The Lupin founder’s offspring are building a global generics powerhouse while sitting 8,000 miles apart
Nilesh Gupta
MD, Lupin
Age: 39
Education: Degree in chemical engineering from Mumbai’s ICT; MBA from Wharton
Role: Revved up the R&D division; will now steer the company’s financial performance
Vinita Gupta
CEO, Lupin
Age: 45
Education: Degree in pharmacy from University of Mumbai; MBA from Kellogg School
Role: Runs the US subsidiary and oversees other foreign markets
B y 2002 Mumbai-based pharma firm Lupin, founded by former professor Desh Bandhu Gupta and known for its TB drugs, was already an emerging star. But with a market capitalisation of $108 million it wasn’t close to being as valuable as Dr Reddy’s Laboratories, which was at $1.7 billion.
One reason investors were not as hot on Lupin was it had no presence in the US whereas competitors like Dr Reddy’s had already latched on to the generics opportunity there. “We really had to come up with a good strategy for the US,” recalls Chief Executive Vinita Gupta, the founder’s daughter and the oldest of five siblings. Lupin had lost valuable years because the Guptas had made an unrelated diversification into real estate in the 1990s. “We’d lost our way,” admits Vinita’s younger brother, Nilesh, Lupin’s managing director.
In 2005 the Guptas plunged into the burgeoning US market, with Vinita leading the charge, and Nilesh assuming a bigger role at home. Since then Lupin—named after a flower that thrives even in barren soil—has blossomed again. Within a decade it has notched up US revenues of $706 million, 40 percent of its total sales. (It claims to be the fifth-largest, by prescriptions, generics firm in the US.)
Back in India, too, Lupin has climbed the ranks to become the third-largest (by revenue) domestic pharma company. This year it also entered the ranks of Forbes Asia’s Fabulous 50, a roster of Asia-Pacific’s best big listed companies. Patriarch Gupta, who owns 47 percent of the company, has seen his net worth jump to $3.3 billion on a 60 percent stock-price rise.
Lupin’s growth was spurred in part by a slew of company and brand acquisitions in the US and elsewhere. With 12 manufacturing plants—including two in Japan—the Guptas are now aiming for $5 billion in revenues by 2018.
Lupin got its start in 1968 as a small vitamin company with a $120 investment by Gupta. He refocussed on anti-TB drugs and became a global leader in this neglected segment, just as the scourge was about to show rising incidence in several parts of the world. “Lupin embodies my vision to fight life-threatening diseases by manufacturing drugs of the highest social priority,” says the 75-year-old Gupta.
This September he formally handed over the day-to-day running of the company to Vinita, 45, and Nilesh, 39. He is still chairman and appears at No. 19 on the India Rich List. Three other daughters aren’t in the business.
Gupta says his decision was a well-planned one. “Both Vinita and Nilesh have been a part of the business—and a part of Lupin’s growth plans for over 15 years now.” The two siblings say their association has been even longer. “We grew up listening about Lupin—Dad was extremely participative,” says Nilesh. “He would always share what was happening with the company.” The kids tagged along on business trips, too. “I went on a trip to Europe when I was 11 years old—during my summer vacation,” recalls Vinita. “I would sit in a corner observing my dad.” The family home, too, was a venue for visiting employees and pharma luminaries.
(This story appears in the 28 November, 2013 issue of Forbes India. To visit our Archives, click here.)