Cipla boss calls Subhanu Saxena quits; cites family reasons
What's the story
Cipla chief executive Subhanu Saxena confirmed that he would no longer be serving as the head of the company. Cipla's COO Umang Vohra has been elevated to the post of the CEO at a time. Saxena in his final message said: "Family reasons brought me to India, family reasons have forced me to the US. We have managed to get a smooth transition".
Introduction
Cipla: Company profile
Cipla Limited is an Indian multinational pharmaceutical and biotechnology company. The company was founded by Dr. KA Hamied in 1935, headquartered in Mumbai. Cipla essentially produces medicines to treat "cardiovascular disease, arthritis, diabetes, weight control, and depression; other medical conditions". As of 2014, Cipla's market capitalization was Rs.517 billion (US$7.7 billion). It was the 42nd largest publicly traded company by market value in India.
Shifting roles
Cipla and its changing reign
Cipla's face for 40 years since 1972 Yousuf K Hamied resigned from the post of managing director in 2013. He is still the non-executive officer at Cipla. MK Hamied's son Kamil who entered Cipla in 2005 (21) resigned in 2015. Amar Lulla, the joint managing director instrumental in shaping Cipla's fortunes was then diagnosed with cancer and passed away in 2011.
Historical
High profile exits in Cipla in the past
People like "Kamil Hamied, Chief Financial Officer Rajesh Garg and Sudhanshu Priyadarshi, who was the Global Chief Technology Officer" have in the past made exits from Cipla.
Saxena's Cipla
Cipla under Saxena's reign
From the time Subhanu Saxena took over the company, Cipla entered new geographies, primarily in the US. He changed the business model to business to business model from the previous direct to market strategy. He also built an impressive top-tier executive team which pronged it into a fierce acquisition mode. However, despite this, the company lagged behind its rivals in terms of revenues.
Reason behind loss
Cipla's fall in revenues: Real reason for resignation
Cipla said that the fall of revenue in its first quarter numbers was mainly because of the drop in its earnings in the US and India markets. Factors like policy changes like price revision are what hit the India market (which grew by 4% otherwise). Cipla's profits before "interest, tax, depreciation and amortisation (EBIDTA) dropped by 42% from last year at Rs.611 crore. "