“Be Proactive, Not Reactive” — Dr. ARM Rao’s Leadership Philosophy

Pharma Now: Welcome to Pharma Now. Today, we are privileged to be in conversation with Dr. ARM Rao, President of Aurobindo Pharmaceuticals. Dr. Rao has over 35 years of experience in the pharmaceutical domain. In today’s discussion, we’ll talk about his early career days, how his journey evolved, and the challenges he has faced along the way.

To begin, could you tell us about your education, your specialisation, and why you chose to start your career in pharma?

Dr. Rao: My education began with a Master’s degree in Organic Chemistry. After that, I pursued a Doctorate in Pharmaceutical Analysis. That is where my journey truly shifted toward pharmaceuticals.

I completed my PhD around 1988. I was awarded the Best Thesis Award that year. My thesis was evaluated by professors from North Carolina, who gave very high recommendations and expressed appreciation for my work. That recognition played a significant role in helping me enter the pharmaceutical industry.

Following that, I joined Ranbaxy Laboratories as an Analytical Research Scientist. I spent nearly nine years there. During that time, I built a strong foundation in analytical research.

After that, I wanted to expand my area of expertise. Analytical research always supports quality functions, so I decided to move into Quality. That’s when I joined Cadila Pharmaceuticals around 1995.

At Cadila, I served as the overall Quality Head, overseeing quality control, analytical functions, and technical operations in manufacturing. This was around the time when Cadila had split into Zydus and Cadila Pharma. I was part of Cadila Pharma.

I was deeply involved in setting up systems and was instrumental in establishing a greenfield project. That phase significantly expanded my knowledge, not just in quality, but also in engineering, compliance systems, and end-to-end project execution. My tenure there continued until around 1998.

From there, I moved to a vaccine company in Hyderabad called Biological E. Once again, I handled overall quality, analytics, animal pharmacology, and related areas. This role expanded my exposure from generics and dosage forms into biologics and vaccines. It gave me a broader understanding of pharmaceutical manufacturing beyond conventional formulations.

After that, Aurobindo Pharma was looking for someone to lead its regulatory journey. I was brought in for that purpose. We evaluated all existing facilities and, as a management decision, chose to establish greenfield projects for regulated markets. Around the year 2000, we initiated one API and one greenfield formulation project. It took about two to three years to set everything up, after which we began filing for Europe and India.

By 2004–2005, we started entering regulated markets and began receiving product and facility approvals. Since I had been involved from scratch, I handled multiple functions: quality, greenfield construction, engineering, parts of the business and commercial operations, and R&D, essentially end-to-end responsibilities.

That journey led to several product approvals. The company grew rapidly during this period, mainly because the infrastructure and systems we established were sustainable and scalable. We continued expanding and setting up additional greenfield projects, primarily for the US and European regulated markets. Today, we have more than 20 facilities.

In 2010, the company faced a significant challenge when one of its facilities received a warning letter and import restrictions. It was a critical moment. Management decided to establish a Global Quality function and harmonise systems across all facilities.

That was an eye-opening phase in the company’s journey. It pushed us to rethink global quality oversight.

At that time, I was asked to step away from other operational responsibilities and focus entirely on building Global Quality. We harmonised systems across all facilities. Compared with many organisations that take several years to resolve such issues, we were able to address the warning letter within about 1.5 years.

Since then, none of our facilities has faced similar significant regulatory actions. Over the last 15 years, our systems have remained stable and robust, without significant compliance setbacks.

One of the most significant steps we took, starting as early as 2004–2005, was automation. At that time, very few Indian companies were investing in automation and software-driven systems.

We implemented a Laboratory Information Management System (LIMS) around 2004–2005, nearly 20 years ago. Then we established a fully integrated QMS that covers engineering, calibration, validation, and all quality systems under one umbrella. Our laboratories and quality management systems became fully automated between 2004 and 2006.

We anticipated that as facilities and product portfolios expanded, manual systems would become unsustainable. Automation was not a reaction; it was a proactive decision. As we added more facilities over the years, we linked them to these centralised systems, ensuring harmonisation and visibility across the organisation.

Pharma Now: I have a question. The time frame you mentioned, did the entire harmonisation and automation happen within two to three years?

Dr. Rao: Up until 2010, we had only a handful of facilities. So we initially implemented these systems in one or two units.

