172@29@16@53!~!172@29@0@53!~!|commonstore|commonfiles|moneycontrol_header.php?cid=0&s_cid=0&radar_off=0&is_revamped_header=0&is_responsive=1&sec=PNC_ANNUALREPORT&priceinter=1&frommc=1!~!www|moneycontrol|com!~!|commonstore|commonfiles|moneycontrol_header.php!~!is_mobile=false
Moneycontrol
SENSEX NIFTY
you are here:

Pfizer Ltd.

BSE: 500680 | NSE: PFIZER |

Represents Equity.Intra - day transactions are permissible and normal trading is done in this category
Series: EQ | ISIN: INE182A01018 | SECTOR: Pharmaceuticals

BSE Live

Oct 20, 16:00
5004.00 11.65 (0.23%)
Volume
AVERAGE VOLUME
5-Day
1,096
10-Day
3,149
30-Day
5,407
1,640
  • Prev. Close

    4992.35

  • Open Price

    4993.00

  • Bid Price (Qty.)

    0.00 (0)

  • Offer Price (Qty.)

    0.00 (0)

NSE Live

Oct 20, 15:52
5000.85 4.70 (0.09%)
Volume
AVERAGE VOLUME
5-Day
30,601
10-Day
32,420
30-Day
66,437
53,834
  • Prev. Close

    4996.15

  • Open Price

    4996.15

  • Bid Price (Qty.)

    5000.85 (219)

  • Offer Price (Qty.)

    0.00 (0)

Annual Report

For Year :
2019 2018 2017 2016 2015 2014 2013 2012 2011

Director’s Report

To the Members

The Directors take pleasure in presenting this 68th Annual Report along with the Audited Financial Statement for the financial year ended March 31, 2019. The Company operates only in one business segment that is, “Pharmaceuticals” and this Report covers its Pharmaceutical business performance.

DIVIDEND

Your Directors recommend a dividend of Rs.22.50 (225%) per equity share for the financial year ended March 31, 2019. The dividend payout will be Rs.102.94 crore and the dividend distribution tax payable by the Company would amount to Rs.21.16 crore. This aggregates to a total dividend outgo of Rs.124.10 crore.

FINANCIAL HIGHLIGHTS

(in Rs.crore)

Particulars

Year ended March 31, 2019

Year ended March 31, 2018

Net Sales

2030.49

1,924.86

Other Operating Income

51.01

55.33

Revenue from Operations

2081.50

1,980.19

Other Income

167.39

114.29

Profit Before Tax

659.91

547.91

Income Tax Expense

230.86

187.84

Profit for the year

429.05

360.07

Total other comprehensive income (net of tax)

1.05

6.81

Total comprehensive income for the year

430.10

366.88

Your Company’s sales for the financial year ended March 31, 2019 stood at Rs.2,030.49 crore as compared to Rs.1,924.86 crore in the previous year, which represents a growth of 5.5%. The sales for the year under review are not strictly comparable with that of the previous year as your Company divested its rights and interests in certain brands in the year under review. Further, sales up to June 30, 2017 in the previous year included excise duty, whereas the sales post July 1, 2017 were net of GST.

Profit before tax for the financial year ended March 31, 2019 was Rs.659.91 crore as compared to Rs.547.91 crore in the previous year. The profit after tax stood at Rs.429.05 crore for the financial year ended March 31, 2019 as compared to Rs.360.07 crore in the previous year. The profit for the financial year under review included Rs.28.93 crore on account of sale of the Company’s rights and interests in certain brands.

DIGITAL MARKETING

Your Company continued to innovate in digital marketing initiatives. This year, these initiatives have not only achieved scale by reaching over 5 million touchpoints with HCPs but also added value through substantial savings and shorter turnaround times.

The team also on-boarded new ‘Patient First’ capabilities by building partnerships with healthcare ecosystems such as social media agencies and online consumer communities that will help improve patient awareness, adherence and compliance. Therapies with patient first approach to business such as Internal Medicine portfolios have shown interest in these online platforms but early adopters such as Vaccines and Women’s Healthcare have closely worked with the Digital Marketing team to deliver over 4 Lakh touchpoints direct to customer as part of consumer awareness and reach programs.

