There is no loss of face for Ranbaxy Laboratories Ltd in the current dispute with pharma stockists over replacing them with FMCG stockists, according to the company's CEO and Managing Director Davinder Singh Brar.
RLL has now decided to take pharma stockists along when new brands are launched by its newly formed "Ranbaxy Global Consumer Healthcare" (RGCH) division, according to Brar.
This decision comes in the wake of an aggressive statement from the head of the OTC division to a financial newspaper on Friday that future brands will not be routed through pharma stockists.
The company is in discussions with new FMCG and old pharma distributors for the new OTC division, Brar said.
Asked about the threat of pharma stockists to put at stake the entire Rs 1000 crore-odd formulations business of the pharma division of the company, he said that this was not likely as the company has been doing business with them all this while.
He said that pharma stockists would continue to remain in the distribution channel, which would be bolstered with the induction of FMCG stockists. "The FMCG stockists will reach where pharma stockists cannot," he said.
The RLL pharma division is upset over the OTC division's decision to annoy the pharma stockists. The trades can even the score by simply refusing to pick up the pharma division products, should the company refuse to relent. "The decision to replace pharma stockists with FMCG stockists has been one of the most ill-planned decisions of the company," an industry source said here.
When told that the trade has claimed that it will not allow RLL to take such decisions on its own, Brar tried to give the impression that there was no problem or dispute with the trade partners. "RLL and the trade are on the same side," he said.
Asked why the company rushed into such a decision, he said the company is undergoing a learning process. "The company has entered a new business, that of OTC, which has different parameters. We are learning the new business," he said.
The Rs 50 crore-odd RGCH has entered the domestic market with four key over-the-counter) brands - Revital, Pepfiz, Gesdyp and Garlic Pearls which can now be sold by grocers also.