With more than 30 years of experience in the pharmaceutical industry, Sinhue drives value for communities. His journey from marketing for others to manufacturing his own products is an exceptional milestone and an inspiration for new-age entrepreneurs. At the age of 58, he built his company into a multi-million dollar business that gives him the confidence to see age is just a number.
Sinhue Bosco Noronha, Founder and CEO of Africure Pharmaceuticals Limited, got into a conversation to share his extraordinary journey and zest for life which is admirable.
- Please tell us about your educational/ professional background. Who inspired you to become a business leader? Would you like to mention some of the highlights from your journey?
Academically, I have a Bachelor of Science degree and an MBA degree in Marketing. I initially started at a grass root level, detailing products to doctors in India and then grew within the ranks, from a Medical Representative to a Product Executive to a Product Manager to a Group Product Manager to a Marketing Manager and finally Marketing Controller. I was a marketing Controller at the age of 28 and driving businesses that were mostly start-ups and where we had almost approximately 150 field personnel. So that has been my basic journey at the start of my career and this had everything to do with domestic companies in India. I worked with three startups and got them going from ideation to commercialization. To get into business, I owe it to a good friend of mine Mr. Arun Kumar who is the Managing Director of Strides Life Sciences based in Bangalore which is a global player in the field of pharmaceutical formulations, where they do manufacturing in regulated markets and semi-regulated markets.
I learned all about exports from Mr. Kumar and that is when I decided that I could probably be an entrepreneur and started my entrepreneurship journey. In 1991 with a company called Simrone Pharmaceutical Industries Limited, where for the first three years we worked on contract manufacturing and sold the products to buyers in Europe, specifically Germany and UK who in turn sold the products to various markets in Africa. In 1994, I was able to raise capital in India from some leading venture capital companies in India and I was able to set up a facility of my own at a place that was approximately a hundred kilometers from Mumbai city. This facility was called Simrone Pharmaceutical Industries Limited and had a team of about 70 or 80 people to start with and we were purely into the manufacturing of products for exports as this was a designated hundred percent export-oriented unit. Subsequently along the way when the government changed the policy and allowed hundred percent EOU’s to market products locally we were associated with companies like Zydus-Cadila, Lyka, Elder and a couple of other companies where we would manufacture products and they would market them in the Indian market. That’s where it all started and this helped me understand the nuances of the African market & have always been passionate about African health.
- Please brief us in detail about the current scenario of the business. How have the customer preferences changed over the years?
Africa is a very potential market for pharmaceutical businesses because it has a very low per capita income, a low per capita consumption of just twelve dollars per person with a population of about 750 million people. The opportunity is good simply because the economies of most of the countries are improving and the wages and pay scales etc are improving and the buying power of the people is better. The need for Africa is basically to be self-sufficient and that starts with having manufacturing facilities and capabilities. As a company, we focus on both creating the capabilities and the assets. We get into markets that have virtually zero or maybe a couple of manufacturing plants. So what we’re doing here is we are trying to create an impact in markets where people were denied medication and knew nothing about the manufacturing processes. We train the locals and we work with almost 95% of the local population. So we are a company that is very focused on manufacturing and we have a portfolio of approximately 350 registrations in various countries, which boils down to approximately 80 or 90 molecules.
In Africa, it’s still very unfortunate that because of the cost factor, people continue to use old age medication and the new molecules that have been discovered globally don’t seem to be doing exceedingly well, it’s simply because of a matter of buying power and people can get relief with the old medication and they can absorb the side effects. So if you take the top fifty products in each market you will find that these are products which are more than twenty years old. That’s the scenario as far as the business goes. So the Business is not really changing too much, although there is a slight shift. Africa has been more of a continent where the medication was self-consumed. People would go and buy over the counter based on their judgment or based on the recommendation of the pharmacist as they were very few doctors available. Now that is changed to some extent as Pharma companies have been going to doctors and promoting their products getting them to write prescriptions for newer molecules. So about 70% of the market in Africa today is, especially in sub-Saharan Africa cause that’s where our strengths lie, is the generic part or the OTC part although antibiotics are sold over the counter and 30% of the market would be the doctor promoted market.
- When was Africure Pharmaceuticals Ltd. established? What are the prominent services/ solutions offered by the company?
Africure Pharmaceuticals was established in April 2017 with the objective of creating and manufacturing assets in Africa. I also did a management buyout of some of the major manufacturing assets in Africa from the company Strides, where I worked as a CEO for four continents. We started with a basket of seven or eight plants and four distribution centers. I raised capital from HNI’s and people who were in Africa and understood the pharmaceutical business. On one single day on April 1st, we had 200 people moving from Strides to Africure with zero attrition, and everyone was willing to work with Africure, because I was the face of the organization for almost 8 years prior to that. I retired in 2017 when the offer came up from the management of Strides, I accepted the offer. I sold them 48% of the company and retained 52% and that’s how Africure was born.
