The Hindu Business Line : Orchid gets US FDA nod for Cefdinir

Chennai, July 24 Orchid Chemicals & Pharmaceuticals Ltd has announced that it has received approval from the US Food & Drug Administration (FDA) for the launch of Cefdinir in the US market.

Cefdinir is an antibiotic of cephalosporin family, which went off-patent only in May. Before it went off-patent, the product had a retail market of $1 billion, but the post-patent market for the drug is estimated at $300 million (as prices fall when more players start selling).

Orchid says it will launch the drug in the current quarter. The drug will be sold in the US market by Orchid’s marketing partner, Apotex.

In June, Orchid launched another cephalosporin-based antibiotic, Cefepime, which again went off-patent recently. Orchid was the only generic player in the US market and by the end of the month, the drug fetched revenues of about $7 million (Rs 28 crore). Judging by the filings with the US regulatory, Orchid believes it would have the market exclusivity for another six months.

But unlike Cefepime, Orchid’s Cefdinir will compete with three other players — Lupin, Novartis and Teva. Orchid says that it is happy with a share of the pie, which is large and points out that cost-advantage is on its side.

Cefepime and Cefdinir are two of the three major products that Orchid had planned to launch this year. “Second quarter revenues and profits will be very strong because of these two products,” an Orchid’s spokesman told Business Line.

The third product is a penicillin-based antibiotic called Tazobactum-Piperacillin. Orchid had counted on earning revenues of $60 million (Rs 250 crore) from this product, but the launch has suffered a delay because the innovator of the drug, Wyeth, has attempted to ‘evergreen’ the patent with some modifications.

Q1 profit up

Meanwhile, Orchid’s net profit for the first quarter of the current year rose to over four times as much as in the same quarter last year, but that was chiefly because of the gains arising out of rupee appreciation. The net profit was Rs 75.91 crore (Rs 14.59 crore). ‘Rupee gains’— saving in servicing and repayment of foreign exchange loans — was Rs 51.30 crore.

Taking into account the effect on taxation, the appreciation of the rupee had a net impact of Rs 33.77 crore on PAT. But even discounting the impact of rupee appreciation, net profit works out to Rs 42.14 crore, a growth of 188 per cent.

Turnover for the quarter was Rs 291 crore (including foreign exchange gains) against Rs 202 crore in the comparable quarter of last year.

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