Dr. Reddy's Fy09 Financial Reckoner
This document was uploaded by user and they confirmed that they have the permission to share it. If you are author or own the copyright of this book, please report to us by using this DMCA report form. Report DMCA
Overview
Download & View Dr. Reddy's Fy09 Financial Reckoner as PDF for free.
More details
- Words: 5,029
- Pages: 16
Reckoner FY09
May 18, 2009 Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09 Business Update Overall revenues at Rs. 69.4 billion ($1.4 billion) in FY09 as against Rs. 50 billion ($983 million) in FY08, representing a growth of 39%. Operating income is at Rs. 11.2 billion ($220 million) in FY09 as against Rs. 5.4 billion ($107 million) in FY08 after adjusting for non cash impairment of intangibles and goodwill. EBITDA at Rs. 14.5 billion ($285 mn) in FY09 as against Rs. 9.7 billion ($190 mn) in FY08, representing a growth of 50%, higher than sales growth of 39%. Key growth drivers: Successful launch of the authorized generic version of GlaxoSmithKline’s Imitrex® (generic version: sumatriptan succinate), in late November 2008. Excluding revenues from Sumatriptan, YoY growth is at 24%, driven by the key markets of North America and Russia. During the year, the company launched 116 new generic products, filed 110 new generic product registrations and filed 55 DMFs globally.
Global Generics Revenues from Global Generics business at Rs. 49.8 billion ($979 million) in FY09 as against Rs. 33.0 billion ($649 million) in FY08. YoY growth of 51% driven by Sumatriptan and key markets of North America and Russia. Revenues from North America at Rs. 19.8 billion ($390 million) in FY09 as against Rs. 8.0 billion ($158 million) in FY08. Excluding revenues from Sumatriptan, the growth of 58% in North America was driven by high volume growth across existing top products and acquisition of Shreveport facility. Revenue from Shreveport facility at Rs. 1.7 billion ($33 million) in FY09. Revenues from Europe at Rs. 11.9 billion ($234 mn) in FY09 as against Rs. 10.2 billion ($201 mn) in FY08, representing a growth of 16%. Revenues from betapharm increase by 20% to Rs. 9.9 billion ($194 mn) in FY09 from Rs. 8.2 billion ($161 mn) in FY08. This increase was on account of volume growth in existing products and one-off seasonal vaccine sales in Q2 FY09 Revenues from Rest of Europe remain flat at Rs. 1.9 billion ($39 million) in FY09. During the year, the company launched 25 new products and filed 11 dossiers across Europe. Revenues from Russia & Other CIS markets at Rs. 7.6 billion ($150 million) in FY09 as against Rs. 5.5 billion ($109 million) in FY08, representing a growth of 38%. Revenues in Russia increase to Rs. 5.8 billion ($114 million) in FY09 as against Rs. 4.1 billion ($80 million) in FY08. YoY growth of 43% driven by key brands of Omez, Nise, Ketorol, Cetrine and Bion. Revenues in Other CIS markets increase to Rs. 1.8 billion ($36 million) in FY09 as against Rs. 1.5 billion ($29 million) in FY08. YoY growth of 25%. Revenues in India increase to Rs. 8.5 billion ($167 million) in FY09 from Rs. 8.1 billion ($158 million), representing a growth of 5%. 36 new products launched during the year.
Pharmaceutical Services & Active Ingredients (PSAI) Revenues from this segment increase to Rs. 18.8 billion ($369 million) in FY09 as against Rs. 16.6 billion ($327 million) in FY08. YoY growth of 13% driven by growth in North America and RoW markets as well as benefit by depreciation of rupee against the dollar. Revenue from the business & facility acquired from Dow Pharma at Rs. 1.0 billion ($20 million)in FY09. During the year, 55 DMFs were filed globally (21 in US, 19 in Europe, 5 in Canada and 10 in RoW). Cumulative DMFs filed till date at 351.
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09 Financial Updates All figures in millions, except EPS All dollar figures based on convenience translation rate of 1USD = Rs 50.87
Dr. Reddy’s Laboratories Ltd. and Subsidiaries Unaudited Condensed Consolitated Interim Income Statement FY09 Particulars Revenue Cost of Revenues Gross Profit Operating Expenses Selling, general & administrative expenses(a) Reserach and development expenses, net Write down of intangible assets Write down of goodwill Other (income)/expenses, net Total Operating Expenses Results from operating activities Finance income(b) Finance expenses(c) Finance expenses, net Share of profit/ (loss) of equity accounted investees Profit before income tax Income tax expense Profit for the period Attributable to: Equity holders of the company Minority interest Profit for the period
Weighted average no. of shares o/s Diluted EPS Exchange rate
FY08
($)
(Rs.)
%
($)
(Rs.)
%
1,365 648 718
69,441 32,941 36,500
100 47 53
983 484 499
50,006 24,598 25,408
100 49 51
39 34 44
413 79 62 213 5 773 (56) (9) 33 23 0
21,020 4,037 3,167 10,856 253 39,333 (2,833) (482) 1,668 1,186 24
30 6 5 16 0 57 (4) (1) 2 2 0
331 69 59 2 (8) 453 46 (31) 21 (10) 0
16,835 3,533 3,011 90 (402) 23,067 2,341 (1,601) 1,080 (521) 2
34 7 6 0 (1) 46 5 (3) 2 (1) 0
25 14 71 (70) 54 1,100
(79) (23) (102)
(3,995) (1,173) (5,168)
(6) (2) (7)
56 19 75
2,864 972 3,836
6 2 8
-
(102) 0 (102)
(5,168) 0 (5,168)
(7) 0 (7)
76 (0) 75
3,846 (10) 3,836
8 (0) 8
-
(0.6)
169 (30.7) 50.87
0.4
169 22.8 50.87
(a) Includes amortization charges of Rs. 1,503 million in FY09 and Rs. 1,588 million in FY08. (b) Includes forex gain of Rs. 739 million in FY08. (c) Includes forex loss of Rs. 634 million in FY09.
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
Growth%
FY09
Financial Updates Key Balance Sheet Items
(in millions)
As on 31st Mar 08
As on 31st Mar 09
Cash and cash equivalents Investments (current & non-current) Trade and other receivables Inventories Property, plant and equipment Loans and borrowings (current & non-current) Trade accounts payable Total Equity
($)
(Rs.)
($)
(Rs.)
110 10 282 260 410 387 118 827
5,603 530 14,368 13,226 20,881 19,701 5,987 42,045
146 93 134 219 330 380 107 931
7,421 4,753 6,823 11,133 16,765 19,352 5,427 47,350
Income Statement Highlights Gross profit increase by 44% to Rs. 36.5 billion ($718 million) in FY09 as against Rs. 25.4 billion ($499 million) in FY08. Gross profit margins on total revenues at 53% as against 51% in FY08, largely driven by attractive margins on sumatriptan. Selling, General & Administration (SG&A) expenses increase to Rs. 21.0 billion ($413 million) in FY09 from Rs. 16.8 billion ($331 million) in FY08. SG&A expenses as a % to sales is at 30% in FY09 as against 34% in FY08. The absolute increase is in line with a higher sales growth and coupled with a higher impact of currency on expenses outside India; however, it was offset by control measures to optimize spending on expenses such as travel, General & Administration expenses and others. Other operating expenses of Rs. 253 million in FY09 includes Rs. 921 million as damages on account of the German court upholding the validity of the olanzapine patent. R&D investments at 6% of total revenues in FY09 as against 7% in FY08. YoY growth of 14%. Finance costs (net) are at Rs. 1.2 billion in FY09 as against Finance income (net) at Rs. 521 million in FY08. The increase is mainly on account of : Net forex loss of Rs. 634 million in FY09 as against net forex gain of Rs. 739 million in FY08. Net interest expense of Rs. 687 million in FY09 as against net interest expense of Rs. 329 million in FY08. PAT adjusted for one time exceptions is at Rs. 8.5 billion ($167 million) as against Rs. 4.5 billion ($88 million) in FY08. Adjusted EPS of Rs. 50.3 ($1.0) in FY09 as against adjusted EPS of Rs. 26.6 ($0.5), representing a growth of 89%. Cash profit in FY09 at Rs. 11.7 billion ($229 million) as against Rs. 7.9 billion ($154 million) in FY08, representing a growth of 48%. Capital expenditure for FY09 is at Rs. 4.4 billion ($87 million).
