‘Looking for acquisitions in India and overseas markets’

‘Looking for acquisitions in India and overseas markets’

Hyderabad: Drug research and development service outsourcing company GVK Biosciences Pvt. Ltd wants to transform itself into a fully integrated global contract research organ-ization. By doing this, it aims to attract high-value outsourcing projects from large pharma and biotech companies and provide the entire range of drug research services.

The company is currently equipped to handle services such as informatics, chemical synthesis, discovery, clinical trials, data management and pilot scale manufacturing—the complete chain in the process of identifying and developing a new drug. The company’s new president Manni Kantipudi, who comes from the IT research background after a long stint at the world’s largest chip maker Intel, believes his first priority is to bring synergy across multiple groups within the organization and tap the talent pool here.

GVK Bio was jointly set up by Hyderabad’s GVK group, which has interests in power, infrastructure and airports, and D.S. Brar, the former CEO and managing director of the country’s largest drug company Ranbaxy Laboratories Ltd. It recently sold an undisclosed stake to private equity company Sequoia Capital India Ltd for Rs100 crore, to part-fund a major expansion programme.

The company is not only looking at growing its operations locally, but is also increasing its presence internationally, said Kantipudi in an exclusive interview with Mint. Edited excerpts:

You joined GVK Bio after a long stint at Intel as director and site manager of its India development centre. Isn’t managing a contract research organization such as GVK Bio an entirely different thing?

Externally, both these organizations are different as this (GVK) is a service-providing company for its clients and the other one was an organization which offered products to its customers.

But, I would say now that this concept of difference in customer profile is slowly disappearing and both are selling products to customers. If you look at any so-called service sectors such as banking or insurance..., (companies in) both currently prefer to be called as product companies as they market their services as customized products according to the nature and need of their customers.

(In the) Same way, if you take the case of an automobile company, which manufactures vehicles..., it sells its product by offering an array of services to its customers.

Hence, I would say that ultimately it’s your capability to understand your customer well and cater to his/her needs that determines your success. So, my task here is to sell my services as special products to my clients utilizing the strengths of the group.

What are the details of GVK Bio’s expansion plans?

In the first phase, the company wanted to integrate some of its facilities which are currently scattered at different locations across the country, by building up yet another integrated campus at Hyderabad. The company has more than 1,300 employees spread across facilities in Gurgaon, Chennai and Hyderabad, and is now setting up a new campus at Mallapur near Hyderabad. This campus will be similar to the one at Nacharam in the outskirts of Hyderabad.

In addition, it is looking for strategic acquisitions in India as well as overseas markets such as the US, Europe and Japan. It also intends to use the funds (from the investmentby Sequoia) to expand capacity in drug discovery servicesand provide new service offerings in pre-clinical and clini-cal space.

What else do you hope to gain from your relationship with Sequoia?

Sequoia is a leading private equity player in the world, which has a significant exposure in the life sciences business in the US as well as Asian countries. Other than the capital which it brings to the firm... (we) look for contributions from this financial group in terms of thinking process for future growth directions.

Also, since the private equity group has large exposure in the life sciences sector in the US as well as Asian countries, it will significantly help us tap the outsourcing channel in the US-India corridor. In addition, GVK can also explore new service partnerships with the companies in other parts of the world, especially China and Japan, where Sequoia has investments.


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