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The year under review has been a successful one as we grew our business, increased profitability and advanced our key strategic initiatives. This enabled us to improve our competitiveness and enhance value for our shareholders. We maintained our leadership position in Oral Thin Films and remained focused on our vision to win new customers.
To begin with, we are pleased to share our immense satisfaction on the successful completion of our listing on the main board of the Bombay Stock Exchange on June 8, 2018. It was indeed a great moment for all of us at ZIM, to be listed on Asia''s first and the fastest-growing stock exchange. I would like to place on record our heartfelt gratitude to you, our valued shareholders, who invested in our Company and have stayed with us through various business cycles. I would like to add a special note of appreciation for AA Capital Development India Fund, our Private Equity Investor, who helped us grow through its constant guidance over the last 5 years. The listing on BSE will surely enable our shareholders to benefit from the platform and realize their value.
Our Business Model
We have indeed come a long way since initiating our operations in 1989. Today, we are a specialty pharmaceutical technology company, specialized in Complex Generics and differentiated products that are based on proprietary Novel Drug Delivery Solutions (NDDS), that improve convenience and adherence of drug treatment. We develop and manufacture innovative and differentiated pharmaceutical products, and have now developed affordable orally disintegrating strips (ODS) formulations.
We work on a unique business model that provides B2B solutions to a targeted client base and local pharmaceutical companies in target markets. We have developed and commercialized the complex oral film technology and plan to launch multi-layer thin films that contain more than one API simultaneously.
At ZIM, we act as a research centric product development partner for our customers across several Pharmerging and RoW markets. We enable our partners to bridge the technology gap by providing them with the ability to compete with a complex generics containing portfolio in the local markets. We ensure this by providing a constant pipeline of therapy agnostic finished and semi-finished pharmaceutical formulation products by making use of novel delivery solutions.
Our Growth Strategy
Our growth strategy captures who we are, what we stand for and what we want to achieve. The key pillars of our growth strategy are: Entering into co-development and supply partnerships with Original Product Manufacturers globally across delivery platforms; Foraying into the emerging and developed markets for the supply of semi-finished formulations; Initiating export of finished formulations through marketing partnerships in RoW markets; and, Entering the domestic market with OTC pharmaceutical and neutraceutical products.
Leaders in OTF
We have established ourselves as the market leaders in Oral Thin Film (OTF) technology in India and amongst a handful of OTF players globally. Our technology platform and portfolio consists of 19 applied product/process patents, with 24 DCGI products already approved and awaiting approvals for 14 products in India and 13 products overseas. Our OTF Technology has been awarded as the “Best Innovation Development of a Solid Dosage Form” in 2016 by the Indian Pharmaceutical Association. We are well positioned to capitalize on the growing OTF market globally.
Pharmaceutical Market - Global and Domestic
Globally, the pharmaceutical industry trends are driven by an aging population, changing lifestyles, hectic daily activities, unhealthy eating habits, and increased incidence of chronic diseases, providing growth opportunities to the industry players. The industry is engaged in discovery, development, manufacture and marketing of prescription drugs. However, the industry is bracing itself with some fundamental challenges due to increasing investment and stringent regulations and looking for newer ways to drive growth. Concerns related to quality, affordability and localization by the various Governments and the public at large are creating uncertainties.
Generalization, accompanied by fierce competition is resulting in rapid price erosion, impacting overall profitability and emphasizing the risk related to new product development.
The domestic healthcare market is also on the cusp of a paradigm shift owing to new Government policies related to product promotional practices and emphasis on generalization, coupled with the advent of large pharmacy chains, disruption of conventional distribution channels and introduction of the Goods & Services Tax (GST). Low cost of production and R&D boosts the efficiency of Indian pharmaceutical companies. India''s ability to manufacture high-quality, low-priced medicines, presents a huge business opportunity for the domestic pharmaceutical industry, while increased regulatory tightening and generalization create a challenge to the creative genius of our industry.
On the back of our strategy to focus on providing therapeutic agnostic drug delivery solutions for healthcare products in the Emerging and RoW markets, we have been able to stay away from some of the key challenges the industry faced in the past year. We managed to grow our exports by 15.5% at Rs, 156 crore, as compared to Rs, 135 crore in the previous year. Our strategy made us increase our focus on product differentiation and development of portfolio favoring complex generics, a relatively uncrowned space, that will continue to be our mainstay for FY2019. We will simultaneously continue to invest in R&D for development of products and solutions that will also be targeted for the developed markets.
Although our journey of the past 25 years has certainly been eventful, today we are at the beginning of another exciting adventure. Our transformation uniquely positions us to take advantage of the massive disruption and paradigm shifts taking place in the pharmaceutical business - globally and domestically.
We have set up a new R&D centre and drug manufacturing facilities with the latest equipment in anticipation of the transformational work ahead.
Our destiny as an important player in pharmaceutical formulation business awaits us. Going forward, we have a proven business model, dedicated team, continuing strong underlying growth and significant potential. We have crafted a differentiated and winning strategy to sustain our out-performance. We have been leveraging our innovation capabilities in novel manufacturing processes, increasing production volumes, reducing our manufacturing costs and widening global market reach. As we build on our advantages, we remain focused on growing our business in the target markets.
Finally, I wish to place on record our thanks for the advice and direction provided by our excellent Board, the constant efforts and contributions made by our Management Committee and Members of the ZIM Family, and our loyal venders. Most of all, we would like to thank our valued customers, Bankers and other stakeholders, for providing their loyal support.
On behalf of the management and the Board of Directors, I again wish to thank all our staff, shareholders, business partners and associates for their continued commitment and support to ZIM Laboratories Limited.
Thank you for being a part of our ongoing success story.
Dr. Anwar S. Daud Chairman & Managing Director