Daiichi Sankyo Company of Japan has suffered heavy setback during the second quarter ended September 2011 due to lower sales and profits by Ranbaxy Laboratories, a wholly owned subsidiary. Its consolidated net profit declined by 38.5 per cent to ¥11.7 billion from ¥19.1 billion in the corresponding period of last year. Its net sales also declined by 7.5 per cent to ¥224.4 billion from ¥242.5 billion. Its gross profit declined by 7.5 per cent to ¥155.4 billion during the second quarter. Appreciation of ¥ to US$ and Euro negatively affected the sales and profits. Ranbaxy's sales declined by 12 per cent to ¥38.4 billion and its net profit declined by 22.7 per cent to ¥3.5 billion.
For the first half ended September 2011, Daiichi's net sales declined by 8.6 per cent to ¥456 billion from ¥499 billion in the similar period of last year. The net sales declined mainly due to negative effect of foreign exchange owing to the strong yen, the return of domestic marketing rights in certain products, and a decrease in net sales of Ranbaxy Laboratories. Its net profit went down by 29 per cent to ¥37 billion from ¥52 billion.
In addition to the steady growth in products including the anti-hypertensive agent olmesartan, other factors making a contribution towards sales were two newly launched products viz., Memary, an n-methyl-D-aspartate receptor antagonist for the treatment of Alzheimer's disease, and Nexium, a proton pump inhibitor for the treatment for gastric ulcer, doudoenal ulcer, reflux esophagitis, etc. In the US the Group commenced co-promotion of Zelboraf, a personalized treatment for metastatic melanoma, which was launched in the US by the Roche Group.
Furthermore, concerning the factories of Daiichi Sankyo Propharma Co Ltd, that were damaged by the March 11 Great East Japan Earthquake, Hiratsuka factory restarted its manufacturing operations in April, and so did Onahama factory in late August.
Net sales in Japan decreased by 7.4 per cent to ¥240.7 billion mainly due to the return of domestic marketing rights of certain products to their licensers. Sales from royalty income and exports o overseas fell by 48.7 per cent to ¥10.3 billion due to the decline in sales from exports of levofloxacin, a synthetic antibacterial agent, following the expiration of marketing exclusivities in various countries, and the stronger yen. Net sales in North America declined by 5.1 per cent to ¥91 billion. However, the sales in Europe increased by 3.6 per cent to ¥32.5 billion in the first half ended September 2011.
The net sales forecast has been downwardly revised by ¥40 billion to ¥930 billion due to adverse foreign exchange rate and lower sales by Luitpold Pharmaceuticals, Inc.