In other digital initiatives, the team has demonstrated reach and frequency with trade partners delivering over 1.6 million digital touchpoints for offer promotions, etc. and over 34,000 interactions with Pfizer field colleagues to augment their efforts in the field.

MANUFACTURING OPERATIONS

Overview

Your Company’s manufacturing operations are carried out in full compliance with local laws and in line with the stringent Global Pfizer Quality and EHS standards.

People

Over the past year, your Company conducted several programs and initiatives to train and motivate colleagues to deliver best in class performance, including Leadership Development Program, Six Sigma Black Belt training and Operational Excellence training.

Environment Sustainability

Your Company’s continued focus on renewable resources has created an excellent model for environmental sustainability through which effort is made to reduce waste and a strong emphasis is put on conservation of resources across manufacturing sites. The Goa Plant follows stringent Global Safety, Environmental Health and Hygiene requirements and this year has received a number of awards including award for Excellence in Environment Sustainability.

The Plant continued its drive towards energy conservation initiatives including waste heat recovery from compressed air generation process and introduction of variable frequency drive in cooling water and chilled water circulation pumps in the system. These initiatives have resulted in significant reductions in power consumption and reduction of carbon footprint.

MEDICAL AFFAIRS DIVISION

The year under review was a year of transformation for the Medical Team. The Team partnered with a large number of healthcare practitioners, medical institutions and associations as relevant to each business line and remained committed to delivering impactful insights and disseminating medical knowledge to meet the ultimate goal of improving patient care.

A. Medical Education

The Team reached out to over 5200 general physicians (GPs) through face-to-face and virtual meetings. MINERVA, the smart medical e-learning platform, was launched in June 2018 and witnessed 673 GPs registrations in the initial six months. The educational meetings across therapy areas covered six premier Gastroenterology Institutes and 65 Gastroenterologists across India, 32 Young Gynaecologists’ Programs (YGP) educating 1200 Gynaecologists and 10 Nephro Connect meetings at 22 hospitals with 197 Nephrologists.

Furthermore, the Team partnered with the Academy of Infection Management (AIM), a non-profit UK-based organization, to develop case-based educational modules to combat the menace of AMR. It partnered with medical professional associations for antimicrobial stewardship training of clinicians and continued Antimicrobial Testing Leadership and Surveillance (ATLAS) at nine institutes pan India.

To strengthen the Company’s leadership position in private hospitals, the Team conducted 28 programs (Pharmacy Academia, Virtual Preceptorship Program with International expert, and Nursing Academia) in 39 key institutes across India, training over 500 pharmacists and 400 nurses.

The team also conducted 64 virtual meetings with 6000 Pediatricians at their clinics disseminating information on Pneumococcal disease and its prevention.

The team also conducted 64 virtual meetings with 6000 Pediatricians at their clinics disseminating information on Pneumococcal disease and its prevention. This provided an excellent opportunity to touch base HCPs by reaching right at their doorstep through technology.

B. Insights Generation

The team gathered structured insights on current attitudes and behaviors regarding the use of Oral Anticoagulants (OACs) from meeting and in-person interactions.

C. Data Generation and Publications

During the year under review, your Company undertook valuable data generation that have been presented at scientific conferences and submitted for publishing in science journals.

For the Gelusil range and Mucaine, new scientific evidence was generated regarding the onset of action of non-systemic antacids in vitro. Other data-based research reports included a paper on ‘Current understanding and practice in menopause hormone therapy: Indian perspective’; a poster on ‘Consensus statement on management of uncontrolled hypertension’ was published in the Journal of Hypertension; reports on ‘Real world Indian clinical evidence of Tofacitinib in Rheumatoid Arthritis’; ‘Review of the role of Echinocandins in Biofilms’; ‘role of tumor necrosis factors in early Axial Spondyloarthritis’.

Attracting Talent

Your Company aims to attract the best talent for its workforce through various channels. With the objective of introducing young talent to the organization, improving gender diversity and being future ready, the ‘Pfizer Sales Trainee Program’ continues to attract high potential graduates for a meaningful career in pharmaceutical sales. In addition to infusing young talent in the organization, the strategy to attract experienced sales professionals has been strengthened through a new recruitment process.

