Gujarat Pharma Majors Maintain Growth Momentum

Mumbai: The pharmaceutical and healthcare segment has moved forward strongly in Gujarat and could expand footprint across the country as well as in global markets with investments in facilities, infrastructure, research & development, technology, merger & acquisition and skilled manpower.

Gujarat has offered the necessary infrastructure for development of industrial growth during the last few years and had attracted huge investments from industries. The pharma & healthcare segment captured domestic as well as international market with higher approvals from highly regulated authorities. Despite stiff competition from international players and the challenges faced in the US, Gujarat-based pharma majors have maintained momentum.

The pharma sector faced several challenges during last few years such as rising costs, pricing pressure in lucrative markets, competition from generics and biosimilars and ongoing regulatory changes. Expiration of product patents intensified competition further.

With investments in ongoing innovation and drug development, the industry continued to bring new and effective treatment to patients. Indian companies grabbed higher approvals from regulatory authorities during the last decade and launched several new products in international markets. The rising consumption of medications in the markets like China, India, Brazil, Russia and South Africa also offering new growth opportunities to Indian pharma companies.

Financial performance improves

The leading six pharma companies, with sales above Rs. 1,000 crore during the year ended March 2023, have achieved better financial performance during the first nine months ended December 2023 and also took due care of their investors by declaring interim dividend. The market capitalisation of these companies also moved up significantly.

The financial performance during the first nine months ended December 2023 has given necessary push to share prices of these companies. As against the total equity capital of Rs. 594 crore, the market capitalisation worked out to Rs. 6,02,429 crore as on March 28, 2024 (last trading day of FY 2023-24)

The BSE Sensex of 30 leading scrips touched its peak level at 74,245 points on March 7, 2024 as against its yearly low level of 58273.86 points March 31, 2023. Similarly, BSE Healthcare index closed at 35,052.84 points as on March 28, 2024 as compared to 31,549 points as at the end of December 2023. Thus, the investors have shown greater confidence in pharma and healthcare segment during last year.

The market capitalisation of Sun Pharma touched Rs. 3,88,803 crore on March 28, 2024 and that of Zydus Lifesciences, Torrent Pharma and Alembic Pharma also increased to Rs. 1,01,151 crore, Rs. 88,030 crore and Rs. 19,309 crore respectively.

Sun Pharma scrip of face value of Re 1 each touched its yearly highest level at Rs. 1,634.05 on the last trading day of March 2024 as against yearly lowest level of Rs. 922.55 during May 2023. Zydus scrip reached highest level at Rs. 1030.15 and Torrent Pharma share clocked yearly high of Rs, 2,745.55 on March 28, 2024. Besides, other Gujarat based companies like Lincoln Pharma, Sun Pharma Advance Research Co (SPARC), Lyka Labs and Denic Chem also moved up during February-March 2024.

Besides major listed companies, Gujarat has created strong network of small companies to fulfil the need of raw material easily and other essential basic infrastructure requirements like water, electricity, roads and technology. The favourable industrial policies also pushed confidence among industrialist. The industrial units also got the necessary financial support from government and bankers.  The Gujarat-based pharma units overcame adverse impact of Covid pandemic and gained success in domestic and international markets.

Topline growth
The aggregate sales of the leading six Gujarat – based pharma companies viz., Sun Pharmaceuticals, Zydus Lifesciences, Torrent Pharma, Alembic Pharmaceuticals, Dishman Carbogen Amcis and Eris Lifesciences increased by 11.4 per cent during the first nine months ending December 2023 to Rs. 65,584 crore from Rs. 58,895 crore in the corresponding period of last year.

These companies posted total sales of Rs. 80,494 crore during the full year ended March 2023. Similarly, their aggregate net profit increased by 18.2 per cent to Rs. 11,562 crore from Rs. 9,781 crore as against fully year 2022-23 net profit of Rs, 12,502 crore. Except Dishman Carbogen, all remaining five companies posted satisfactory growth during first nine months of current year and well set to achieve better financial performance.

The Gujarat-based, Sun Pharmaceutical Industries, a leading Indian pharma company with sales of over Rs. 43,000 crore in 2022-23, has moved forward during last couple of years with focus on R&D and international markets. Its revenues during the first nine months ended December 2023 increased by 10.4 per cent to Rs. 36,514 crore from Rs. 32,955 crore in the similar period of last year.

Thus, the company is well set to achieve sales growth of over 12 per cent in the current year. Its net profit also increased by 6.7 per cent to Rs. 6,922 crore. The company declared an interim dividend of Rs. 8.5 each share of Re 1. The growth was driven by specialty business, including Ilumya, Cequa and Levulan, but partially offset by impact of ongoing Halol and Mohali facility issues in the generics business.

Sun Pharma increased its R&D spending to Rs. 2,278 crore during the first nine months ended December 2024 as against Rs. 1,702 crore during the same period of last year. The company launched 28 new products during December 2023 quarter.

