A healthy jump in export formulation sales (38 per cent) helped Cipla achieve 17.7 per cent year-on-year growth in revenues during the December quarter.
Higher recurring export sales and supplies of Meda Pharma’s innovative anti-allergy drug Dymista compensated for the lower proportion of Lexapro (anxiety drug) supplies to Teva, whose exclusivity ended in September last year. This enabled Cipla improve operating margins by 1.5 percentage points to 23.8 per cent.
Even as Meda Pharma commenced Dymista sales in the US in September last, the product is expected to be launched in Europe in the current year. Dymista being an innovative drug, gradual ramp up in sales over the next two years should add to Cipla’s revenues and profits.
Change of guard with the stepping down of its current CMD Y.K. Hamied and induction of Subhanu Saxena as the CEO and an export strategy rejig may give the company a new make over. With cash in excess of Rs 1,400 crore, Cipla is pursuing inorganic opportunities to expand presence in export markets such as China, Japan, Brazil and Turkey. This is a marked shift from the company’s earlier partnership model. To scale up its direct presence in the key US market, Cipla has initiated own product filings there, with five product filings in the current fiscal. But benefits from these may take some time to accrue.
Cipla’s domestic formulation sales grew 10.2 per cent during the quarter, compared to the same period last year despite a challenging environment. The management is confident of sustaining growth in excess of 15 per cent over the next two years.