Your Company’s employees are also its best ambassadors and have continuously helped scout for the right talent both in and beyond this industry. In order to leverage this strong network, an employee referral policy for non-field colleagues was launched during the year under review, in addition to the existing field referral policy. Your Company is an equal opportunity employer. In line with this, the employee referral policy offers a differentiated reward for referring female candidates to the Company, in order to bring in high caliber female talent to support the diversity and inclusion agenda of your Company. We are endeavoring to build a strong ecosystem where our managers support young women as they take their first step to building their careers.

Developing Talent

Your Company is committed to people development and growing talent from within. The Sales Career Architecture (SCA) framework launched in 2016 has seen the successful transition of several field colleagues into various career opportunities within the Company. During the year under review, an active campaign to garner feedback on the experiences of colleagues and their managers in the career architecture was launched. The feedback received from a large cross section of colleagues has formed the foundation of the design of a revised version of the Sales Career Architecture (SCA 2.0), the tenets of which are deeply rooted in taking ownership of careers, embracing new experiences and focusing on development.

In the ever-changing external and internal environment, your Company’s capability-development interventions, present platforms for leveraging the opportunity of the evolving roles of field managers by building their leadership capabilities. These programs offer a combination of various forms of learning platforms ranging from classroom training, coaching and introspective learning. During the year under review, these have equipped your frontline managers in building coaching capabilities as well as developing need-specific operating plans independently.

Prevention of Sexual Harassment Policy

The ‘Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013’ (“the Act”) seeks to protect women colleagues against sexual harassment in their workplace. Your company has specially-designed training modules to help all colleagues and contingent associates to understand what constitutes sexual harassment in the workplace and how to address it; as well as the organization’s role in preventing it.

Your Company has complied with the provisions relating to the constitution of Internal Complaints Committee under the Act. The details of complaints filed and disposed of during the Financial Year under review are as under:

Number of complaints filed during the financial year 2018-19

2

Number of complaints disposed of during the financial year 2018-19

Nil

Number of complaints pending as on end of the financial year 2018-19

2

LEGAL DIVISION

Your Company’s Legal Division is committed to providing a proactive, qualitative and client-centric service that protects and advances your Company’s goals in adherence to the law of the land.

The Legal Division is responsible inter alia to protect your Company’s business interests; ensure compliance with applicable laws; protecting the Company’s intellectual property and other assets; and assisting various business units in evaluating risks associated with business transactions . The Legal Division plays a partnership role in generating innovative business ideas and strategies from inception, to ensure compliant outreach programs that promote your Company’s commitment to always keep ‘Patients First’.

Few of the areas where the Legal Division has played leadership role during the year under review are:

- Growth of your Company’s business through strategic business development transactions.

- Mitigation of risks associated with Company’s business operations and intellectual property rights.

- Defending the Company against litigation as well as pro-actively initiating litigation, wherever necessary, to ensure that your Company is insulated from operational risks.

FINANCE

The Finance division is a key partner to the management in upholding internal controls and governance standards, driving performance and leading enterprise wide initiatives.

During the year under review, your Company’s Finance team partnered strongly with business in driving various projects/ initiatives including portfolio optimization, resource allocation/ reallocation, stabilization of new ERP and GST for the Company and providing innovative solutions in multiple high impact decision making and business critical matters.

Your Finance division was recognized with Pfizer Inc’s prestigious Jade Grand Prix Pricing Award for innovative pricing solutions. Further, the Finance division was also awarded with Asia’s Adam Smith Award for best in class Treasury services.

In addition to the strong business partnering, the Finance division played a pivotal role in ensuring fiduciary integrity, upholding high governance standards, institutionalizing effective internal controls and consistently driving strong business performance and financial prudence.

COMPLIANCE AND ETHICS

Integrity is one of the fundamental values of your Company and it never compromises integrity in its decision making or during the pursuit of its business goals. Through an effective and integrated compliance management with a robust framework (quality management system), Pfizer Limited has maintained a proactive approach to manage compliance risks and drive thoughtful risk taking and leadership accountability.

