Interviews: Medical

The market requires flexibility

Interview with Gustavo Lico, managing director of Farmaservice

Farmaservice is a recently founded company, operating in the market for the past few years. It was founded in the province of Latina (Italy), thanks to funds in favour of young entrepreneurs. After a 3 years start up, 2004 concluded as the first full productive year. The Company, fully automated, is a Uniloy customer for injection and blowing technologies (bottles) and also has a division for injection production (stoppers, capsules, teaspoons). It exclusively supplies the pharmaceutical-medical sector.

What are the reasons that convinced you to start from zero and enter this crowded and strong competitive market?
Lico: Between the south of Rome and Latina there is the second Italian pharmaceutical pole, with very important productions. According to our market analysis, there weren’t companies sufficiently structured in the area to serve
these important customers, particularly for the injection and blowing product range, that is to say the bottles.
The transportation costs of the bottles from the north of Italy to Latina are too onerous. The production of bottles for injection and blowing was therefore our first investment. Afterwards the market oriented us towards other productions such as capsules, stoppers and teaspoons, connected to the first and produced with injection.

What are some of the difficulties you have run into in these first years?
Lico: The major difficulties concern the competitors that produce with the same technologies and therefore the same quality. To replace a bottle of medicine with another, the product must be identical, to avoid a long bureaucratic process to approve it. Substituting a product that has already been approved and used by a pharmaceutical company without any problems is very difficult. The pharmaceutical company is responsible for the finished and packaged product that is distributed on the market and therefore considers any changes very cautiously. We focused our attention on services and flexibility, after demonstrating that we are able to produce with the same quality. On the other hand, difficulties for a new company come from the fact that to propose a new product on the market in this sector, projects last up to several years due to the necessary bureaucratic process. Finally we collide with the policy of the Italian Health services whose tendency is to reduce the consumption of medicines. This nevertheless is a relative problem because we, like all the companies in this sector, sell to multinational firms that distribute in many European countries and in America.

What, on the other hand, are the winning strategies for an emerging company? What possibilities are there for growth?
Lico: Today we mainly work for two big multinational companies, producing two types of containers, for antibiotics in powder for one, and ten different kind of products for the other. The most interesting possibilities I can see for us are given by a study of new products on behalf of the pharmaceutical companies, particularly the ones we already serve. In this case, having already demonstrated our capability and quality, we could have privileged dialogue with these companies. Furthermore there are many pharmaceutical companies in the area we operate in, many more than we have already contacted. We hope to have an opportunity to work with them in the future. What permits us to remain on the market as a new company is: the quality of the product and the choice of injection and blowing technology (which nevertheless is the same as those that operate with the same machines as ours, the Uniloy) the location of the site, strategically chosen close to the pharmaceutical companies; the service we offer our customers in the most flexible way possible, even for warehouse and logistics. Moreover something extra: the possibility to supply a customer even if it must export in particular markets, like the United States, that require specific documentation. We have bottles which Drug Master File is registered at the American FDA for exportation in that market.