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Active Pharmaceutical Ingredients (API) maker Neuland Labs Ltd is planning to increase its focus on higher margin products.
“We feel margins are (more) important than top line growth,’’ N.S. Vishwanathan, Chief Financial Officer, told Business Line . On average, the margins for API manufactures are in the range of 42 to 45 per cent, he added. “The product-mix has been changed and we have fixed product pipeline challenges. The dependence on Ciprofloxacin for revenue has been reduced.’’
Ciprofloxacin, the company’s flagship product, accounted for 47 per cent of sales in 2007. This was brought down to 30 per cent in the last financial year.
The pharma industry’s market size is estimated to be $22 billion. “Of this, the API space is $900 million. At Rs 460 crore turnover, we still have a lot of scope to grow,’’ he said.
The Hyderabad-based company filed 35 drug master files in the financial year ended March 31, 2013. A drug master file is a document submitted by an API manufacturer to the US Food and Drug Administration with confidential details about its manufacturing facilities, processes, packaging, storage infrastructure and so on. It also obtained 16 patents during the year.
Neuland Labs now has over 45 products and is likely to launch seven more this year.
COLLABORATION
Neuland will also have better access to Japan due to its business agreement with API Corporation (APIC), a healthcare unit of Mitsubishi Chemical Holdings Group, added Vishwanathan.
Apart from the Japanese market, the capacity addition will also help serveNeuland’s customers in 85 countries, he added.
The company has shifted its focus from domestic markets to regulated markets in recent years. Today, about 70 per cent of its revenues come from exports.
“All top five MNC pharma companies are our customers,” said Vishwanathan.
naga.gunturi@thehindu.co.in
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