During the year under review, the Compliance team introduced various innovative initiatives to promote a compliance culture at grassroots level, such as, a Compliance Champions League, through which different teams of Compliance Champions compete to achieve compliance goals and introduction of a compliance ambassador called “Captain Compliance” to guide colleagues in an interesting and exiting way.

Office of the Ombudsman

As a global best practice, Pfizer Limited established the “Office of the Ombudsman” during the year under review. Office of the Ombudsman provides Pfizer employees access to multiple formal platforms and avenues to raise concerns and seek assistance on a variety of matters. This is designed as an ‘informal’ service - a mechanism whereby colleagues are able to ask their question in an informal atmosphere and get sound advice back on what to do and how to handle.

The Office of the Ombudsman is an independent body that supplements the formal channels of grievance redressal that exist at Pfizer.

CORPORATE AFFAIRS

The Corporate Affairs Division works in the domains of Government Relations, Communications and Corporate Social Responsibility. During the year under review, the division undertook a number of policy advocacy initiatives; stakeholder engagement outreach; image building campaigns; and community and colleague engagement programs.

Government Relations

Your Company’s Managing Director Mr. S. Sridhar was re-elected as the Chair of the Federation of Indian Chambers of Commerce & Industry’s (FICCI) National Pharmaceutical Committee for the current year. He also continues to serve as an Executive Committee Member in the Organization of Pharmaceuticals Producers of India (‘OPPI’).

a) Engagement through industry associations and direct advocacy

As a member of the OPPI, your Company continued to participate and play an active role in leading the dialogue with relevant government stakeholders and contributing recommendations and comments on key policy matters.

b) Ayushman Bharat - Pradhan Mantri Jan Arogya Yojna (AB-PMJAY)

Your Company continued to be at the forefront of advocacy to strengthen the Ayushman Bharat program. Through various industry associations as well as independent engagement, Pfizer engaged with the National Health Authority to provide recommendations on mechanisms through which innovative therapies may be included in the scope of the program, thereby providing Ayushman Bharat beneficiaries with access to advanced treatments.

c) Tiered pricing concepts for national and state programs

Your Company strongly believes in the concept of tiered pricing and targeted access as a sustainable approach for public-private collaborations. To this end, your Company continued its advocacy with the national Pradhan Mantri Jan Aushadhi Pariyojana (Jan Aushadhi) and similar state-level programs to explore opportunities for participation through the tiered-pricing models.

Communications

Your Company’s communications team plays the role of a key enabler in communicating the organization’s growth plans, important decisions and milestones to stakeholders both internally and externally.

Externally, your Company, continued to engage with media to share important messages pertaining to business developments and key therapies and products. The team also showcased important corporate responsibility initiatives to a wider universe of external stakeholders, including media, the HCP community, Government and industry stakeholders, through communication and participation in industry events.

Internally, your Company continued to maintain a high impact communication program, including the launch of a new colleague communication platform.

Talking Straight: A video-interview platform was launched that enable Pfizer leaders in India and globally to field direct questions and share insights, key decisions and new initiatives. In its first episode, your Company’s Managing Director, in a live video chat, briefed employees about the Company’s focus areas, new initiatives on simplification and alignment of the India organization to the global business strategy.

Colleague Engagement

Your Company maintained a high-performance culture by engaging employees and aligning them with our values, purpose and strategy. Through an active calendar of activities that focused on the wellness of our colleagues, as well as celebrations of achievements and festivals, your Company worked towards bringing its colleagues together regularly

Highlights of the year under review include:

a) Pfizer Family Day: The Pfizer Family Day was celebrated at the Mumbai headquarters and regional offices to bring together colleagues and their families for an evening of entertainment, engagement and recognitions. The Mumbai Pfizer Family Day event saw participation from nearly 1,200 employees and their family members and over 300 attended at each of the regional centres.

b) Celebrating the larger Pfizer family: Your Company also hosted several in-office initiatives for employees’ families. The Kids’ Day Out program saw 55 children aged 4-12 years enjoying a host of activities in the Pfizer India office.

