Business India
Sekhar Seshan, India
June - July, 2006

Healthy on Herbs

Muhammed Majeed has a simple reason for coming back to India in 1991, after 16 years as a pharmacist and an entrepreneur in the US. "Scratch any Malayali and you will find a Kerala communist!" grins the founder-chairman of Sami Labs lim­ited. But, though he visits his home state frequently and spends a lot of his time at the corporate headquarters of his Ayurvedic ingredients and formu­lations company in Bangalore, he hasn't made a complete home-com­ing. And Sabinsa Corporation, which he set up in New Jersey in 1988 to import and market generic drugs into the US, continues to contribute a major share of his $60-million revenues.

"In those days, most people from Kerala went to the Gulf or into gov­ernment service," Majeed says. "But I always had my eyes on the US. And as a pharmacist, I got direct immigration to that country." But though his fam­ily was never poor - his father was a plantain wholesaler, who passed away when Majeed was only 12 years old ­he did not have the wherewithal to buy the airline tickets. Canara Bank had a scheme to fund these expenses. He got funding from the bank - with which he still has 'some business', though his main business accounts are with the State Bank of India.

So, Majeed moved to the US in 1975, two years after earning his degree in pharmacy, and proceeded to complete his MS in industrial phar­macy from Long Island University, New York - followed by a doctorate in the same field from St John's Univer­sity. Simultaneously, he worked as a pharmacist at Pfizer and a couple of other companies. "That's something the US allows you to do: you can work full-time and go back to school, too," he says.

In 1988, Majeed set up Sabinsa, named after his wife, to introduce a line of products based on Indian herbal plants. "Phyto-pharmaceuti­cals, based on plants, was the best option at that time," he explains. "The market was open for standardised products." Three years later, he decided to set up a facility in India to meet the increasing demand for inno­vative application-based products. Sami Chemicals & Extracts, named after his daughter, was born as a qual­ity assurance facility. Now Sami Labs, its main thrust is on new product development and market-oriented research.

"Setting up and operating a com­pany in the US is simple - there's less bureaucracy!" Majeed says. But belonging to an ethnic minority was a 'hindrance'. Fortunately for him, there is a group of retired service peo­ple doing voluntary work in helping people found enterprises, who set him up with a freight forwarder to import extracts from India. He still uses the company for his shipments.

Now manufacturing a range of standardised herbal extracts, cosme­ceuticals, probiotics, spice extracts, minerals, fine chemicals, phytochem­icals and oils used in the nutritional, pharmaceutical and food industries, Sami Labs has a few firsts to its credit. It uses a proprietary process to make ForsLean, a standardised extract from the roots of the Coleus Forskohlin plant, the only known plant source Of forskohlin used to promote lean body mass and treat mood disorders.

NAME: Sami Labs Limited
ENTREPRENEUR: Muhammed Majeed
LOCATIONS: Bangalore, the US, japan, China, Malaysia, Australia, the Middle East, South Africa
BUSINESS: Herbal extracts and formulations
TURNOVER: Rs486 crore

ForsLean has won two awards for Sabinsa - now Sami Labs' interna­tional marketing arm - the 'best new product' award in 2001 at Nutracon, as well as the Thomas Alva Edison patent award for 2004, having been adjudged one of the most important scientific breakthroughs and revolu­tionary product innovations originat­ing in New Jersey.

Other Sabinsa trademarks include:

  • Gugulipid, a standardised extract prepared from the oleo gum resin of Commiphora Mukul, an Indian medici­nal tree that has been clinically proven to reduce the levels of harmful serum lipids in the bloodstream;
  • Bacopin, made from the leaves of the Bacopa Monniera (brahmi) plant, which helps support cognitive functions; and
  • Bioperine, an extract of black pepper or long pepper, which is the only source of piperine to obtain patented status for its ability to increase the bio-availability of nutritional compounds. (It is also the only one to have undergone clinical studies in the US to substantiate its safety and effi­cacy for nutritional use.)

The company is also into research and development for quality herbal extracts, fine chemicals, specialty chemicals and cosmeceuticals. It has a team of 16 senior scientists and more than SO scientists and chemists, work­ing on its projects and involved in research for new drug discovery. Sami Labs also has full-fledged laboratories for phytochemistry, organic chem­istry, tissue culture, biotechnology and quality control. Its herbal extracts division isolates and develops active ingredients from herbs for various therapeutic applications and provides custom requirements for clients.

With a series of 23 US and interna­tional patents beginning with one for the use of Piperine to increase the bio­availability of nutritional compounds in 1996, Majeed is specially proud of a process of hydrogenating turmeric to make it white so that women can use it as a skin lightening cosmeceutical without having to suffer the yellow tinge it otherwise leaves behind. Other products help prevent and cure a wide variety of ailments.

The strict regulations on emissions and the rigid examination of the sol­vent residues that goes into any phar­maceutical, medical or nutraceutical product led to the setting up of a super-critical fluid extraction (SCFE) facility in 2002. The first com­mercial unit to be established with indigenous technology developed by the Indian Institute of Technology (IIT), Mumbai, the fully computerised unit uses carbon dioxide in its critical phase as the extraction medium.

World class
"The SCFE plant at Sami Labs is world class, yet lower in cost than the equiv­alent imported plant," says Swap­neshu Baser, professor in the chemical engineering department of IIT Mum­bai, whom Majeed credits for the SCFE technology. "The knowledge and understanding of Sami Labs towards natural extracts is also an important factor in successful use of SCFE tech­nology." The original development was part of a Technology Develop­ment Mission (TDM) project from the Planning Commission that started in 1993. The biggest of nine plants sup­plied so far, the capacity of two 200­litre extractors commissioned at Sami Labs in March 2002 is now being dou­bled with the addition of two more 200-litre extractors.

"Sabinsa is a unique company for several reasons," says Hamdi K. Hamdi, president of H2RC Corpora­tion in Orange, California, which buys multiple ingredients from it for research. "They are responsive to their customers and adapt to new situa­tions quickly on a technical as well as a managerial leveL" Adds Deepak Sharma, director of the Ireland-based nutraceuticals manufacturer Bioshell Teoranta, which buys a dozen ingredi­ents from Sabinsa: "(This is) a com­pany whose products I would always like to recommend. Some of them are simply unique, like Bioperine which is an excellent ingredient for bio­availability enhancement and Forslean." Thanks to the product quality” he says, "We are buying extra peace of mind."

At Finnish weight management products manufacturer Medvia Oy in Helsinki, medical and strategic direc­tor Mika Kettula says, "The products they have are well documented and there is good clinical evidence on the ingredients." Medvia buys Sabinsa's Forslean, Bioperine, Tribulus Terras­tris and calcium ascorbate as raw materials.

And, in India, Azhar Ibrahim, director, licensing, at the Hyderabad­based Dr. Reddy's Laboratories, which buys the ingredient for its dermato­logical cosmetic from Sami Labs, says the latter is 'extremely unique' as an integrated Natural product company with a strong R&D focus. "Also, they operate at high levels of integrity (and are) a good alliance partner to have," he adds.

"We plan to grow more aggres­sively now," Majeed says. "The next phase of growth will have to be through acquisitions; so we are exploring various options, including an IPO (initial public offering) to fund this." With 100 scientists, 50 profes­sionals, 700 employees, 10,000 farm­ers, four manufacturing units and R&D hubs, Sami today has a formidable army to help it grow to Majeed's vision of becoming a Rsl,OOO-crore company in the next two years.