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D o m e s t i c g r o w t h c r a wl s b a c k t o n o r m a l …
In September the domestic branded formulations market grew by ~ 15%
after faltering to ~9% growth in July and ~14% growth in August,
according to latest All India Organisation of Chemists & Druggists
(AIOCD) data. Domestic giants such as Sun, Lupin and Glenmark as well
as MNCs such as Pfizer, Sanofi Aventis and Novartis lead the growth.
Unlisted players such as Macleods, Mankind, Intas and USV also
registered good growth.
During the month, Strides Arcolab hogged the limelight with some
important approvals. It received two approvals in the Oncology space
from USFDA and EDQM. Besides it also received USFDA approval for an
Anti-infective and a successful cGMP audit for the existing plant from the
same authority. On the IP front, Glenmark received unfavourable verdict
in its Anti-hyper Tarka case and was asked to pay damages to the
innovators, which had some effect on the stock price. Also in the news
was the break up of JB Chemicals and Dr Reddy’s tie up to acquire JB’s
prescription portfolio in Russia and CIS countries due to policy changes
in Russia. Sun Pharma received some respite on the regulatory front
when its US subsidiary officially resolved the observations sited in a
warning letter from the USFDA.
S e c t o r v i e w
The healthcare index under performed the broader market on account of
dampened global sentiments and some value buying in the beaten down
stocks of the broader index. But importantly some leading large caps
such as Ranbaxy, Lupin and Cipla have shown good amount of resilience
and even some of the mid caps such as Biocon and Strides have also
fathomed the selling pressure. This suggests that the sell-off was not
broad based and still the sector remains safe heaven in volatile periods.
This is mainly on account of relative resilience to global shocks, in line
Q1FY12 numbers amidst margin pressure and better visibility of future
performance. The margin pressure was mainly on account of pricing
pressure in acute therapies in both the US and India. The field force
expansion in India also added some pressure. Going ahead, we expect
improvement on this front on account of chronic therapy focus,
improved contribution from the new field force and rural penetration.
Good traction from the US, Japan and other developed markets
supported by product approvals, a growing presence in Pharmerging
markets and a strong foothold in India are some aspects that will
continue to weigh on the relative out performance vis-à-vis broader
markets.
Regulatory approvals
Jubilant gets USFDA nod for Anti Ulcerant tablets
Jubilant Life Sciences has received approval for pantoprazole sodium
delayed release (Anti-ulcerant) tablets 20mg and 40mg, a generic
equivalent of Protonix a product of Wyeth, from the USFDA. The total
sales of pantoprazole sodium tablets in USA were over US$1.46 billion as
on March 2011, as per New Port Global Database. The product will be
marketed by its US subsidiary Jubilant Cadista Pharmaceuticals Inc.
under its own label.
Lupin receives UKMHRA approval for Topiramate tablets
Lupin has received marketing authorization from the UKMHRA for the
Topiramate tablets in multiple strengths of 25 mg, 50 mg, 100 mg and
200 mg. It is indicated as adjunctive therapy for patients with partial
onset seizures or primary generalized tonic-clonic seizures and falls
under the Central Nervous System (CNS) therapeutic category.
USFDA approves Lupin’s NOR-QD tablets
Lupin’s subsidiary, Lupin Pharmaceuticals Inc. (LPI) has been granted
final approval by the USFDA to market a generic version of Watson’s
NOR-QD tablets. Lupin will commence shipping its norethindrone tablets,
USP 0.35 mg shortly. NOR-QD (norethindrone tablets, USP 0.35 mg) is a
progestin-only oral contraceptive indicated for the prevention of
pregnancy. Combined annual sales for NOR-QD and its generic
equivalents were approximately US$ 52 million for the twelve months
ended June 2011 based on IMS Health sales data.
Strides gets UK MHRA approval for Oxaliplatin injection
Strides Arcolab has obtained European Union approval for Oxaliplatin
Injection 5mg/ml (10 ml 20 ml and 40 ml). This is the second European
approval for the oncology product. The current approval is from UK and
approval for the rest of the European countries is expected shortly.