The day also allowed children to gain a wider appreciation for the work their parents do. In June 2018, your Company celebrated Parents’ Day by giving employees an opportunity to reconnect with their parents in the simplest of ways - by crafting handwritten notes and creating videos through booth installations for their parents.

CORPORATE SOCIAL RESPONSIBILITY

Your Company continued to stay true to its purpose of promoting access to quality healthcare in the country by nurturing innovation, encouraging community involvement of our colleagues and synergizing efforts with government and other stakeholders for collective impact.

This year, the team continued to identify and work on projects that are aligned to Pfizer’s CSR priorities as listed below:

a) Encourage and support Indian innovation and Indian intellectual property with a focus on healthcare;

b) Undertake awareness and access programs ourselves or in partnership with NGOs, government and healthcare providers in areas such as women and child health, among others;

c) Support government’s national and/or state programs and priorities with linkages to healthcare;

d) Enlist employees as volunteers to support activities around health, sanitation and disease awareness; and

e) Participate in disaster relief activities.

Your Company’s flagship CSR initiatives undertaken during the year gained significant momentum leading to high-impact outcomes.

1. Your Company’s Pfizer-IIT Delhi Innovation and IP Program is now in its third phase with projects incubated in the earlier two phases either launched or in an advanced stage of launch. The program supports Indian innovation and Indian intellectual property with a focus on healthcare. Since inception in 2015-16, the program has incubated five and supported IP filings of nine innovators. During the year under review, one innovator was incubated, and three IP filings supported.

2. The ICMR Pfizer Centre for AMR Research and Education set up in partnership with the Indian Council of Medical Research, launched its first Anti-Microbial Stewardship Program (AMSP) workshop in New Delhi with over 150 participants from the medical fraternity. In January 2019, the partnership launched a high-decibel public awareness campaign titled ‘AMR ko Aao Milkar Rokein’ (Let us work together to curb AMR). This public awareness and advocacy program was intended to disseminate information on AMR and promote the responsible use of antibiotics through multiple media platforms. The campaign succeeded in reaching over 100 million people across six metros.

3. During the year under review, your Company adopted 13 schools in Mumbai and Goa under the Pfizer School Sanitation and Development Program. The objective is to look at the complete development of these schools including infrastructure, sanitation facilities, water purifiers, digitalization, menstrual hygiene as well as setting up science labs. Under the program, more than 240 sanitation units in schools across five states have been successfully built and refurbished since its launch in 2017.

4. Your Company contributed towards Disaster Relief by strengthening healthcare infrastructure in wake of the natural calamity that struck the state of Kerala. Through your Company’s grants, a total of 21 family health centers were restored and upgraded in the state. Pfizer’s contributions were used to buy equipment for these centres including sterilizers, oxygen concentrators, laryngoscopes, ECG machines and cardiac monitors among others. As an instantaneous relief to the community, your Company helped provide healthcare kits and water purifiers, while also supplying a number of essential medicines required for immediate relief.

Your Company fully met its requisite CSR spends obligation by funding novel, scalable and sustainable projects, aligned with national priorities providing maximum impact to the community. A brief outline of the initiatives undertaken during the year and details of CSR projects undertaken by your Company during the financial year under review are provided in the Corporate Social Responsibility Report (Annexure-A).

WHISTLE BLOWER / VIGIL MECHANISM:

Your Company has established a Whistle Blower / Vigil Mechanism through which its Directors, Employees and Stakeholders can report their genuine concerns about unethical behaviour, actual or suspected fraud or violation of the Company’s code of conduct or ethics policy. The said Policy provides for adequate safeguards against victimization and also direct access to the higher levels of supervisors. The e-mail ID for reporting genuine concerns is: ‘corporate.compliance@pfizer. com’. In appropriate and exceptional cases, concerns may be raised directly to the Chairman of the Audit Committee at ‘Chairman.IndiaAuditcom@pfizer. com’. A quarterly report on the whistle blower complaints received and action taken thereon is placed before the Audit Committee for its review.

DIRECTORS:

In accordance with the provisions of the Companies Act, 2013, Mr. Vivek Dhariwal (DIN: 02826679) retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment.