Revenue Mix by Geography
FY09 $
FY09 INR
as a %
FY08 $
(in millions)
FY08 INR
as a %
Growth %
North America
472
24,012
35
224
11,374
23
111
Europe
355
18,047
26
312
15,863
32
14
India
225
11,460
17
212
10,772
22
6
109
5,526
11
38
6,470
13
28
50,006
100
39
Russia & other CIS
150
7,623
11
Others
163
8,299
12 127
TOTAL
1,365 69,441 100
9 83
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09 Financial Update Revenue Mix by Segment
Global Generics North America Europe India Russia & other CIS Others PSAI (Pharmaceutical Services & Active Ingredients) North America Europe India Others Proprietary Products Others Total
RoW 196 Russia & CIS 762 India 848 Europe 1,189
North America 1,984
Rs. Crs
g=147%
FY09 $
FY09 INR
as a FY08 % $
979 390 234 167 150 39 369 76 121 47 125 06 12 1,365
49,790 19,843 11,886 8,478 7,623 1,959 18,758 3,875 6,160 2,383 6,340 294 599 69,441
72 40 24 17 15 04 27 21 33 13 34 00 01 100
649 158 201 158 109 24 327 66 111 46 104 01 06 983
FY08 INR
as a %
33,023 66 8,024 24 10,216 31 8,060 24 5,526 17 1,197 04 16,622 33 3,350 20 5,647 34 2,352 14 5,273 32 39 00 321 01 50,006 100
Rs. 6,944 Crs. g --> 39%
Global Generics Rs. 4,979 Crs. g-->51%
g=38%
g=16%
(in millions)
Consolidated Revenue
g=64%
g=5%
Others Rs. 89 Crs. PSAI Rs. 1,876 Crs. g-->13%
51 147 16 05 38 64 13 16 09 01 20 651 86 39
g=Growth Rs. Crs
g=20%
Row=634
g=1%
India=238
g=9%
Europe=616
g=16%
Global Generics
Growth %
North America=388
PSAI
Key P&L Items for FY09 Revenue
Gross Margins
Rs. 6,944 Crs YoY growth --> 39%
Rs. 3,650 Crs 53% to sales YoY growth--> 44%
EBITDA Rs. 1,451 Crs 21% to sales YoY growth --> 50%
Cash Profit* Rs. 1,166 Crs 17% to sales YoY growth --> 26%
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
*Cash Profit = Net Profit + Non cash expenses (depreciation + amortization + impairment)
FY09
Q4 FY09 Highlights Overall revenues at Rs. 19.8 billion ($390 million) in Q4 FY09 as against Rs. 13.2 billion ($261 million) in Q4 FY08, representing a growth of 50%. The growth was majorly driven by the successful launch of the authorized generic version of GlaxoSmithKline’s Imitrex® (generic version: sumatriptan succinate), in late November 2008. Excluding revenues from Sumatriptan, the YoY growth is at 23%. Operating income at Rs. 4.6 billion ($90 million) in Q4 FY09 as against Rs. 1.4 billion ($28 million) in Q4 FY08 after adjusting for non-cash impairment. EBITDA at Rs. 5.5 billion ($108 million) in Q4 FY09 as against Rs. 2.6 billion ($51 million) in Q4 FY08, representing a growth of 113%. Revenues from Global Generics business at Rs. 14.7 billion ($288 million) in Q4 FY09 as against Rs. 8.7 billion ($172 million) in Q4 FY08. YoY growth of 68% driven by sumatriptan and key markets of North America and Russia. Excluding revenues from Sumatriptan, the growth of 44% in North America was driven by new product launches like Divalproex, Levetiracetam and acquisition of the Shreveport facility. Revenue growth of 88% in Russia driven by key brands of Omez, Nise, Ketorol and Cetrine. Revenues from Pharmaceutical Services & Active Ingredients (PSAI) increase by 11% to Rs. 4.9 billion ($96 million) in Q4 FY09 as against Rs. 4.4 billion ($86 million) in Q4 FY08.
Revenue Mix by Segment
Q4FY09 Q4 FY09 $ INR
Global Generics North America Europe India Russia & other CIS Others PSAI (Pharmaceutical Services & Active Ingredients) North America Europe India Others Proprietary Products Others Total
14,670 7,205 3,096 2,072 1,834 462 4,859 833 2,153 572 1,302 177 145 19,851
288 142 61 41 36 09 96 16 42 11 26 03 03 390
Revenue Mix by Geography
(in millions)
as a Q4 FY08 Q4 FY08 as a % $ INR %
Growth %
8,744 66 2,466 28 2,905 33 1,993 23 1,055 12 04 325 4,373 33 10 441 1,730 40 13 548 1,654 38 00 04 01 132 13,253 100
68 192 07 04 74 42 11 89 24 04 (21) 4,356 10 50
73 49 21 14 13 03 24 17 44 12 27 01 01 100
172 48 57 39 21 06 86 09 34 11 33 00 03 261
(in millions)
Q4 FY09 Q4 FY09 as a Q4 FY08 Q4 FY08 as a $ INR % $ INR %
North America
161
8,215
41
Europe
103
5,249
26
91
India
55
2,789
14
53
Russia & other CIS
36
1,834
9
21
Others
35
1,763
9
TOTAL
390
19,851 100
57
2,908
Growth %
22
183
4,636
35
13
2,675
20
4
1,055
8
74
39
1,979
15
(11)
261
13,253
100
50
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09
Driving Sustainable Long-term growth FY09 Guidance Achievement Revenue Guidance --> 25% Growth
Gross Margin Guidance --> ~50% Levels
Revenue (Rs. Crs)
Gross Margin (% to Sales)
54.3%
55.8%
FY09 -------------------------------------------- 52.6%
g=39%
49.8% 5,001
6,944
FY08
FY09
49.3%
Q2FY09
Q1FY09
R&D Margin Guidance --> 7% of Sales
Q3FY09
Q4FY09
Guidance --> Improved Profitability
R&D Margin (% to Sales)
7.0%
PAT* (% to Sales)
FY09 -------------------------------------------- 5.8%
Q1FY09
Q2FY09
5.7%
5.6%
5.1%
12.3%
Q3FY09
9.0%
Q4FY09
FY08
FY09 * Adjusted for one time exceptions
Consistent Growth Momentum
(For Last Eight Quarters)
Rs. Crs
Revenue g--25% g--30%
1,198
1,245
1,232 1,325
1,504 1,615
g--49%
Rs. Crs
Adjusted PAT*
g--50%
1,840 1,985 135
Q1FY08 Q2FY08 Q3FY08 Q4FY08 Q1FY09 Q2FY09 Q3FY09 Q4FY09
80
70
100
132
146
302
328
Q1FY08 Q2FY08 Q3FY08 Q4FY08 Q1FY09 Q2FY09 Q3FY09 Q4FY09
* Adjusted for Forex, one time write downs and tax benefits
Global Launches & Filings in FY09 ANDAs ANDS Dossiers Dossiers DMFs Filings = 20 + 03 + (Europe) + (RoW) + 55 110 76 11
North New India RoW Specialty Europe = America Launches + 25 + 36 + 39 + 02 16 118
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09
Quick Facts - FY09 Global Generics - Key Markets North America
Rs. Crs.
