PRINCETON, N.J. — Marc Kikuchi, chief executive officer of Dr. Reddy’s Laboratories North America Generics, has always looked to the future while managing the present. That philosophy was important when he joined the company in February 2019 — just about a year before COVID and its variants washed over the globe and upended businesses.
His outlook, along with a wide range of skills — including a background as a biochemist, as an entrepreneur, as a generics buyer and later as CEO of another generic drug company — enabled Kikuchi and his team to drive top-line growth at Dr. Reddy’s domestic generic operations for three years straight, despite the disease’s disruptions.
“The pandemic and the resulting supply chain disruptions served as a wake-up call for many companies, but fortunately we always carried a reasonable level of safety stock,” he recalls. “At the same time, we were thoughtful about our production deployment — despite COVID-related restrictions surrounding on-site staffing, especially during the early stages, we were still able to meet 85% of our production targets — so we redeployed employees and achieved even greater efficiencies.”
A biochemist who later earned an MBA at the prestigious Carnegie Mellon University, Kikuchi’s business background includes working as a consultant at PRTM (now owned by PwC), launching a services company and, during an 11-year tenure at AmerisourceBergen Corp., serving as a generics buyer and then ultimately rising to senior vice president and procurement officer, where he successfully managed the company’s drive to establish a global generic drug manufacturing network. For three years, Kikuchi also served as CEO of the generic drug company Zydus Pharmaceuticals Inc. before making the move to Dr. Reddy’s.
“I’ve sat at both sides of the table, so I understand the customer as well as the manufacturing and sales end,” he notes. “This gives me a wide perspective.” That, along with “a hard-working team,” helped the North American generics team to deliver three years of revenue growth along with about 80 new product introductions.
“As a company, Dr. Reddy’s distinguishes itself from other competitors with basics like price, quality and consistent supply,” he explains. “But we then go farther by building close relationships with our customers, making it easy to do business with us, and we’re responsive to any inquiries. Add to that the breadth of our portfolio, which is close to 200 product families, and it moves the conversations to a different level: Instead of a simple sales transaction, we’re having strategic portfolio discussions with our partners.”
Under Kikuchi’s watch, the generics division is also “investing heavily” in digitizing core processes like account management and marketing. “This minimizes the chances of misalignment across product lines,” he says. “At the same time, we’ve created ‘bots’ (software programs that perform automated, repetitive, pre-defined tasks) to scour across websites for information that we collate and distribute across appropriate departments.”
Other initiatives include a global move to “lighthouse facilities,” which feature smaller, modular factories. “Many newer off-patent products are smaller-volume runs, so we need agile production facilities that give us the option of quickly changing out assembly line parts so we can run small batches on the same line. This ability gives us the opportunity to expand our markets while capturing greater market shares.”
The company looks externally and internally as it continues to evolve. “As more operations and sales move to digital channels, we continue to improve our finished goods output while reducing labor,” says Kikuchi. “Our initiatives include a direct-to-consumer program, using advanced APIs (application programming interfaces, or software intermediaries that allow different digital applications to communicate with each other) that will enable hospitals to order products directly from us through a secure portal. We’re also partnering with companies like Thirty Madison (which uses a digital platform to deliver accessible, affordable health care to consumers) to provide O-T-C and prescription products on their own rapid delivery platforms.”
Dr. Reddy’s has also expanded its presence on Amazon, growing it from an initial 2016 launch of its O-T-C Habitrol brand nicotine patches in 2016 to more than 20 products now, with a planned increase to some 50 in the near future. “We continue to significantly expand our portfolio while ensuring appropriate cost structures as a way to effectively perform in this highly competitive market,” Kikuchi notes. “If your portfolio is static, you’re in trouble.”