Alkem Laboratories, a Rs.5,150 crore plus Mumabi based company which entered capital market during December 2015, is moving ahead and establishing its strong presence in the international as well as in domestic markets with a portfolio of 700 brands across multiple therapies. Currently, it is generating 73 per cent of its revenues from domestic market and remaining 27 per cent from global markets focusing more on US. The company is managing its entire business with the help of 16 manufacturing facilities – 14 in India and 2 in US, and four R&D centres. The US FDA has approved 6 of its facilities and it has presence in more than 50 countries.
Alkem entered capital market during December 2015 with a public issue of 1.28 crore equity shares of Rs.2 each at a price band of Rs.1,020-1,050. The public issue was oversubscribed by more than 44 times. The company's scrip commenced trading on December 23, 2015 with 31 per cent higher from its issue price of Rs.1,050. Currently, Alkem scrip is moving in the range of Rs.1,530-1,550 on BSE with market capitalisation of Rs.18,400 crore. The scrip touched its highest level at Rs.1,626 on August 12, 2016 as against its lowest level of Rs.1,175 in May 2016. Promoters are holding 66.88 per cent stake.
The company declared and paid two handsome interim dividends of Rs.3 and Rs.9.7 for the year 2015-16 on face value of Rs.2 each. The total dividend distribution amounted to Rs.151.85 crore. As against the equity capital of Rs.23.91 crore, it created strong reserves position of Rs.3,479 crore.
The company's consolidated net sales for the year ended March 2016 increased by 33.4 per cent to Rs.4,992 crore from Rs.3,743 crore in the previous year. Its domestic sales improved by 30.3 per cent to Rs.3,536 crore from Rs.2,713 crore and international sales by 41.3 per cent to Rs.1,341 crore from Rs.949 crore. Alkem has set up total 18 subsidiaries in domestic and international locations. Its standalone net sales increased by 25.1 per cent to Rs.3,925 crore from Rs.3,138 crore in the previous year.
The company launched 53 new products, including line extensions during 2015-16. It launched key products like, Rituximab, the first monoclonal antibodies (MABs) under oncology division, Teneligliptin, launched under anti-diabetes division, Faropenem, under anti-infective segment and Sofosbuvir and combinations, a hepatitis C portfolio. Further, few new products launched like Merosure, Gemcal Plus, Pan MPS, Olkem Trio and Tacrovera received strong response from market.
Its sales in US increased by 38.9 per cent to Rs.991 crore from Rs.713 crore and it contributed almost 20 per cent to its net consolidated revenue during 2015-16. The company is managing its US business under 'Ascend' brand which sold 19 products in the market, out of which 14 are the Alkem's own products and five are in-licensed from third parties.
The company filed 12 ANDAs during 2015-16 and its cumulative total reached at 76 ANDAs and 1 NDA. Out of these, 31 are Para IV filings including First-to-File opportunities. Alkem received approval for 12 ANDAs, including 3 tentative approvals during 2015-16. Its cumulative ANDA approvals reached at 30. The company has set up a 100-bed clinical research facility to conduct studies on healthy volunteers. It conducts R&D activities at four of its facilities – two in India at Taloja and Pune, and two in the US at California and St Lauis. The company's Taloja facility was inspected by UK MHRA during March 2016 and the regulatory authorities has listed eight observations that were not conforming to the good clinical practice requirement. Alkem has submitted its report during May 2016 regarding appropriate measures.
The company has also invested in global biosimilar markets through its subsidiary Enzene Biosciences, which is located in Pune. Enzene has established several technology platforms in the areas of molecular biology, protein expression, fermentation technology, bio-analytics, immunology and peptide synthesis. Currently, Alkem has biosimilar products in pre-clinical and clinical development stages.
To strengthen its R&D pipeline, Alkem acquired manufacturing facility and R&D capabilities from Long Pharmaceuticals LLC in US for over Rs.46 crore. The company received US FDA accreditation for its Mandva API facility during 2015-16 in Gujarat. Further, US FDA also inspected its API facility at California and formulation facility at Baddi. The company acquired a formulation facility in St. Louis (Missorril) US during June 2015.
The company has also presence in other markets like Australia, Europe, South East Asia, Latin America, Africa and CIS, and its sales from these markets increased by 57 per cent to Rs.383 crore from Rs.244 crore in the previous year. Its key markets remained Australia, Chile, Philippines and Kazakhstan. The company is looking out for strategic acquisitions and partnership agreements for out-licensing and in-licensing opportunities in these markets. However, the foreign exchange fluctuation and government policies may put pressure on bottom line.
The company has posted satisfactory financial performance for the quarter ended June 2016. Alkem's consolidated net profit increased by 18.7 per cent to Rs.238.79 crore from Rs.201.10 crore in the similar quarter of last year. Its net sales increased by 20.3 per cent to Rs.1,439 crore from Rs.1,196 crore. EPS worked out to Rs.19.97 as against Rs.16.82 in the last period. Its R&D expenditure reached at Rs.78.8 crore and worked out to 5.4 per cent of net operating income. It received 3 tentative approvals, taking its cumulative ANDA approvals to 33 and 1 NDA.
Highlights : Alkem Laboratories (Consolidated)