Six years after Croatian independence and nearly two years since theDayton Accords, Pliva, central and eastern Europe's largest pharmaceutical company, is building the foundations needed to cement its position as a leading competitor to regional powerhouses such as Richter Gedeon and Egis of Hungary and Slovenia's Krka and Lek.
The scope for future growth has been recognized by analysts at Credit Suisse First Boston, who have initiated coverage of Pliva with a buy recommendation underpinned by a higher-than-average return on invested capital, strong growth in royalties and an attractive branded generic pipeline.
Growth Driven By Blockbuster Pliva is the only large pharmaceutical company in the region to have developed a blockbuster original drug, the macrolide antibiotic azithromycin, which is the driver of the company's earnings growth. The cash flow generated from azithromycin comes principally from two sources, namely Pliva's out-licensing agreement with Pfizer, which markets the drug worldwide as Zithromax, and sales throughout central and eastern Europe under its own trade name Sumamed.
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