Page 41 - IACC Newsletter June 2013 Issue 11

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Patel. This is the first success that Cadila has seen from the armory of nine products under various stages of
development.
Commenting on the development Hitesh Mahida, analyst at Fortune capital, said that the development is positive
though guidance Rs 100 crore in first three years of launch seems aggressive.
US business
While the new product approval and launch is positive, the upside for the stock hinges on traction in the US business.
Monica Joshi at Avendus Research post FY13 results had observed that Product launches in the US are trickling in, but
not materially contributing to earnings. US business had just seen a 9% year-on-year growth during March’13 quarter.
Joshi observed that this, however, could change as the number of approvals and the quality of new launches .
Approval for launch of products as injectable, a nasal spray in FY14 (whose manufacturing facility had been inspected by
USFDA) a transdermal towards end of FY14 as FDA inspection of facility is pending and other products as generics of
Asacol used for treatment of Ulcerative colitis and anti-hypertensive product Toprol XL etc. All are essential for
achieving the guided 20 percent growth in the US generic sales and Joshi observes that the inability to deliver scale in
the business could impact valuations.
Dr. Sharvi P Patel Deputy MD Cadila said that they should be able to launch 12-14 products in the US during FY14
depending on approvals. He added that company is banking on Biosimilars, vaccines and transdermals to drive growth.
Pharma pricing policy headwinds
The new drug policy is likely to impact 2.5% of the domestic sales as per Nomura estimates. The domestic business
contributes about 47% to overall revenues for the company. However the company plans to continue launching 40-50
products every year which should mitigate the losses observed Pankaj Patel. The new research product too should add
to domestic growth and materially impact will be seen in FY15.