Aurobindo Pharma: Gearing Up for the Future

Aurobindo Pharma: Gearing Up for the Future

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Abstract

The Chairman and co-founder of the Hyderabad, India-based family-owned pharmaceutical company Aurobindo Pharma Limited (APL), P. V. Ramaprasad Reddy is reminiscing on his business growth journey. In 1986, along with a close friend, K. Nithyananda Reddy (no relation), and a few other associates, he started a small semi-synthetic penicillin manufacturing unit. Since then the business had grown both organically and through strategic acquisitions. By 2011, APL was present in more than 125 countries. It had more than 500 drugs and intermediates spanning multiple therapeutic areas. As the business grew in size, scale, and scope so did its complexities, which demanded it adopt systematic processes, policies, and procedures. APL had adopted best practices in all functional areas and cultivated a culture of quality, to meet its objective to grow the business in the more demanding and developed markets of the USA and Europe. However, Ramaprasad pondered the future, specifically if APL was to continue to grow it had to further transform itself by professionalizing governance. Ramaprasad and Nithyananda were good friends and had effective control over APL. However, they were growing old due to which APL faced a leadership succession challenge. There was limited choice within the family and the next generation members were not prepared to take leadership positions in the company. The co-founders faced the dilemma of whether to groom someone within the family or to appoint a non-family professional at the helm.

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