The Report Company: With a worldwide pharmaceutical industry that is increasingly competitive and globalised, what would you say makes Randall stand out from the rest? What are your principal strengths as a company?

Rodrigo Iturralde: Five years ago we were looking in the market for opportunities, particularly for things that our competitors had not yet seen. Many international companies were looking at the Mexican market, many for the first time. We can’t compete with these companies as we are small but we were curious as to what they were looking for. The generic market in Mexico is very interesting because there are over 110 million Mexicans but all with different needs; you can go to a pharmacy in Polanco or Monterrey and you will see many different types of generics. Most of these companies cater for general needs, but we decided to start a campaign with our distributors to restructure our distribution network and to look at where the need is greatest for generic products in each region of Mexico. We began our strategy with one product and we continued with our own brands. We have had a leading product for the past ten years but it wasn’t available in the large pharmacies, only in independent stores, because we couldn’t get the necessary registration.

TRC: Why couldn’t you get the necessary registration?

RI: Because this was in a period in which the Commission was very slow and it was difficult to work with them. Almost all the laboratories found themselves in the same situation as us. Preference was given to big companies. Later, we sought out partnerships and we started to produce and manufacture for other laboratories. Randall already had an image based on 50 years of quality, and despite being a small company, we had good results. Although we were not obliged to offer a generic line, we did and we started working in distribution. We are now self-sufficient in manufacturing and distribution.

TRC: Do you only sell to Mexico or do you also sell abroad?

RI: Only in Mexico for now, but we are registered in Central America. That’s a step we’re taking at the moment, towards internationalisation.

TRC: What are your short, medium and long-term objectives?

RI: We have partnerships with two pharmaceutical companies: Unipharm, which is a Central American company based in Guatemala with operations in Mexico, and the other is Atlantis Pharma. They produce and manufacture different products for us and we have an interesting line of generics which makes us strong in antibiotics. The intention is to distribute them in Guatemala, Honduras and other places where they’ve been present for many years.

TRC: Talking about your domestic network, what would you say are your objectives?

RI: First of all, consolidation in the private consumer field, so pharmacies, hospitals, everything that has to do with the public. There are groups of pharmacies that have merged or that have been buying wholesalers. We have already joined a network of two wholesalers. It was hard work because in this market there is a lot of competition; for example there are currently 15 manufacturers of aspirin and although negotiations have been progressing and we now have ours in various points of sale, we still haven’t reached all the pharmacies that I would like to.

We work with groups of pharmacies spanning regions. These are popular pharmacies that buy from me at prices I agree with. This is my market, not so much the elite pharmacies. Then there’s the Seguro Popular program, which is interesting to us, as we see the opportunity to consolidate ourselves as a distributor.

TRC: Speaking of the Seguro Popular, what synergies are there between the private sector, like yourselves, and the government?

RI: This laboratory was founded by my grandfather 60 years ago. My father worked here, and now I do. I remember when the tenders with the government were done through the laboratories to cater to the Mexican Social Security Institute and the Institute for Social Security and Services for State Workers, which was all there was. Now, the distributor is whoever has the control of the supply of medicines. To invite bids for the Seguro Popular program, the government publishes a budget and delivers it to a distributor which can do whatever it wants, while the laboratory produces the medicine and bears all the risks. We have encountered irresponsible operators who make mistakes and damage us, because the time between manufacture to delivery to government can be up to nine months. The laboratory cannot work efficiently in this way. Currently, there is no relationship between the government and the laboratory because they’re not interesting in dealing with the laboratory, only with the distributor.

It’s definitely a very ambitious program because it does provide care to the population, but there are illnesses that the Seguro Popular doesn’t cover and they have poorly maintained hospitals.

TRC: So would you say that the best strategy would be to improve relations with the distributors because it’s more efficient and more economical?

RI: For us it has improved our relationship with distributors and the model does work, but operations with the government are every day more remote and the model will end soon since it currently adversely affects the price of medicines.

TRC: What can you tell us about your links with universities and academia in terms of research?

RI: Being a company which provides employment is very interesting to us. I have no preference for any university in particular because here in Mexico engineering, chemistry and pharmaceutical degrees are only awarded in three universities and research is only carried out in institutes which are part of these universities. We have found a lot of talent, but it lacks polish. We have learnt that we need to get closer to this research phase and make mutually beneficial partnerships.

Some time ago we started a program with the Universidad Iberoamericana to hire people who were interested in the pharmaceutical industry. This program worked well, we were able to use their facilities which were suitable and there was some progress. We also work alongside a group from Puerto Rico in injectables, and although we need further investment, we’ve done some very fulfilling research.

TRC: What opportunities are there for foreign investors to partner with Randall?

RI: We are a company which is consolidated in the Mexican market. I have seen generic competitors enter Mexico and I don’t feel pressured by these brands because here there is enough market for everyone. This company has been growing at a good pace, and I’ve chosen my people very carefully. The personnel that we have in key roles is a combination of experience and youth, because I don’t like to move forward without the right people.

I know that globally, there are many eyes on Mexico. I know that we are in a good place.

TRC: How much do you invest in innovation?

RI: We are going to wait until the next semester but over the past few years we have invested an important amount. The company is growing compared to last year, thanks to the distribution.

TRC: What are your goals for the company in the next 5 years? What values would you like people to associate the Randall brand with?

RI: A few years ago I was asked a similar question, and at that time, I thought that Randall was going to increase its facilities and that we would have another plant, but you can never guess what’s coming. Things change, I’ve found interesting opportunities. A while ago, I travelled to Europe and I found incredible things that can be done, but here we’re still stuck on the idea that “Mexico is for Mexicans only”. We have missed many opportunities. There are many foreign companies that are now in Mexico. I want Randall to be seen by those abroad as an opportunity. We are a good quality, talented company.

I see myself in a while looking for new business. I know my country well, I know many Mexicans, but I would like to explore what Mexico can give to other countries, maybe not internationalise the brand, but instead offer products, and create synergies so that there’s more investment. The multinational plants are now going to Brazil and to Colombia, many people are in Ireland, but Mexico is a big opportunity today.