From the beginning, I was very clear that if we wanted to sustain growth and remain fully compliant while delivering quality products, we could not wait for challenges to arise. The infrastructure we developed was expandable from day one. We invested in enterprise versions of systems so that whenever a new facility was added, it could simply be linked and brought online immediately.

As part of centralisation, for example, all laboratory specifications were brought into a central system. When a new facility was linked, we simply enabled access, and it launched there. There was no difference between sites; globally, the specifications, test procedures, and worksheets remained identical.

Pharma Now: So it becomes a unified platform. Whenever a new auditor or regulator comes in, the explanation, procedure, and approach remain consistent across sites.

Dr. Rao: Exactly. The same principle applied to other operational areas, including quality systems.

We developed high-level documents called company policies. We invested significant time in building policies that applied across the organisation. We had policies covering analytical research platforms, trials, QMS, and other areas. These policies guide what needs to be done, not necessarily how to do it.

The real challenge in policy development for a multi-regulatory company is aligning various regulatory requirements with practical execution on a common platform. We integrated global regulatory expectations into a unified set of company policies.

Our recommendation is simple: people at any site or level should not interpret individual regulatory guidance independently. They should follow the company policy. That ensures uniformity.

Pharma Now: That’s an important point. When individuals read guidelines independently, interpretations vary. Some guidelines are comprehensive, others are highly detailed. With multiple regulatory bodies and requirements, confusion is inevitable.

Having a top-level company policy ensures that quality and operational personnel first refer to a single guiding document. From there, they derive the appropriate SOPs to ensure uniformity across all sites.

Dr. Rao: Absolutely. In multi-regulatory companies, the absence of unified policies leads to different interpretations and inconsistent execution across sites. One unit may perform the same process differently from another.

I anticipated this early. At that time, we had limited facilities, but I could see the company’s growth plans. I knew that without structured policies, inconsistencies would eventually surface. So we started early.

As we added more products and complexity, people simply followed the policies. In the generics business, speed is critical. If we wait to interpret guidelines every time we file for a new market, whether in Canada or elsewhere, we lose time. Having predefined policies eliminated that delay.

From these policies, we developed standard procedures at the corporate level. These were centrally developed, trained, and mandated across all sites. For example, sampling procedures are standardised. Whether sampling happens in one unit or another, the same corporate procedure applies.

We have around 100 such standard procedures. Site-specific SOPs are allowed only when truly necessary. I am very clear that duplicate SOPs should not exist if the process is the same. If the process is identical, it must follow the standard procedure.

There are challenges in implementing this across a large organisation. Differences of opinion arise. That’s why we established a structured review mechanism. With electronic systems in place, procedures are reviewed by multiple stakeholders before approval. Once everyone agrees, it becomes a common decision. The buy-in from people across the organisation was a critical success factor.

Pharma Now: That clearly gives the company an advantage.

Dr. Rao: It does. Today, if a crisis arises at any site, the response follows the same procedure across the company.

Similarly, if demand increases for a product and manufacturing shifts to another site, nothing changes. The receiving site uses the exact specifications, test procedures, and worksheets. There is no need to retrain teams on different systems.

Proactiveness has always been central to our success. We don’t wait for observations to react, we act well in advance. We continuously monitor regulatory guidelines, industry best practices, and emerging inspection trends. Based on that, we update our policies and procedures and retrain our people. 

We conduct internal workshops regularly to evaluate and improve our systems. Continuous improvement is a core principle for us. It is not a one-time initiative; it is an ongoing discipline that demands consistent effort and focus.

Pharma Now: Over the course of your career, when you look at regulatory bodies. From the late 1980s to today, what significant differences do you see? Have they remained the same, or have they evolved? And where do you think they are eventually heading?

Dr. Rao: In the 1980s, when I was at Ranbaxy Laboratories, I was closely involved in regulatory collaborations, particularly related to US requirements. That’s where my regulatory journey truly began.

At that time, there were no detailed written guidelines like we have today. Many aspects had to be interpreted and developed internally. We had to innovate and decide for ourselves what was correct and scientifically justified. The challenge was that both management and regulators might accept or reject what we implemented.

For example, in the early 1980s, I developed validation processes for analytical methods. There was no formal concept of analytical method validation as we know it today. We relied heavily on research papers and scientific literature. Even during research work, we would check parameters like sensitivity, but it wasn’t structured as a formal validation process.