The Board of Directors of the Company at their Meeting held on November 14, 2018, pursuant to the recommendation of Nomination and Remuneration Committee, appointed Mr. Milind Patil (DIN: 02546815) as Executive Director -Finance with effect from November 14, 2018 for a period of 5 (five) years subject to the approval of members at the ensuing Annual General Meeting and approval from the Central Government. The Company has received a Notice for candidature as a Director from a Member pursuant to Section 160 of the Act.

The Board of Directors of the Company at their Meeting held on March 8, 2019, pursuant to the recommendation of Nomination and Remuneration Committee, appointed Ms. Meena Ganesh (DIN: 02546815) as an Additional (Independent Director) Director with effect from March 8, 2019 for a term of 5 (five) years subject to the approval of members at the ensuing Annual General Meeting. The Company has received a Notice for candidature as a Director from a Member pursuant to Section 160 of the Act

The Board of Directors of the Company at their Meeting held on May 28, 2019, pursuant to the recommendation of Nomination and Remuneration Committee, re-appointed Mr. R. A. Shah (DIN: 00009851) as an Independent Director with effect from November 10, 2019 for a term of 5 (five) years subject to the approval of members at the ensuing Annual General Meeting.

The Board of Directors of the Company at their Meeting held on May 28, 2019, pursuant to the recommendation of Nomination and Remuneration Committee, re-appointed Mr. Pradip Shah (DIN: 00066242) as an Independent Director with effect from November 10, 2019 for a term of 5 (five) years subject to the approval of members at the ensuing Annual General Meeting.

The Board of Directors of the Company at their Meeting held on May 28, 2019, pursuant to the recommendation of Nomination and Remuneration Committee, re-appointed Mr. Uday Khanna (DIN: 00079129) as an Independent Director with effect from November 10, 2019 for a term of 5 (five) years subject to the approval of members at the ensuing Annual General Meeting.

The Board of Directors of the Company at their Meeting held on May 28, 2019, pursuant to the recommendation of Nomination and Remuneration Committee, re-appointed Mr. Sunil Lalbhai (DIN: 00045590) as an Independent Director with effect from February 14, 2020 for a term of 5 (five) years subject to the approval of members at the ensuing Annual General Meeting.

All Independent Directors have given the declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Board Performance Evaluation

The Company has devised a Performance Evaluation Framework and Policy, which sets a mechanism for the evaluation of the Board, Board Committees and Directors.

Performance Evaluation of the Board, Committees and Directors was carried out through an evaluation mechanism in terms of the aforesaid Performance Evaluation Framework and Policy.

The performance evaluation of each individual Director, the Board and Committees was carried out through deliberations. The said performance evaluation was done based on the parameters stated in the templates designed under the aforesaid Framework and after taking into consideration the guidance note issued by the Securities and Exchange Board of India.

Independent Directors’ Meeting

One Meeting of the Independent Directors was held on May 7, 2018, without the presence of the Executive Directors and Management Personnel. At the Independent Directors Meeting held on May 7, 2018, the Independent Directors carried out performance evaluation of Non-Independent Directors and the Board of Directors as a whole, performance of Chairman of the Company, the quality, content and timeliness of flow of information between the Management and the Board, based on the Performance Evaluation framework of the Company. All the Independent Directors were present at the aforesaid Meeting.

FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS:

Your Company has in place a Familiarization Program for Independent Directors to provide insights into the Company’s business to enable them contribute significantly to its success. The Executive Directors and Senior Management make presentations periodically to familiarize the Independent Directors with the strategy operations and functions of the Company. Your Company also circulates news and articles related to the Industry and provide specific regulatory updates to the Independent Directors on a regular basis.

A brief summary of the major Familiarization Programs carried out during the year for the Independent Directors is given below:

Sr. No.

Particulars of the Programmes / Presentations

Date

No of Hours Duration (Hrs.)

1.

Pharma Market, Industry Performance and Regulatory changes update (Duration 1.00 hr each)

Quarterly Board Meetings

4.00

2.

Business Strategy

May 7, 2018

1.00

3.

Manufacturing Operations

January 24, 2019

1.00

Total Duration (Hrs.)

