Ranbaxy Laboratories (BSE: 50035), India’s largest generic drugmaker by sales, saw its shares rise 5.6% to 340 rupees after the company, which is majority owned by Japan’s Daiichi Sankyo (TYO: 4568) posted financial results for the three months ended December 31, 2013.
Sales for the period rose 7% to 28.6 billion rupees ($456.5 million), boosted by higher US revenues for two acne drugs. However, given the company’s current problems with the US Food and Drug Administration, which just this month issued yet another ban on imports of products from another of its Indian drug manufacturing facilities, observers are wondering if strong sales can continue, given that around 40% of its sales come from the USA.
Earnings before Interest, tax, depreciation and amortization (EBITDA) were 2.7 billion rupees. Margins strengthened in the quarter. Adjusted for Forex movements and non-routine charges, margin was >10%. The company recorded a net loss before taxes of 600 million rupees after providing for stock write-off and other costs of 2.6 billion rupees pursuant to the inclusion of the Toansa plant under certain provisions of the Consent Decree (CD) by the US FDA (The Pharma Letter January 24). Last year, it paid a record $500 million in fines and penalties and pleaded guilty to seven criminal counts related to egregiously falsifying its laboratory data TPL May 14, 2013).
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