Gufic Biosciences is one of those small listed pharmaceutical companies that are dime a dozen on the BSE.
They survive on contract manufacturing for larger peers or supplying bulk drugs and intermediates, and a few among them have front-end capabilities to push drugs on their own brands.
Gufic does all of it and much better than most of its peers of similar size.
It exports drugs to regulated markets like Europe and US, it sells critical care medicines like antibiotics, antifungals, cardiac, proton pump inhibitors, and infertility products in lyophilized injection forms in domestic market deploying sales representatives.
To be sure, Gufic isn’t a new kid on the block. The company has been around since the 1970s, but in 1997, it made news when it sold its bread-and-butter branded business to Ranbaxy for Rs 80 crore. After a brief hiatus, it came back to business in 2000, and since then tried to get a toehold in the pharmaceutical business.
In the last two decades, Gufic attempted several things starting from herbal medicines to nutritional supplements to sanitary pads and hybrid seeds and tissue culture. After churning its businesses, Gufic finally found its footing in the business that it had known traditionally -- the manufacture of lyophilized injectables.
The company's Navsari plant had developed 34 products in lyophilized injectables segment, between 1998 and 2007, giving it the launchpad for its second innings.
Lyophilization is the process of preserving a drug in dry powder form, which can be reconstituted for injection for use. It helps in maintaining the stability of the drugs.
The company clocked revenues of around Rs 350 crore in FY19, growing at 13-14 percent and making a neat profit after tax of Rs 22 crore. The company says it sees no problems in maintaining this growth path.
Larger ambitions
But Pranav Choksi, 35, the restless third-generation entrepreneur and the Chief Executive Officer of Gufic, with a Masters in Biotechnology from the John Hopkins University in the US, isn’t content with playing too safe.
He wanted Gufic to do products that are highly complex, proving to the outside world what his small company is capable of doing. It also made strong business case as well.
It was the chance encounter with an Indian origin scientist Bal Ram Singh in US, that gave shape to Choksi's urge of turning the tide.
Singh, a Professor of Chemistry and Biochemistry at the University of Massachusetts (UMass) Dartmouth, has been an expert at the structure and functions of botulinum neurotoxins for over three decades.
He is also the Founding Director of the National Botulinum Research Centre at UMass Dartmouth, which has over three dozen national and international botulinum researchers associated with it.
Singh who became mentor to Choksi, decided to help Gufic to develop and launch its version of botulinum toxin-A. Singh is also on the board of Gufic.
Cracking Botulinum Toxin
Botox, marketed by US-drug giant Allergan, is the most popular aesthetic therapy, used to remove fine lines and wrinkles, considered symptoms of ageing.
For Allergan, Botox clocked sales of $3.57 billion in 2018. Sales are only expected to go north with the drug finding use in treatment beyond aesthetic applications, such as migraines, eye squints, excess sweating, leaky bladders, severe muscle spasms and depression.
Botox is nothing but Botulinum Toxin Type A, a protein byproduct derived from naturally occurring bacteria called clostridium botulinum.
But the problem with botulinum is: it is the deadliest toxic substance known to science.
It is so powerful that sniffing a speck of botulinum can suffocate a person to death by paralyzing the muscles used for breathing.
Scientists have estimated that a single gram could kill as many as 1 million people and a couple of kilograms could kill every human on earth.
That said, botulinum toxin injected into humans in small doses and at extremely low concentrations, works wonders by preventing signals from the nerve cells reaching the muscles, therefore paralyzing them or relaxing them.
Botox isn’t patent-protected but its recipe is a trade secret similar to the formula for Coke.
The making of Botox is akin to making a wine, through a fermentation process. But the comparison ends there.
“The amount of time, the purification process, the reagents that are used with it, these are very, very important, and they’re heavily controlled,” said Mitchell Brin, Allergan’s chief scientific officer for Botox to Bloomberg Businessweek in 2017.
Given the high regulatory and safety standards required for manufacturing, storing and transporting the drug, many competitors have kept away.
This is where Singh played an important role. His company’s Prime Bio website says it has deactivated clostridium botulinum Type A Neurotoxin Complex by exposing it to formalin treatment to remove its activity. The resultant mixture is retaining all of the complexing proteins along with the neurotoxin.
Choksi said the company has received all the regulatory approvals to manufacture and market Botulinum Neurotoxin in India and is planning to launch it by end of FY20 or early FY21.
It took five years for Gufic to bring to the product to the stage of commercialisation, Choksi told Moneycontrol.
The company is also in the process of seeking approval for new drug delivery systems for the Botulinum Neurotoxin for first-time users, which do not prefer the injectable route.
To be sure, it isn’t Gufic alone that’s chasing Botox. Other companies like US-based Revance Therapeutics, Evolus and South Korea-based Ipsen and Hugel are also in the race to sell Botox copies.
Challenging product
Choksi says while Botox is a multi-billion dollar product globally, in India, it is still very small.
He estimates the sales of Botox to be around Rs 60 crore in India.
Along with Allergan’s Botox, Ipsen’s Dysport are two botulinum toxins imported and sold in India.
Choksi still wonders why Allergan despite being the top seller of Botox in the world, is scratching the surface in India.
“If you think in any other segment, India is growing much higher, why not botulin toxin? That's a question I hope I can answer in a good way by sales,” Choksi says.
He adds that the cost could be just one factor for low penetration of Botox.
It takes around Rs 18,000 and upwards for a single sitting to get Botox. This includes the cost of the drug plus doctor administration fee. It takes a minimum of two sittings per year. Doctors use needles to inject the drug.
The other factors Choksi says could be lack of trained doctors or that people aren’t comfortable given the stories they hear on Botox treatments.
Choksi is building an entire derma division, hiring about 30-40 salespeople and a portfolio of products around its botulin toxin, to reach out to skin specialists.
He recently hired Satyen Manikani, a seasoned Alkem Laboratories executive to head the strategy and business development.
Manikani is currently working on a go-to market plan for botulinum.
With all the ingredients seemingly in place to create an India-made version of Botox, how is Choksi planning to price his product? He wouldn't divulge much, except to say that it would be much affordable than Allergan's product.
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