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Aug 12, 2017 02:00 PM IST | Source: Moneycontrol.com

Pharma weekly wrap: Pharma stocks had tough week due to GST and pricing pressures in US

The news highlights in the sector include first quarter results of Sun Pharma, Aurobindo Pharma, Cipla, Cadila Healthcare among others. The US pricing pressure looks more structural than a temporary event.

Pharma weekly wrap: Pharma stocks had tough week due to GST and pricing pressures in US

Viswanath Pilla

Moneycontrol News

For pharmaceutical stocks, this past week was one of the worst - many have sunk on weak Q1 results due to destocking of channel on account of GST rollout and US pricing pressures. The weak global cues also didn't help the matters.

The news highlights in the sector include first quarter results of Sun Pharma, Aurobindo Pharma, Cipla, Cadila Healthcare among others. The US pricing pressure looks more structural than a temporary event.

How did Pharma Index Perform?

The BSE Healthcare index declined 8.13 percent in the past week, while the benchmark Sensex dropped 4.04 percent.

None of the big pharma stocks have seen gains this past week.

Sun Pharma (-11.13 percent), Cadila Healthcare (-11.35 percent), Glenmark (-10.99 percent) and Dr Reddy's (-10.37 percent) have lost one-tenth of their market value. Natco Pharma (-26.05 percent) was worst hit shedding almost a quarter of its value.

The rest of the pack saw huge dips of their share prices.

Lupin (-5.3 percent), Cipla (-4.79 percent), Aurobindo Pharma (-3.98 percent), Divis (-8.36 percent), Torrent Pharma (-4.81 percent) and Biocon (4.61 percent).

Here's What Kept the Sector Buzzing:

Sun Pharma, India's largest drug maker reported Rs crore 425 loss in Q1 impacted by steep pricing pressure, GST and one-time write-off.The company said thing could see improvement in second half. The company also said it had completed remedial measures and is awaiting US re-inspection of its critical Halol facility.

http://www.moneycontrol.com/news/business/earnings-business/sun-pharma-posts-q1-loss-at-rs-425-cr-on-settlement-provision-us-biz-drags-revenue-25-2357681.html

http://www.moneycontrol.com/news/business/companies/sun-pharma-says-it-sought-re-inspection-of-its-halol-facility-awaiting-us-fda-response-2358227.html

Aurobindo Pharma, India's third largest drug maker posted a 11.4 percent decline in net profit to Rs 518.5 crore for the first quarter ended June FY18 with flat US generics sales and drop in revenues of API and anti-retrovirals impacting the bottomline, despite surge in Europe business.The company reported a net profit of Rs 585 crore in the corresponding quarter of the previous year. The revenues declined 2.3 percent to Rs 3678.75 crore for the quarter ended June.

http://www.moneycontrol.com/news/business/earnings-business/aurobindo-pharma-q1-net-profit-drops-11-4-to-rs-518-cr-2355263.html

Cipla was one of very few companies that was able to wither the storm. The company posted 21 percent rise in net profit to Rs 409 crores on a year-on-year basis for the first quarter ended June 30 reigning in expenses and enhancing operational efficiency.

http://www.moneycontrol.com/news/business/earnings-business/cipla-profit-rises-21-to-rs-409-cr-in-q1-on-cost-controls-operational-efficiency-2357463.html

Dr.Reddy's regulatory woes surfaced again this week with German regulator revoking the GMP certificate of company's Bachupally Unit-2 formulation plant.

http://www.moneycontrol.com/news/business/companies/german-regulator-revokes-gmp-certificate-of-dr-reddys-bachupally-plant-for-non-compliance-2356341.html
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