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The shares of Glenmark Pharmaceuticals surged about 7 per cent in early trades on Friday on the back of strong third-quarter (Q3) earnings. The stock recorded a high of ₹970 and has come-off from there to current levels of ₹950 (up 4.6 per cent).
The drug maker’s consolidated net profit more than doubled on the back of sustained traction in the US formulation business to ₹477.03 crore as against ₹196 crore reported in the same quarter last year. The company’s consolidated revenue rose to ₹2,535 crore, up 42.55 per cent from ₹1,778 crore in the corresponding period last year.
Glenmark’s Ezetimibe, the only generic version of ZETIA (Merck) for high cholesterol, was launched in the US in December 2016. Along with its licensing partner Par Pharmaceutical, Glenmark is entitled to exclusivity in marketing this product for 180 days in the US. This, along with higher sales in other formulations, propped up US sales by 102 per cent in the third quarter. The top line growth of the company was further aided by the good performance of the API business, which grew by 32 per cent. According to IMS Health data, Zetia had sales of about $2.3 billion in the US in the 12 months ended October 2016. So high demand for this drug is expected to keep the fourth quarter also strong in terms of US sales.
On the domestic front, the formulation business was impacted by demonetisation and it recorded moderate growth of 5.9 per cent in the third quarter. According to the management, the EBITDA margin is expected to remain at 21 per cent.
In the last quarter, the company had announced a strategic blueprint for the next decade where it plans to focus on three key therapies — dermatology, oncology and respiratory. It also envisages building a portfolio of differentiated and technologically complex products such as hormones, semi-solids and inhalers.
Glenmark’s marketing portfolio through December 31, 2016 consists of 112 generic products authorised for distribution in the US market. The company currently has 63 applications pending in various stages of approval with the USFDA, of which 24 are Paragraph IV applications.
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