratory medicines in India was estimated at
₹57.23 billion,13 which increased to ₹64.45 billion in March 2014. Cipla was known for pioneering

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inhalation therapy and was the leading company operating in this domain, both nationally (see Exhibit 4)
and in the Delhi area (see Exhibit 5). It had established itself as a leader in most categories of inhalation
therapy (see Exhibits 6 and 7).

Cipla had been at the forefront of innovation and offered the world’s largest portfolio of inhalation
products. Its therapeutic basket consisted of various combinations of 27 molecules across a range of
devices to suit the individual needs of patients. The company manufactured metered dose inhalers, dry

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powder inhalers, nasal sprays, nebulization solutions, and a range of inhaling accessory devices. Cipla
was the third-largest manufacturer of metered dose inhalers in the world. With the launch of a new form
of transparent inhaler called the Rotahaler in 1996, it had heralded an era of patient-friendly inhalation
therapy and was successfully transforming the lives of millions of asthmatic patients.

Awareness Initiatives by Cipla

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Cipla had introduced various awareness initiatives to promote adoption and correct use of inhalation
therapy. These initiatives consisted of continuing medical education programs for health care practitioners
and large-scale patient education programs (see Exhibit 8). The most significant of these public service
programs was called Breathefree. Introduced on Cipla’s 75th anniversary, the program was developed
into a comprehensive support system for patient care. Clinics and counselling centres under the
Breathefree umbrella were established across the country. The team consisted of more than 600 Cipla
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Breathefree educators working to spread awareness about respiratory diseases and inhalation therapy. The
major role of Breathefree educators was to assist people in diagnosis of the disease and advise them on
the importance of treatment adherence to lead a normal life. A website was set up as an important source
for information, solutions, and support for chronic airway diseases. The site also formed an important link
between patients and their advisors.14
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THE RESPIRATORY THERAPY MANAGER IDEA AND CONCEPTUALIZATION

RTMs were doctors who held degrees in alternative systems of medicine. They were added to the sales
teams with the objective of creating a new prescriber base for inhalation therapy. Their main task was to
provide assistance to primary care physicians, especially those who held BAMS or BUMS degrees, in the
adoption and correct use of inhalation practices to treat asthma, thereby helping primary care physicians
to both expand their practices and deliver optimal treatment to their patients. The concept emerged from
an experimental initiative during a field visit by Sarkar to the Ayurvedic and Unani Tibbia College in
Delhi (Tibbia College). The institute offered bachelor’s and master’s degrees in Ayurvedic and Unani
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medicine. At an asthma awareness camp at the college in September 2013, Sarkar met BAMS/BUMS
doctors and learned about the scarce employment prospects available to them. Most students felt that they
would not be given the same respect as graduates with bachelor of medicine and surgery degrees (degrees

13
₹ = INR = Indian rupee; ₹1 = US$0.02 on March 15, 2014.
14
“About Breathfree,” Breathefree: A Cipla Initiative, accessed September 21, 2018, www.breathefree.com/about-
us/breathefree.

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from modern schools of medicine rather than degrees in alternative medicine). Therefore, establishing a

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private practice in urban areas would be difficult and only rural or semi-urban areas would be open to
them. This issue was especially serious for female graduates.

Sarkar had a “eureka” moment. He had been looking for unconventional ways to bring inhalation therapy
to the BOP markets after efforts by Cipla’s sales and marketing team had failed to yield productive

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results. He saw an opportunity in the graduates he met and wondered how they could help Cipla’s sales
team introduce inhalation therapy to practicing alternative-medicine doctors. In Delhi, Cipla’s sales
professionals worked in different divisions (see Exhibit 9). Approximately 80 sales representatives
worked in the respiratory division with support from the marketing team at Mumbai, which consisted of
the marketing head, a group product manager, and various product managers. As part of the sales team,
RTMs would provide strong lateral support to the sales team members.

When Sarkar first proposed his idea to the graduates, most were reluctant, seeing it as a front-line sales

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position that did not interest them. The concept was also unfamiliar to them; no other pharmaceutical
company in India had doctors as part of the sales team. However, after further discussion about the
position of knowledge experts working with general practitioners to improve the use of inhalation
therapy, five graduates agreed to give it a try. Two of the doctors, Mohammad Faiz and Mohammad
Irshad Alam, would take part in Cipla’s first trial run as RTMs.