1,984 147%
719
Sumatriptan
168
Acquisition
Top Products . Sumatriptan AG . Fexofenadine . Glimepiride . Oxaprozin . Ondansetron . Meprobamate . Divalproex . Simvastatin . Finasteride . Ciprofloxacin . Tizanadine
802
1,097
FY08
FY09
Base Business
Revenues at Rs 19.8 bn ($390 mn) in FY09 Successful launch of the AG version of GSK’s Imitrex® Current market share ~ 50% Revenues excluding sumatriptan grew by 58% in rupee terms and 24% in dollar terms 16 new product launched. Received 23 ANDA approvals. Total No of ANDAs filed till date: 144 Filed 20 ANDAs ; 69 pending approval (30 are Para IVs and 18 are FTFs) addressing innovator sales of $46 bn Settled Desloratadine --> IMS $50 mn Favorable summary judgment ruling in the Omeprazole Mg OTC litigation Fondaparinux ANDA filed under ‘GIVE’
India Growth flat --> change in supply chain model to a replenishment based model Sub-industry growth because of lack of adequate new product launches and change in supply chain model Launched 36 new products New product launches in the last 36 months contributed 14% of total revenues Action Plan: To capitalize on our brand equity strength with GPs/ CPs To address the issue of penetration in potential areas like rural and northern regions. To address portfolio width gap.
5%
Rs. Crs.
Top Brands 806
848
FY08
FY09
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
Omez . Nise . Stamlo . Stamlo Beta . Atocor . Razo . Omez-DSR . Reditux . Mintop . Enam .
FY09 Quick Facts - FY09 Global Generics - Key Markets Germany High volume growth in existing products offset by price declines betapharm volume growth --> 16.5% Market volume growth --> 3.2% AOK Tender : Among Top 3 in contracts 8 products/33 contracts (~ 18% of AOK volumes) Filed 8 dossiers and launched 10 new product Olanzapine damages --> Rs. 92 crs. Restructuring the organization to meet the requiremets of the new market model German business model: High volume, low margins Strategy to focus on absolute profitability
Rs. Crs.
20%
819
FY08
985
FY09
Top Brands Simvastatin . Alendron . Oxycodon . Omeprazol . Tramadol . Ramipril & HCT . Venlafaxin . Ibuprofen . Ramipril . Gabapentin .
Russia
Rs. Crs. 43%
Top Brands . Omez . Ciprolet . Nise . Enam . Ketorol . Exifine . Cetrine
406
580
FY08
FY09
Revenues in Russia increases to Rs 5.8 bn Rouble growth of 35% led by key brands of Omez, Nise, Ketorol and Bion Omez, Nise and Ketorol > $25million each Fastest growing international branded generic company by volumes (Source: Pharmexpert MAT Mar 09) Dr. Reddy’s volume growth --> 11.2% Industry’s volume growth --> (0.2%) Top 4 brands rank #1 in respective segments 9 brands in the Top 3 ranks OTC and hospital segment contribute 27% to total revenues Top-4 distributors > 80% of our revenues Revenues from Russia & CIS region crossed $150 mn
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09 Key Company Updates Dr. Reddy’s acquired Dowpharma’s Small Molecules business associated with Dow’s Mirfield and Cambridge, UK Sites The site at Mirfield is a manufacturing facility whereas the one at Cambridge is an R&D facility. This acquisition brings strengths in industrial synthesis of complex prostaglandins and carbohydrate chemistry. The proprietary chiral and biocatalysis technology at the Cambridge site and the scale up capability in the Mirfield site adds significant value to Dr. Reddy’s existing R&D and commercial infrastructure and positions it as a leading provider of Custom Pharmaceutical Services globally. We acquired BASF’s Pharmaceutical Contract Manufacturing Business and related facility at Shreveport, Louisiana, USA. This business involved the contract manufacturing of generic prescription and over-the-counter products for branded and generic companies in the US. The facility is designed to manufacture solid, semi-solid and liquid dosage forms. It also provides Dr. Reddy’s with an additional platform to further expand its portfolio of prescription generics, OTC capabilities and product portfolio and the ability to supply generic products to US government agencies. Dr. Reddy’s established its Generics business in Italy through acquisition of Jet Generici Srl. Dr. Reddy’s acquired Jet Generici Srl, a company engaged in the sale of generic finished dosages in Italy. The acquisition provided access to an essential product portfolio, a pipeline of registration applications, a sales and marketing organization and helped Dr. Reddy’s establish its business in the third largest pharmaceutical market in Europe. Dr Reddy’s launched ‘Atocor-R’ – combination of Atorvastatin and Ramipril in India It was the first such combination to be approved by DCGI and had completed a multi-centre clinical trial data on Indian patients.
PromiusTM Pharma – Dr. Reddy’s US Specialty business was launched Located in Bridgewater, NJ, PromiusTM Pharma will initially focus on the branded dermatology market, and is based on a platform of strategic licensing initiatives and internal product development activities undertaken over the last several years. Since its launch Promius has introduced two products in the market: EPICERAM® skin barrier emulsion and Scytera™ (coal tar) Foam 2% We entered the respiratory inhalers market in India with launch of ‘CombihaleTM’ & ‘RedihalerTM’ ‘Combihale™’ is a combination of a steroid and a long acting bronchodilator. It is used in the treatment of asthma. It is available along with ‘RedihalerTM’, a dry powder inhalation device that was designed in-house. Dr. Reddy’s launched the authorized generic version of Imitrex® Tablets We launched the authorized generic version of GlaxoSmith-Kline’s Imitrex® (sumatriptan succinate) tablets in 25mg, 50mg, and 100mg strengths in the United States thus becoming the first company to do so in the US market.
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09
Key Company Updates betapharm received preliminary results on AOK tender in Germany betapharm AG was offered 8 products in different regions of Germany covering the AOKinsured persons in the preliminary result of the tender by the Allgemeine Ortskrankenkassen (AOK). The tender results established betapharm’s competitiveness in the tender segment of the market in Germany.
Dr. Reddy’s announced settlement of Clarinex® (Desloratadine) ANDA patent litigation with Schering Corporation and Sepracor Inc. We entered into agreements with Schering and Sepracor which will allow us to manufacture and market generic versions of the CLARINEX-D®-12 Hour and CLARINEX-D® -24 Hour products, with six months marketing exclusivity, and the CLARINEX® REDITABS® product, with six months marketing co-exclusivity, starting in 2012. Dr. Reddy’s will also market a generic version of the CLARINEX® 5 milligram tablet six months after the launch of the first generic version of that product. Dr Reddy’s announced the appointment of Umang Vohra as the new Chief Financial Officer (CFO) Dr. Reddy’s realigned its Global Generics geography portfolio We realigned our Global Generics finished dosages strategy to focus on certain key geographies and would gradually exit some of the very small distributor driven markets. In addition to the US, India, Russia & CIS and Germany where our operations are already very large contributing to approx 90% of the Global Generics revenues, we will continue operations in 10-15 markets where our finished dosages sales are growing significantly. Dr. Reddy’s crossed $150 million revenue milestone in Russia & CIS region We entered the Russian market in 1992 and today are the largest Indian Pharmaceutical company in Russia. Dr. Reddy’s is the fastest growing international branded generic company by volume.
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09
Recognitions Dr Reddy’s was ranked the Best Workplace in the biotech pharmaceutical industry in India in a study conducted by The Ecnomic Times and the Great Place to Work Institute.
Dr. Reddy’s Foundation received the Economic Times’ Corporate Citizen Award for 200708. This award was in recognition for DRF’s “contribution to the public good through commitment to critical social causes that influence the lives and livelihood of thousands of needy Indians.
Dr. Reddy’s was awarded the Gold Shield in the category ‘Manufacturing and Trading Enterprises’ of the ICAI Awards for Excellence in Financial Reporting. Dr. Reddy’s UK was awarded the Unichem Generics Supplier for 2008. This prestigious award was presented by the industry’s biggest UK wholesaler / retailer.
Dr. Reddy’s North America Generic Team was honored at the HDMA Annual Leadership Forum in Washington DC by its customers as the BEST company in class with sales under $100 M USD to wholesalers and distributors in the US.
Dr. Reddy’s won the ‘Company with Best CSR & Sustainability Practices 2008’ award at the 9th International Conference on Corporate Governance & Sustainability organized by The Asian Centre for Corporate Governance & Sustainability and the Indian Merchants Chamber
Dr. Reddy’s won the EPCES Export Awards for outstanding export performance during the year 2006-07. Our company was adjudged the best EOU (Non SSI Category: Chemicals & Allied Products, Drugs & Pharmaceuticals & Allied Products). The award was conferred by the Export Promotion Council for EOUs and SEZs, Ministry of Commerce & Industry, Government of India. Public Relations Society of India conferred three awards on Dr. Reddy’s for the best all India House Journal, Websites and Photography.
