



Robust ANDA pipeline to help Sun Pharma sustain US growthPosted AtEconomictimes.Indiatimes.comSun Pharma’s first quarter results reflect the way the fortunes of generic Indian pharma companies swing from quarter to quarter due to one-time income earned from exclusive launch of generic drugs in the US. The most valuable Indian pharma company has posted better-than expected results aided by the non-recurring income earned due to distribution of generic drug Oxaliplatin by its US subsidiary Caraco. The consolidated earnings grew by nearly three-and-a-half times y-o-y while revenues increased by 78% — making it an exceptional quarter for the company. The operating profit margin sprang from 16% in the same quarter in the previous year to 44% this quarter. While such performance may not be repeated in the coming quarters, it has definitely helped the company to come closer to achieving its revenue growth guidance of 18-20% for FY11. The market gave a positive response to the results with the stock closing over 2% on Wednesday over its previous close. The company, holding 3.7% share in the domestic market, has logged a good performance in the Indian market during the quarter. Sales from domestic market contributed little less than half of the company’s total quarterly revenues and showed the maximum growth of 91%, which was understated by Rs 200 crore in the previous corresponding quarter due to change in distribution policy. Sun Pharma’s international formulations sales have grown by 32% y-o-y. While the non-recurring income has boosted the quarterly performance of Caraco, its manufacturing still remains suspended. A work plan submitted by the company had been approved by the US FDA in March and it expects to resolve this issue by second half of this fiscal. Sun Pharma has built a robust ANDA pipeline that could help it sustain its US growth. The cumulative ANDA filings with the US FDA by Sun Pharma and Caraco stand at 211, with 120 filings awaiting approval. This makes it one of the largest ANDA pipelines among its peers. Besides a strong ANDA pipeline, dominating position in the domestic market along with possibility of positive outcome in case of Caraco and Taro are positive factors to watch out for Sun Pharma’s investors. July 30, 2010
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