The Hindu Business Line : Wyeth Q4 net profit down on higher input costs

Mumbai, June 30 Drug-maker Wyeth Ltd has decided to appeal to the Supreme Court against a Bombay High Court order earlier this month, regarding the pricing of certain drugs, the company told the Bombay Stock Exchange (BSE).

The appeal is part of a dispute that Wyeth had in 1981, regarding the price fixed by the Centre on the multinational company’s De-Methyl-Chior-Tetracycline Hydrochloride formulations for the period 1981 to 1987.

The issue was challenged in the Supreme Court.

And though the apex court upheld the Centre’s right to fix prices, it directed the Government to review the prices, Wyeth said.

After several committee meetings, the Centre raised a demand of about Rs 44.07 crore, comprising principal amount of Rs 13.20 crore (a sum of Rs 1 crore had been deposited earlier) and interest up to November 2, 2007 or Rs 31.86 crore, the company said.

The Government then asked Wyeth to deposit the amount with interest into the Drugs Prices Equalisation Account (DPEA), following which Wyeth had filed a writ petition in the Bombay HC.

Pending disposal of the writ petition, the Court, on June 10, granted a stay on the recovery of interest, subject to deposit of the principal amount and furnishing security for the interest within a period of six weeks, Wyeth said.

It is against this order that Wyeth’s board of directors took a decision, on Monday, to appeal against.

Meanwhile, higher expenses and rising input costs resulted in Wyeth’s net profits seeing an eight per cent dip, for the quarter ended March 31, 2008.

The company clocked a net profit of Rs 12.16 crore for the quarter under review, as compared to Rs 13.25 crore in the corresponding period last year. The company’s net sales for the quarter stood at Rs 74 crore in the said quarter, against Rs 60.27 crore in the corresponding quarter.

The company’s net profit for the year ended March 2008, also slipped close to 12 per cent, at Rs 81.48 crore for the year under review, as compared to Rs 92.36 crore corresponding year. The year under review clocked net sales of Rs 331.32 crore (Rs 288.13 crore).

Wyeth shares were down about five per cent, at Rs 410.40, on the BSE.

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