The award for ‘NASSCOM - CNBC IT USER AWARD 2008 for the Pharmaceutical Vertical’ was conferred on our company at the NASSCOM-CNBC IT USER AWARDS 2008 Dr. Reddy’s won five awards at the annual Public Relations Council of India (PRCI) Corporate Collateral Awards competition along with the Overall Excellence Award for Communications Collaterals. Dr. Reddy’s received five coveted awards in the field of Human Resources at the World HRD Congress.
RedituxTM was conferred the ‘Product of the Year 2008’ by the Indian biotechnology magazine BioSpectrum.
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09
Social Initiatives
Primary class at Pudami School Set up in 1996, the Dr. Reddy’s Foundation makes an important contribution to sustainable social development through its pioneering programs in the areas of education and livelihood creation. Working in partnership with various state governments in India, DRF’s Livelihood Advancement Business School (LABS) and neighbourhood schools program reach out to thousands of underprivileged youth. DR. REDDY’S FOUNDATION The activities of Dr. Reddy’s Foundation (DRF) span two broad areas of social intervention: Livelihoods: Create, implement and disseminate sustainable and replicable livelihood models through partnerships. Education: Provide learning opportunities for those who have never been to school, or have dropped out of it; while improving quality of education across schools. Livelihoods Update Livelihood Advancement Business School (LABS): A total of 46,473 livelihoods were generated by LABS in 2008-09 taking the total no to over 1, 85,000 since inception. New LABS Partnerships were forged in the year with the following: Michael & Susan Dell Foundation Indira Kranthi Patham -Urban (UPADHI) Asha LABS with Tata Teleservices Self Help Groups, West Bengal Employment Generation & Marketing Mission (EGMM, Government of AP), IKP (Indira Kranthi Patham) LABS Exploring New Livelihood Options: Based on market needs analyses, new LABS curricula have been developed in the following domains: Retailing, Telecom Sales, Rural Marketing, Direct Selling, Banking, Financial Services & Insurance, Housekeeping, Security Services, Bengali Cuisine, Chinese Cuisine and Bakery & Confectionery.
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09 Social Initiatives Education Update Yuva Youth Learning Centers: Helps students prepare for the Class X Board exam. Also provides career counseling and job-related training. Transit Education Centers: Schools for children of migrant construction workers in Andhra Pradesh. Nearly 4000 children have been enrolled so far, with 120 teachers engaged in teaching them. Altius, the Advancement School, Hyderabad: Altius helps graduates and diploma holders access various career advancement opportunities by providing them requisite employability skills. Pudami Neighbourhood Schools: These schools address the rising demand for english-medium education from marginalized / lower-income communities. Kallam Anji Reddy Vidyalaya, Hyderabad: The Kallam Anji Reddy Vidyalaya has a current strength of over 1500 students. The school offers instruction in both English and Telugu medium. Kallam Anji Reddy Vocational Junior College, Hyderabad: Offers five 2-year vocational courses at the Intermediate level DR. REDDY’S FOUNDATION FOR HEALTH EDUCATION (DRFHE) Conducts programs like Post Graduate Certificate in Healthcare Management and Certificate Program in Cancer Counseling. Students passing out from these courses assist healthcare professionals and doctors in providing better care to patients. Life at Your Doorstep: Palliative care initiative that helps terminally ill patients and their families better manage serious illness
Photo: A training session at the DRFHE’s Patient Assistance Programme
Dr. Reddy’s Foundation won the ET Corporate Citizenship Award 2007-08 Dr. Reddy’s Foundation (DRF) won the Economic Times Corporate Citizen Award at the Economic Times Corporate Excellence Awards 2007-2008. This award was in recognition of DRF’s “contribution to the public good through commitment to critical social causes that influence the lives and livelihood of thousands of needy Indians.” A jury comprising global business leaders such as Pepsi Chairman & CEO Indra Nooyi, AV Birla Group Chairman Kumar Mangalam Birla, Wipro Chairman Azim Premji, Standard Chartered Group CEO Peter Sands, among others, chose Dr. Reddy’s not only because of its CSR record, but also because the company’s core business philosophy contributes to society.
Photo: Founder Chairman, Dr. K Anji Reddy receiving the award from the honorable Prime Minister of India, Dr. Manmohan Singh
Special mention was made of DRF’s Livelihood Advancement Business School (LABS) program, which has helped more than 1.85 lakh youth till date and has become a model for both NGOs and private companies. This award demonstrated how far Dr. Reddy’s has come in its journey to build a sustainable and highly respected company.
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
Pharmaceutical Services & Active Ingredients
Product Development
Integrated Product development Capabilities that includes API development, Formulations development and analytical development skills. One Integrated Product development facility in Hyderbad, INDIA.
6 FDA-approved plants in INDIA 1 Cytotoxic facility 1 FDA-approved plant in Mexico 1 FDA-approved plant in Mirfield, UK 3 Technology development centers (2 in Hyderabad, INDIA; 1 in Cambridge, UK)
Global Generics
New Chemical Entities
6 Formulation plants in INDIA (1 USFDA inspected) 1 USFDA inspected plant in USA
Two Research centers Conducts research in the areas of metabolic, cardiovascular, anti-bacterials, and pain & inflammation.
Biologics Biologics development center GMP production E coli and mammalian cell platforms
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
R&D Capabilities
Manufacturing Bandwidth
FY09
Manufacturing Bandwidth and R&D Capabilities
FY09
General Information About Dr. Reddy’s Established in 1984, Dr. Reddy’s Laboratories (NYSE: RDY) is an emerging global pharmaceutical company. As a fully integrated pharmaceutical company, our purpose is to provide affordable and innovative medicines through our three core businesses of: - Pharmaceutical Services and Active Ingredients: comprising of Active Pharmaceutical Ingredients and Custom Pharmaceutical Services - Global Generics, which includes branded and unbranded generics - Proprietary Products, which includes New Chemical Entities (NCEs), Differentiated Formulations, and Generic Biopharmaceuticals. Our products are marketed globally, with a focus on India, US, Europe and Russia. Dr. Reddy’s conducts NCE research in the areas of metabolic disorders, cardiovascular indications, anti-infectives and inflammation.
Safe Harbor This presentation contains forward-looking statements and information that involve risks, uncertainties and assumptions. Forwardlooking statements are all statements that concern plans, objectives, goals, strategies, future events or performance and underlying assumptions and other statements that are other than statements of historical fact, including, but not limited to, those that are identified by the use of words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “projects” and similar expressions. Risks and uncertainties that could affect us include, without limitation: General economic and business conditions in India The ability to successfully implement our strategy, our research and development efforts, growth and expansion plans and techn logical changes Changes in the value of the Rupee and other currency changes Changes in the Indian and international interest rates Allocations of funds by the Government Changes in laws and regulations that apply to our customers, suppliers, and the pharmaceutical industry Increasing competition in and the conditions of our customers, suppliers and the pharmaceutical industry Changes in political conditions in India Should one or more of such risks and uncertainties materialize, or should any underlying assumption prove incorrect, actual outcomes may vary materially from those indicated in the applicable forward-looking statements. Any forward-looking statement or information contained in this presentation speaks only as of the date of the statement. We are not required to update any such statement or information to either reflect events or circumstances that occur after the date the statement or information is made or to account for unanticipated events.
