8th May, 2013
India’s biggest drugmaker Ranbaxy said Wednesday its quarterly net profit slid 90 percent, hit by the loss of exclusive rights to sell a copycat version of cholesterol-busting drug Lipitor in the United States.
The Indian generics firm, majority-owned by Japan’s Daiichi Sankyo, posted a net profit of 1.26 billion rupees ($23 million) for the three months to March, down from 12.47 billion rupees in the same period a year earlier.
Ranbaxy’s quarterly profit last year was helped by an exclusive mandate to sell the generic version of Lipitor but since then that right has expired.
“Profitability for the first quarter seems lower when compared to the corresponding quarter primarily due to absence of contribution from exclusivities present in the corresponding quarter last year,” Ranbaxy said in a statement.
Sales of Ranbaxy, headquartered in Gurgaon near New Delhi, fell 34 percent to 24.39 billion rupees in the first quarter from a year earlier.
Analysts had expected Ranbaxy, which follows a January-December financial year, to report net profit of 1.6 billion rupees.
Ranbaxy, which has factories in eight countries, has expanded by selling cheap copies of branded drugs that have gone off-patent and through challenges to patents owned by Western companies.
Japan’s Daiichi Sankyo won control of Ranbaxy through a $4.6-billion deal in 2008 as it sought to diversify globally and to break into the fast-growing generics market.
But it has been an uphill task for Daiichi Sankyo to turn around Ranbaxy after US authorities alleged in 2009 that the Indian firm falsified data, failed to prevent contamination of medicines and kept poor records.
In 2012 Ranbaxy reached a deal with US regulators over a lengthy quality compliance dispute in which it promised tighter checks.