Business Daily from THE HINDU group of publications
Friday, Apr 17, 2009
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Business Daily from THE HINDU group of publications Friday, Apr 17, 2009 ePaper | Mobile/PDA Version | Audio | Blogs |
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Corporate
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Outlook
Mr Umang Vohra, Chief Financial Officer G. Naga Sridhar Hyderabad, April 16 Pharma major Dr Reddy’s Laboratories Ltd will start supplying drugs to Germany’s largest health insurance fund, Allgemeine Ortskrankenkasse (AOK) as legal hurdles for the $3.5-billion tender have been cleared. “While the exact value of drugs to be supplied cannot be disclosed, we are the third largest contractor globally for AOK to supply 18 per cent of total volume of drugs,” Mr Umang Vohra, Chief Financial Officer, Dr Reddy’s, told Business Line. The Hyderabad-based company, which bagged the tender for 33 contracts (for eight products) last year, could not begin supplies as the tender process was legally challenged by some firms in Germany. ‘Significant revenue’Now that the legal hurdles are cleared, Dr Reddy’s expects “significant revenue” from the tender beginning this quarter. About 60 per cent of the drugs to be supplied would be shipped from India. The commencement of supplies is also likely to provide relief for the company in the German market which is witnessing severe pricing pressure. “The pricing pressure in Germany is also being offset by maximisation of sales through pharmacies, shifting of manufacturing process to India and value optimisation in various areas,” he said. IMPROVEMENTIn comparison with the first three quarters, the business environment has improved considerably in the US and other key markets, Mr Vohra said. “From the last quarter, there is some improvement which is expected to continue during the current quarter as well,” he said. In the global generics segment, Sumatriptan (generic version of GSK’s Imitrex) – launched in North American and Russian markets in November 2008 – continued to benefit the company in the last quarter too. “Despite the entry of two competitors in February, it had generated significant revenues,” Mr Vohra said, while not disclosing the actual figure. In the third quarter of last fiscal, Sumatriptan contributed $73 million revenues. INVESTMENTThe company, which is developing two special economic zones in Visakhapatnam and Hyderabad, plans to go ahead with the projects. “While we are reviewing non-core projects, the SEZs would be taking off as planned. The investment cycle will begin soon and we are working on investment patterns,” he said. Dr Reddy's buys German co Betapharm for Rs 2,250 cr — Biggest overseas acquisition by an Indian pharma co Dr Reddy's launches new drug Dr Reddy's completes 2 acquisitions More Stories on : Outlook | Pharmaceuticals | Dr. Reddy's Laboratories Ltd
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