6.00

NOMINATION AND REMUNERATION POLICY:

The Board has on the recommendation of the Nomination and Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management, Key Managerial Personnel and their remuneration. The Nomination and Remuneration Policy is annexed herewith as “Annexure - B”.

MEETINGS OF THE BOARD:

The details of the meetings of the Board and Committees are provided in the Corporate Governance Report (Annexure H to the Board’s report).

DIRECTORS’ RESPONSIBILITY STATEMENT:

Your Directors make the following statements in terms of Section 134(3)(c) of the Companies Act, 2013:

a. that in the preparation of the annual financial statements for the year ended March 31, 2019, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

b. that such accounting policies as mentioned in Notes 2 and 3 of the Notes to the Financial Statements have been selected and applied consistently and judgments and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2019 and of the profit of the Company for the year ended on that date;

c. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. that the annual financial statements have been prepared on a going concern basis;

e. that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively; and

f. that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

KEY FINANCIAL RATIOS:

Pursuant to the SEBI (Listing Obligations and Disclosure Requirements), Regulations 2015, we give below the key financial ratios:

Sr. No.

Particulars

FY 2019

FY 2018

1

Debtors Turnover Ratio

12.75

14.94

2

Inventory Turnover Ratio

2.19

2.43

3

Interest Coverage Ratio

N.A.

N.A.

4

Current Ratio

3.05

2.53

5

Debt Equity Ratio

N.A.

N.A.

6

Operating Profit Margin (%)

31%

29%

7

Net Profit Margin (%)

21%

19%

8

Return on Net Worth

14%

13%

None of the aforementioned ratios have undergone a change of more than 25% as compared to the previous financial year.

The return on net worth is computed as net income by shareholders equity. The change in return on net worth is primarily on account of increase in net profit to Rs.429.05 crore from Rs.360.07 crore.

AUDIT COMMITTEE:

The details pertaining to composition of Audit Committee are included in the Corporate Governance Report, which forms part of this report.

RISK MANAGEMENT POLICY:

The details pertaining to the Risk Management Policy are included in the Corporate Governance Report, which forms part of this Report.

RELATED PARTY TRANSACTIONS:

All Related Party Transactions that were entered into during the financial year were on an arm’s length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. The Company had entered into materially significant related party transactions with Pfizer Innovative Supply Point Intl BVBA, Belgium and Pfizer Service Company BVBA, Belgium for purchase of raw materials, bulk drugs and finished goods. The same are within the limits duly approved by the members at the 65th Annual General Meeting.

All Related Party Transactions are placed on a quarterly basis before the Audit Committee for approval and before the Board for consideration and noting.

The Policy on Related Party Transactions as approved by the Board is uploaded on the Company’s website ‘www.pfizerindia. com’. The weblink for the Policy is http://www.pfizerindia.com/ eNewsWebsite/investor/pdf/Revised%20Related%20Party%20 Transaction%20Policy%20-%20Pfizer%20website.pdf

None of the Directors have any material pecuniary relationships or transactions vis-a-visthe Company.

Pursuant to Section 134 of the Companies Act, 2013 and Rules made thereunder, particulars of transactions with related parties as required under Section 188 (1) of the Companies Act, 2013, in the prescribed Form AOC-2 is annexed herewith as “Annexure - C”.

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS:

The Company has not granted any loans, guarantees and investments under Section 186 of the Companies Act, 2013 for the financial year ended March 31, 2019.

DEPOSITS FROM PUBLIC:

During the financial year under review, the Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the Balance Sheet.

DISCLOSURES OF ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNAL:

No orders have been passed by any Regulator or Court or Tribunal which can have impact on the going concern status and the Company’s operations in future.

OTHER INFORMATION:

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as “Annexure - D”.

A table containing particulars of employees in accordance with the provisions of Section 197(12) of the Companies Act, 2013, (“the Act”) read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is annexed herewith as “Annexure - E”.

The information required pursuant to Section 197(12) of the Act read with Rule 5(2) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, forms part of this Report. However, as per the provision of Sections 134 and 136 of the Act, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees’ particulars which is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. Any member interested in obtaining a copy of such statement may write to the Company Secretary at the Company’s Registered Office.

The Company does not have any subsidiary company or associate company or joint venture company.