Oxaliplatin is a chemotherapy drug used to treat advanced cancer of the
colon and rectum. It is used in combination with other medications to
slow or stop cancer cell growth. Oxaliplatin is amongst 37 drugs licensed
to Pfizer on a semi-exclusive basis for sales in 17 European countries.
Strides receives USFDA approval for Paclitaxel Injecation
Strides Arcolab has received USFDA approval for Paclitaxel Injection
USP, 6mg/ML packaged in 30mg/mL, 100mg/16.7 mL and 300mg/50mL
multiple dose vials. Paclitaxel can be used alone or with other drugs to
treat ovarian cancer, breast cancer, non-small cell lung cancer and AIDSrelated Kaposi's sarcoma. Paclitaxel is among the products in the drug
shortage list of the American Society of Health-System Pharmacists and
the USDFDA. The company said the product would be launched through
Pfizer immediately. According IMS data, the US market for generic
Paclitaxel was around US$ 46 million.
Strides gets USFDA nod for Clindamycin injection
Strides Arcolab has received US FDA approval for Clindamycin Injection,
USP, an antibiotic used to treat bacterial infections. According to IMS,
the 2011 U.S. market for Injectable Clindamycin approximates to US$ 65
million. The product is expected to be launched in early 2012.
Sun Pharma receives USFDA approval for Ranitidine HCL syrup
Sun Pharmaceuticals has received the final approval from the USFDA for
Ranitidine Hydrochloride 15mg (base) /ml syrup. It was originally
developed and marketed by the GlaxoSmithKline under the brand name
Zantac. The Syrup falls under the Gastrointestinal (GI) therapeutic
category. The product has a market size of approximately US$ 40 Million
according to IMS Health.
IP issues
Glenmark lost Tarka patent litigation against Sanofi & Abbott
Sanofi Aventis and Abbott Laboratories won a patent litigation case
against Glenmark Pharmaceuticals related to the generic version of Antihypertensive Tarka in a US district court. Under the judgment, Glenmark
has been asked to pay US$16 million to Abbott for damages. Glenmark is
expected to appeal in a higher court against the verdict.
Sun Pharma lost patent litigation of Eloxatin against Sanofi
A US Court in New Jersey ruled against Sun Pharmaceuticals in favor of
Sanofi U.S. with respect to a contractual dispute arising from the
resolution of a patent litigation over cancer drug Eloxatin. Sun had
appealed the District Court's April 2010 ruling requiring Sun to cease
selling its at-risk Eloxatin (generic oxaliplatin) product as of June 30,
2010. The District Court's latest ruling maintains Eloxatin's US market
exclusivity through August 9, 2012.
Deals & Alliances
Dr Reddy’s & JB chemicals terminated deal signed related to product
portfolio in Russia
Dr. Reddy's Laboratories has terminated the proposed business deal to
acquire the pharmaceutical prescription portfolio of JB Chemicals &
Pharmaceuticals in Russia and other CIS countries. On July 21, 2011, the
company had entered into an agreement with said JB chemicals, which
involved acquisition of 20 brands, key one being Metrogyl and Jocet, for
a consideration of US$34.85 million. It has also entered into a supply
agreement with JB Chemicals for the continued manufacturing and
supply of these products associated with the acquired brands. The
scrapping of the agreement with Dr Reddy’s follows policy changes
approved by Russia to make public healthcare less dependent on drug
imports by encouraging domestic manufacturers.
Glenmark exercised purchase option of derma products with Paul
Capital
Glenmark Pharmaceuticals has paid US$28.8 million to Paul Capital's
Royalty Fund and exercised its purchase option related to the derma
product portfolio. In 2005, Glenmark signed a royalty deal with Paul
Capital Partners' Royalty Fund. Under the terms of the agreement, Paul
Royalty had invested US$27 million to finance the development of 16
dermatological products by Glenmark for the US market. Glenmark had
an option of paying royalty on net sales or paying one-time royalty
payment. Till date, Glenmark has been paying royalty on the drug
portfolio based on sales. Now, the company has exercised the option by
paying one-time royalty of US$28.8 million. With the exercise of the
purchase option, Glenmark has no further obligation to pay royalties to
Paul Capital.