When we first implemented method validation, it took nearly a month. Management was unhappy; they questioned why we were spending so much time and resources on documentation that, in their view, would simply “sit in a file.” There was no regulatory mandate at that time. I had to justify why it was necessary and what the long-term benefits would be.

Six months to a year later, during our first US FDA inspection, the first question asked was: “How did you validate this method?” I was able to pull out the documentation immediately. That was the reality of those times: no structured guidance, limited clarity, and heavy dependence on internal scientific judgment.

Even auditors then did not have very detailed frameworks. They often compared practices across companies rather than referring to structured global guidance. Today, that has completely changed.

Now, there are far more detailed and specific guidelines. Regulators have clarity about what to ask and what to expect. While interpretation differences still exist, the framework is much stronger.

Another major shift is exposure. Earlier, global regulators had limited interaction with Indian companies. Today, their exposure to India has increased significantly. They better understand cultural nuances, operational realities, and industry practices here. At the same time, regulators themselves undergo training and continuously upgrade their understanding.

Compared to the 1980s, today’s regulatory environment is far more structured, transparent, and defined.

Many people feel that regulators are constantly asking for “new” things. But if you analyse it carefully, the shift is toward higher-quality standards and greater assurance. For example, impurity requirements have become stricter. The focus on nitrosamines emerged from accumulated regulatory experience and global learnings. Naturally, companies must now comply.

There is also a common misconception that guidelines are absolute mandates. In reality, guidelines suggest approaches. If you can justify an alternative scientifically and demonstrate compliance, it is acceptable. The key lies in interpretation and justification.

Over time, audits have become more thorough. That is a natural progression. As the industry evolves, quality standards must rise. The most significant shift I see is the movement from quality control to quality assurance.

Earlier, the focus was on testing and control, verifying the finished product and ensuring it meets specifications. Today, regulators look at systems that provide assurance. An audit may last one week, but the regulator wants confidence that the organisation consistently operates under a robust quality system.

This is why there is greater emphasis on process understanding, PAT, supplier qualification, and preventive controls, rather than relying only on end-product testing. The idea is not to test quality into the product every time, but to build systems that inherently assure quality. That, in my view, is the fundamental evolution of regulatory oversight, from reactive control to proactive assurance.

Pharma Now: As organisations grow rapidly, infrastructure can be outsourced, but people cannot. How did you handle the challenge of onboarding talent at scale? Not just freshers, but also experienced professionals, how did you integrate them into a harmonised and fast-growing system?

Dr. Rao: One fundamental belief that helped me navigate this challenge is understanding that the pharmaceutical industry is different from many other industries.

Pharma manufacturing is essentially a discrete process. To produce a tablet, you go through multiple independent steps. Each stage requires attention and control. In industries like steel or aluminium, the process is continuous: you feed in material and get output. Pharma doesn’t work that way. 

Even with today’s discussions about continuous manufacturing, I still consider pharma largely discrete. When you have a discrete process, human intervention cannot be eliminated entirely. And when human intervention exists, variability can occur.

So from the beginning, I focused on building a strong cultural foundation. We decided that, even at the operator level, there would be minimum qualification standards: a Diploma in Pharmacy, a Diploma in Engineering, or Chemical Engineering. We did not recruit unqualified personnel at the shop-floor level.

It’s not about intelligence. It’s about baseline understanding. When someone comes with formal technical education, training becomes easier, comprehension improves, and they are more receptive to doing things correctly.

If a person lacks understanding or willingness, no amount of training can compensate. So hiring the right people was the first strong step we took, and we continue to follow that principle even today.

The second aspect was harmonisation. Since our processes, software systems, and quality frameworks were standardised across facilities, onboarding became much easier. When we launched a new facility, we would immediately transfer trained personnel from existing sites. Everything was already online from day one, systems, specifications, procedures.

We did not wait to build processes after commissioning. The entire structure was ready before operations began. In the generics business, speed is critical. You cannot afford to say, “Let us set up the facility first, then qualify systems, then train people, then develop procedures.” That model doesn’t work. So we built readiness into the system itself.

At the same time, we reduced human intervention wherever possible through automation and harmonisation. From the beginning, we automated key processes to minimise dependency on manual controls.