Contact Information Media Relations
Investor Relations
Mythili Mamidanna
Ph: +91-40-66511620 Fax: +91-40-23731955 Email: [email protected]
Kedar Upadhyay Ph: +91-40-66834297 Fax: +91-40-23731955 Email: [email protected]
Rajan S
Raghavender R
Ph: +91-40-66511725
Ph: +91-40-66511529
Email: [email protected]
Email: [email protected] Milan Kalawadia
Ph: +1 - 9082034931 Email: [email protected]
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
May 18, 2009 Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09 Business Update Overall revenues at Rs. 69.4 billion ($1.4 billion) in FY09 as against Rs. 50 billion ($983 million) in FY08, representing a growth of 39%. Operating income is at Rs. 11.2 billion ($220 million) in FY09 as against Rs. 5.4 billion ($107 million) in FY08 after adjusting for non cash impairment of intangibles and goodwill. EBITDA at Rs. 14.5 billion ($285 mn) in FY09 as against Rs. 9.7 billion ($190 mn) in FY08, representing a growth of 50%, higher than sales growth of 39%. Key growth drivers: Successful launch of the authorized generic version of GlaxoSmithKline’s Imitrex® (generic version: sumatriptan succinate), in late November 2008. Excluding revenues from Sumatriptan, YoY growth is at 24%, driven by the key markets of North America and Russia. During the year, the company launched 116 new generic products, filed 110 new generic product registrations and filed 55 DMFs globally.
Global Generics Revenues from Global Generics business at Rs. 49.8 billion ($979 million) in FY09 as against Rs. 33.0 billion ($649 million) in FY08. YoY growth of 51% driven by Sumatriptan and key markets of North America and Russia. Revenues from North America at Rs. 19.8 billion ($390 million) in FY09 as against Rs. 8.0 billion ($158 million) in FY08. Excluding revenues from Sumatriptan, the growth of 58% in North America was driven by high volume growth across existing top products and acquisition of Shreveport facility. Revenue from Shreveport facility at Rs. 1.7 billion ($33 million) in FY09. Revenues from Europe at Rs. 11.9 billion ($234 mn) in FY09 as against Rs. 10.2 billion ($201 mn) in FY08, representing a growth of 16%. Revenues from betapharm increase by 20% to Rs. 9.9 billion ($194 mn) in FY09 from Rs. 8.2 billion ($161 mn) in FY08. This increase was on account of volume growth in existing products and one-off seasonal vaccine sales in Q2 FY09 Revenues from Rest of Europe remain flat at Rs. 1.9 billion ($39 million) in FY09. During the year, the company launched 25 new products and filed 11 dossiers across Europe. Revenues from Russia & Other CIS markets at Rs. 7.6 billion ($150 million) in FY09 as against Rs. 5.5 billion ($109 million) in FY08, representing a growth of 38%. Revenues in Russia increase to Rs. 5.8 billion ($114 million) in FY09 as against Rs. 4.1 billion ($80 million) in FY08. YoY growth of 43% driven by key brands of Omez, Nise, Ketorol, Cetrine and Bion. Revenues in Other CIS markets increase to Rs. 1.8 billion ($36 million) in FY09 as against Rs. 1.5 billion ($29 million) in FY08. YoY growth of 25%. Revenues in India increase to Rs. 8.5 billion ($167 million) in FY09 from Rs. 8.1 billion ($158 million), representing a growth of 5%. 36 new products launched during the year.
Pharmaceutical Services & Active Ingredients (PSAI) Revenues from this segment increase to Rs. 18.8 billion ($369 million) in FY09 as against Rs. 16.6 billion ($327 million) in FY08. YoY growth of 13% driven by growth in North America and RoW markets as well as benefit by depreciation of rupee against the dollar. Revenue from the business & facility acquired from Dow Pharma at Rs. 1.0 billion ($20 million)in FY09. During the year, 55 DMFs were filed globally (21 in US, 19 in Europe, 5 in Canada and 10 in RoW). Cumulative DMFs filed till date at 351.
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09 Financial Updates All figures in millions, except EPS All dollar figures based on convenience translation rate of 1USD = Rs 50.87
Dr. Reddy’s Laboratories Ltd. and Subsidiaries Unaudited Condensed Consolitated Interim Income Statement FY09 Particulars Revenue Cost of Revenues Gross Profit Operating Expenses Selling, general & administrative expenses(a) Reserach and development expenses, net Write down of intangible assets Write down of goodwill Other (income)/expenses, net Total Operating Expenses Results from operating activities Finance income(b) Finance expenses(c) Finance expenses, net Share of profit/ (loss) of equity accounted investees Profit before income tax Income tax expense Profit for the period Attributable to: Equity holders of the company Minority interest Profit for the period
Weighted average no. of shares o/s Diluted EPS Exchange rate
FY08
($)
(Rs.)
%
($)
(Rs.)
%
1,365 648 718
69,441 32,941 36,500
100 47 53
983 484 499
50,006 24,598 25,408
100 49 51
39 34 44
413 79 62 213 5 773 (56) (9) 33 23 0
21,020 4,037 3,167 10,856 253 39,333 (2,833) (482) 1,668 1,186 24
30 6 5 16 0 57 (4) (1) 2 2 0
331 69 59 2 (8) 453 46 (31) 21 (10) 0
16,835 3,533 3,011 90 (402) 23,067 2,341 (1,601) 1,080 (521) 2
34 7 6 0 (1) 46 5 (3) 2 (1) 0
25 14 71 (70) 54 1,100
(79) (23) (102)
(3,995) (1,173) (5,168)
(6) (2) (7)
56 19 75
2,864 972 3,836
6 2 8
-
(102) 0 (102)
(5,168) 0 (5,168)
(7) 0 (7)
76 (0) 75
3,846 (10) 3,836
8 (0) 8
-
(0.6)
169 (30.7) 50.87
0.4
169 22.8 50.87
(a) Includes amortization charges of Rs. 1,503 million in FY09 and Rs. 1,588 million in FY08. (b) Includes forex gain of Rs. 739 million in FY08. (c) Includes forex loss of Rs. 634 million in FY09.
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
Growth%
FY09
Financial Updates Key Balance Sheet Items
(in millions)
As on 31st Mar 08
As on 31st Mar 09
Cash and cash equivalents Investments (current & non-current) Trade and other receivables Inventories Property, plant and equipment Loans and borrowings (current & non-current) Trade accounts payable Total Equity
($)
(Rs.)
($)
(Rs.)
110 10 282 260 410 387 118 827
5,603 530 14,368 13,226 20,881 19,701 5,987 42,045
146 93 134 219 330 380 107 931
7,421 4,753 6,823 11,133 16,765 19,352 5,427 47,350
Income Statement Highlights Gross profit increase by 44% to Rs. 36.5 billion ($718 million) in FY09 as against Rs. 25.4 billion ($499 million) in FY08. Gross profit margins on total revenues at 53% as against 51% in FY08, largely driven by attractive margins on sumatriptan. Selling, General & Administration (SG&A) expenses increase to Rs. 21.0 billion ($413 million) in FY09 from Rs. 16.8 billion ($331 million) in FY08. SG&A expenses as a % to sales is at 30% in FY09 as against 34% in FY08. The absolute increase is in line with a higher sales growth and coupled with a higher impact of currency on expenses outside India; however, it was offset by control measures to optimize spending on expenses such as travel, General & Administration expenses and others. Other operating expenses of Rs. 253 million in FY09 includes Rs. 921 million as damages on account of the German court upholding the validity of the olanzapine patent. R&D investments at 6% of total revenues in FY09 as against 7% in FY08. YoY growth of 14%. Finance costs (net) are at Rs. 1.2 billion in FY09 as against Finance income (net) at Rs. 521 million in FY08. The increase is mainly on account of : Net forex loss of Rs. 634 million in FY09 as against net forex gain of Rs. 739 million in FY08. Net interest expense of Rs. 687 million in FY09 as against net interest expense of Rs. 329 million in FY08. PAT adjusted for one time exceptions is at Rs. 8.5 billion ($167 million) as against Rs. 4.5 billion ($88 million) in FY08. Adjusted EPS of Rs. 50.3 ($1.0) in FY09 as against adjusted EPS of Rs. 26.6 ($0.5), representing a growth of 89%. Cash profit in FY09 at Rs. 11.7 billion ($229 million) as against Rs. 7.9 billion ($154 million) in FY08, representing a growth of 48%. Capital expenditure for FY09 is at Rs. 4.4 billion ($87 million).
