Simon Lucas, Symphar
Release Date: 0000-00-00
Following significant experience as the General Manager for the Polish operations at Roche, one of the major players in the market, what led to the creation of SymPhar in 2004?When I was in management at Roche, at one stage, I remember that I was looking for companies which would do what we call fostering services, in other words, which would take some of the company’s mature products and take over the promotion of them. I found companies which were doing this in Poland, however I was not impressed by them. So I thought I should do it myself.
Moreover, my career started in 1981 as a medical representative and I have been working for different international companies since then, including Sandoz and Roche, where I stayed for over fifteen years with assignments in Switzerland, Norway, and Poland. To be honest, I got a bit bored of the corporate life. On top of that, I was not getting any younger, and I was a bit foolish which helped considerably!
These facts combined, lead to the creation of SymPhar.
I left Roche early in 2003, and then spent some time looking for investors. I was able to sign the first fostering contract at the end of 2003, thanks to the brave decision of Tapani Sura, who was working for Novartis at the time.
Although SymPhar started with fostering services, the company moved onto imports and the distribution of certain niche medical products. SymPhar’s initial strategy was to eventually enter the branded generic market with its product lines. The company launched the first SymGeneration product in the middle of 2006, and now offers 18 products which “fit the Polish pocket”. I do not really like to call these drugs generics as the term generic itself is very generic.
Even though fostering and distribution services are still important activities at SymPhar, SymGeneration products already generate almost 80% of the sales. Today the company is happy to have these three legs on which to stand. We have a unique profile as a company, considering most of the generic companies only do generics. All three elements are part of SymPhar’s development strategy and offer a very good balance. I am personally responsible for our business development in these three areas in which we are working.
The generic business in Poland is very much subject to whatever the Ministry of Health (MoH) imposes on the industry with regards to pricing. The Polish market is a price sensitive market, which does not mean it is completely price elastic, where the cheapest product has the biggest unit market share and vice-versa, but nonetheless we have to be price competitive
What impact do you expect from the new bill on healthcare on SymPhar’s operations in Poland?
The impact of the future reform remains unclear. The introduction of fixed prices and margins will not affect SymPhar so much, considering that as a small company, SymPhar has limited opportunity to give significant rebates on its offering.
It is not a positive thing for the market to go into a rebate spiral, pushing down the prices to the levels that do not allow any margin for building a business. SymPhar would much rather be able to concentrate on meritocratic promotion to doctors, and have at the same time a competitive pricing strategy.
The objective of any Ministry of Health (MOH) anywhere in the world is to use efficiently the part of the healthcare budget allocated to the pharmaceutical sector and to reduce its costs. The best way to reduce cost is to encourage generics. As a generic company, SymPhar benefits from this logical imperative.
Generics should therefore be used wherever it is possible. Of course, the MOH has to invest in innovative products if it wants to maintain or improve the health services provided to Polish people, and bring them up to Western European standards. The MOH should therefore invest intelligently in innovative products which represent true medical advances and which are still protected by valid patents and where the generic alternative is therefore not available For products where generics are available, the original product should not be used at all.
Why on earth should people (or even worse, the public health service) pay twice the price for a product which is exactly the same as the original? The quality of the generic products has been long assured, particularly since Poland’s accession to the European Union (EU), considering all the regulatory procedures that generic products now have to go through.
SymPhar prides itself on providing patients with products that “fit the Polish pocket”, but this is a must have of the generic players. What would you say are SymPhar’s main comparative advantages in the industry?
SymPhar tries to be remembered in the industry. How can a small company, which was completely unknown initially, establish a profile in Poland? A pricing strategy is ineffective, because generic companies must have by definition competitive prices. Indeed SymPhar cannot sell itself just by having affordable drugs. This is rather a potential negative factor if the company is not competitive on prices, but not an opportunity for a differential advantage
SymPhar uses more modern communication techniques as a differentiating factor in the industry, capitalizing on its Australian connection – the company is Polish but it has Australian roots.
For instance, after SymPhar introduced two products in urology to the Polish market, we used the fact that the tip of the penis of a Kangaroo is bifurcated, when approaching the physicians, reflecting the double strength in these urology products. This radical approach was actually very well received. As Oscar Wilde put it, “the only thing worse than being talked about is not being talked about”.
Being controversial is a way to help doctors remember SymPhar. At the same time of course we make sure that medical representatives are well trained so they can persuade the doctors of the merits of the products: registered according to European standards, their high quality, and affordable prices.
