BUSINESS STANDARD
Wednesday, Dec 23, 2004

Sami Labs turns to India to up growth

Sami Labs, which started off as an export oriented unit (EOU) in 1991 from Bangalore , is beginning to look inward to expand business. Right now, less than 1 percent of its revenue comes from the domestic market.

For its growth in India , the neutraceuticals' (food with a high concentration of nutrients) manufacturer is betting big on many of its award-winning and patented products. The firm holds 16 patents and has many patent applications pending.

In the near future, Indian consumers will see “colourless turmeric and such other products on the shop shelves” developed by the company, said Dr. Muhammed Majeed, founder and chairman of Sami Labs and a PhD in Industrial Pharmacy from St. John's University, New York.

Majeed affirms that “ayurveda is the basis of the company. We took the basic knowledge of ayurveda and refined it to develop our products.” As a future strategy, the company intends to market products which are “evidence-based” by subjecting them to clinical trials and by bio-assays (chemically testing the products without using animals) where clinical trials are not possible.

As a marketing strategy, the company will concentrate on value addition to the existing products by selling more and more of formulations, developed by the company. “We also intend to concentrate on introducing new products,” said Majeed.

The company's margins are not very impressive. “This can be attributed to the very high proportion of revenues we spend on research around 7-9 percent,” sways Majeed.

As an EoU it exports mostly to the US . Other than India , it is now looking at Europe , Africa and Australia for growth. From 1991, when it started off, to 1996 it had a monopoly in its category in the US market. Now, there are at least 50 others vying for the US market in the category.

Hence, it has had to look elsewhere for growth by opening up newer markets like Australia and South Africa where we have set up new marketing offices. Also, we are looking for a acquisitions in Europe and South America ,” said Majeed.

The company owes its success to the change to mindset in the US . “From 1991 to 1996 Ayurveda was seen as an alternative medicine in the US . It became a part of the complementary medicine systems towards the end of the 1990s. Now, it has become a part of the mainstream ‘integrated' system of medicine along with yoga,” says Majeed.

In 2000-2001 courses in ayurveda began to be introduced in the US , which was testimony to the success and acceptance level for ayurveda.

The company was given the Thomas Alva Edison Patent Award by the Research & Development Council of New Jersey, USA , in November 2004 for the weight-reducing product ForsLean which it had developed. Only patents that are commercially successful are considered for the award, adds Majeed.

Majeed holds the top 2002 award for the R&D efforts given by the Department of Scientific and Industrial Research (DSIR), Ministry of Science and Technology, Government of India.