Headquartered in Mauritius, Africure has one of the most motivated teams one could ever find because they’re all very young, enthusiastic and willing to work in rugged terrains and environments away from their families and focus more on the job. So the only way I could keep them further motivated was by traveling continuously and meeting them frequently to make them understand that Covid is not a threat to us and we will still survive. I spend almost 200 days in Africa in various markets constantly on the move, perhaps that may be the reason why people are very motivated as the CEO visits them very often. With regards to productivity, we have very good systems in place, we have high-speed machinery and we have a target for every process. We are monitoring these targets the heads of each plant are responsible for delivering on target and just to give you an example the small facility which is in MUMBAI which is our smallest and oldest facility produces 4.5 million tablets packed every day by evening. So that’s the kind of productivity we have. We are a very large volume producer of lower per-unit costing products. That’s how the market is structured in Africa. There is a large consumption of low-value products and a very small consumption of high-value products. Since we have high-speed machinery we have to keep them running therefore we have to be in the segment of low value and high volume.
- Please tell us about the services/ products your company is offering? How are they different from your competitors’ offerings?
The products that we offer are largely consumed generics, which are similar to the others in the market. The differentiator is our products are made from high-quality input materials, the packaging is of extraordinary standards, the designs are very well accepted by the patients and the pricing is very sharp. Beyond this, we also do specialized products, like pellets which are like small balls put into transparent capsules, whereby these are for high-end treatment of lifestyle diseases like diabetes, hypertension, cardiac, etc. That is the product differentiator, at one end we are into extremely specialized products on the other end we are into commodity generics.
- What are the unique challenges your company is currently facing? How have they affected your company?
Currently, because of the Covid situation, the challenge that we face is supply chain logistics where containers are reaching 60 to 90 days late. We were a company with limited cash so we always worked just in time, which is creating hassles for us at the moment because just in time does not seem to happen, as it used to in the past. Another thing that has hit is the high cost of the freight where we used to be approximately $2000 a container and today we are paying as much as $8000 for the same container. So these are a couple of challenges we see today on the ground or else everything seems to fall in place and business is as usual. All through the Covid period, we were running, none of our plants had to shut down, except for one which was closed for 15 days forcibly by the Indian authorities, as they closed all the industries in the area where we were located. So I don’t think the impact is something that is going to hit us very badly, we may have a slightly weaker bottom line than what we would have expected to have, but that’s not a worry because we are a growing company and adding a new plant every year so obviously the full impact of the company‘s progress has not yet been felt and it will take another couple of years where we will see a great jump.
Another major hindrance is because of the various global challenges such as the short supply of chemicals to India hence there is a price increase in the APIs and it does not get well accepted in the African market because they have an inventory pipeline of about six months to nine months and only when their stocks get exhausted do they do to their prices change. So we take a hit on cost, freight and a little more on OPEX because we have to look after our people. I am only explaining to you what the hits are but that does not mean that we would have a bad year. I am very optimistic and I know this is going to be a fantastic year for us. Last year we closed with 34 million dollars and this year we are planning to close at $45 million revenues.
- What measures do you incorporate to ensure motivation and productivity within the workspace? How do you respond to criticism and disagreements?
I keep an open mind with respect to disagreements and criticism because human nature is to criticize and disagree frequently. I am not very happy with having YES men around me but like to be challenged and questioned on my decisions which gives me a better insight into what I am doing. Fortunately or unfortunately, it is more of a top-down approach that there is tremendous information that flows down from me to all across the organization on a daily basis. I keep feeding them with the various developments that are happening daily globally, happening with products, people, etc. So this is something that keeps the people aware of the latest developments that are relevant to us, in addition to what they learn themselves.
- What measures do you undertake to ensure optimum customer satisfaction? How much impact does the customer feedback have on the company’s strategies?
We are in a market where the price is decided by the customer and not by us, because it is decided by the competition, being in a generic space. It’s more of a commodity as it’s in common use, so the prices are fixed based on what the competition is selling and we try our best to ensure that we are on par or at least we have a few percentage points higher than the average competitive price, simply because we have very good brand equity, good packaging and visibility in the market that we are in. That’s how we ensure customer satisfaction. We do extend credit for our reliable customers And to date in the last five years we’ve had a zero default. We believe that the customers also reciprocate our efforts in keeping them happy by ensuring that the credit period is respected and we get paid on time.
- Are you planning to launch any new products/services or advancements to your existing offerings? If so, we would like to know about it.
Yes, we are continuously looking at introducing new products in our range. We have a formulation development facility in India which has a target of 60 products per year. We are also looking at buying technology from companies who have high-tech products and for which there is a demand in the African market. So the way forward for every company is, moving higher up the value chain and probably that’s what we are also wanting to do.
Tips for aspirants
Age is only a number. I started my second innings in business at the age of 58 and build it into a $34 million business in five years, so there is always ample opportunity to be a successful entrepreneur. All that it takes is dedication, hard work, focus, and passion. Money will run after you because people who recognize good talent are wanting to fund it. The products that you have must be differentiated products, or else you could probably get lost in the crowd.