RANBAXY LABS (NSE:RANBAXY)

QUOTE AND NEWS
The Economic Times  Oct 5  Comment 
From trading at a high of Rs 609 in 2008, Ranbaxy’s stock crashed to a low of Rs 134 in March 2009 after regulatory action by the US FDA.
The Economic Times  Sep 30  Comment 
"Ranbaxy is a 'BUY' call with a target of Rs 650 and a stop loss of Rs 625."
The Economic Times  Sep 29  Comment 
Among the top performers in the pharma space have been Sun Pharmaceuticals, Ranbaxy, Lupin and Aurobindo Pharmaceuticals.
The Economic Times  Sep 29  Comment 
"Ranbaxy is a 'BUY' call with a target of Rs 650 and a stop loss of Rs 610."
The Economic Times  Sep 26  Comment 
"Ranbaxy is a 'SELL' call with a target of Rs 541 and a stop loss of Rs 563."
The Hindu Business Line  Sep 23  Comment 
Conclusively breaching its 50-day moving average and key support at ₹590 levels, the stock of Ranbaxy Laboratories tumbled 3.4 per cent on Tuesday. This fall has strengthened the stock’s sh...
The Hindu Business Line  Sep 23  Comment 
The Hindu Business Line  Sep 17  Comment 
Drug-maker Ranbaxy Laboratories has been asked to furnish details on its products eligible for reimbursements from the US Government, the company informed the Bombay Stock Exchange on Wednesday.
Reuters  Sep 15  Comment 
REUTERS - Epirus Biopharmaceuticals Inc said India's drug regulator has approved its copy of a top-selling arthritis treatment, paving the way for its launch in the country early next year.
FiercePharma  Sep 15  Comment 
Pfizer and Ranbaxy Laboratories persuaded a U.S. judge to toss out an antitrust lawsuit accusing them of conspiring to delay generic versions of the cholesterol-fighting blockbuster Lipitor.




 

Ranbaxy Laboratories Ltd. (NSE: EQRANBAXY) is the largest generic pharmaceutical company in India by sales and a top 10 generic company globally.[1] [2][3]

In 2008, a majority stake in the company was acquired by Japanese Pharma Daiichi Sankyo Company (4568-TO),[4] the third largest pharmaceutical company in Japan.[5] Daiichi-Sankyo’s strength in proprietary medicine complements Ranbaxy’s leadership in the generics segment and both companies acquire a broader product base, therapeutic focus areas and well distributed risks.[6]

Ranbaxy also reached settlements with the makers of the world's two largest selling drugs - Lipitor (with Pfizer (PFE)) and Nexium (with AstraZeneca (AZN)).[7] This decision will allow for an earlier introduction of a generic formulation in several countries. Ranbaxy is also bringing out novel drug-delivery systems and was the first Indian company to license a product in this field to Bayer AG.[2]

Company Overview

Ranbaxy Laboratories Limited operates as an integrated international pharmaceuticals organization with businesses encompassing the value chain in the marketing, production and distribution of pharmaceuticals products. It operates under two segments: Pharmaceuticals and other business. Pharmaceuticals segment comprises the manufacture and trading of Formulations, Active Pharmaceuticals Ingredients (API) and Intermediate, Generics, Drug discovery and Consumer Health Care products. Other business comprises rendering of financial services.

The Company manufactures products for anti-infectives, cardiovasculars, musculoskeletal, gastrointestinals, dermatologicals, and central nervous system.

Ranbaxy Laboratories Limited encompasses the entire pharmaceutical value chain[8] from manufacturing to marketing generic pharmaceuticals, value added generic pharmaceuticals, branded generics, Active Pharmaceuticals Ingredients (API) and intermediates.[9] As a research driven company, over 6% of its revenues are invested in R&D.[10] Among the pharmaceutical companies in India, Ranbaxy has the largest R&D budget with an R&D spend of over U.S. $100 million.[11]

The company has manufacturing operations in eight countries with a ground presence in 49 countries, and its products are available in over 125 countries. It has been aggressively entering into joint ventures and strategically acquiring companies in the past few years. Besides concluding its acquisition of Be-Tabs in South Africa, which makes Ranbaxy the 5th largest generic pharmaceutical company in South Africa, the Company acquired 13 Dermatalogy products from Bristol-Myers Squibb in the U.S in 2007.[2] Ranbaxy acquired RPG Aventis which has since been renamed Ranbaxy Pharmacie Generiques SAS. It also has subsidiaries in Spain, Netherlands, Russia and Australia.