Revenue Mix by Geography
FY09 $
FY09 INR
as a %
FY08 $
(in millions)
FY08 INR
as a %
Growth %
North America
472
24,012
35
224
11,374
23
111
Europe
355
18,047
26
312
15,863
32
14
India
225
11,460
17
212
10,772
22
6
109
5,526
11
38
6,470
13
28
50,006
100
39
Russia & other CIS
150
7,623
11
Others
163
8,299
12 127
TOTAL
1,365 69,441 100
9 83
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09 Financial Update Revenue Mix by Segment
Global Generics North America Europe India Russia & other CIS Others PSAI (Pharmaceutical Services & Active Ingredients) North America Europe India Others Proprietary Products Others Total
RoW 196 Russia & CIS 762 India 848 Europe 1,189
North America 1,984
Rs. Crs
g=147%
FY09 $
FY09 INR
as a FY08 % $
979 390 234 167 150 39 369 76 121 47 125 06 12 1,365
49,790 19,843 11,886 8,478 7,623 1,959 18,758 3,875 6,160 2,383 6,340 294 599 69,441
72 40 24 17 15 04 27 21 33 13 34 00 01 100
649 158 201 158 109 24 327 66 111 46 104 01 06 983
FY08 INR
as a %
33,023 66 8,024 24 10,216 31 8,060 24 5,526 17 1,197 04 16,622 33 3,350 20 5,647 34 2,352 14 5,273 32 39 00 321 01 50,006 100
Rs. 6,944 Crs. g --> 39%
Global Generics Rs. 4,979 Crs. g-->51%
g=38%
g=16%
(in millions)
Consolidated Revenue
g=64%
g=5%
Others Rs. 89 Crs. PSAI Rs. 1,876 Crs. g-->13%
51 147 16 05 38 64 13 16 09 01 20 651 86 39
g=Growth Rs. Crs
g=20%
Row=634
g=1%
India=238
g=9%
Europe=616
g=16%
Global Generics
Growth %
North America=388
PSAI
Key P&L Items for FY09 Revenue
Gross Margins
Rs. 6,944 Crs YoY growth --> 39%
Rs. 3,650 Crs 53% to sales YoY growth--> 44%
EBITDA Rs. 1,451 Crs 21% to sales YoY growth --> 50%
Cash Profit* Rs. 1,166 Crs 17% to sales YoY growth --> 26%
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
*Cash Profit = Net Profit + Non cash expenses (depreciation + amortization + impairment)
FY09
Q4 FY09 Highlights Overall revenues at Rs. 19.8 billion ($390 million) in Q4 FY09 as against Rs. 13.2 billion ($261 million) in Q4 FY08, representing a growth of 50%. The growth was majorly driven by the successful launch of the authorized generic version of GlaxoSmithKline’s Imitrex® (generic version: sumatriptan succinate), in late November 2008. Excluding revenues from Sumatriptan, the YoY growth is at 23%. Operating income at Rs. 4.6 billion ($90 million) in Q4 FY09 as against Rs. 1.4 billion ($28 million) in Q4 FY08 after adjusting for non-cash impairment. EBITDA at Rs. 5.5 billion ($108 million) in Q4 FY09 as against Rs. 2.6 billion ($51 million) in Q4 FY08, representing a growth of 113%. Revenues from Global Generics business at Rs. 14.7 billion ($288 million) in Q4 FY09 as against Rs. 8.7 billion ($172 million) in Q4 FY08. YoY growth of 68% driven by sumatriptan and key markets of North America and Russia. Excluding revenues from Sumatriptan, the growth of 44% in North America was driven by new product launches like Divalproex, Levetiracetam and acquisition of the Shreveport facility. Revenue growth of 88% in Russia driven by key brands of Omez, Nise, Ketorol and Cetrine. Revenues from Pharmaceutical Services & Active Ingredients (PSAI) increase by 11% to Rs. 4.9 billion ($96 million) in Q4 FY09 as against Rs. 4.4 billion ($86 million) in Q4 FY08.
Revenue Mix by Segment
Q4FY09 Q4 FY09 $ INR
Global Generics North America Europe India Russia & other CIS Others PSAI (Pharmaceutical Services & Active Ingredients) North America Europe India Others Proprietary Products Others Total
14,670 7,205 3,096 2,072 1,834 462 4,859 833 2,153 572 1,302 177 145 19,851
288 142 61 41 36 09 96 16 42 11 26 03 03 390
Revenue Mix by Geography
(in millions)
as a Q4 FY08 Q4 FY08 as a % $ INR %
Growth %
8,744 66 2,466 28 2,905 33 1,993 23 1,055 12 04 325 4,373 33 10 441 1,730 40 13 548 1,654 38 00 04 01 132 13,253 100
68 192 07 04 74 42 11 89 24 04 (21) 4,356 10 50
73 49 21 14 13 03 24 17 44 12 27 01 01 100
172 48 57 39 21 06 86 09 34 11 33 00 03 261
(in millions)
Q4 FY09 Q4 FY09 as a Q4 FY08 Q4 FY08 as a $ INR % $ INR %
North America
161
8,215
41
Europe
103
5,249
26
91
India
55
2,789
14
53
Russia & other CIS
36
1,834
9
21
Others
35
1,763
9
TOTAL
390
19,851 100
57
2,908
Growth %
22
183
4,636
35
13
2,675
20
4
1,055
8
74
39
1,979
15
(11)
261
13,253
100
50
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09
Driving Sustainable Long-term growth FY09 Guidance Achievement Revenue Guidance --> 25% Growth
Gross Margin Guidance --> ~50% Levels
Revenue (Rs. Crs)
Gross Margin (% to Sales)
54.3%
55.8%
FY09 -------------------------------------------- 52.6%
g=39%
49.8% 5,001
6,944
FY08
FY09
49.3%
Q2FY09
Q1FY09
R&D Margin Guidance --> 7% of Sales
Q3FY09
Q4FY09
Guidance --> Improved Profitability
R&D Margin (% to Sales)
7.0%
PAT* (% to Sales)
FY09 -------------------------------------------- 5.8%
Q1FY09
Q2FY09
5.7%
5.6%
5.1%
12.3%
Q3FY09
9.0%
Q4FY09
FY08
FY09 * Adjusted for one time exceptions
Consistent Growth Momentum
(For Last Eight Quarters)
Rs. Crs
Revenue g--25% g--30%
1,198
1,245
1,232 1,325
1,504 1,615
g--49%
Rs. Crs
Adjusted PAT*
g--50%
1,840 1,985 135
Q1FY08 Q2FY08 Q3FY08 Q4FY08 Q1FY09 Q2FY09 Q3FY09 Q4FY09
80
70
100
132
146
302
328
Q1FY08 Q2FY08 Q3FY08 Q4FY08 Q1FY09 Q2FY09 Q3FY09 Q4FY09
* Adjusted for Forex, one time write downs and tax benefits
Global Launches & Filings in FY09 ANDAs ANDS Dossiers Dossiers DMFs Filings = 20 + 03 + (Europe) + (RoW) + 55 110 76 11
North New India RoW Specialty Europe = America Launches + 25 + 36 + 39 + 02 16 118
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09
Quick Facts - FY09 Global Generics - Key Markets North America
Rs. Crs.
1,984 147%
719
Sumatriptan
168
Acquisition
Top Products . Sumatriptan AG . Fexofenadine . Glimepiride . Oxaprozin . Ondansetron . Meprobamate . Divalproex . Simvastatin . Finasteride . Ciprofloxacin . Tizanadine
802
1,097
FY08
FY09
Base Business
Revenues at Rs 19.8 bn ($390 mn) in FY09 Successful launch of the AG version of GSK’s Imitrex® Current market share ~ 50% Revenues excluding sumatriptan grew by 58% in rupee terms and 24% in dollar terms 16 new product launched. Received 23 ANDA approvals. Total No of ANDAs filed till date: 144 Filed 20 ANDAs ; 69 pending approval (30 are Para IVs and 18 are FTFs) addressing innovator sales of $46 bn Settled Desloratadine --> IMS $50 mn Favorable summary judgment ruling in the Omeprazole Mg OTC litigation Fondaparinux ANDA filed under ‘GIVE’
India Growth flat --> change in supply chain model to a replenishment based model Sub-industry growth because of lack of adequate new product launches and change in supply chain model Launched 36 new products New product launches in the last 36 months contributed 14% of total revenues Action Plan: To capitalize on our brand equity strength with GPs/ CPs To address the issue of penetration in potential areas like rural and northern regions. To address portfolio width gap.