TRIAL RUN
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Training and Induction

The two RTMs were given extensive training for seven days in the first week of October 2013 at Cipla’s
head office in Mumbai. The first part of the training, provided by Cipla professionals, was on the basics
of the respiratory system, asthma, and COPD. It covered details of treatment, current epidemiology, and
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inhaler techniques. Further training was then provided by inhalation therapy experts in Delhi. Because the
new doctors were from a non-managerial background, they were also given training on basic selling
skills, customer profiling, product pitch, situation handling, and follow-up. The RTMs were assigned to
urban slums in Delhi, including Daryaganj and parts of South Delhi, for an initial breakthrough. The
target was to reach 50 doctors and work on a dot-convert-shift methodology.15 Those doctors who became
active prescribers of inhalation therapy would be transferred to the sales team for business generation and
follow-up. A new set of doctors would then be targeted by RTMs. The concept was meant to help the
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sales team retain its core focus on business generation, while the RTMs supported the company’s
expansion efforts by bringing inhalation therapy to the BOP segment.

Methodology Adopted

The RTMs briefed targeted doctors about the use of inhalation therapy and correct protocols for treating
asthma patients. RTMs were able to secure appointments with practitioners and develop a rapport thanks
to a peer effect. They had an understanding of the target audience and the grass-root problems of
prescribing inhalation therapy, which made their in-clinic discussion more effective. The adopted
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approach was qualitative, requiring them to spend long hours at the doctor’s clinic to facilitate the
conversion from oral medicine to inhalation therapy. Promotional and training material on the use of
inhalation therapy was available in Hindi, which helped make the RTMs’ task less daunting.

15
Dot doctors (doctors with no current business with Cipla) would be targeted for conversion.

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The RTMs were supported by members of the executive team; Pachisia played a crucial role through his

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team of Breathefree educators, who offered repeated training to patients, created awareness about asthma
and its management, and advised them about the appropriate use of inhalers. Regional managers Singh
and Sharma also contributed to the flawless execution of the trial run by driving existing business,
whereas Pasha was an important link between the RTMs and the sales team to ensure synergy between
both groups. Pasha helped the RTMs garner a strong foothold at the general practitioner segment and

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helped the sales team leverage business potential from the converted doctors.

Outcome

The RTMs were the major vehicle for social change in the area of inhalation therapy, driving the adoption of
new inhalation practices. Within six months, an average of 31 of 50 doctors targeted by each RTM had started

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prescribing inhalation therapy. An increase was also seen in the average monthly sales of inhalers (see Exhibit
10). The trial was seen as an overwhelming success by Cipla’s management, something that the core sales
team could not have achieved despite previous efforts and major promotional campaigns. However,
management wanted to be sure that the outcome was a result of the planned strategic initiative, rather than
something achieved by chance. Faiz was asked to meet with top management officials in the Mumbai head
office and brief them on how they were able to achieve such impressive results. To assess the actual impact of
the initiative, management also advised Sarkar to replicate the same effect in other territories.
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WAY FORWARD

After receiving approval from management, Sarkar was looking forward to expanding the initiative and
making it a countrywide phenomenon. Although initial results were promising, there was uncertainty
about the sustainability of the concept when replicated on a large scale. The immediate challenge was
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how to integrate a “hit and trial” approach into the existing sales and marketing framework and leverage
optimal efficiency. Some health care practitioners had also expressed resentment over the approach,
which posed a business risk. Therefore, various immediate challenges were anticipated.

Key Challenges
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Recruitment and Continuous Deployment: Recruitment and continuous deployment of RTMs was a major
practical challenge. Because the concept was new and unconventional, it was difficult to find the right
candidates using conventional methods of recruitment. This meant that recruitment would have to be done
at the regional level, but attracting a suitable talent pool at the regional level was difficult. The absence of
a defined career path at the start, coupled with upcoming opportunities in the government sector, could
turn the initiative into only a stop-gap measure and could spark a high attrition rate. In addition, the
unconventional compensation structure provided a relatively low salary, mainly due to the low revenue
potential of the BOP markets.
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Motivation to Work in Rural and Semi-Urban Areas: The weak infrastructure of rural and semi-urban
areas, coupled with difficult working conditions, made the job profile less attractive than other
mainstream positions. The RTMs also felt that it was socially demeaning to be stationed in such areas.
They felt they were viewed as sales representatives rather than knowledge experts, which could have an
adverse effect on their social status.