Ipca board approves amalgamation of Tonira Pharma
Ipca Laboratories board has approved amalgamation of Tonira Pharma
with the company from April 1, 2011. The scheme envisages an
exchange ratio of six equity shares of | 2 each of Ipca Laboratories for
every 100 equity shares of | 10 each of Tonira Pharma.
Jubilant signs multi year contract with US based Pharma company
Jubilant Life Sciences subsidiary, Jubilant HollisterStier, a contract
manufacturer in North America has entered into a multi year contract
with a US pharma company to manufacture over the counter (OTC)
women health and personal care product. The product will be
manufactured at Jubilant's Montreal facility in North America. This is a
“take or pay” contract with a minimum quantity commitment and has a
total value of over US$ 70 million for a period of over 4 years with a
possibility of extension for another 2 years for a higher quantity. The
production of the product under this agreement started earlier this
month.
New Launches
Dr Reddy’s launches Rivastigmine Tartrate capsules in US market
Dr. Reddy’s Laboratories has launched Rivastigmine Tartrate Capsules
(1.5 mg, 3 mg, 4.5 mg and 6 mg), a bioequivalent generic version of
Exelon Capsules, used in the treatment for Parkinson’s disease, in the US
market following the approval by USFDA. The Exelon brand and generic
Rivastigmine tartrate had U.S. sales of approximately US$92.6 million for
the most recent twelve months ending June 2011 according to IMS
Health.
Ranbaxy launches Esomeprazole in UK market
Ranbaxy (UK) has launched esomeprazole 20 mg and 40 mg tablets
(Anti-ulcerant), the first approved generic bio-equivalent version of the
product Nexium by Astra Zeneca, in the UK. Annual UK sales of
esomeprazole stood at £ 60 million (IMS June 2011).
Facility Approval
Strides’ oral dosage manufacturing facility successfully re-inspected by
USFDA
Strides Arcolab’s oral dosage forms manufacturing site in Bangalore was
recently inspected by the USFDA as part of GMP compliance audit and
the facility continued to be approved with 'zero inspectional observation'
reported in FDA 483. Previous USFDA inspection and approval for this
facility was in 2008. The Bangalore facility makes oral dosage forms such
as tablets and capsules. The manufacturing plant supports important
current and future submissions for the US market.
M&A, Demerger and JVs
Aurobindo forms JV with Russian OJSC Diod
Aurobindo Pharma and OJSC Diod, a Russian manufacturer of ecological
healthcare equipment and nutrition supplements, have established a
50:50 joint venture (JV) – Aurospharma Company – in Russia to
manufacture and sell the pharmaceuticals in the markets of Russia,
Belarus and Kazakhstan. The JV intends to construct a plant to
manufacture non-penicillin and non-cephalosporin Rx drugs and other
drugs that are categorised as over-the-counter (OTC) products in Russia.
It has also been contemplated to transfer 100 per cent interest in the
CJSC Olifen (engaged in production of pharmaceutical substances) being
held by Diod to the JV company, subject to due diligence. In addition,
the JV will source penicillins, cephalo-sporins and few other therapy
products manufactured by Aurobindo Pharma in India, to sell in the
markets of Russia, Belarus and Kazakhstan.
Warning Letters
Sun Pharma resolves cGMPs issues at Canbury facility
Sun Pharmaceutical Industries, Inc., a wholly owned subsidiary of Sun
Pharmaceuticals has resolved the USFDA observations (mentioned in a
warning letter issued on 25th August 2010) at its Cranbury, New Jersey,
US manufacturing facility. As per the USFDA, the site now has an
acceptable regulatory status.
Other development
Barclays & SBI life insurance subscribed to Ipca Laboratories’ non
convertible Debentures
Barclays Bank PLC and SBI life Insurance Company have subscribed to
Ipca Laboratories Ltd's 500, 9.95% Secured, Redeemable Non
Convertible Debentures of the face value of |10 lakh each, amounting to
|25 crore each aggregating to | 50 crore. These debentures will be
redeemed in bullet at the end of third year if the put/call option is
exercised or the end of 5th year from the date of subscription. These
Non Convertible Debentures are proposed to be listed on the wholesale
debt segment of the National Stock Exchange of India Limited (NSE).
