Taro Pharma, a subsidiary of Sun Pharmaceutical and Industries, has suffered a setback during the quarter ended June 2014 due to charges taken to meet contractual obligations associated with price adjustments. Its net profit declined sharply by 22 per cent to $46 million from $59 million in the same period of last year. Its net sales also declined by 15 per cent to $130 million from $154 million. Its EPS declined to $1.08 from $1.32.

The net sales declined due to price adjustments. The charges for the quarter amounted to $79 million as against $24 million in the corresponding quarter of last year. The benefits from these price adjustments are expected to commence in the second fiscal quarter.

Its R&D expenditure increased by 23 per cent to $15 million from $12 million and the company anticipate the increase in R&D spend to continue throughout the year. Its selling, marketing, general and administrative expenses increased to $22 million from $21 million.

Kal Sundaram, CEO, said, “Our underlying business is stable, with volumes relatively flat from the comparative 2013 quarter. We continue to increase our investment in our R&D, having filed five ANDAs this quarter, with 31 total ANDAs awaiting approval with the FDA. Excluding the impact on net sales from the net charges associated with price adjustments, net sales would have increased by 18 per cent versus the comparable prior year quarter.”

Taro received US FDA approval for Flucinonide cream, USP, - 0.1 percent.