Daijiworld Media Network - Hyderabad

Hyderabad, Jun 21: Hyderabad-based HRV Pharma is attempting to redefine the traditional pharmaceutical business model by building an active pharmaceutical ingredient (API) company without owning any manufacturing facility.

Unlike conventional pharma companies that measure growth through reactors, plants and production blocks, HRV Pharma operates as a “virtual API platform” by partnering with more than 50 USFDA and European Union GMP-approved manufacturing facilities.

The company claims to have recorded 60-65 per cent annual revenue growth over the past five years, serving more than 700 active customers globally. HRV Pharma ended FY26 with revenue estimated at Rs 650-700 crore and is aiming to reach Rs 1,000 crore revenue in the coming years.

At the centre of its strategy is the belief that regulatory ownership, drug master files (DMFs) and customer relationships can be more valuable than owning manufacturing assets.

“We are a virtual API platform, probably the first in the world. How can I underwrite capacities, control the product, and also control the customer from this process? Today, that combination makes our model very different from anything seen in Indian pharma,” said Hari Kiran Chereddi, Managing Director and CEO of HRV Pharma.

Chereddi said India has more than 650 USFDA or EU GMP-approved API manufacturing facilities, many of which are operating below full capacity.

“There is an abundance of such capacities in India. A recent report says capacity utilisation is anywhere between 50 to 55 per cent in each of those plants,” he said.

The company’s model focuses on developing products, owning regulatory documentation, managing customers and outsourcing production to approved manufacturing partners.

“For a formulator, we are also an API company because we are the ones who own the regulatory documentation. For an API manufacturing site, we become their capacity aggregator because, for them, we become the customer,” Chereddi explained.

The company’s DMFs can be used by customers in their regulatory filings, allowing HRV Pharma to be recognised as the API supplier despite manufacturing being carried out by partner facilities.

HRV Pharma currently operates across 55 countries with teams in Dubai, Switzerland, the United States and Mexico, along with its India operations.

“The plan is to have a hub-and-spoke model. We are not a retail outfit, so every country does not need a showroom,” Chereddi said.

The company has agreements with 53 manufacturing partners and plans to expand its network further. Chereddi said the focus is not on adding factories but strengthening regulatory and quality capabilities.

“We are not an intermediate player. What is missing in such models is the regulatory and quality aspect,” he said.

The asset-light structure has helped the company maintain low capital requirements.

“We are a zero fixed asset company. We do not have a physical manufacturing site,” Chereddi added.

HRV Pharma said it currently owns more than 50 US DMFs, has a working capital cycle of negative 10 days, carries no debt and reported a PAT margin of around 13.5 per cent in FY26, subject to audit.

The company’s model is aimed at proving that in an industry traditionally driven by manufacturing capacity, regulatory ownership and market access can become scalable business assets.