Another major factor was visibility. Since we use enterprise-level electronic systems, I can see deviations, trends, and human errors across facilities within minutes. Everything is integrated into LIMS and electronic quality systems.

Visibility itself becomes a powerful behavioural driver. When people know that systems are transparent and traceable, they are naturally more careful. We also focused heavily on training effectiveness. All SOPs, training modules, and document management systems are available online. People can access them instantly.

Recently, we introduced a structured SOP writing process called FSPro. It includes a built-in tracking mechanism. For example, if an operator wants to check machine operation steps, they don’t have to scroll through a 10-page SOP. They can click the “Operation” section to jump to the relevant page.

This may seem small, but it addresses human behaviour. If accessing information is cumbersome, people avoid it. If it is easy and intuitive, they use it. Systems must be designed around real human behaviour, not theoretical expectations.

In many cases, this becomes indirect self-training. When someone encounters a problem, they can immediately access the exact guidance they need without disrupting operations extensively. We often ask whether employees are performing correctly. But we must also ask: Are we giving them the right tools?

An operator cannot be expected to stop a running machine, walk away, and read a lengthy SOP. That’s unrealistic. Instead, we designed systems that provide information instantly at the point of need.

So onboarding at scale was not just about hiring more people. It was about building structured systems, reducing variability, ensuring visibility, and creating user-friendly tools that support performance. That combination made rapid growth manageable.

Pharma Now: Definitely, sir. In the same context, since you’ve implemented so many software platforms and online systems, what impact do you think AI will have on such systems?

Dr. Rao: There is a lot of discussion around AI today. We have tried a couple of pilot projects internally. There is definitely scope for improving productivity and reducing human intervention. However, I believe AI still requires significant maturity, especially in the pharmaceutical industry.

One of the biggest challenges with AI in pharma is validity. When I say validation, I mean consistency and sustainability. In pharma, every system must be validated. It must produce consistent, reproducible results. AI does not always provide 100% deterministic outcomes. That creates a challenge.

For example, consider a tool that automatically reads source documents and extracts data. Today, the source document may be in Word format. Tomorrow, it may be a PDF. The AI might interpret them differently. If it misses data or misreads it, it could lead to a wrong decision, especially in critical areas like batch release.

This is a simple example, but it highlights the core issue. If we rely on AI, we must clearly understand: What level of accuracy are we achieving? How consistent is the output? What are the variability limits? Where are the risks?

AI can reduce manual data entry and enable predictive analysis. But everything depends on the quality and stability of the source data. If your input variables themselves have variation, your output will naturally reflect that variation.

So we must define acceptable limits. For instance, if there is 10% variability in the source data, I must assume a similar level of variation in AI-driven output. That means I may still need manual oversight for that portion. In predictive models, we must decide where to trust the system and where not to. That level of risk assessment is critical.

At this stage, we are not yet at a point where I can entirely depend on AI and say, “My batch release is fully AI-driven, and I have zero concerns.” There is still risk.

Regulators also recognise this. They are beginning to issue guidance on AI validation and oversight. That is a positive development. AI has potential, but in pharma, adoption must be cautious, structured, and validation-driven. Productivity gains are significant, but consistency, compliance, and patient safety are non-negotiable.

Pharma Now: I was about to ask, how do regulators view AI?

Dr. Rao: Regulators acknowledge AI, but their position is clear: validate it. For example, if a data-entry AI tool claims 80% or 75% accuracy, the organisation must decide whether that level of accuracy is acceptable and how to manage the remaining risk.

So realistically, AI must currently be used in a hybrid model. The biggest concern remains validity and consistency. Imagine releasing 100 batches; if even one batch decision is wrong due to AI dependency, that’s a serious issue. In our industry, you cannot afford that. Even a single incorrect batch decision can have significant consequences.

So complete dependency is not advisable at this stage. Perhaps in the future. For now, AI should be used in non-final decision areas, repetitive tasks, data compilation, preliminary assessments, while keeping human oversight for critical decisions.

From a regulator’s perspective, it does not matter whether you are using AI or manual systems. The core question is: Are the results consistent? How is it validated? Everything goes back to validation.

Validation is only possible when you understand all the variables. If you know your AI system will only process Word documents and standardised PDFs, you can validate it for those defined conditions. But if variability increases, so does risk. That’s where the complexity lies.

Pharma Now: Compared to the early days of your career, how much automation or computerisation do you see today? How deeply integrated are robotics and system-based controls now, compared to then?