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Performance Management Design for RTMs: Another major challenge was determining how to design key

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result areas (KRA) for the RTM position to drive maximum output, while avoiding any overlap with the
existing KRAs of the sales team. The work done by RTMs was a concept-building activity and was
therefore purely qualitative in nature, which made it difficult to quantify each RTM’s performance. Also, the
primary KRA of the sales team was revenue generation, whereas RTMs were mainly promoting inhalation
therapy to family practitioners, which made it difficult to measure quantifiable business outcomes.

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Synergy between the Sales Team and RTMs: The sales team and the RTMs had different priorities, despite
managing the same end objective. RTMs were focused on establishing inhalation therapy as a concept,
whereas the sales team’s core focus was business generation. Defining the hierarchy of RTMs, with
respect to the sales team, was also a key concern. Cipla had to find a means to establish synergy between
the two teams and overcome the antipathy that was gradually setting in.

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Training: Training the RTMs and supplying adequate materials for RTMs to use was yet another
challenge. Most materials for training and marketing teams were only available in English, so the entire
training content had to be created in an easy-to-understand format in the language and vernacular of the
target audience. This task required additional human resources who were trained to write scientific
content, with an understanding of possible communication barriers. Ideally, the background of the trainers
would be similar to that of the target audience, and they would be motivated to accept the challenge. The
many different languages spoken across the vast country further added scope to the challenge.
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Challenges at the Value-Chain Level: Creating and managing sustainable demand in BOP markets was
difficult. Poor infrastructure made the target markets inaccessible and the effort-to-impact ratio low.

Conclusion
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The concept of RTMs had provided Sarkar with an approach to leverage the untapped potential of BOP
markets for promoting inhalation therapy to treat asthma. The results of the trial run were promising.
Sarkar was planning to extend the concept’s reach at the level of general practitioners in rural and semi-
urban areas. However, the unconventional RTM method was not currently being practiced by any other
pharmaceutical company in India. Therefore, Sarkar would have to weigh the pros and cons of the
concept and devise a blueprint for implementation and expansion.
No
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EXHIBIT 1: PREVALENCE RATE OF ASTHMA FOR DIAGNOSED CASES, INDIA AND SUB-REGION

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(2011–12)

Prevalence Rate (per 1,000) Percentage of Distribution (N = 204,568)

Geographies
Reported (N) Diagnosed (N) Reported Diagnosed Population
India 54.90 (11,229) 9.10 (1,855) - - -

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Rural 59.80 (8,070) 9.50 (1,286) 71.90 69.30 66.00
Urban 45.40 (3,159) 8.20 (569) 28.10 30.70 34.00
Poorer States 73.50 (6,073) 9.90 (816) 54.10 44.00 40.40
Richer States 42.30 (5,156) 8.50 (1,039) 45.90 56.00 59.60
Northern States 83.30 (4,801) 9.80 (565) 42.80 30.50 28.20
Southern States 40.20 (1,694) 10.30 (432) 15.10 23.30 20.60

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Eastern States 54.00 (1,812) 8.30 (279) 16.10 15.00 16.40
Western States 30.30 (1,244) 7.40 (304) 11.10 16.40 20.10
Central States 66.40 (1,426) 11.70 (251) 12.70 13.50 10.50
North-Eastern
28.80 (252) 2.70 (24) 2.20 1.30 4.30
States

Note: Reported cases include both diagnosed cases and cases having short breadth; Diagnosed cases include only those
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cases diagnosed with asthma by a doctor; Poor states include Bihar, Jharkhand, Chhattisgarh, Madhya Pradesh, Uttar
Pradesh, Uttarakhand, Orissa, Rajasthan, and Assam; Rich states include Jammu and Kashmir, Himachal Pradesh, Punjab,
Andhra Pradesh, Karnataka, Kerala, Tamil Nadu, West Bengal, Gujarat, Goa, Maharashtra, Madhya Pradesh, Sikkim,
Nagaland, Meghalaya, Tripura, Mizoram, Arunachal Pradesh, and Manipur; Northern states includes Jammu and Kashmir,
Himachal Pradesh, Punjab, Uttar Pradesh, and Uttarakhand; Southern states include Andhra Pradesh, Karnataka, Kerala, Tamil
Nadu, and Pondicherry; Eastern states include Bihar, West Bengal, Orissa, and Jharkhand; Western states include Rajasthan,
Gujarat, Goa, Maharashtra, Daman and Due, Dadar, and Nagar Haveli; Central states include Madhya Pradesh and
Chhattisgarh; North-Eastern states include Assam, Sikkim, Nagaland, Meghalaya, Tripura, Mizoram, and Arunachal Pradesh.
tC

Source: Prakash Kumar and Usha Ram, “Patterns, Factors Associated and Morbidity Burden of Asthma in India,” PLOS
ONE, accessed September 29, 2018, https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0185938.
 

