Viswanath Pilla Moneycontrol News
Fourth quarter earnings, some big generic approvals in US, NPPA's notices to drug makers for non-compliance with pricing rules and GST rate announcement were the highlights of the week.
How did pharma index perform?
The BSE Healthcare Index, which has shown signs of recovery last week, slipped into red this week. The BSE Healthcare Index underperformed compared to benchmark BSE Sensex. While the benchmark BSE Sensex gained 0.59 percent, BSE Healthcare declined 0.57 percent this week.
Shares of Lupin and Dr Reddy’s arrested their three-week fall by gaining 4.77 percent and 1.61 percent, respectively. Sun Pharma, Cadila, Aurobindo, Cipla, Divis, Glenmark were the losers. Glenmark was the worst performing stock losing almost 13.3 percent of its market value.
US FDA approvals
The United States Food and Drug Administration (US FDA) approvals of some key drugs kept the industry busy.
Dr Reddy’s and Lupin benefited out of two much anticipated approvals in US market. Dr Reddy’s got US FDA approval of generic anti-cancer drug Doxil. Doxil developed in partnership with Natco Pharma is a complex injectable drug with low competition.
Lupin got approval for its generic version of anti-schizophrenia drug Seroquel extended release tablets. Seroquel XR had US sales of USD 1.27 billion as March 2017. Lupin has limited competition and is expected to make good cash flows out of this generic.
Glenmark received US FDA nod to initiate a Phase 1 study of its anti-cancer biologic GBR 1342.
Laurus Labs cleared US FDA inspection for its plant in Vizag.
Drug price control and NPPA
Indian drug regulator the National Pharmaceutical Pricing Authority (NPPA) never ceased to be in news. This week NPPA showcause notices threatening penal action against dozens of pharmaceutical firms selling hundreds of fixed-dose combination (FDC) drugs without complying with various provisions of drug price control order. National Pharmaceutical Pricing Authority (NPPA) has identified 52 companies selling 201 FDC formulations without applying for price approval.
Startup fund
The government approved USD 250 million corpus as part of Biopharma Mission to fund biotech startups and accelerate innovation in the areas of vaccines, bio-therapeutics and medical devices. World Bank has agreed to line up USD 125 million for the fund.
Q4 results
Dishman, Laurus Labs and Glaxosmithkline have posted decent set of numbers in Q4 earnings.
Things to look out for next week
Busy week – with four big companies Lupin, Sun Pharma, Cadila and Aurobindo announcing their Q4 results. Will be interesting to see the how they performed in US market in backdrop of competition and pricing pressure. Drug makers will also give their commentary on GST rates and implementation. It was said that GST rollout could possible cause some disruption to the supply chain.
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