Dr. Rao: If I look at the overall industry, I would say automation has crossed 50% compared to earlier decades. But rather than percentages, I prefer to describe the cultural shift.

When we implemented enterprise systems around 2004–2005, operators resisted management. People were uncomfortable with transparency. IT systems bring visibility, and visibility brings accountability. That naturally creates fear.

There was also hesitation because technology was unfamiliar. Many believed manual processes were sufficient and questioned the added value of automation. That mindset has changed significantly.

With stricter regulatory requirements and more rigorous audits, companies now understand that reducing human intervention is essential for sustainability. The shift is visible. For example, when we first implemented systems, some vendors had only a handful of pharma clients. Today, the same vendors serve hundreds. That shows a precise industry-wide movement toward automation.

However, there is a challenge. Companies that built large manual or fragmented systems over decades now face a difficult transition. Integrating legacy systems and driving change management is complex. That is where many struggle.

We were fortunate because we anticipated this early and started building structured systems from the beginning. For companies starting now, integration and change management are significant hurdles.

Pharma Now: When do you think we can achieve complete robotics, fully online continuous manufacturing, and real-time product testing? Will it take a decade? Two decades.

Dr. Rao: It’s difficult to give a timeline. It depends not only on the maturity of the tools but also on organisational adoptability. There is currently no regulatory mandate forcing 100% automation. If a regulator were to mandate full electronic integration, adoption would accelerate. But that is not the case today.

So progress depends largely on management's willingness and strategic vision. Earlier, there was resistance. Now, awareness has increased. The challenge today is execution, especially for companies with complex legacy operations. If management believes transformation is essential and commits to it, progress will accelerate. If they see it as too complicated, adoption will remain slow.

Some technologies, like Process Analytical Technology (PAT), are advancing but have not yet matured to the point where every company can entirely depend on them. Additionally, many legacy products and established discrete processes are not easily converted into continuous models.

The shift toward automation and digitalisation is happening, but evolution in pharma is gradual, not revolutionary. It will move forward steadily, driven by technology maturity, regulatory comfort, and organisational readiness.

Pharma Now: ?When we say India is the “pharmacy of the world,” what potential do you think still remains untapped? How can India strengthen its position and take advantage of future opportunities

Dr. Rao: The key factors are quality and reliability. That is where we still face some resistance in developed markets, and we must address it first.

Affordability is already our strength. The following critical elements are logistics, accessibility, and timely delivery. Beyond that, India has strong fundamentals. We have established manufacturing capabilities, deep knowledge centres, and a large number of pharmacy graduates. The skill base is strong.

What we must continue improving is reliability. That is why companies are investing in automation and PAT, because they enhance consistency. But automation alone will not solve everything. Automation can reduce human error, but it can never eliminate it completely.

So along with technology, we must focus on cultural transformation, building discipline, ownership, and reliability in execution. If India strengthens quality culture and consistency, the global opportunity is immense.

Pharma Now: Your journey is truly inspiring. What message would you like to give to viewers in this domain or those who aspire to grow in it?

Dr. Rao: First, this is a demanding industry. If you want to succeed here, you must be committed, time-conscious, accurate, and thorough, because we are dealing with patient safety.

Whenever I speak to freshers, I ask them: What is the difference between a company that manufactures refrigerators and one that manufactures tablets? Both expect quality. No one wants a damaged refrigerator. But a refrigerator comes with a warranty and guarantee. A tablet comes with a guarantee.

A medicine has no warranty. Once it reaches the patient, there is no replacement. That is the mindset you must carry. Whatever you do, it must be right the first time.

Second, always be proactive. Never operate in a reactive mode. In pharma, once a product reaches the patient, you cannot reverse it. You cannot say, “I will correct it later.” That option does not exist. Accountability and ownership are critical. You must feel personally responsible for your work. When you leave at the end of the day, you should be able to say, “I stand by what I did today.”

In this industry, right-first-time is not a slogan; it is a responsibility. If the younger generation understands this culture of accountability and proactiveness, they will do very well.

Pharma Now: Thank you very much, sir, for your time and for sharing your journey and insights. I’m sure this conversation will inspire many of our viewers.

Dr. Rao: Thank you to Pharma Now for the opportunity. It has been a privilege to share my experiences. I hope others can learn something from them.