Toyota Tsusho Corporation ("Toyota Tsusho") announced today that it invested in Skites Pharma Private Ltd. ("Skites"), a pharmaceutical distributor in India, on March 26, 2021 with the aims of advancing consolidation and improving the efficiency of pharmaceutical product distribution and building systems for the timely delivery of needed pharmaceutical products to hospitals and pharmacies.

India, the world’s 11th largest pharmaceutical market, is home to many pharmaceutical companies. Moreover, due in part to recent improvements in medical care levels, further market growth is anticipated. On the other hand, many pharmaceutical distributors in India are small- and medium-sized family-managed companies; the number of such family-managed companies exceeds 65,000. Therefore, there are limitations to the types and quantities of pharmaceutical products that can be purchased from a single pharmaceutical distributor, and hospitals need to purchase pharmaceutical products from multiple distributors, leading to the issues of increased labor for order placement and complex inventory management.

Established in 2017, Skites is a pharmaceutical distributor that has its own warehouses, IT infrastructure, and cold chain facilities. Unlike other pharmaceutical distributors, Skites’ strength lies in its ability to handle a large number of pharmaceutical products—as many as 22,000 varieties—and the company sells and provides them efficiently to roughly 6,000 customer pharmacies and hospitals. India introduced a GST* in 2017, which helped to integrate taxation systems that differed among states. As this has made it easier for major pharmaceutical distributors like Skites to acquire customers across states, market shares will be consolidated, and reorganization of pharmaceutical distributors is expected in the future.

Toyota Tsusho established SAKRA WORLD HOSPITAL in India with SECOM Medical System Co., Ltd. in 2014 and entered the hospital operation business. Since then, it has accumulated know-how on improving hospital operations, including pharmaceutical inventory management.

The investment in Skites is intended to consolidate the distribution of pharmaceutical products and achieve higher efficiency from the perspective of hospitals. Toyota Tsusho, which understands the needs of hospitals—the buyers of pharmaceutical products—will collaborate with pharmaceutical distributors—the sellers. By expanding into businesses peripheral to hospitals, Toyota Tsusho will package the know-how on improving hospital operations it has acquired in the past with the know-how on improving peripheral businesses that it will acquire through this investment and is considering expansion to other hospitals. Moreover, with the creation of opportunities to sell pharmaceutical products both in and outside of India in mind, Toyota Tsusho is considering exporting pharmaceutical products from India to Eurapharma, an African pharmaceutical distributor operated by the Toyota Tsusho Group.

Through supporting higher efficiency in the hospital business by hospital operation and expansion into businesses peripheral to hospitals, thereby contributing to the creation of a society where medical care services can be provided to as many people as possible, Toyota Tsusho will promote initiatives for medical business and contribute toward the achievement of Goal 3—Ensure healthy lives and promote well-being for all at all ages—of the Sustainable Development Goals (SDGs) set by the United Nations.

Skites warehouse


Packaging　pharmaceutical　products in Skites

* GST (Goods and Services Tax):
An indirect tax introduced in July 2017. Prior to the introduction of the GST, the central government and state governments each levied complex indirect taxes, and entry taxes were imposed at state borders. These taxes were a cause of inefficient supply chains in India.