   
No
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 Page 10 9B19M002

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EXHIBIT 2: RISK FACTORS FOR ASTHMA

os
Prevalence Rate Percentage Distribution of Population Reported
Attributes
per 1,000 (N) Asthma No Asthma
Sex
Male 52.00 (5,312) 47.30 50.00
Female 57.70 (5,917) 52.70 50.00

rP
Age Group
Less than 5 years 130.50 (2,221) 19.80 7.70
5–14 years 51.40 (2,073) 18.50 19.80
15–29 years 28.10 (1,551) 13.80 27.80
30–44 years 37.00 (1,499) 13.40 20.20
45–65 years 68.00 (2,891) 25.80 20.50
Over 65 years 110.50 (994) 8.90 4.10

yo
Marital Status
Married 48.50 (4,797) 42.70 48.70
Never married 57.30 (5,229) 47.20 45.10
Others 85.80 (1,132) 10.10 6.20
Completed Year
11 years and above 27.30 (849) 7.90 16.20
5–10 years 35.60 (2,235) 20.90 32.30
op
1–5 years 52.50 (2,281) 21.30 22.00
0 years 87.90 (5,325) 49.80 29.50
Smoke
No 53.80 (10,166) 90.50 92.50
Yes 68.00 (1,063) 9.50 7.50
Chew Tobacco
No 53.90 (9,851) 87.70 89.40
tC

Yes 63.00 (1,378) 12.30 10.60

Drink Alcohol
No 55.10 (10,617) 94.50 94.10
Yes 51.00 (612) 5.50 5.90
Vegetarian
Yes 55.10 (3,089) 27.50 27.50
No 55.00 (8,133) 72.50 72.50
No

Nutritional Status
Normal weight 52.00 (2,934) 33.80 41.80
Underweight 77.20 (4,598) 53.00 43.00
Overweight 51.40 (771) 8.90 11.10
Obese 67.00 (373) 4.30 4.10
Wealth Quintile
Middle 52.50 (2,303) 20.80 20.00
Poorest 84.90 (2,441) 20.60 20.00
Poor 65.30 (2,470) 21.10 19.90
Do

Rich 46.00 (2,080) 19.90 20.00

Richest 39.50 (1,928) 21.80 13.60
Type of Fuel Used
Clean only 38.80 (1,726) 15.40 22.10
Others 59.40 (9,503) 84.60 77.90

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 Page 11 9B19M002

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EXHIBIT 2 (CONTINUED)

os
Prevalence Rate Percentage Distribution of Population Reported
Attributions
per 1,000 (N))
Asthma No Asthma
Hours Burning
Less than 3 hours 53.20 (4,002) 35.90 37.20

rP
3 hours and more 56.10 (7,150) 64.10 62.80
Religion
Hindu 53.80 (8,815) 22.00 18.30
Muslim 63.40 (1,761) 20.50 21.50
Others 50.60 (653) 5.80 6.30
Caste
General 53.30 (3,179) 28.30 29.30

yo
Other backward 56.10 (4,706) 42.00 41.10
Scheduled castes 60.20 (2,599) 23.20 21.00
Scheduled tribe 42.30 (735) 6.60 8.60
Place of Residence
Rural 59.80 (8,070) 71.90 65.70
Urban 45.40 (3,159) 28.10 34.30
Total 54.90 (11,229) - -
op
Source: Prakash Kumar and Usha Ram, “Patterns, Factors Associated and Morbidity Burden of Asthma in India,” PLOS
ONE, accessed September 29, 2018, https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0185938.
tC
No
Do

