Dilip Shanghvi: Replicating Sun Pharma magic in start-ups!

Sun Pharma is in the pink of health and the chairman and managing director Dilip Shanghvi now wants to repeat the miracle he performed in making Sun Pharma a billion dollar drug maker, with a host of smaller drug companies.

CNBC-TV18's Archana Shukla caught up with this camera-shy entrepreneur who says he is a true believer in partnership rather than acquiring a business and running it as a part of Sun Pharma.

He's an entrepreneur who is keen on helping other entrepreneurs realise their dream in his personal capacity. And Sun Pharma's Dilip Shanghvi is methodical in his approach:

Step 1: Identify small promoter-run pharma R&D and drug-manufacturing firms.

Step 2: Infuse capital in these companies for a majority stake.

Step 3: Let them keep management control.

Shanghvi has already picked up such stake in four Rs 40 to 50 crore companies.

He says, "Many companies have their strength because they are run as a small company. Now if you make them part of this company then what happens is they lose their strength and then they don't get our strength."

Shanghvi's pill for small companies is that he believes that these firms may grow to be of great support to Sun Pharma but he is adamant that these will remain separate individual entities.

There has to be some benefit for Sun from these investments, but in the immediate future. He also adds that product sharing could be looked into.

Shanghvi is not restricting this interest to Indian companies alone. Last year, he picked up an 11% stake in Israel-based Bio Light Life Sciences.

Other industry players agree that such collaborations are the future of the Indian pharma space.

Prakash Mody, the chairman and managing director of Unichem Laboratories says the country is dependent on the entrepreneurship of the private sector.

It's a strategy that is prevalent in the global biotechnology space where small start-ups are funded by bigger players, without interference in management or the threat of a takeover or merger down the road. And while indulging in start-ups may look like a risky proposition, Dilip Shanghvi is confident that such moves will only make the Indian pharma space that much healthier.