Business and Financial Metrics

Second Quarter 2010 Results (ended June 30, 2010)[12]

Ranbaxy reported sales for the second quarter of $458 million (Rs 21,029 million), a growth of 22% over the second quarter of 2009. Earnings before interest, taxes, depreciation & amortization (EBITDA) was $90 million (Rs. 4,168 million), a margin of 20%. Profit after tax was $72 million (Rs. 3,320 Mn), a margin of 16%.

Operational Highlights of the Second Quarter 2010[12]

  • To sharpen its focus on generics, the Company reached an agreement to transfer its New Drug Discovery Research assets to Daiichi Sankyo India Pharma Pvt Ltd (DSIN).
  • Ranbaxy launched Atorvastatin in Canada and South Africa. The launch in Canada, was under the Company’s global settlement with Pfizer. In South Africa, Ranbaxy was the first to launch a generic version in the market.
  • Valacyclovir, an FTF product in the US, achieved a peak market share of 74% before the end of exclusivity during the quarter.
  • The Company introduced Daiichi Sankyo’s innovative anti-platelet drug Prasita (Prasugrel) in India. During the quarter, Ranbaxy launched 31 new products in India, including 3 in-licensed products.
  • The Company made 32 filings and received 35 approvals for dosage forms during the quarter.
  • During the quarter, emerging markets recorded sales of $230 million, a growth of 6%, and contributed about 50% to global sales. Sales in developed markets amounted to $203 million, a growth of 63%.

Business Segments

Anti-Infectives[13]

This segment launched Valacyclovir Hydrochloride in the United States. The product was also launched in United Kingdom and France.

Cardiovascular[13]

This segment introduced the drug Simvastatin. The Company launched Olvance (Olmesartan Medoxomil) and its fixed dose combination with Amlodipine (Ol-Vamlo), in India. Further expanding its portfolio in Canada, Ranbaxy launched two products, Ran-Simvastatin (Simvastatin) and Ran-Amlodipine (Amlodipine).

Musculoskeletal[13]

In the Musculoskeletal segment, Ketorolac was the primary contributor to sales. In the United States, Ranbaxy entered into an agreement with Validus Pharmaceuticals to market and distribute an Authorized Generic version of Rocaltrol (Calcitriol). Ranbaxy's flagship brand in this segment is Volini.sssssss

Central Nervous[13]

The key products in Central Nervous System segment are Gabapentin and Sertraline. The two other products include Oxcarbazepine Suspension and Sumatriptan tablets.

Gastrointestinal[13]

The Company launched Pantoprazole in the Gastrointestinals segment. Ondansetron tablets were launched in Canada.

Dermatological[13]

The Company received Dermatological franchises through the acquisition of brands and marketing rights from Ochoa Laboratories in India for their range of Dermatological products.

Trends and Forces

Gaining First-to-File exclusive rights to a generic through patent challenges

Generic drug companies can challenge a patent's validity or argue that their version does not infringe on the existing drug's patent even before patent expiration. The first company to apply for FDA Approval for a generic, in spite of an existing patent, receives a 180-day period of exclusivity to produce and sell the generic version. [14]

Ranbaxy has been filing more than 20 ANDAs to the U.S. Food and Drug Administration (FDA) each year.[15] It has one of the largest product pipeline in the US that includes 18 potential First-To-File opportunities with a market size of around US $27 billion, at innovator prices.[2]

Pricing Pressures in US & European generic markets affect Ranbaxy's revenue

Due to an increase in number of pharmaceutical companies forging into the generics market, there has been downward pricing pressure on generics in the U.S.[16] The generics market in Europe, which had become a safe haven for Indian pharmaceutical companies after competition pulled down margins in the US, has come under pricing pressure too, especially in countries like Germany, the UK and France, the top three generics markets on the continent. These countries have seen margins in the generics segment erode as much as 80-90%.[17] The pricing pressure has been adversely affecting revenue as both US & Europe occupy Ranbaxy's majority market share.