Apart from visiting doctors, SymPhar runs and sponsors different programs, such as our “SymPhar Musical Therapy” program. Over the last three years, the company organized concerts in Polish hospitals for the patients, as I believe music is a good way of improving health. Among other initiatives, SymPhar has also been active in promotion for Australian wine importing companies, in organizing joint functions with the embassy of Australia, in the distribution of calendars featuring Australia and Australian artists, and so forth. Even as a small company, SymPhar feels that it has the duty to participate proactively in society, that is part of the reason why SymPhar is involved in musical therapy, in various charities, and in the support of Polish arts.
You cannot be competitive on the basis of the uniqueness of a molecule if there are already twenty of them in the market. It is really at the core of the company’s philosophy to use communication as a competitive advantage.
The proof of the success of this approach is SymPhar’s very first launch. When the company launched its first generic (glimepiride for diabetes) in July 2006, it was the 13th generic glimepiride to enter the market. SymPhar was at that time an unknown company, with unknown products. Over the following years, another five glimepirides entered the market, so that 18 products were competing. Today, SymPhar’s product is the second best performing generic in the market after that of Polpharma, Poland’s biggest pharmaceutical producer
The Australian touch has been successful for SymPhar in a way.
The Australian touch is not only in communication, but also in the overall atmosphere of the company. I try to avoid what could be a sort of hierarchical Polish structure, and to encourage a sense of common endeavour. I do have strict standards when it comes to work, although I also bring Australian informality into the company. At SymPhar, we take the business seriously, but we do not take ourselves too seriously. There is a difference between the atmosphere of SymPhar and the atmosphere of most traditional Polish companies.
You have a particular angle to doing business in Poland and the values that you apply are very specific to SymPhar. When you set up you business, it was crucial to find the best human resources to be able to bring the business forward. How did you find the right people that fit the core values of the company?
In the beginning, I must acknowledge that there was a bit too much staff turnover. SymPhar then went through various changes, which contributed to the higher stability of its workforce. Over the last one and a half years, SymPhar has had a much more demanding selection procedure, in which I decided to personally take the final decisions. When I observed too much rotation I tried to analyze the reasons for that rotation and came to the conclusion that perhaps I should make the final call on whether or not the newly recruited persons would fit to the company’s culture, regardless of their backgrounds.
Coming back to the company’s overall development, most pharmaceutical companies in Poland grew significantly in the 90s, benefitting from a strong market growth. It was easier then to be an entrepreneur, as Mr Herba of Neuca was telling us. Do you feel like you missed out on this period of opportunity?
Obviously, if I had set up my business before I did, it would have been a lot easier. The main difference between the current conditions and these of the 1990s is that companies need to invest more to be able to achieve the same level of sales.
But the nostalgic perspective of the “golden nineties” is more specific to pharmaceutical wholesalers then companies like ours, considering that setting up a business in wholesale today is absolutely impossible because it is such a consolidated market. With the affordable pharmaceuticals business, it is a bit different. According to IMS 2010, SymPhar was the second-fastest growing pharmaceutical company in Poland, considering all the 125 companies with more than 2,5 mio Euros sales.. SymPhar managed to achieve very dynamic growth despite late entry into the market, and there is a lot of time ahead of us.
What will be SymPhar’s next moves?
SymPhar is not going to implement new business strategies, as the company has been adding four to five products and launched new cooperations and fostering projects every year. The main priorities consist in developing SymPhar’s existing business and strengthening it, although we do also intend to enter the consumer health market with some unique Australian brands.
Would you say that today you have achieved the objectives that were set up when you started the business? What is left to achieve?
I do not think I have achieved them by any means; SymPhar is in fact a long way from it. To set up a company in this area is very challenging, it takes a long time and a lot of investment. From making a licensing agreement with the producers of the products, to registration fees, to the launch of a product where there is no profit at first and creating a good financial performance, there is a long way to go. I am far from complacent about the situation at the moment, although it is moving in the right direction.
SymPhar is among the top 60 pharmaceutical companies in Poland today, and should enter the top 20 companies five years from today.
Do you have a final message to the readers of Pharmaceutical Executive?
The people in the pharmaceutical industry in Poland should not take themselves so seriously. It should be enough that the business is serious!
| Company: | Symphar |
| Position: | CEO |
| Country: | 波兰 |