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 Page 12 9B19M002

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EXHIBIT 3: CIPLA LIMITED BALANCE SHEET

os
Cipla Limited Standalone Balance Sheet (in ₹ Billion)
March 18 March 17 March 16 March 15 March 14
12 Months 12 Months 12 Months 12 Months 12 Months
Sources of Funds

rP
Total Share Capital 1.61 1.61 1.61 1.61 1.61
Equity Share Capital 1.61 1.61 1.61 1.61 1.61
Reserves 139.53 126.40 118.25 109.21 99.22
Net Worth 141.14 128.01 119.86 110.81 100.83
Secured Loans 1.74 3.24 0.00 0.01 0.00

yo
Unsecured Loans 0.00 0.00 11.32 13.80 8.77
Total Debt 1.74 3.24 11.32 13.81 8.77
Total Liabilities 142.88 131.25 131.18 124.62 109.60
Application of Funds
Gross Block 56.29 50.89 42.40 59.36 53.94
Less: Revaluation
0.00 0.00 0.00 0.09 0.09
Reserves
op
Less: Accumulated
13.09 8.54 4.14 23.42 18.70
Depreciation
Net Block 43.20 42.35 38.26 35.85 35.15
Capital Work in Progress 4.63 5.56 5.51 3.61 3.77
Investments 46.37 42.86 42.56 44.21 35.87
tC

Inventories 30.38 26.54 29.18 32.89 25.11

Sundry Debtors 23.36 19.39 18.96 20.59 17.28
Cash and Bank Balance 2.28 0.58 0.53 0.83 0.46
Total Current Assets 56.02 46.51 48.68 54.31 42.85
Loans and Advances 20.73 18.79 17.38 13.86 11.51
Total Current Assets,
76.75 65.30 66.06 68.16 54.36
Loans, and Advances
No

Current Liabilities 22.84 20.94 17.40 22.20 16.37

Provisions 5.23 3.88 3.81 5.01 3.18
Total Current Liabilities,
28.07 24.82 21.21 27.21 19.55
and Provisions
Net Current Assets 48.68 40.48 44.85 40.95 34.81
Total Assets 142.88 131.25 131.18 124.62 109.60
Contingent Liabilities 45.11 47.61 47.35 17.60 12.01
Do

Book Value 1.75 1.59 1.49 1.38 1.26

Note: ₹ = INR = Indian rupee; ₹1 = US$0.02 on March 15, 2014.

Source: Company documents.

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 Page 13 9B19M002

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EXHIBIT 4: LEADING COMPANIES IN THE RESPIRATORY DOMAIN (ALL OF INDIA)

os
India RESPIRATORY SYSTEM
MAT July 2014
Corporation Values (in ₹ Billion)
Cipla 13.08
Lupin Limited 2.84

rP
Zydus Cadila 3.32
Glenmark Pharma 2.31
Abbott 3.89
Sun 2.45
Mankind 1.85
Dr. Reddy’s Labs 2.04
GlaxoSmithKline 3.02

yo
Centaur 1.80
Grand Total 66.62

Note: MAT = moving annual total; ₹ = INR = Indian rupee; ₹1 = US$0.02 on March 15, 2014.
Source: Adapted by the case author using data from IMS MAT (company subscription).

EXHIBIT 5: LEADING COMPANIES IN RESPIRATORY SEGMENT – DELHI

op
India RESPIRATORY SYSTEM
State = DELHI
MAT August 2014
Corporation Values (in ₹)
Cipla 865,907,296
Lupin Limited 147,765,116
tC

Sanofi 152,723,059
Wockhardt Limited 136,713,166
Sun 186,310,273
GlaxoSmithKline 161,895,029
Glenmark Pharma 74,473,241
Dr. Reddy’s Labs 67,255,650
Emcure 46,602,707
Mankind 43,990,029
No

Grand Total 3,229,045,188

Note: MAT = moving annual total; ₹ = INR = Indian rupee; ₹1 = US$0.02 on March 15, 2014.
Source: Adapted by the case author using data from IMS MAT (company subscription).

