The pharmaceutical industry could well take a page out of the automobile industry’s book when it comes to handling attrition and quality, said Sun Pharmaceutical Managing Director Dilip Shanghvi.

Recounting his personal experience, he said that Sun had as its independent director V C Sehgal of the Motherson Group, whose flagship auto ancillary company Motherson Sumi saw zero defects in the parts supplied to multinational carmakers and attrition as low as two per cent.

The pharmaceutical industry needs to pick up lessons on what makes these industries successful, Shanghvi said, speaking at the concluding CEO roundtable at the Indian Pharmaceutical Forum.

The industry is “promiscuous”, he said, referring to the high rate of employee turnover. The pharma industry estimates peg attrition at about 20 per cent.

Integrating quality into the culture of the company, building capacity and empowering employees to do the right thing at different manufacturing sites and other departments was the central theme at the third edition of the Forum, as some of the biggest drug companies in India face action at their production sites from overseas regulatory authorities.

In fact, even as the session was on, Sun said that its Halol plant (Gujarat) had received regulatory observations from the United States Food and Drug Administration.

Shanghvi pointed out that drug companies needed to replicate best practices within the company and just be a “good employer” so people would not leave. “The auto industry is growing at the same rate as the pharmaceutical industry, but they don't lose people,” he said.

While the industry was still away from implementing Six Sigma, he cautioned that companies should not take short-term measures that would hurt them in the long run. Agreeing with Shanghvi's observations were the other young turks of the pharmaceutical industry.

Lupin Managing Director Nilesh Gupta pointed out that companies needed to empower people at various levels like the production site and so on, even as they integrate quality into the culture. Given the highly competitive environment companies were facing, he said, it was in the industry's interest to become efficient as the cost of failures was very expensive.

Attrition is the biggest risk in building the culture of a company, agreed Cipla Managing Director and Chief Executive Officer Umang Vohra, citing examples of how they were designing ways to make the work culture more flexible for women.

But attrition will be a problem because of the demand-supply gap, observed Sharvil Patel of Cadila Healthcare. They have managed to improve retention at operator and supervisor levels, he said, adding that more work was required in the analytics area, for instance. The company was investing in training young people, he said, to build the right employable behaviour.

Giving a personal insight, Cadila's Patel said that Chairman Pankaj Patel used to address the team after an audit saying that they needed to only focus on getting a quality product out and the commercial aspects of earning profits was his job as head of the company. That's the focus employees should be allowed to have, he said, in the face of multiple regulatory requirements and competitive pressures.

The two-day Forum was organised by the Indian Pharmaceutical Alliance in collaboration with the United States Food and Drug Administration, the UK’s MHRA, the European Medicines Agency and India's CDSCO (Central Drugs Standard Control Organisation).

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