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
D o m e s t i c g r o w t h c r a wl s b a c k t o n o r m a l …
In September the domestic branded formulations market grew by ~ 15%
after faltering to ~9% growth in July and ~14% growth in August,
according to latest All India Organisation of Chemists & Druggists
(AIOCD) data. Domestic giants such as Sun, Lupin and Glenmark as well
as MNCs such as Pfizer, Sanofi Aventis and Novartis lead the growth.
Unlisted players such as Macleods, Mankind, Intas and USV also
registered good growth.
During the month, Strides Arcolab hogged the limelight with some
important approvals. It received two approvals in the Oncology space
from USFDA and EDQM. Besides it also received USFDA approval for an
Anti-infective and a successful cGMP audit for the existing plant from the
same authority. On the IP front, Glenmark received unfavourable verdict
in its Anti-hyper Tarka case and was asked to pay damages to the
innovators, which had some effect on the stock price. Also in the news
was the break up of JB Chemicals and Dr Reddy’s tie up to acquire JB’s
prescription portfolio in Russia and CIS countries due to policy changes
in Russia. Sun Pharma received some respite on the regulatory front
when its US subsidiary officially resolved the observations sited in a
warning letter from the USFDA.
S e c t o r v i e w
The healthcare index under performed the broader market on account of
dampened global sentiments and some value buying in the beaten down
stocks of the broader index. But importantly some leading large caps
such as Ranbaxy, Lupin and Cipla have shown good amount of resilience
and even some of the mid caps such as Biocon and Strides have also
fathomed the selling pressure. This suggests that the sell-off was not
broad based and still the sector remains safe heaven in volatile periods.
This is mainly on account of relative resilience to global shocks, in line
Q1FY12 numbers amidst margin pressure and better visibility of future
performance. The margin pressure was mainly on account of pricing
pressure in acute therapies in both the US and India. The field force
expansion in India also added some pressure. Going ahead, we expect
improvement on this front on account of chronic therapy focus,
improved contribution from the new field force and rural penetration.
Good traction from the US, Japan and other developed markets
supported by product approvals, a growing presence in Pharmerging
markets and a strong foothold in India are some aspects that will
continue to weigh on the relative out performance vis-à-vis broader
markets.
Regulatory approvals
Jubilant gets USFDA nod for Anti Ulcerant tablets
Jubilant Life Sciences has received approval for pantoprazole sodium
delayed release (Anti-ulcerant) tablets 20mg and 40mg, a generic
equivalent of Protonix a product of Wyeth, from the USFDA. The total
sales of pantoprazole sodium tablets in USA were over US$1.46 billion as
on March 2011, as per New Port Global Database. The product will be
marketed by its US subsidiary Jubilant Cadista Pharmaceuticals Inc.
under its own label.
Lupin receives UKMHRA approval for Topiramate tablets
Lupin has received marketing authorization from the UKMHRA for the
Topiramate tablets in multiple strengths of 25 mg, 50 mg, 100 mg and
200 mg. It is indicated as adjunctive therapy for patients with partial
onset seizures or primary generalized tonic-clonic seizures and falls
under the Central Nervous System (CNS) therapeutic category.
USFDA approves Lupin’s NOR-QD tablets
Lupin’s subsidiary, Lupin Pharmaceuticals Inc. (LPI) has been granted
final approval by the USFDA to market a generic version of Watson’s
NOR-QD tablets. Lupin will commence shipping its norethindrone tablets,
USP 0.35 mg shortly. NOR-QD (norethindrone tablets, USP 0.35 mg) is a
progestin-only oral contraceptive indicated for the prevention of
pregnancy. Combined annual sales for NOR-QD and its generic
equivalents were approximately US$ 52 million for the twelve months
ended June 2011 based on IMS Health sales data.
Strides gets UK MHRA approval for Oxaliplatin injection
Strides Arcolab has obtained European Union approval for Oxaliplatin
Injection 5mg/ml (10 ml 20 ml and 40 ml). This is the second European
approval for the oncology product. The current approval is from UK and
approval for the rest of the European countries is expected shortly.
