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Last Updated : Jan 01, 2013 08:52 AM IST | Source: CNBC-TV18

UK biz strong; see FY13 revenue at Rs 1,200cr: Shashun

Shasun Pharma is one of the key suppliers to Vertex for Hepatitis C drug -Incivek, which has received a US Food & Drug Administration (USFDA) 'Black Box' warning. This warning indicates that if one gets severe rash symptoms then the drug should be stopped using immediately.


Shasun Pharma is one of the key suppliers to Vertex for Hepatitis C drug -Incivek, which has received a US Food & Drug Administration (USFDA) 'Black Box' warning. This warning indicates that if one gets severe rash symptoms then the drug should be stopped using immediately.


Its stock price has tanked from Rs 180 to Rs 137 in the past couple of trading sessions. S. Abhaya Kumar, MD, Shasun Pharma told CNBC-TV18 that this fall in stock price has not impacted their business.


"UK business continues to be very strong and has good amount of profits. We don’t foresee any problem because of any hearsay in the market about the customers," he added.


He expects the company to clock revenues of Rs 1200 crore and Rs 50 crore EBITDA for fiscal year 2013.


Below is an edited transcript of Shasun Pharma's inetrview on CNBC-TV18


Q: What is the likelihood of this “Black Box” warning getting severe from the USFDA or do you think that this is just it and that anyone who receives severe symptoms should stop utilising this drug as a whole?


A: As a policy we do not talk about our customers nor confirm that we supply to Vertex. Whatever knowledge you have about Vertex, the internet knowledge about the “Black Box” warning we too have the same amount of knowledge. This is where we manufacture APIs for the innovators from our UK unit. We have lot of other customers who really support us and are getting a contract for a new molecule.


We also have two important contracts signed with two innovator companies for few years to supply some of the APIs and the intermediates for them. So, the UK business continues to be very strong and have good amount of profits. We don’t foresee any problem because of any hearsay in the market about the customers.


Q:  Is nothing affected in terms of supplies to Vertex at this point in time or may be supplies to one of your key customers in the US?


A: It has not affected. Business is as usual at Shasun. The expected growth of around 20-25 percent this year may come down to 10-15 percent. Our long term plan for reaching Rs 2000 crore by 2014-15 is intact. We are very confident of achieving it.


Also Read: Aurobindo Pharma gets US FDA nod for Nafcillin injections


Q: Is the “Black Box” warning not a fact to Vertex itself?


A: “Black Box” warning about Vertex is a confirmed case, it is not hearsay.

Q: What is the percentage of your sales to Vertex and what composition does that API contribute to your total revenues from APIs?


A: If you look at Shasun’s total revenues, 45 percent is API, 45 percent is Contract Research and Manufacturing Services (CRAMS) business and 10 percent is from the formulations.


Q: In that 45 percent, does this API form a large part?


A: We do not talk about our customers. This actually comes under CRAMS business not under API business. Anything which applies to the innovator comes under CRAMS business.


Q: Would you consider retracting or renegotiating with regards to this particular drug in terms of supplies or would you continue your supplies as per your contract?


A: We do not talk about our customers.


Q: Last year was an excellent year for you, both in terms of revenues as well as earnings before interest, taxes, depreciation, and amortization (EBITDA) growth. What may be the rate of growth of revenues and EBIDTA?


A: This year our revenues are going to be around Rs 1200 crore, with EBITDA of Rs 150-160 crore.


Q: What about FY14 which is tipped as a bigger year for you?

A: FY14 is going to be a big year for us and we expect the revenues of around Rs 1500 crore and above because that will be inline with our target of Rs 2000 crore by 2014-15 and with EBITDA of Rs 200 crore.



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First Published on Dec 31, 2012 02:45 pm
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