Praful Shah, Eishi Maekawa, Rohan Shah, Samir Shah, Mahesh Shah

Directors

By 2028, the global pharmaceutical market is estimated to reach USD 2,067.36 million, rising at a 5.7 percent CAGR. The pharmaceutical industry is a vital part of the healthcare system and a key contributor to the economy, employing millions of people and generating billions of dollars in revenue each year. The industry plays a crucial role in developing new and innovative medicines that improve the quality of life for patients around the world. There are several growth drivers in pharma, including R&D, US FDA compliance, low-cost production, and a large workforce.

Pharmaceutical distributors play a significant role in the supply of drugs and other pharmaceutical products to the market. They are the link between the manufacturers and the retailers, and they ensure that the products reach the consumers in a timely and efficient manner. They are responsible for the storage, transportation, and distribution of all medications, including prescription and over-thecounter drugs.

With roots dating back to 1932, the Sevantilal Kantilal Group (SK Group) is an integral part of the Indian pharmaceutical industry. Since its inception 90 years ago, the group has become highly successful in various pharmaceutical markets, including APIs, Bulk Drugs, Specialty Chemicals and Formulations/Finished Dosage Forms, Logistics, Warehousing, Repackaging, Distribution, and Research and Development.

Today, Skites Pharma within the SK Group is one of India's leading distributors of pharma and healthcare products. The firm works with leading manufacturers to bring the latest products and treatment options to its customers. It is committed to providing the highest quality products and services, and to helping its customers improve the health of their patients.

Skites Pharma's vision is to transform Pharma and Healthcare distribution in India through better Infrastructure, Technology, and Services.

Evolution of the Pharma Market and the Factors Driving It

India has more than 65,000 distributors with over 8,00,000 retailers or pharmacies. India's pharma market is estimated to be worth Rs. 1,80,000 crores, and the largest distributor has a share of only 4-5 percent. A fragmented market offers abundant consolidation opportunities for major players looking at organic and inorganic growth. Many major players are evolving into pan-India distributors and expanding their geographical reach.

Currently, the market is largely driven by mergers and acquisitions. E-commerce companies are also flourishing in the healthcare sector alongside offline distributors, with consolidation in the space already taking place. Technology, automation, availability, accessibility, and telehealth are other factors contributing to the industry's growth. Additionally, pharmaceutical companies are seeking distributors with enough reach to meet the market's requirements.

Pain Points

"Currently, companies are facing the challenges of availability, cold chain facilities and last-mile delivery. Newer companies also expect distributors to also serve as marketing partners. Our organization currently operates in 3 states and we follow hub-and-spoke model. Our warehouses are strategically located in these 3 states to meet market demands. We are therefore able to offer our customers increased service levels. The warehouses are designed to operate as efficiently as possible and have cold chain facilities for storing vaccines, injectables, and more, where temperature conditions are monitored 24/7", shares Rohan Shah, Director, Skites Pharma.

Plethora of Services

With over 12000+ retailers, the Trade Segment accounts for almost 60 percent of the firm’s total business. Additionally, Skites Pharma assists companies in targeting retailers that will help them market and sell their products. The company has a dedicated hospital team serving hospitals in Maharashtra, Gujarat, and Karnataka. It also has a separate group for SD/ B2B and modern trade businesses catering to retail giants like Flipkart, Amazon, Tata 1 MG, and other retailers.

The firm’s central focus within the Medical Devices industry is on the Point of Care Areas and it has relationships with companies like Omron, Accucheck, and One Touch, where segments like Diabetes, Covid Test Kits, and more are the primary areas of concentration. Moreover, the firm offers Direct to Patient products through partnerships with companies to offer specialized patient-specific products.

The Differentiating Factor

Skites Pharma’s hub and spoke model uses a bulk storage space to store inventory which replenishes goods to different spokes, which prevents stock-out situations at the spokes by maintaining adequate stock levels. The firm’s relationship with distributors across India allows it to differentiate itself from its competitors despite being present in only three states right now.

SKITES ONE, an in-house developed ERP solution, is an end-to-end solution for purchases, sales, expiry, and accounts. It is the core of all the operations and is instrumental in the smooth running of the organization. The firm also provides retailers with an App that can place orders directly on its platform and keep them updated on the status of their orders.

A Dynamic Team Spearheading the Firm’s Growth

The organization is driven by a young and dynamic team of 700+ members. Having separate teams for trade business, hospital, B2B, medical devices, and D2P helps the firm to focus on each vertical separately. Skites Pharma’s family is working hard to deliver medicines to people in need, learning, experimenting, and innovating simultaneously.

An Exceptional Journey

Over the last five years, SPPL has seen good growth in terms of revenue, going from Rs. 150 Cr in the fiscal year 2017-2018 to over Rs 850 Cr turnover in 2022-23. Since 2017, the firm has expanded to almost ten locations across three states and has been distributing for more than 250+ pharma companies. Some of the firm’s renowned associates include Pfizer, SANOFI, USV, Zydus, Abbott, Cadila, Cipla, Dr. Reddy’s, FDC, Franco Indian Pharmaceuticals, GSK, Lupin, Merck, Novartis, Ranbaxy and many more.

Giving Back to the Community

Skites Pharma was among the key distributors of lifesaving drugs such as (Actemra) Tocilizumab & Remdesivir during COVID. During this time all of the firm's warehouses were operational and it continued to provide these medicines round the clock. With the advent of the second and third waves, the firm became the exclusive distributor of Covid Self Test Kits, benefiting both companies and patients.

Future Roadmap

Skites Pharma envisions becoming one of the leading pharmaceutical distribution houses in India. There are two strategies that the firm is adopting for growth. The first is to consolidate and expand in the states where it is already present, and the second is to continue its expansion in new states focusing on the west and south before moving into the north and east. Skites Pharma aims to transform the pharma and healthcare distribution market in India through better infrastructure technology and service delivery.