Oxaliplatin is a chemotherapy drug used to treat advanced cancer of the
colon and rectum. It is used in combination with other medications to
slow or stop cancer cell growth. Oxaliplatin is amongst 37 drugs licensed
to Pfizer on a semi-exclusive basis for sales in 17 European countries.
Strides receives USFDA approval for Paclitaxel Injecation
Strides Arcolab has received USFDA approval for Paclitaxel Injection
USP, 6mg/ML packaged in 30mg/mL, 100mg/16.7 mL and 300mg/50mL
multiple dose vials. Paclitaxel can be used alone or with other drugs to
treat ovarian cancer, breast cancer, non-small cell lung cancer and AIDSrelated Kaposi's sarcoma. Paclitaxel is among the products in the drug
shortage list of the American Society of Health-System Pharmacists and
the USDFDA. The company said the product would be launched through
Pfizer immediately. According IMS data, the US market for generic
Paclitaxel was around US$ 46 million.
Strides gets USFDA nod for Clindamycin injection
Strides Arcolab has received US FDA approval for Clindamycin Injection,
USP, an antibiotic used to treat bacterial infections. According to IMS,
the 2011 U.S. market for Injectable Clindamycin approximates to US$ 65
million. The product is expected to be launched in early 2012.
Sun Pharma receives USFDA approval for Ranitidine HCL syrup
Sun Pharmaceuticals has received the final approval from the USFDA for
Ranitidine Hydrochloride 15mg (base) /ml syrup. It was originally
developed and marketed by the GlaxoSmithKline under the brand name
Zantac. The Syrup falls under the Gastrointestinal (GI) therapeutic
category. The product has a market size of approximately US$ 40 Million
according to IMS Health.
IP issues
Glenmark lost Tarka patent litigation against Sanofi & Abbott
Sanofi Aventis and Abbott Laboratories won a patent litigation case
against Glenmark Pharmaceuticals related to the generic version of Antihypertensive Tarka in a US district court. Under the judgment, Glenmark
has been asked to pay US$16 million to Abbott for damages. Glenmark is
expected to appeal in a higher court against the verdict.
Sun Pharma lost patent litigation of Eloxatin against Sanofi
A US Court in New Jersey ruled against Sun Pharmaceuticals in favor of
Sanofi U.S. with respect to a contractual dispute arising from the
resolution of a patent litigation over cancer drug Eloxatin. Sun had
appealed the District Court's April 2010 ruling requiring Sun to cease
selling its at-risk Eloxatin (generic oxaliplatin) product as of June 30,
2010. The District Court's latest ruling maintains Eloxatin's US market
exclusivity through August 9, 2012.
Deals & Alliances
Dr Reddy’s & JB chemicals terminated deal signed related to product
portfolio in Russia
Dr. Reddy's Laboratories has terminated the proposed business deal to
acquire the pharmaceutical prescription portfolio of JB Chemicals &
Pharmaceuticals in Russia and other CIS countries. On July 21, 2011, the
company had entered into an agreement with said JB chemicals, which
involved acquisition of 20 brands, key one being Metrogyl and Jocet, for
a consideration of US$34.85 million. It has also entered into a supply
agreement with JB Chemicals for the continued manufacturing and
supply of these products associated with the acquired brands. The
scrapping of the agreement with Dr Reddy’s follows policy changes
approved by Russia to make public healthcare less dependent on drug
imports by encouraging domestic manufacturers.
Glenmark exercised purchase option of derma products with Paul
Capital
Glenmark Pharmaceuticals has paid US$28.8 million to Paul Capital's
Royalty Fund and exercised its purchase option related to the derma
product portfolio. In 2005, Glenmark signed a royalty deal with Paul
Capital Partners' Royalty Fund. Under the terms of the agreement, Paul
Royalty had invested US$27 million to finance the development of 16
dermatological products by Glenmark for the US market. Glenmark had
an option of paying royalty on net sales or paying one-time royalty
payment. Till date, Glenmark has been paying royalty on the drug
portfolio based on sales. Now, the company has exercised the option by
paying one-time royalty of US$28.8 million. With the exercise of the
purchase option, Glenmark has no further obligation to pay royalties to
Paul Capital.
