Sun Pharma Q4 net down 13.58% at Rs1,224 cr as US sales slump

Sun Pharmaceutical Industries, India's largest drug firm, has reported a 13.58 per cent decline in its consolidated fourth-quarter net profit to Rs1,223.71 crore, pulled down by lower sales in the US market.

Sun Pharma had reported a net profit of Rs1,416.13 crore in the year-ago quarter.

Income from operations during the period also declined to Rs6,825 crore from Rs7,415 crore in the same period of the previous fiscal.

Sun Pharma's US subsidiary Taro reported a 28 per cent decline in the fourth quarter profit at $83 million, while fall in operating profit was steeper at 44 per cent.

Fourth-quarter sales were lower by 26 per cent at $196 million. For the full year, Taro's sales declined 8 per cent to $879 million.

Taro contributes more than half of Sun's US sales, and saw revenues decline 26 per cent year-on-year in Q4.

Sun's US sales were down 34 per cent at $381 million. Excluding Taro, the pressure on the US business is also due to weak pricing and high base as year-ago quarter benefitted from the launch of the oncology product, Gleevec generics, on exclusivity.

"Our fourth-quarter performance reflects the impact of the challenging generic pricing environment in the US. Despite this, we continue to invest our strong cash flows in enhancing our specialty pipeline.

"During the quarter, the US FDA lifted the import alert on the Mohali facility, while remediation efforts are on-going to bring back the Halol facility into full cGMP (current good manufacturing practices) compliance,'' Dilip Shanghvi, managing director of the company, said.

Pharmaceutical firms are now witnessing pricing pressure on generic drugs and this has resulted in disappointing numbers from peers such as Glenmark and Lupin too.

Sun Pharma said sales of branded formulations in India for the fourth quarter stood at Rs1,916 crore, marking a growth of 10 per cent and accounting for 28 per cent of total sales.

For the entire year, sales from India were at Rs7,749 crore, higher by 8 per cent over last year.

Sales in emerging markets stood at $181 million during the quarter, a growth of 46 per cent over the corresponding period last year.

Ahead of the numbers, the Sun Pharma stock ended lower by almost 4 per cent at Rs568.55.