AUDITORS:

The Auditors, Messrs. Walker Chandiok & Co LLP, Chartered Accountants (Firm Registration No. 001076N/N500013), were appointed as Statutory Auditors to hold office for a term of 5 (five) years from conclusion of 66th Annual General Meeting till the conclusion of the 71st Annual General Meeting subject to ratification by members at every subsequent Annual General Meeting.

The Companies (Amendment) Act, 2017 has waived the requirement for ratification of the appointment of statutory auditor by the shareholders at every Annual General Meeting. Hence, the approval of the members is not being sought for the re-appointment of the statutory auditor and in line with their resolution of appointment passed at the previous Annual General Meeting held on September 6, 2018, Accordingly Messrs. Walker Chandiok & Co. LLP will continue to hold office till the conclusion of the 71st Annual General Meeting of the Company. Messrs. Walker Chandiok & Co. LLP have confirmed their eligibility and submitted the certificate in writing that they are not disqualified to hold the office of the Statutory Auditor.

The Auditor’s Report for the financial year ended March 31, 2019 do not contain any qualification, reservation or adverse remark.

COST AUDITORS:

Pursuant to Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Rules, 2014, as amended from time to time, the cost audit records maintained by the Company is required to be audited. Your Directors had, on the recommendation of the Audit Committee, appointed Messrs. RA & Co., to audit the cost accounts of the Company for the financial year 2019-20 on a remuneration of Rs.12,00,000/- (Rupees Twelve Lakhs only). As required under the Companies Act, 2013, the remuneration payable to the Cost Auditor is required to be placed before the Members in a general meeting for their ratification. Accordingly, a Resolution seeking Member’s ratification for the remuneration payable to Messrs. RA & Co., Cost Auditors is included at Item No. 11 of the Notice convening the Annual General Meeting.

Your Company is required to maintain the cost records as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act, 2013. Your Company has accordingly maintained the same and has filed the Cost Audit Report for Formulations and Compliance Report for the financial year ended March 31, 2018 on October 15, 2018, which is within the stipulated timeline prescribed under the applicable regulations. The Cost Audit Report for Formulations for the financial year ended March 31, 2019 is due to be filed by October 26, 2019.

Messrs. R. A. & Co., have confirmed their eligibility to be the Cost Auditors and have been appointed to conduct Cost Audit of the Company’s records for the financial year ending March 31, 2020. The remuneration is subject to ratification by the shareholders.

SECRETARIAL AUDIT:

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Messrs. Saraf & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as “Annexure - F”. The Secretarial Audit Report for the financial year ended March 31, 2019 does not contain any qualification, reservation or adverse remark.

COMPLIANCE WITH SECRETARIAL STANDARDS:

Your Directors confirm that the Secretarial Standards issued by the Institute of Companies Secretaries of India, as applicable to the Company and which are mandatory in nature, have been duly complied with.

ANNUAL RETURN:

The details forming part of the extract of the Annual Return in Form MGT 9 is annexed herewith as “Annexure - G”. The Annual Return of the Company as required under the Companies Act, 2013, will be available on the website of the Company at www.pfizerindia.com.

CORPORATE GOVERNANCE & BUSINESS RESPONSIBILITY REPORTING:

A Report on Corporate Governance along with a Certificate from Messrs. Walker Chandiok & Co LLP, regarding compliance with the conditions of Corporate Governance as stipulated under Regulation 34(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of this Report and annexed herewith as “Annexure - H”.

A Business Responsibility Report as stipulated under Regulation 34(2) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, describing the initiatives taken by your Company from an environmental, social and governance perspective, forms part of this Report and annexed herewith as “Annexure-I”.

ACKNOWLEDGMENTS

Your Directors would like to place on record their sincere appreciation for the support and assistance extended by the Company’s suppliers and business associates. Your Directors are thankful to the esteemed shareholders for their continued support and the confidence reposed in the Company and its Management.

Your Directors wish to place on record their appreciation for the support and guidance provided by its Parent Company, Pfizer Inc. USA.

For and on behalf of the Board of Directors

R.A. Shah

Chairman

Mumbai, May 28, 2019 DIN: 00009851

Director’s Report