5%
Rs. Crs.
Top Brands 806
848
FY08
FY09
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
Omez . Nise . Stamlo . Stamlo Beta . Atocor . Razo . Omez-DSR . Reditux . Mintop . Enam .
FY09 Quick Facts - FY09 Global Generics - Key Markets Germany High volume growth in existing products offset by price declines betapharm volume growth --> 16.5% Market volume growth --> 3.2% AOK Tender : Among Top 3 in contracts 8 products/33 contracts (~ 18% of AOK volumes) Filed 8 dossiers and launched 10 new product Olanzapine damages --> Rs. 92 crs. Restructuring the organization to meet the requiremets of the new market model German business model: High volume, low margins Strategy to focus on absolute profitability
Rs. Crs.
20%
819
FY08
985
FY09
Top Brands Simvastatin . Alendron . Oxycodon . Omeprazol . Tramadol . Ramipril & HCT . Venlafaxin . Ibuprofen . Ramipril . Gabapentin .
Russia
Rs. Crs. 43%
Top Brands . Omez . Ciprolet . Nise . Enam . Ketorol . Exifine . Cetrine
406
580
FY08
FY09
Revenues in Russia increases to Rs 5.8 bn Rouble growth of 35% led by key brands of Omez, Nise, Ketorol and Bion Omez, Nise and Ketorol > $25million each Fastest growing international branded generic company by volumes (Source: Pharmexpert MAT Mar 09) Dr. Reddy’s volume growth --> 11.2% Industry’s volume growth --> (0.2%) Top 4 brands rank #1 in respective segments 9 brands in the Top 3 ranks OTC and hospital segment contribute 27% to total revenues Top-4 distributors > 80% of our revenues Revenues from Russia & CIS region crossed $150 mn
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09 Key Company Updates Dr. Reddy’s acquired Dowpharma’s Small Molecules business associated with Dow’s Mirfield and Cambridge, UK Sites The site at Mirfield is a manufacturing facility whereas the one at Cambridge is an R&D facility. This acquisition brings strengths in industrial synthesis of complex prostaglandins and carbohydrate chemistry. The proprietary chiral and biocatalysis technology at the Cambridge site and the scale up capability in the Mirfield site adds significant value to Dr. Reddy’s existing R&D and commercial infrastructure and positions it as a leading provider of Custom Pharmaceutical Services globally. We acquired BASF’s Pharmaceutical Contract Manufacturing Business and related facility at Shreveport, Louisiana, USA. This business involved the contract manufacturing of generic prescription and over-the-counter products for branded and generic companies in the US. The facility is designed to manufacture solid, semi-solid and liquid dosage forms. It also provides Dr. Reddy’s with an additional platform to further expand its portfolio of prescription generics, OTC capabilities and product portfolio and the ability to supply generic products to US government agencies. Dr. Reddy’s established its Generics business in Italy through acquisition of Jet Generici Srl. Dr. Reddy’s acquired Jet Generici Srl, a company engaged in the sale of generic finished dosages in Italy. The acquisition provided access to an essential product portfolio, a pipeline of registration applications, a sales and marketing organization and helped Dr. Reddy’s establish its business in the third largest pharmaceutical market in Europe. Dr Reddy’s launched ‘Atocor-R’ – combination of Atorvastatin and Ramipril in India It was the first such combination to be approved by DCGI and had completed a multi-centre clinical trial data on Indian patients.
PromiusTM Pharma – Dr. Reddy’s US Specialty business was launched Located in Bridgewater, NJ, PromiusTM Pharma will initially focus on the branded dermatology market, and is based on a platform of strategic licensing initiatives and internal product development activities undertaken over the last several years. Since its launch Promius has introduced two products in the market: EPICERAM® skin barrier emulsion and Scytera™ (coal tar) Foam 2% We entered the respiratory inhalers market in India with launch of ‘CombihaleTM’ & ‘RedihalerTM’ ‘Combihale™’ is a combination of a steroid and a long acting bronchodilator. It is used in the treatment of asthma. It is available along with ‘RedihalerTM’, a dry powder inhalation device that was designed in-house. Dr. Reddy’s launched the authorized generic version of Imitrex® Tablets We launched the authorized generic version of GlaxoSmith-Kline’s Imitrex® (sumatriptan succinate) tablets in 25mg, 50mg, and 100mg strengths in the United States thus becoming the first company to do so in the US market.
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09
Key Company Updates betapharm received preliminary results on AOK tender in Germany betapharm AG was offered 8 products in different regions of Germany covering the AOKinsured persons in the preliminary result of the tender by the Allgemeine Ortskrankenkassen (AOK). The tender results established betapharm’s competitiveness in the tender segment of the market in Germany.
Dr. Reddy’s announced settlement of Clarinex® (Desloratadine) ANDA patent litigation with Schering Corporation and Sepracor Inc. We entered into agreements with Schering and Sepracor which will allow us to manufacture and market generic versions of the CLARINEX-D®-12 Hour and CLARINEX-D® -24 Hour products, with six months marketing exclusivity, and the CLARINEX® REDITABS® product, with six months marketing co-exclusivity, starting in 2012. Dr. Reddy’s will also market a generic version of the CLARINEX® 5 milligram tablet six months after the launch of the first generic version of that product. Dr Reddy’s announced the appointment of Umang Vohra as the new Chief Financial Officer (CFO) Dr. Reddy’s realigned its Global Generics geography portfolio We realigned our Global Generics finished dosages strategy to focus on certain key geographies and would gradually exit some of the very small distributor driven markets. In addition to the US, India, Russia & CIS and Germany where our operations are already very large contributing to approx 90% of the Global Generics revenues, we will continue operations in 10-15 markets where our finished dosages sales are growing significantly. Dr. Reddy’s crossed $150 million revenue milestone in Russia & CIS region We entered the Russian market in 1992 and today are the largest Indian Pharmaceutical company in Russia. Dr. Reddy’s is the fastest growing international branded generic company by volume.
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09
Recognitions Dr Reddy’s was ranked the Best Workplace in the biotech pharmaceutical industry in India in a study conducted by The Ecnomic Times and the Great Place to Work Institute.
Dr. Reddy’s Foundation received the Economic Times’ Corporate Citizen Award for 200708. This award was in recognition for DRF’s “contribution to the public good through commitment to critical social causes that influence the lives and livelihood of thousands of needy Indians.
Dr. Reddy’s was awarded the Gold Shield in the category ‘Manufacturing and Trading Enterprises’ of the ICAI Awards for Excellence in Financial Reporting. Dr. Reddy’s UK was awarded the Unichem Generics Supplier for 2008. This prestigious award was presented by the industry’s biggest UK wholesaler / retailer.
Dr. Reddy’s North America Generic Team was honored at the HDMA Annual Leadership Forum in Washington DC by its customers as the BEST company in class with sales under $100 M USD to wholesalers and distributors in the US.
Dr. Reddy’s won the ‘Company with Best CSR & Sustainability Practices 2008’ award at the 9th International Conference on Corporate Governance & Sustainability organized by The Asian Centre for Corporate Governance & Sustainability and the Indian Merchants Chamber
Dr. Reddy’s won the EPCES Export Awards for outstanding export performance during the year 2006-07. Our company was adjudged the best EOU (Non SSI Category: Chemicals & Allied Products, Drugs & Pharmaceuticals & Allied Products). The award was conferred by the Export Promotion Council for EOUs and SEZs, Ministry of Commerce & Industry, Government of India. Public Relations Society of India conferred three awards on Dr. Reddy’s for the best all India House Journal, Websites and Photography.
