BackAnji Reddy | Unassuming elder statesman of India’s pharma industry
Anji Reddy, founder of Dr Reddy’s and the pioneer of drug discovery research in India, died on Friday
Premium(Mint)
New Delhi/Hyderabad: Kallam Anji Reddy, founder-chairman of Dr Reddy’s Laboratories Ltd and the pioneer of drug discovery research in India, died on Friday. He was 72 years old.
Anji Reddy, who founded Dr Reddy’s in 1984 with ₹ 25 lakh in initial capital and built it into India’s second largest drug maker with sales of ₹ 9,673.7 crore last year, died in a city hospital where he had been admitted earlier this month.
The company said in a statement that he had been ailing for sometime. PTI said he had been suffering from liver cancer.
Anji Reddy is survived by his son Satish Reddy, managing director and chief operating officer of the Hyderabad-based company, and daughter Anuradha, who is married to G.V. Prasad, vice-chairman and chief executive officer (CEO).
Born the son of a turmeric farmer, the scientist-entrepreneur went on to become the elder statesman of the pharma industry. In demeanour, he was always unassuming and self-effacing, belying his stature and the regard in which he was held.
Anji Reddy removed himself from day-to-day management of Dr Reddy’s some years ago, taking the back seat to his son and son-in-law, and retired to a quiet life at his farmhouse on the outskirts of Hyderabad where he grew grapes and read Telugu fiction.
Last year, he failed to attend the company’s annual general meeting for the first time because of ill health.
Anji Reddy still stayed in touch with the pharma community and kept himself updated on drug research until the very end. Under him, Dr Reddy’s in 1993 became the first Indian pharma company to venture into basic drug discovery research, although a big breakthrough proved elusive.
“My passion is drug discovery," Anji Reddy said in an interview with Mint in April 2011. “At this moment, nothing else gives me kicks..."
After obtaining a PhD in chemical engineering from the Pune-based National Chemical Laboratory, Anji Reddy worked in state-run Indian Drugs and Pharmaceuticals Ltd from 1969 to 1975 before turning entrepreneur.
After a couple of early ventures, he founded Dr Reddy’s in 1984 to produce and supply bulk drugs, taking advantage of a liberal Indian patent regime that recognized process patents over product patents.
The company started with methyldopa, a hypertension drug, in 1985. Its success was followed by an initial public offering in 1986 that raised ₹ 2.46 crore.
A key breakthrough came in 1987, when Dr Reddy’s received approval from the US food and drug administration to make the painkiller ibuprofen, opening up that country’s market.
“We earned our dollars in a hard way, nobody gave us a feast or gave it on a plate," Anji Reddy said in the 2011 interview with Mint. “We worked hard and we have innovated; we have made things in a better way at a cheaper rate and gave it to the people of India."
Venturing into drug research in 1993 with what he called “a kind of prayer on my lips", the company discovered and licensed an anti-diabetes drug to the world leader in diabetes therapies, Novo Nordisk A/S.
In April 2011, Dr Reddy’s became the first Asia-Pacific pharma firm outside Japan to list on the New York Stock Exchange.
In subsequent years, it had its share of difficulties in drug research and perhaps even plain bad luck.
Its acquisition of Betapharm, the fourth largest generic pharmaceuticals maker in Germany, for a total enterprise value of €480 million in cash in 2006 didn’t work out. Germany shifted to a tender-based system for drug purchases that saw prices dropping, turning the acquisition into a liability.
But Dr Reddy’s bounced back last year with a 29% increase in net profit to ₹ 1,426.2 crore and a 30% rise in sales to ₹ 9,673.7 crore, 80% of which was from exports. The company has a market capitalization of around ₹ 31,000 crore.
Anji Reddy was known for his philanthropy. In 1998, he founded the Naandi Foundation as a charitable trust to provide safe drinking water in rural areas and provide mid-day meals to 1.3 million school students and farmers.
Another philanthropic arm, the Dr Reddy’s Foundation, is active in education and skills development. He set up the Institute of Life Sciences in Hyderabad in partnership with the Andhra Pradesh government for research into that area.
The company said its founder’s “outcome-based institutional philanthropy" had benefited nearly five million underprivileged citizens.
“Dr Reddy touched millions of lives through his contribution to the pharmaceutical industry and his philanthropic efforts," his son Satish Reddy said in the statement. “His philanthropic initiatives made a difference in the lives of so many Indians in the areas of livelihood, education, clean drinking water and healthcare."
More effusive and personal tributes came in from other industrialists who knew him well. B.V.R. Mohan Reddy, chairman and managing director of Infotech Enterprises Ltd, called him “a very simple and humane person, and a great visionary".
Suchitra K. Ella, chairperson of the Confederation of Indian Industry’s Andhra Pradesh chapter and joint managing director and co-founder of Bharat Biotech International Ltd, described him as a “father figure for many of us, a role model and inspiration for many young techno-entrepreneurs".
Anji Reddy received the Padma Bhushan, India’s second highest civilian honour, in 2011.
There has been periodic speculation that Dr Reddy’s may be a potential acquisition target for Big Pharma. Anji Reddy told Mint: “This is my life. I mean, maybe I have ₹ 100 crore in the bank, sitting comfortably. If that increases to ₹ 10,000 crore, what difference does it make to me?"
On the next generation of leadership at Dr Reddy’s, he said: “In our company, it is so professionally managed that for example, Satish and Prasad, they both told me that we have CEO material—at least six of them—in our company..."
He added: “But let me also tell you that the kind of risk that I have taken, they will not take. Their aim is to streamline the whole thing and grow in such a way that it is a darling of the stock market. Whereas I always look at something which can change the picture..."
Yogendra Kalavalapalli in Hyderabad contributed to this story.
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