Pharma and biotech companies from southern, western and other parts of India are making a beeline to tap emerging opportunities in northern parts of India. The companies, especially pharma and biotech bigwigs, from these parts are mainly making a flee to the newly introduced excise free zones in this region - Baddi, Uttaranchal, Jammu and Kashmir and Sikkim - to avail of the tax sops and other benefits. Also, the introduction of tax free zones have turned the north India into a hub of pharma and biotech export activities with all of the companies sticking to the latest regulatory requirements like good manufacturing practices (GMP).
Meanwhile, powered by acquisitions, spirited exports and better all-round performance, the pharma majors in northern parts of India continued to consolidate their ground, while the small scale units in the region, which were squeezed into competition and adverse factors, are loosing their ground.
Even within north India, states like Delhi, which was once a prestigious land for pharma firms, is being further eclipsed by emerging hubs in other parts of the region, with small cap units and biggies shifting focus and investing more in places like Himachal Pradesh, Uttaranchal and Jammu Kashmir to take advantage of the existing government policies.
However, the tax free zones in this region have to an extent only helped major players like Ranbaxy and Dabur to consolidate the growth. A Pharmabiz study showed that all the major companies in the north India have just brighter stories of growth to tell. They are into acquisitions to boost the base, win more markets abroad, apart from spending more on research and development (R & D). The heavyweights like Ranbaxy Laboratories, Panacea Biotec, Ind-Swift Laboratories, Dabur Pharma, Mankind Pharma, Jubilant Organosys and Venus Remedies dominate the northern terrain with excellent results.
Ranbaxy
As a major player in the north, Ranbaxy continued its successful march to strength with more acquisitions, forays into newer vistas abroad and filing of ANDAs. In rupee terms, the company's sales grew by 12 per cent to Rs 16,238 million during the first quarter of the current fiscal, while its net profit increased 118 per cent to Rs 2,662 million, compared to the figures of year-ago quarter. Excluding foreign exchange gains / losses on translation, Ranbaxy's net profit stood at Rs 1,604 million, reflecting a growth of 53 per cent over the previous quarter.
As part of the company's efforts to consolidate itself as an Indian multinational in the global arena, Ranbaxy's business in USA recorded an increase of 37 per cent (without sales of First-to-File products), while its sales in Europe surged by 55 per cent. Also, the company's activities in emerging markets remained robust with a growth rate of 44 per cent and contributing 54 per cent of the global sales.
The company officials attributed its strong performance in the first quarter to its focus on branded generics, accelerated generic substitution and better performance of its business segments across key markets. According to them, India, Russia, Ukraine, Romania and South Africa continued to be the primary drivers of performance in the emerging markets, while Europe contributed significantly to the growth in the developed markets.
Following the successful launch of Simvastatin 80 mg in 2006, Ranbaxy launched Pravastatin 80 mg with a 180 days marketing exclusivity in June 2007. The launch of Pravastatin 80 mg has helped the company to so far garner approximately 50 per cent of prescription market share in this segment.
During the quarter, Ranbaxy received 6 ANDA approvals, 3 final approvals and 3 tentative approvals. Final approvals were received for Pravastatin Tablets 10/20/40/80 mg, Zolpidem Tartrate Tablets 5 / 10 mg and Loratadine Oral Tablets 10 mg, while the company received tentative approvals for Fexofenadine Hydrochloride Tablets 30/60/180 mg, Amlodipine Besylate Tablets 2.5/5/10 mg and Tamsulosin Hydrochloride capsules 0.4 mg.
With its alliances and partnerships gathering momentum, Ranbaxy will be introducing Hydroxychloroquine Sulfate Tablets USP - 200 mg under its pact with Ipca, which received approval for the product in the recent quarter. After Furosemide and Atenolol tablets, this will be the third product to receive US FDA approval for marketing under its alliance with Ipca. Apart, in May 2007, Ranbaxy acquired US rights for 13 dermatology products from Bristol-Myers Squibb (BMS). These well established and proven brands from the key therapeutic areas of dermatitis, psoriasis, anti-fungal, scabies and acne, will strengthen and extend Ranbaxy's franchise in dermatology area.
The acquisition will leverage the company's existing branded derma business and considerably enhance its portfolio in this niche therapeutic segment in US.
Ranbaxy also focused on drug discovery and drug delivery systems with vigor and purpose. During the quarter, the company filed 4 ANDAs with US FDA and received approval for 6 ANDAs (3 final and 3 tentative), taking the cumulative filings to 203 with 114 approvals. In European Union (EU) the company made 7 national filings in 6 reference member states (RMS) and received 10 approvals in 4 RMS.