The award for ‘NASSCOM - CNBC IT USER AWARD 2008 for the Pharmaceutical Vertical’ was conferred on our company at the NASSCOM-CNBC IT USER AWARDS 2008 Dr. Reddy’s won five awards at the annual Public Relations Council of India (PRCI) Corporate Collateral Awards competition along with the Overall Excellence Award for Communications Collaterals. Dr. Reddy’s received five coveted awards in the field of Human Resources at the World HRD Congress.
RedituxTM was conferred the ‘Product of the Year 2008’ by the Indian biotechnology magazine BioSpectrum.
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09
Social Initiatives
Primary class at Pudami School Set up in 1996, the Dr. Reddy’s Foundation makes an important contribution to sustainable social development through its pioneering programs in the areas of education and livelihood creation. Working in partnership with various state governments in India, DRF’s Livelihood Advancement Business School (LABS) and neighbourhood schools program reach out to thousands of underprivileged youth. DR. REDDY’S FOUNDATION The activities of Dr. Reddy’s Foundation (DRF) span two broad areas of social intervention: Livelihoods: Create, implement and disseminate sustainable and replicable livelihood models through partnerships. Education: Provide learning opportunities for those who have never been to school, or have dropped out of it; while improving quality of education across schools. Livelihoods Update Livelihood Advancement Business School (LABS): A total of 46,473 livelihoods were generated by LABS in 2008-09 taking the total no to over 1, 85,000 since inception. New LABS Partnerships were forged in the year with the following: Michael & Susan Dell Foundation Indira Kranthi Patham -Urban (UPADHI) Asha LABS with Tata Teleservices Self Help Groups, West Bengal Employment Generation & Marketing Mission (EGMM, Government of AP), IKP (Indira Kranthi Patham) LABS Exploring New Livelihood Options: Based on market needs analyses, new LABS curricula have been developed in the following domains: Retailing, Telecom Sales, Rural Marketing, Direct Selling, Banking, Financial Services & Insurance, Housekeeping, Security Services, Bengali Cuisine, Chinese Cuisine and Bakery & Confectionery.
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
FY09 Social Initiatives Education Update Yuva Youth Learning Centers: Helps students prepare for the Class X Board exam. Also provides career counseling and job-related training. Transit Education Centers: Schools for children of migrant construction workers in Andhra Pradesh. Nearly 4000 children have been enrolled so far, with 120 teachers engaged in teaching them. Altius, the Advancement School, Hyderabad: Altius helps graduates and diploma holders access various career advancement opportunities by providing them requisite employability skills. Pudami Neighbourhood Schools: These schools address the rising demand for english-medium education from marginalized / lower-income communities. Kallam Anji Reddy Vidyalaya, Hyderabad: The Kallam Anji Reddy Vidyalaya has a current strength of over 1500 students. The school offers instruction in both English and Telugu medium. Kallam Anji Reddy Vocational Junior College, Hyderabad: Offers five 2-year vocational courses at the Intermediate level DR. REDDY’S FOUNDATION FOR HEALTH EDUCATION (DRFHE) Conducts programs like Post Graduate Certificate in Healthcare Management and Certificate Program in Cancer Counseling. Students passing out from these courses assist healthcare professionals and doctors in providing better care to patients. Life at Your Doorstep: Palliative care initiative that helps terminally ill patients and their families better manage serious illness
Photo: A training session at the DRFHE’s Patient Assistance Programme
Dr. Reddy’s Foundation won the ET Corporate Citizenship Award 2007-08 Dr. Reddy’s Foundation (DRF) won the Economic Times Corporate Citizen Award at the Economic Times Corporate Excellence Awards 2007-2008. This award was in recognition of DRF’s “contribution to the public good through commitment to critical social causes that influence the lives and livelihood of thousands of needy Indians.” A jury comprising global business leaders such as Pepsi Chairman & CEO Indra Nooyi, AV Birla Group Chairman Kumar Mangalam Birla, Wipro Chairman Azim Premji, Standard Chartered Group CEO Peter Sands, among others, chose Dr. Reddy’s not only because of its CSR record, but also because the company’s core business philosophy contributes to society.
Photo: Founder Chairman, Dr. K Anji Reddy receiving the award from the honorable Prime Minister of India, Dr. Manmohan Singh
Special mention was made of DRF’s Livelihood Advancement Business School (LABS) program, which has helped more than 1.85 lakh youth till date and has become a model for both NGOs and private companies. This award demonstrated how far Dr. Reddy’s has come in its journey to build a sustainable and highly respected company.
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
Pharmaceutical Services & Active Ingredients
Product Development
Integrated Product development Capabilities that includes API development, Formulations development and analytical development skills. One Integrated Product development facility in Hyderbad, INDIA.
6 FDA-approved plants in INDIA 1 Cytotoxic facility 1 FDA-approved plant in Mexico 1 FDA-approved plant in Mirfield, UK 3 Technology development centers (2 in Hyderabad, INDIA; 1 in Cambridge, UK)
Global Generics
New Chemical Entities
6 Formulation plants in INDIA (1 USFDA inspected) 1 USFDA inspected plant in USA
Two Research centers Conducts research in the areas of metabolic, cardiovascular, anti-bacterials, and pain & inflammation.
Biologics Biologics development center GMP production E coli and mammalian cell platforms
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
R&D Capabilities
Manufacturing Bandwidth
FY09
Manufacturing Bandwidth and R&D Capabilities
FY09
General Information About Dr. Reddy’s Established in 1984, Dr. Reddy’s Laboratories (NYSE: RDY) is an emerging global pharmaceutical company. As a fully integrated pharmaceutical company, our purpose is to provide affordable and innovative medicines through our three core businesses of: - Pharmaceutical Services and Active Ingredients: comprising of Active Pharmaceutical Ingredients and Custom Pharmaceutical Services - Global Generics, which includes branded and unbranded generics - Proprietary Products, which includes New Chemical Entities (NCEs), Differentiated Formulations, and Generic Biopharmaceuticals. Our products are marketed globally, with a focus on India, US, Europe and Russia. Dr. Reddy’s conducts NCE research in the areas of metabolic disorders, cardiovascular indications, anti-infectives and inflammation.
Safe Harbor This presentation contains forward-looking statements and information that involve risks, uncertainties and assumptions. Forwardlooking statements are all statements that concern plans, objectives, goals, strategies, future events or performance and underlying assumptions and other statements that are other than statements of historical fact, including, but not limited to, those that are identified by the use of words such as “anticipates,” “believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “projects” and similar expressions. Risks and uncertainties that could affect us include, without limitation: General economic and business conditions in India The ability to successfully implement our strategy, our research and development efforts, growth and expansion plans and techn logical changes Changes in the value of the Rupee and other currency changes Changes in the Indian and international interest rates Allocations of funds by the Government Changes in laws and regulations that apply to our customers, suppliers, and the pharmaceutical industry Increasing competition in and the conditions of our customers, suppliers and the pharmaceutical industry Changes in political conditions in India Should one or more of such risks and uncertainties materialize, or should any underlying assumption prove incorrect, actual outcomes may vary materially from those indicated in the applicable forward-looking statements. Any forward-looking statement or information contained in this presentation speaks only as of the date of the statement. We are not required to update any such statement or information to either reflect events or circumstances that occur after the date the statement or information is made or to account for unanticipated events.
Contact Information Media Relations
Investor Relations
Mythili Mamidanna
Ph: +91-40-66511620 Fax: +91-40-23731955 Email: [email protected]
Kedar Upadhyay Ph: +91-40-66834297 Fax: +91-40-23731955 Email: [email protected]
Rajan S
Raghavender R
Ph: +91-40-66511725
Ph: +91-40-66511529
Email: [email protected]
Email: [email protected] Milan Kalawadia
Ph: +1 - 9082034931 Email: [email protected]
Dr. Reddy’s Laboratories Ltd. www.drreddys.com
Related Documents
Dr. Reddy's Fy09 Financial Reckoner
May 2020 4
Reddys
June 2020 2
Dr. Reddy's Reckoner Q1 Fy10
May 2020 9
Da Reckoner 010109
April 2020 7
Da Ready Reckoner
April 2020 7