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Fresenius Kabi Oncology

BSE: 532545|NSE: FKONCO|ISIN: INE575G01010|SECTOR: Pharmaceuticals
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Fresenius Kabi Oncology is not traded in the last 30 days
Fresenius Kabi Oncology is not traded in the last 30 days
Mar 12
Chairman's Speech (Fresenius Kabi Oncology) Year : Mar '13
Dear Shareholders,
 
 It is with great pleasure that I extend to you the warmest greetings on
 behalf of Fresenius Kabi Oncology Limited, all its employees and on my
 own behalf. It is once again my privilege to address you at the end of
 another eventful year marking your Company''s endeavors towards
 reinforcing its growth. While there were notable successes and
 significant milestones crossed, we were reminded of the risks to which
 we are continuously exposed, owing to the fact that we operate in an
 industry which is subject to most stringent regulation not only by
 Indian authorities, but by so many foreign regulators in our export
 markets. Therefore, we avowed to renew our commitment to exercise
 utmost vigilance over our manufacturing operations. The business
 environment both international and in India remained turbulent, but
 despite that, I am glad to announce that your Company navigated these
 rough waters well and reworked business strategies to post heartening
 results.
 
 A recuperating US economy, stagnant Europe and worldwide slow growth
 had its repercussions on the global healthcare industry, with developed
 nations initiating aggressive cost containment measures. Even during
 this period of austerity, our international business, driven by the
 sale of high value products in the European markets, continued to be at
 the core of our growth story. Thanks to a diligent and professional
 approach, we were able to expand our presence in the key Pharmerging
 Markets of Latin- America, Asia, Middle-East and CIS countries.
 
 Coming to the business environment in India, there were numerous
 landmark developments on the Government policy front during the year.
 The Government of India announced a new pricing policy which brought
 348 drugs listed in the National List of Essential Medicines
 (NLEM-2011) under price control as against 74 drugs covered in DPCO
 1995. The NLEM includes a number of our products whose prices will now
 be controlled. The only positive aspect is that in Drug Price Control
 Order (DPCO) 2013, the ceiling prices will be transparently fixed by
 the government on the basis of actual market prices of brands as
 against discretionary cost based method used earlier under DPCO 1995.
 
 There were a number of patent litigations, judgments, and granting of
 compulsory licenses which will determine the freedom of the generic
 companies in India such as ourselves to produce the subject molecules.
 We are examining the implications of these developments on our product
 portfolio and are working towards ensuring that our operating model
 remains resilient to future changes.
 
 As we move forward, our focus on R&D to deliver innovative products to
 cancer patients across the world remains steadfast. The year under
 review saw our R&D team develop many new formulations, including a
 platform technology to create the difficult-to-formulate lyophilized
 products. With continued investments in R&D, we are confident of
 building a more agile business and strengthening our leadership
 position in oncology excellence.
 
 Some of the most notable achievements during the year in various field
 of our activities were :
 
 - Commissioning of expansion of our dosage form factory at Baddi
 
 - Successful completion of facility audits at Baddi by USFDA, PMDA,
 Japan & MHRA
 
 - Recognition of our R&D Center at Gurgaon by Department of
 Scientific & Industrial Research (DSIR)
 
 - Successful development of key new formulations and non-infringing
 novel technologies for APIs
 
 - Regulatory filings in more than 30 countries
 
 - Filings of many patent applications for new inventions and grant of
 patents in a number of developed countries
 
 - Start of Oxaliplatin RTUs & Gemcitabine exports to USA and
 Docetaxel, Carboplatin & Cytarabine to EU and many new product launches
 in India
 
 - Settlement of Docetaxel Case in Philippines with Sanofi-Aventis
 with no cost
 
 You will agree that such successes are not possible without excellent
 teamwork among our R&D, regulatory, API and dosage forms manufacturing
 functions.
 
 On the flip side, proliferation of oncology drug competitors in India
 and intense pricing pressures resulted in decline of API sales and
 domestic business.  Voluntary suspension of production at our API plant
 in Kalyani due to GMP compliance concerns impacted production of both
 APIs and dosage forms.
 
 Notwithstanding these negative developments, our momentum in delivering
 strong results continued, with a renewed focus on constant evaluation
 of internal and external challenges and reinforcement of priorities to
 keep the growth story intact. Our promoters'' strategic proposal to
 delist the Company from the Bombay Stock Exchange and the National
 Stock Exchange is aimed at the creation of an even stronger entity, as
 we move forward. This important step of investing for the future shall
 provide greater operational control and flexibility to the Fresenius
 Group to support our Company''s business and meet the needs of its
 customers.
 
 We are fully aware that demanding market conditions, increased cost
 ofR&D, government interventions in pricing and other policies, and
 intensifying pricing pressures will continue to dominate the
 pharmaceutical environment. With the dedicated and committed services
 of our people and the continued support of our stakeholders, we remain
 positive to meet the challenges. As we progress in 2013-14, we do it
 with a renewed belief in our abilities to charter the roadmap to
 success by rethinking strategies and realigning priorities.
 
 I thank you for your continued support and co-operation and will look
 forward to the same in the future.
 
 Rakesh Bhargava 
 
 Chairman
Source : Dion Global Solutions Limited
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