The company revealed that its programs on chronic obstructive pulmonary disease (COPD) and anti-infective, identified under the GSK alliance, are progressing as per plan and the team has identified a development candidate for one of these programs.
Apart, Ranbaxy entered into a collaborative research agreement with International Centre for Genetic Engineering and Biotechnology (ICGEB) and Department of Biotechnology (DBT), New Delhi, in the area of new drug discovery. Under the alliance, Ranbaxy and ICGEB will work towards developing novel agents for the treatment of dengue, while DBT will participate as a funding partner. A joint research committee, with representation from all the partnering organizations, will monitor and direct the course of research.
The company is serving its customers in over 125 countries and has an expanding international portfolio of affiliates, joint ventures and alliances, ground operations (in 49 countries) and manufacturing operations (in 11 countries).
Recently, Ranbaxy signed a definitive agreement with Hyderabad-based Zenotech Laboratories to increase its equity stake to 45 per cent from the current 7 per cent. The company, thus, aims to consolidate its position in biopharmaceuticals and specialty injectables, including oncology. At present, the global biopharmaceuticals is valued at $65 billion and the new agreement is expected to give the company at least one third of the market share in future. In the coming months, Ranbaxy is planning to file 7 ANDAs with US FDA from Zenotech facilities.
The Delhi-based Dabur Pharma, which is aggressively looking to expand its market reach, has already established its mark in the country and abroad by launching India's first indigenously developed nanotechnology based chemotherapy agent. Its research wing is working on a number of new drugs on the nanotechnology platform. Also, the company would soon commence clinical trials in the neighbouring countries and is hoping to market the product in Europe and some other countries in the next 18-26 months time.
The $250 million Dabur Pharma has been into cancer research and anti-cancer products. It also markets a range of products in the cardiovascular, antibacterial, antidiabetic and digestive segments. The company, which has presence in 40 countries, showed solid performance over the years and is chalking out steps to expand reach in the global arena. It has recently entered the US market through US FDA approvals for two of it products - Carboplatin Injection and Paclitaxel Injection. The company also has plans to register several products in US and Europe.
The company reported consolidated net profit of Rs 62.2 crore on the back of a turnover of Rs 571 crore for the first quarter of 2007. During the quarter Dabur India's standalone net profit rose 18 per cent to Rs 54.1 crore, while its net profit stood at Rs 54.06 crore, compared to Rs 45.84 crore in the same period of the last year. Its turnover also marked a 14.9 per cent increase to Rs 445.31 crore from Rs 387.68 crore in the corresponding quarter of the previous year.
Regarded as the leading oncology player, Dabur also got US FDA approval for ANDA for Epirubicin Injection 50mg and 200mg. Epirubicin is the generic equivalent of Pfizer's Ellence Injection, a chemotherapy drug used to fight early-stage breast cancer. It had sales of approximately US $60 million (IMS - March 2007) in the US alone.
Dabur Pharma Ltd, a public limited company incorporated in March 2003, is an associate company of Dabur India Ltd, a US $ 250 million healthcare company founded in 1884. Dabur Pharma Ltd. operates in Europe and some other markets through its fully owned subsidiary Dabur Oncology Plc.
The Dabur group of companies has a legacy of trust and excellence in the healthcare business.
The fully integrated pharmaceutical business of Dabur covers the oral and injectable finished dosage forms and active pharmaceutical ingredients and intermediates. The company has world-class expertise in the development and manufacturing of active pharmaceutical ingredients, intermediates and finished dosage forms. This expertise enables it to provide high quality and cost effective pharmaceutical products to markets worldwide.
Dabur Pharma is using the services of Dabur Research Foundation (DRF), for research and development activities. DRF is an independent research organization recognized by the Department of Science and Technology.
The company's finished dosage forms are manufactured at its modern manufacturing units in Bordon (UK) and Baddi (India), while the active pharmaceutical ingredients (APIs) are manufactured at Kalyani (India). Some of the products are also manufactured at its Sahibabad facilities (India).
Dabur's facilities at Bordon have received a manufacturing license from UK MHRA. These facilities use the unique isolator technology and are one of the best in Europe. The Baddi facilities are approved by the regulatory bodies of countries like Brazil, Colombia, Malaysia, Turkey, Pakistan, Ukraine, Sudan, Belarus Hungary, Jordan, Zimbabwe and Yemen. APIs manufacturing facilities at Kalyani have approvals from TGA Australia and US FDA.
