Sun Pharma Feels US Slow­down Pinch, Profit De­clines 5%

Co’s in­come from op­er­a­tions in­creases 8% to .₹ 7,683 crore

The Economic Times - - Companies: Pursuit Of Profit - Our Bureau

Mum­bai: The im­pact of a slow­down in its US busi­ness is be­gin­ning to show on the per­for­mance of In­dia’s largest drug maker Sun Phar­ma­ceu­ti­cal In­dus­tries, with the com­pany re­port­ing a 5% on-year de­cline in its net profit in the De­cem­ber quar­ter.

Sun’s net profit de­clined to .₹ 1,472 crore in the quar­ter, with the Mum­bai-based com­pany’s in­come from op­er­a­tions in­creas­ing 8% to .₹ 7,683 crore, com­pared with .₹ 7,087 crore in the same quar­ter last year. The US mar­ket, which con­trib­utes about 45% of Sun’s sales, reg­is­tered a 4% growth to $507 mil­lion. The com­pany’s sales growth in the US was led by the generic Olme­sar­tan, a blood­pres­sure-con­trol­ling drug, and the con­ti­nu­ity of the 180-day ex­clu­siv­ity push for anti-can­cer drug Imatanib. Sun Pharma’s US sales were also af­fected by a rev­enue drop at its sub­sidiary Taro Pharma: In the just­con­cluded quar­ter, Taro re­ported sales worth $220 mil­lion, down 15% on-year. Taro’s net profit also fell 26% to $140 mil­lion. Sun Pharma’s In­dia busi­ness was also af­fected as the de­mon­eti­sa­tion woes hit the mar­ket leader along with its lo­cal pharma peers.

Sale of branded for­mu­la­tions in In­dia was .₹ 1,969 crore, up 5%, with the home mar­ket mak­ing up 26% of Sun Pharma’s rev­enues. How­ever, the poor show­ing in In­dia and US was off­set by the com­pany’s emerg­ing-mar­kets rev­enues, which re­ported a 14% sales growth at $172 mil­lion. The earn­ings be­fore in­ter­ests, tax, de­pre­ci­a­tion and amor­ti­sa­tion (EBITDA) was at .₹ 7,575 crores, re­sult­ing in an EBITDA mar­gin of 32%. Dur­ing the quar­ter, Sun Pharma com­mer­cialised BromSite, its first spe­cialty eye care prod­uct in the US, Dilip Shanghvi, man­ag­ing di­rec­tor of Sun Pharma, said. He also noted pos­i­tive re­sults in the Phase-3 tri­als for Seciera, its drug for the dry-eye syn­drome. Sun last year also ac­quired the anti-can­cer brand Odomzo, an in­di­cated treat­ment for adult pa­tients of skin can­cer.

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