Regulatory issues raised by regulators in various countries where Ranbaxy operates pose a risk to its markets

On September 16, 2008 the U.S.Food and Drug Administration (FDA) issued warning letters to Ranbaxy Laboratories Ltd., and an Import Alert for Drugs from Two Ranbaxy Plants in India affecting over 30 different generic drugs and citing serious manufacturing deficiencies. Following this the World Health Organisation (WHO) observed that several inspections of Ranbaxy's Paonta Sahib site, in June 2008, revealed noncompliance with WHO good manufacturing practices standards.[18] Further, India's business daily Mint quoted the Canadian health ministry as saying a "regulatory letter" was sent to Ranbaxy Pharmaceuticals Canada requesting an action plan and a response to the FDA's move.[19] Impending healthcare reforms in Romania, Ranbaxy's largest market in the EU, is leading to a delay in the government's product and price approval list, and adding to uncertainty amongst customers and suppliers.[2] The outcome of these regulatory issues pose a risk to the company's image as global generic player as well a risk to its markets worldwide.

Competition

The pharmaceutical industry is characterized by rapid advances in scientific knowledge. The industry is therefore led by large manufacturers and marketers of drugs investing heavily in research & development, having clinical testing, marketing and distribution capabilities.[20] Some of Ranbaxy's main competitors are:

  • Sun Pharmaceuticals Industries is No. 1 in India in specialty therapy areas like psychiatry, neurology, cardiology, gastroenterology, diabetology and respiratory.[21]. It has brands in 30 markets worldwide and also has a generic presence in the U.S. with Caraco Pharm Labs, Sun Pharmaceutical Industries Inc (subsidiary).[21]
  • Cipla is a leader in the domestic retail pharmaceutical market.[22] It also exports raw materials, intermediates, prescription drugs, over-the-counter products, and veterinary products to some 180 countries around the world.[22]
  • GlaxoSmithKline is one of the oldest pharma companies in India and with a turnover of Rs. 1500 crore is one of the market leaders in India with a share of 6.2%.[23] Its main portfolios consist of anti- infectives, dermatologicals and pain management drugs.[24]
  • Dr. Reddy's Laboratories is a global pharmaceutical company with its headquarters in India and a presence in more than 100 countries.[25] In India it the largest drug maker by sales.[26]

References

  1. Ranbaxy Labs Corporate Profile
  2. 2.0 2.1 2.2 2.3 2.4 Annual Report 2007
  3. YahooFinance/Ranbaxy/Company profile
  4. The Hindu Business Line/Daiichi Sankyo acquisition of Ranbaxy
  5. Ranbaxy Official Website / Press Release 2008
  6. Wikipedia Ranbaxy Labs
  7. ranbaxy Labs/History History of Ranbaxy labs
  8. Google Finance/ Ranbaxy Labs Parent
  9. Ranbaxy Labs/Products
  10. Equity Master/news on Ranbaxy/April 5, 2008
  11. Ranbaxy Labs/Indian Operations
  12. 12.0 12.1 Ranbaxy Investor Relations: "RANBAXY ACHIEVES USD 1 BILLION REVENUE AND USD 282 MN PAT FOR H1’2010. AFTER RECORD Q1 SALES, Q2 GROWTH AT 22%" August 12, 2010
  13. 13.0 13.1 13.2 13.3 13.4 13.5 Reuters: Ranbaxy Labs Company Profile
  14. Wikinvet Concept/Generic Drug
  15. Ranbaxy USA/Business Opportunities
  16. The Hindu Bisiness Line/Ranbaxy Q3 net down
  17. YahooFinance/After US, generics players feel the heat in European market
  18. Biopharma Today/Ranbaxy's trouble with WHO
  19. AFP/Canada drug review
  20. Hoovers/Pharma Industry Profile
  21. 21.0 21.1 Sun Pharma Industries
  22. 22.0 22.1 YahooFinance Cipla
  23. GlaxoSmithKline website
  24. Business Standard/ORG-IMS report
  25. Dr.Reddys Labs/Company Profile
  26. Business Standard/ Dr. Reddy's Labs
Wikinvest © 2006, 2007, 2008, 2009, 2010, 2011, 2012. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.
Powered by MediaWiki