Ipca board approves amalgamation of Tonira Pharma
Ipca Laboratories board has approved amalgamation of Tonira Pharma
with the company from April 1, 2011. The scheme envisages an
exchange ratio of six equity shares of | 2 each of Ipca Laboratories for
every 100 equity shares of | 10 each of Tonira Pharma.
Jubilant signs multi year contract with US based Pharma company
Jubilant Life Sciences subsidiary, Jubilant HollisterStier, a contract
manufacturer in North America has entered into a multi year contract
with a US pharma company to manufacture over the counter (OTC)
women health and personal care product. The product will be
manufactured at Jubilant's Montreal facility in North America. This is a
“take or pay” contract with a minimum quantity commitment and has a
total value of over US$ 70 million for a period of over 4 years with a
possibility of extension for another 2 years for a higher quantity. The
production of the product under this agreement started earlier this
month.
New Launches
Dr Reddy’s launches Rivastigmine Tartrate capsules in US market
Dr. Reddy’s Laboratories has launched Rivastigmine Tartrate Capsules
(1.5 mg, 3 mg, 4.5 mg and 6 mg), a bioequivalent generic version of
Exelon Capsules, used in the treatment for Parkinson’s disease, in the US
market following the approval by USFDA. The Exelon brand and generic
Rivastigmine tartrate had U.S. sales of approximately US$92.6 million for
the most recent twelve months ending June 2011 according to IMS
Health.
Ranbaxy launches Esomeprazole in UK market
Ranbaxy (UK) has launched esomeprazole 20 mg and 40 mg tablets
(Anti-ulcerant), the first approved generic bio-equivalent version of the
product Nexium by Astra Zeneca, in the UK. Annual UK sales of
esomeprazole stood at £ 60 million (IMS June 2011).
Facility Approval
Strides’ oral dosage manufacturing facility successfully re-inspected by
USFDA
Strides Arcolab’s oral dosage forms manufacturing site in Bangalore was
recently inspected by the USFDA as part of GMP compliance audit and
the facility continued to be approved with 'zero inspectional observation'
reported in FDA 483. Previous USFDA inspection and approval for this
facility was in 2008. The Bangalore facility makes oral dosage forms such
as tablets and capsules. The manufacturing plant supports important
current and future submissions for the US market.
M&A, Demerger and JVs
Aurobindo forms JV with Russian OJSC Diod
Aurobindo Pharma and OJSC Diod, a Russian manufacturer of ecological
healthcare equipment and nutrition supplements, have established a
50:50 joint venture (JV) – Aurospharma Company – in Russia to
manufacture and sell the pharmaceuticals in the markets of Russia,
Belarus and Kazakhstan. The JV intends to construct a plant to
manufacture non-penicillin and non-cephalosporin Rx drugs and other
drugs that are categorised as over-the-counter (OTC) products in Russia.
It has also been contemplated to transfer 100 per cent interest in the
CJSC Olifen (engaged in production of pharmaceutical substances) being
held by Diod to the JV company, subject to due diligence. In addition,
the JV will source penicillins, cephalo-sporins and few other therapy
products manufactured by Aurobindo Pharma in India, to sell in the
markets of Russia, Belarus and Kazakhstan.
Warning Letters
Sun Pharma resolves cGMPs issues at Canbury facility
Sun Pharmaceutical Industries, Inc., a wholly owned subsidiary of Sun
Pharmaceuticals has resolved the USFDA observations (mentioned in a
warning letter issued on 25th August 2010) at its Cranbury, New Jersey,
US manufacturing facility. As per the USFDA, the site now has an
acceptable regulatory status.
Other development
Barclays & SBI life insurance subscribed to Ipca Laboratories’ non
convertible Debentures
Barclays Bank PLC and SBI life Insurance Company have subscribed to
Ipca Laboratories Ltd's 500, 9.95% Secured, Redeemable Non
Convertible Debentures of the face value of |10 lakh each, amounting to
|25 crore each aggregating to | 50 crore. These debentures will be
redeemed in bullet at the end of third year if the put/call option is
exercised or the end of 5th year from the date of subscription. These
Non Convertible Debentures are proposed to be listed on the wholesale
debt segment of the National Stock Exchange of India Limited (NSE).
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