Compensation Structure

in
Pharmaceutical Sector
 What is a Compensation
Package?
The compensation package comprises of monetary and
non-monetary benefits that includes salary, special
allowances, house rent allowance, travel allowance, mobile
allowance, employee stock options, club memberships,
accommodations, retirement benefits and other benefits.
It may include a number of other benefits, including
insurance, employee discounts, extended leaves, and
The basic tools of any compensation system
retirement programs.
Wage surveys
Job analysis/evaluation
Performance appraisal

The basic goals of any compensation system

to retain high quality employees
to stimulate high performance
to attract high quality employees
Total Compensation = Direct + Indirect Compensation

Base Pay Incentives Benefits

About..
 The first Indian pharmaceutical company, Bengal Chemicals and
Pharmaceutical Works, that exists today as one of 5 government-owned
drug manufacturers, appeared in Calcutta in 1930.
 For the next 60 years, most of the drugs in India were imported by
multinationals either in fully-formulated or bulk form.
 The government started to encourage the growth of drug manufacturing
by Indian companies in the early 1960s, and with the Patents Act in 1970,
enabled the industry to become what it its today.
 The pharmaceutical sector is witnessing the highest salary hike of 11.1
percent for the fiscal year 2009-10
 India is the world’s fourth largest producer of pharmaceuticals by volume,
accounting for around 8% of global production.
 The Indian pharmaceutical industry directly employs around 500,000
people and is highly fragmented with 20,000 registered units.
 The leading 250 pharmaceutical companies control 70% of the market
with market leader holding nearly 7% of the market share.
 Major Player in the Industry

 Ranbaxy Laboratories
 Dr. Reddy's Laboratories
 Cipla
 Nicolas Piramal India
 Aurobindo Pharma
 GlaxoSmithKline
 Lupin Laboratories
 Sun Pharmaceutical Industries
 Cadila Healthcare
 Wockhardt
 Salary Package for Junior Managers

Designation A (Basic B C D (Retiral E (Valued Average

Salary) (Benefit (Perform Benefits) Perquisite Annual
s and ance Pay) s) CTC
Reimbu
rsemen
ts)

Minimum 11655 11774 1000 1959 0 316658

Average 20443 19926 5173 3608 1641 609498

Maximum 17616 40507 9779 2961 17420 1059396

 Salary Package for Middle Managers

Designati A (Basic B C D E (Valued Average

on Salary) (Benefits (Performa (Retiral Perquisite Annual CTC
and nce Pay) Benefits) s)
Reimburs
ements)

Minimum 25530 24362 3333 8122 12902 890988

Average 56731 81729 22888 18160 14758 2331173

Maximu 13600 164773 1066 43263 27549 4471818

m
 Salary Package for Senior Managers
Designat A (Basic B C D (Retiral E Average
ion Salary) (Benefits (Perform Benefits) (Valued Annual
and ance Perquisit CTC
Reimbur Pay) es)
sements)

Minimum67200 90899 26750 21376 22718 2747311

Average 147374 222854 67874 46880 32085 6204802

Maximu 280000 453901 220000 89068 41667 1301563

m 3
Salary Structure for MBA
Trainee
Salary Structure after
Confirmation
Compensation Structures in
Major Cities in India for
fresher
Major Cities Salary Packages Per
Annum
(in Rs)
Mumbai 240000- 340000

Delhi 210000- 320000

Kolkata 160000 – 220000

Chennai 200000 - 310000

Bangalore 190000- 320000
 Some facts & figures
 28 %of all jobs in the pharmaceutical and medicine
manufacturing industry are in professional and related
occupations, mostly scientists and science technicians

 18 % are in management occupations

 12 % are in office and administrative support

 3 % in sales and related occupations

 3 out of 10 jobs in the industry are in production occupations,

including both low-skilled and high-skilled jobs
 Salary Packages across
various B-Schools
 The Students from IIMs get a package of 30% plus
the packages

 Students from other B-schools that fall in the A++

category gets the aforesaid salary packages

 The package also depends on the individual

performance and quality.
 Conclusion
Decisions concerning compensation issues are some of the
most critical decisions faced by organizations today,
because of their influence on:
-- organizational survival and growth
-- employee perceptions of fairness and equity
Remuneration has now become the central issue for
attracting and retaining employees across industries. The
compensation structure within the pharma industry has
also undergone a sea change over the past couple of years
due to the phenomenal growth in this sector