   
Do

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 Page 14 9B19M002

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EXHIBIT 6: OVERVIEW OF INHALATION THERAPY MARKET IN INDIA

os
MAT August
2014
Molecule Product Corporation Values (in ₹)
R03cr – Formoterol + Budesonide Foracort Cipla 1,654,455,419
R03cr – Formoterol + Budesonide Budamate Lupin Limited 590,187,433

rP
R03cr – Formoterol + Budesonide Formonide Zydus Cadila 443,291,135
R03cp – Salmeterol + Fluticasone Seroflo Cipla 1,443,370,056
R03cp – Salmeterol + Fluticasone Esiflo Lupin Limited 344,497,066
R03cp – Salmeterol + Fluticasone Seretide GlaxoSmithKline 180,752,641
R03cs – Ipratropium + Levosalbutamol Duolin Cipla 1,028,403,666
R03cs – Ipratropium + Levosalbutamol Combimist-L Zydus Cadila 172,049,062
R03cs – Ipratropium + Levosalbutamol Salbair-I Lupin Limited 128,887,395

yo
R03cs – Ipratropium + Levosalbutamol Duoset Cipla 22,793,153
R03cs – Ipratropium + Levosalbutamol Combolin Cipla 1,217,480
R03c2 – Budesonide Budecort Cipla 1,251,850,225
R03c2 – Budesonide Budate Lupin Limited 103,188,148
R03c2 – Budesonide Bunase Macleods
Pharma 71,647,362
R03c2 – Budesonide Budenase Aq Cipla 22,109,499
R03c5 – Salbutamol Asthalin Cipla 1,122,317,662
op
R03c5 – Salbutamol Salbair Lupin Limited 19,244,410
R03c5 – Salbutamol Ventorlin GlaxoSmithKline 69,249,127
R03ck – Salbutamol + Beclomethasone Aerocort Cipla 1,081,381,063
R03ck – Salbutamol + Beclomethasone Salbair-B Lupin Limited 51,625,539
R03ck – Salbutamol + Beclomethasone Derisone Zydus Cadila 19,379,926
R03cf – Fluticasone + Formoterol Maxiflo Cipla 270,304,739
R03cf – Fluticasone + Formoterol Formoflo Lupin Limited 142,504,819
tC

R03cf – Fluticasone + Formoterol Combihale-Ff Dr. Reddy’s

Labs 125,623,470
R03g1 – Inhaler Device Rotahaler Transpar Cipla 119,868,302
R03g1 – Inhaler Device Zerostat-Vt Spacer Cipla 69,555,275
R03g1 – Inhaler Device Revolizer Cipla 77,687,140
R03g1 – Inhaler Device Lupihaler Lupin Limited 61,524,720
R03g1 – Inhaler Device Huf Puf Kit Cipla 28,173,824
No

R03g1 – Inhaler Device Baby Mask Cipla 29,622,080

Grand Total 13,751,580,857

Note: MAT = moving annual total; ₹ = INR = Indian rupee; ₹1 = US$0.02 on March 15, 2014.
Source: Adapted by the case author using data from IMS MAT (company subscription).
Do

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 Page 15 9B19M002

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EXHIBIT 7: OVERVIEW OF INHALATION THERAPY MARKET IN DELHI

os
MAT August 2014
Molecule Product Corporation
Values ₹
R03cr – Formoterol + Budesonide Foracort Cipla 69,259,949
R03cr – Formoterol + Budesonide Budamate Lupin Limited 21,718,499
R03cr – Formoterol + Budesonide Symbicort AstraZeneca 3,841,260

rP
R03cp – Salmeterol + Fluticasone Seroflo Cipla 76,517,859
R03cp – Salmeterol + Fluticasone Seretide GlaxoSmithKline 15,152,561
R03cp – Salmeterol + Fluticasone Esiflo Lupin Limited 16,863,745
R03cs – Ipratropium + Levosalbutamol Duolin Cipla 97,483,919
R03cs – Ipratropium + Levosalbutamol Salbair-I Lupin Limited 8,200,459
R03cs – Ipratropium + Levosalbutamol Iprazest Macleods Pharma 1,121,461
R03c2 – Budesonide Budecort Cipla 110,314,541

yo
R03c2 – Budesonide Budate Lupin Limited 7,068,173
R03c2 – Budesonide Budez Sun 1,908,494
R03c2 – Budesonide Budenase Aq Cipla 1,842,711
R03c5 – Salbutamol Asthalin Cipla 83,493,759
R03c5 – Salbutamol Ventorlin GlaxoSmithKline 1,864,774
R03c5 – Salbutamol Salbair Lupin Limited 617,827
R03cz – Levosalbutamol Levolin Cipla 29,476,833
R03cz – Levosalbutamol Salbair Neb Lupin Limited 1,046,292
op
R03cz – Levosalbutamol Salbair Lupin Limited 545,599
R03cd – Tiotropium Tiova Cipla 19,398,729
R03cd – Tiotropium Tiate Lupin Limited 8,304,095
R03cd – Tiotropium Tiomist Zydus Cadila 486,039
R03cf – Fluticasone + Formoterol Formoflo Lupin Limited 7,528,566
R03cf – Fluticasone + Formoterol Maxiflo Cipla 5,332,658
tC

