I am happy to be back in the thick of action as the Group CEO. It is not long ago when I decided to move into a non-executive role and stay in business with Board oversight. Indeed, the times are not exciting for the pharmaceutical industry and Strides is no exception. FY 2017-18 was one of the most challenging years for our business.
Our performance was impacted by the challenges in the US market and the institutional business.
Our strategies, especially in our US partnered business, did not translate to expected outcomes. The environment was not very conducive in our therapeutic areas on the institutional front.
We are going through a phase of temporary hardship, and I am confident that all our businesses will start performing at desired levels in the next three-to-four quarters. I must also emphasize that our strategy continues to evolve; and with the new rigour that we have established at Strides, we are determined to bounce back strongly.
The US continues to be our key growth market. We are recalibrating our US strategy by reinforcing our focus on the front-end business to ensure sustainable future growth. We are strengthening our US footprint with an emphasis on niche products or products where we have complete control.
We have made strategic progression in Australia (Arrow) over the last few years to become a leading and profitable player. The year witnessed steady business with a sequential ramp-up driven by expansion of pharmacy footprint, new product launches and a strong performance in Chemists Own OTC portfolio. In August 2017, Arrow acquired Ameal Pharmaceutical''s Australian operations which we could smoothly integrate into our business in a short span.
During FY 2017-18, we also announced our intent to merge the Australian businesses of Strides and Apotex which is subject to certain customary closing conditions and statutory approvals, including approval of Australian Competition and Consumer Commission (ACCC).
The combined entity will create an industry-leading position in Australia, both by value and volume as a large proportion of pharmacies will offer Arrow and Apotex products exclusively.
It will also take the best of both companies to optimize the viability of operations through effective delivery of medicines and services to consumers and patients. The merger will deliver 100 additional products which can significantly contribute to growth, profitability and IP for the merged entity in the medium to long-term.
In the other regulated markets outside the US and Australia, our operations in the UK and parts of Europe are growing encouragingly. We also entered the highly regulated South African market with the acquisition of Trinity Pharma. This will continue to help us broad-base our business outside the US.
Our Africa business is maintaining steady growth on the back of secondary sales. We intend to grow the business through our 500-product pipeline and encourage a pan-Africa branded generics presence. We are strengthening our sales force for enhanced market penetration and focusing on improving the productivity of our sales representatives.
Our institutional business saw one of the toughest years, owing to a decline in anti-malarial business, driven by skewed tendering activity. We will be aiming to capitalize on our WHO-approved manufacturing facility in Kenya for global donor agencies and local government tenders. We have initiated the site transfer for our Antiretroviral (ARV) portfolio to the facility; and will participate in global donor funding and regional government programmes.
During FY 2017-18, we de-merged our select API business to Solara Active Pharma Sciences Limited (Solara). It also houses the Human API business of SeQuent Scientific Limited. Operating as a standalone API company, Solara has inherited the extensive pharmaceutical experience of these two entities.
We also propose to divest our shareholding in Strides Chemicals, which has an USFDA API facility in Ambernath to Solara. As part of the transaction understanding, Solara has offered the Company long-term development and manufacturing arrangement and a ''Most
Favoured Customer'' status for all the DMFs required for the integrated formulations portfolio of the Company. The divestment will help Strides become leaner while retaining supply chain security for the formulations portfolio.
Our India branded business was divested to Eris Life sciences for Rs,5,000 Million to focus more on our global business strategy. Net proceeds from this transaction were used to reduce our debt.
A business needs to constantly course-correct and focus on building the right enablers to move forward on the evolution curve. That''s precisely what we are now focusing on at Strides, and we are keeping vigilant eyes on the unfolding macro scenario.
We completed several corporate initiatives that we had planned. Now we are focusing on building Strides as a diversified B2C player and we are confident that we are building it right.
On behalf of the Board and the entire leadership team, I thank our people for their dedication and hard work. I also express my sincere appreciation to all our stakeholders for their guidance and support.