Glenmark Q3 net soars 143% to Rs 477 cr aided by US generic biz

Viswanath PillaMoneycontrolGlenmark Pharmaceuticals on Thursday posted a 143 percent increase in its third quarter net profit for FY17. It beat analyst estimates on the back of strong performance of its formulation business in US aided by 180-day marketing exclusivity of generic Zetia.Glenmark’s net profit rose to Rs 477 crore for the quarter in question compared to the previous year’s Rs 196.2 crore. Revenues rose 43 percent to Rs 2535.08 crore.A CNBC-TV18 analysts poll predicted the net profit at Rs 303 crore, and net sales at Rs 2,372 crore.The US business that constitutes close to half of Glenmark’s business doubled to Rs 1230.8 crore led by new launches including Ezetimibe - which has a 180-day exclusivity.Ezetimibe used in the treatment of high cholesterol is the generic version of Merck-Schering Plough’s Zetia. Glenmark settled the patent litigation with Merck in May 2010.As per the settlement, the company can launch the drug in December 2016 for 134 days of sole exclusivity, ahead of the April 25, 2017 expiry of Merck’s patent exclusivity for Zetia.Glenmark has a licensing partnership with Par Pharmaceutical, a subsidiary Endo. Analysts expect the company to make USD 200-250 million from Zetia in 6 months.The company also launched dermatological products Nystatin and Triamcinolone Acetonide Cream and Triamcinolone Acetonide, in addition to Potassium Chloride Extended-Release tablets to treat low blood levels.The company filed five ANDA applications with the US FDA in the third quarter, and plans to file an additional 10 applications in the forthcoming quarter. The total number of ANDAs filed during this year was eleven.Glenmark’s marketing portfolio through December 31, 2016 consists of 112 generic products authorized for distribution in the US market. The company currently has 63 applications pending in various stages of the approval process with the US FDA, of which 24 are Paragraph IV applications.Glenmark’s US portfolio consists of over 100 generic products authorized for distribution. The company currently has 62 ANDAs in various stages of the approval process with the US FDA.India, the company’s second largest market, grew at modest 5.9 percent to Rs 516.9 crore due to the impact of demonetization and price controls.Around a quarter of Glenmark’s Indian formulation portfolio comes under NLEM, the company said. The European business grew 11 percent to Rs 195.7 crore on the back of new launches in UK and Germany. The company said it won new drug supply contracts in Germany.The rest of the world (ROW) business that includes Russia grew 6 percent to Rs.251 crore. Glenmark’s Latin American sales declined 23.4 percent to Rs 156 crore, as the Venezuela subsidiary’s sales dropped significantly, and even its other markets such as Brazil and Mexico did not perform well.Glenmark has about USD 50 million stuck in the bank account of its subsidiary in Venezuela, as it is facing challenges to repatriate the money it earned through sales. The South American country has controls over transferring dollars earned as income there.Revenue from sale of API to regulated and semi-regulated markets globally grew 33 percent to Rs 192 crore – largely aided by supplies of Olmesartan API ingredients to Mylan, which had 180-day marketing exclusivity.Glenmark filed for two drug master files in US during the third quarter. “The overall growth for the organization has been bolstered due to the strong performance by our US formulation business. It was further aided by the good performance from our API business too. In India, considering the overall demand environment, the business still managed to record sales growth.” said Glenn Saldanha, Chairman & MD, Glenmark Pharmaceuticals Limited.He further added, “During the quarter, we announced our Strategic Blueprint for the Next Decade where the organization’s focus will be directed to three therapeutic areas namely; Oncology, Respiratory and Dermatology. Also, our innovative pipeline continues to make good progress primarily on account of the Bi-specific Antibodies which are in clinical or pre-clinical development stage.”Shares of Glenmark rose 0.98 percent to close at Rs.907.95 on BSE, the benchmark Sensex gained 0.30 percent to end at 28,226.61 points.