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Jul
22
ragupathyrenganathan
Sun Pharma cuts projections on integration of Ranbaxy
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Sun Pharmaceutical Industries, a Rs. 27,000 crore Indian pharma giant after merging Ranabxy Laboratories, has cut down its sales and profit projections for the year ended March 2015 on account of amalgamation of Ranbaxy Laboratories. The sales are likely to remain stagnant or lower during 2015-16 and profits are also likely to be adversely impacted due to certain expenses/charges arising out of integration as well as remedial actions. The company is taking steps to meet global regulatory standards.

Despite adverse conditions, Sun Pharma scrip surged today by almost 2 per cent in the morning session to Rs.822 as against its 52-weeks peak level of Rs.1200.70 touched on April 7, 2015.

The company is taking steps to explore opportunities to expand its global footprint through focus on enhancing share of specialty/branded business and targeting differentiated product offerings. Sun has recently strengthened its ophthalmology and OTC teams in the US as well as formed a dedicated team for MK-3222, its IL-23 anti-body which is currently undergoing phase-III clinical trials.

Sun is investing large amount on R&D in order to strengthen the specialty pipeline including patented products and complex generics. The company is focusing on cGMP compliance by enhancing systems, processes and human capabilities to meet global regulatory standards at all its manufacturing facilities. As part of this process and in order to address the cGMP deviations at its Halol facility, the company has undertaken various remedial measures. These remedial measures have resulted in supply constraints for some of the projects. It expect this situation to continue for some more time till all the remedial steps at Halol are completed. The remedial action at the Mohali, Dewas, Poanta Sahib and Toansa facilities is on track. It is working towards the fulfillment of the requirements of the US consent decree and will try to expedite the resolution for at least one of these facilities.

The company’s profits may be hit by the integration process with certain integration charges. Further, as a part of the integration process, Sun may decide to discontinue certain non-strategic businesses.



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