Buoyed by a favourable Union budget, the pharma scrips have moved up in the share market today. Though the BSE Sensex declined by over 245 points at 17578, the BSE Health Care index of 25 leading pharmaceutical companies improved slightly by 3.03 points to 3928.78. Out of 25 pharma companies, 16 companies moved up while nine companies slipped from their pre-budget level.

The hike in short term capital gains tax rate from the earlier 10 per cent to 15 per cent impacted the overall market sentiment. Further the overall corporate sector has not received any tax concessions. According to Pharma analysts the finance minister has give further sops for life saving and HIV drugs which will also have a good impact on the industry. The cut in excise duty from 16 per cent to 8 per cent is an extremely positive step. The finance minister has failed to offer any special concession for the Research and Development.

The analyst from foreign broking firm pointed out that the cost of R&D is going up with several kinds of uncertainties. Without investment in R&D the pharma players will not able to generate positive results. The industry players were eagerly awaiting some tax concessions based on R&D expenditure. However, the weighted deduction of 125 per cent to R&D will add back significantly to profits.

The share price of multinational companies like GloaxoSmithKline Pharma, Pfizer and Aventis improved by Rs 48, Rs 28.25 and Rs 30.05 respectively in the post-budget session. However, Matrix, a subsidiary of Mylan Inc., also moved up by Rs 14.20 to Rs 191.90.

Leading companies like Glenmark, Nicholas Piramal, Biocon, Divi's Lab, Ipca Lab and Sun Pharmaceuticals from BSEHC index moved down after the announcement of budget. Sun Pharma scrip moved to southward direction and declined by Rs 33.30 to Rs 1225.90. Similarly, Biocon scrip also declined by Rs 5.25 to Rs 446.30.