Dilip Shanghvi, managing director of Sun Pharma said at the time of its quarterly financial performance, “We are pleased by our continued broad-based growth including in global specialty. We are keenly looking forward to EMA filing of Nidlegy in coming months. Once approved, Nidlegy will significantly expand our onco-derm franchise in Europe.”

Another Gujarat- based major player, Zydus Lifesciences, a Rs. 16,800 crore plus pharma major, has declared strong financial performance during the nine months period ended December 2023 and its consolidated revenues went up by 14.6 per cent to Rs. 14,014 crore from Rs. 12,227 crore in the corresponding period of last year. Its net profit jumped by 55.6 per cent to Rs. 2,702 crore from Rs. 1,736 crore. Its R&D expenditure reached at Rs. 958 crore and worked out to 6.8 per cent of revenues. Its biotech R&D pipeline continues to advance with two mAbs awaiting marketing approvals in India and two other products including one mAb are currently undergoing phase III clinical trials in India. The company has received the WHO prequalification approval for the API and formulation of the key drug to treat Leishmaniasis, ‘Miltefosine’.

Its FMCG segment also achieved better performance which comprises Nycil and EverYuth brands. It filed 20 ANDAs with US FDA during third quarter and received final approval for 34 ANDAs. Its cumulative filing reached 460 ANDAs and it received 394 ANDA approvals.

Zydus Life acquired Watson Pharma Pvt Ltd for a lump sum cash consideration of Rs. 46.8 crore during August 2023. Further. Its UK-based subsidiary has completed the acquisition of 100 per cent stake of LlqMeds Worldwide Ltd, LiqMeds LTd, Medsolutions (Europe) Ltd, LlqMeds Lifecare Ltd and LM Manufacturing Ltd [collectively referred as “LiqMeds Group”) on November 6, 2023 for a upfront consideration of Rs. 720 crore. The company bought back its equity share of Re 1 each for a total amount of Rs. 600 crore as price of Rs. 1,005 each.

The third largest pharma major from Gujarat, Torrent Pharma, posted revenues of Rs. 7,983 crore during the first nine months ended December 2023 as compared to Rs. 7,012 crore in the similar period of last year.

Its net profit went up to Rs. 1,207 crore from Rs. 958 crore. The company declared equity dividend of 440 per cent for the year 2023-24. Its R&D expenditure increased to Rs. 388 crore from Rs. 366 crore. Torrent has eight manufacturing facilities, of which five are US FDA approved. With R&D as the backbone for its growth in domestic & overseas market, it has invested significantly in R&D capabilities with state-of-the-art R&D infrastructure employing more than 750 scientists. The company acquired Curatio business for a consideration of Rs. 2,000 crore in the October 2022.

Alembic Pharma, a Rs. 5,600 crore pharma major, launched 18 products during the third quarter ended December 2023 and received approval for 22 products. It filed 20 ANDAs and increased the launch of injectable products The company has introduced oncology products in the market and also stepped up the product basket for dermatology and ophthalmology therapies.

Thus, Gujarat- based pharma majors are moving ahead strongly in the domestic as well as international market with investments in R&D, acquisitions and new product launches. Though these companies will have to face competition in the global market, new product launches will help to propel the growth in the future.

Related Posts

  • Pharma
  • April 24, 2024
  • 25 views
India Lifts Safeguard Measures On Isopropyl Alcohol Imports

Mumbai: The Directorate General of Foreign Trade (DGFT) has officially announced the discontinuation of safeguard measures on the import of isopropyl alcohol (IPA). The decision, communicated through Trade Notice dated April…

  • Pharma
  • April 24, 2024
  • 35 views
Punjab And Haryana HC Notice To Centre On Petition Against Misuse Of Oxytocin

Chandigarh: The Punjab and Haryana High Court today sought response from the Union and State government in PIL seeking implementation of Prevention of Cruelty to Animals Act, 1960 (Resignation of…

Leave a Reply

Your email address will not be published. Required fields are marked *

You Missed

India Lifts Safeguard Measures On Isopropyl Alcohol Imports

India Lifts Safeguard Measures On Isopropyl Alcohol Imports

Punjab And Haryana HC Notice To Centre On Petition Against Misuse Of Oxytocin

Punjab And Haryana HC Notice To Centre On Petition Against Misuse Of Oxytocin

Nepal Drugs Regulator To Conduct On-Site Testing Of Medicines

Nepal Drugs Regulator To Conduct On-Site Testing Of Medicines

‘Auric’ Relied On Amazon Reviews For Research Claims To Cure Fatty Liver

‘Auric’ Relied On Amazon Reviews For Research Claims To Cure Fatty Liver

Misleading Ads Case: Patanjali Issues Public Apology In A Daily Newspaper

Misleading Ads Case: Patanjali Issues Public Apology In A Daily Newspaper

AFMS Collaborates With IIT Delhi To Develop Medical Devices

AFMS Collaborates With IIT Delhi To Develop Medical Devices