The company has also set up overseas offices in UK, Malaysia, Russia, Thailand and Philippines. Apart, offices are also being set up in Brazil and US.
Over the years, the company has strived hard to strategically position itself as a global player in the field of anticancer (oncology) formulations and provide high quality products supported by superior level of customer services at highly competitive prices.
Panacea Biotec
The Delhi-based Panacea Biotec reported a 140.9 per cent rise in net profit for the financial year ended March 31, 2007, backed by a 55 per cent growth in turnover. With expanded geographic reach by exporting branded formulations and vaccines to new markets, the company's gross turnover is expected to grow by 67.8 per cent soon.
The company continues to focus on R&D and is planning to launch at least seven cancer drugs soon. The company has a joint venture in Chiron Panacea. Panacea Biotec, which emerged as a pet for stock market players, is planning to focus on its vaccine segment. It has launched a number of new products and commercialised new facilities at Baddi.
Mankind Pharma
Mankind Pharma, an Rs 350 crore company, has for the past few years grown at a rate of more than 60 per cent and is billed as one of the top five fastest growing pharmaceutical firms. From its humble beginning with an investment of Rs 50-lakh, the company has grown by leaps and bounds, thanks to its marketing strategy, which tapped small towns and rural areas.
The company's turnover grew by 65 per cent to Rs 530 crore in the last year, on the back of overall expansion by foraying into newer segments. Also, it ventured into the OTC drug market last year with the introduction of its fourth business division - Special Mankind. The products launched under this segment are condoms, emergency contraceptives and home pregnancy kits. This division has already recorded an outstanding sale of Rs 1 crore in 3 months since its launch in January 2007. Mankind has also plans to further expand its product portfolio under Special Mankind. It has set the target of Rs 1100 crore by 2010. The company's future strategies include launching of new products, enhancing manpower and expanding its reach.
Venus Remedies
The Punjab-based Venus Remedies, which is entering new markets abroad with fresh registrations, has showed solid performance over the years. Its income for the quarter ended on June 30 increased to Rs 4362 lakh from Rs 3185 lakh in the same quarter of the last year. The total sales for the last financial year stood at Rs 9207.25 crore. Recently, the company came up with its research product, a FDC of Cephalosporin with an Amino-glycoside, registered in Ukraine with approval for marketing rights.
The company has already filed for an international patent for this unique formulation in Ukraine and an order for bulk supplies to this region is under execution. Ukraine being one of the largest markets of CIS, the company is expecting good volume of sales for this specialty formulation.
Ind-Swift
The Chandigarh-based Ind-Swift recorded 84.69 per cent growth in income and an increase of 18.67 per cent in exports during the quarter ended on June 30. Its income for the period stood at Rs 102.62 crore against Rs 55.56 crore in the previous year. The total income for the last financial year stood at Rs 357.14 crore with a net profit of Rs 18.23 crore. The net profit for the first quarter of the current year was Rs 5.33 crore against Rs 4.23 crore in the corresponding period of the last year.
Jubilant Organosys
Jubilant Organosys Ltd., an integrated pharmaceutical industry player and the largest custom research and manufacturing services company in India, has set up necessary building blocks that make for a successful and sustainable outsourcing activities. Presently, the company gets more than 55 per cent of the revenues and 65 per cent of profits from outsourcing related activities. The company not only enjoys an integrated presence across the pharmaceutical value chain, but has also achieved international scale in key product categories.
In consolidated terms, the company's revenues increased by 20.7 per cent to Rs 18,097 million in 2007, largely due to better sales in the pharma and life sciences products (PLSP) businesses and contribution from the international operations. Its operating profitability rose 59.3 per cent to Rs. 3,771 million, thanks to healthier margins in its CRAMS and medicinal chemistry services, softer input pricing of industrial products and performance of polymers segment. The net profit increased by 76.0 per cent, while earnings per share stood at Rs 13.02. Also, the company's standalone revenues grew by 16.1 per cent to Rs 16,097 million.
In the first quarter of 2008, Jubilant Organosys' consolidated net sales increased by a third to Rs 5,400 million, boosted by the positive results of pharma and life sciences products and services. The result also included performance of Hollister-Stier Labs, whose operations were acquired during the quarter. In the first quarter, the company's net profits increased 210 per cent to Rs 1,429 million.