R03cf – Fluticasone + Formoterol Combihale-Ff Dr Reddys Labs 1,783,636

R03g1 – Inhaler Device Rotahaler
Transpar Cipla 3,537,136
R03g1 – Inhaler Device Zerostat-Vt
Spacer Cipla 3,794,321
R03g1 – Inhaler Device Lupihaler Lupin Limited 2,095,909
R03g1 – Inhaler Device Revolizer Cipla 1,741,630
R03g1 – Inhaler Device Huf Puf Kit Cipla 752,640
No

R03g1 – Inhaler Device Nebzmart Glenmark Pharma –

R03g1 – Inhaler Device Zerostat Cipla 997,923
R03g1 – Inhaler Device Transpacer-
Vm Lupin Limited –
R03g1 – Inhaler Device Mini Zerostat
Spac Cipla –
R03g1 – Inhaler Device Baby Mask Cipla 398,505
Grand Total 777,016,068
Do

Note: MAT = moving annual total; ₹ = INR = Indian rupee; US$1 = ₹61.27 on March 15, 2014.
Source: Adapted by the case author using data from IMS MAT (company subscription).

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 Page 16 9B19M002

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EXHIBIT 8: AWARENESS INITIATIVES BY CIPLA LIMITED

os
Name of Program Target Audience Brief
Good Nebulization Doctors and Aims to create awareness about hygiene and
Practice (GNP) paramedics maintenance of nebulizer

rP
With the concept of “Try, Test, and Treat,” aims to
INCEPT Package General practitioners assist general practitioners in usage of
nebulization therapy

Comprehensive package to update general

Progress to
General practitioners practitioners on asthma treatment and
Prosper (P2P)
management

yo
Assemble to Adapt Updating general practitioners on acute asthma
General practitioners
(A2A) management and nebulization

Refresher Course
on Asthma Workshop to update general practitioners on
General practitioners
Management airway disease management
(ROAM)
op
Doctors, chemists, and Mass awareness about asthma, its management,
Breathefree
patients and use of inhalers

Source: Created by the case author using company documents.

   
tC
No
Do

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EXHIBIT 9: SALES STRUCTURE AT DELHI OFFICE OF CIPLA LIMITED

os
 

  Head of Therapy
Debashis Sarkar
 

rP
 

  North Zone South Zone East Zone West Zone Corporate

 
Sales Manager Sales Manager Sales Manager  Sales Manager
  Gaurav Gupta Neepun Mago Sales Manager 
Mukesh Thakur  Vijay Singh 
Ajay Sharma Amit Johar
  Vishal Sharma  Yashu Arora

yo
 

  Regional Manager  Regional Manager  Regional Manager  Regional Manager  Regional Manager 

(03)  (04)  (03) (04)  (02) 
 

  Business Manager  Business Manager  Business Manager  Business Manager  Business Manager 

(10) (13) (09) (14) (06)
 
op
Territory Manager  Territory Manager  Territory Manager  Territory Manager  Territory Manager 
  (69) (90) (63) (93) (35)

Source: Company documents.

tC

EXHIBIT 10: CONVERSION OUTCOME RESULTING FROM RTM TRIAL RUN IN DELHI

Pre RTM Snapshot Post RTM 0–3 Months Post RTM 4–6 Months

Number Number
Total Average Number Number of Average Number of Average
Total active of Dot of Dot
doctors monthly of Dot doctors monthly doctors monthly
prescribers doctors doctors
targeted sales doctors converted sales (in converted sales (in
No

(GP) targeted targeted

(GP) (₹ Million) (GP) (GP) ₹ Million) (GP) ₹ Million)
(GP) (GP)

1,900 170 0.22 1,730 450 12 0.27 438 31 0.33

Note: RTM = respiratory therapy manager; GP = general practitioner; Dot = Doctors with no prescription to Cipla; ₹ = INR =
Indian rupee; ₹1 = US$0.02 on March 15, 2014.
Source: Company documents.
Do

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