Indian drugmaker Dr Reddy’s Laboratories turned in a pleasing set of results for its third quarter ended December 31, 2005, with net profit rocketing to 628 million rupees ($14.2m) from 40 million rupees in the like, year-earlier period.
Profit growth was primarily driven by cost cuts and a one-time profit gain from the sale its Goa, India-based plant, which helped buffer disappointing sales in the US, where the group’s products are battling mounting competition.
Sales for the period hit 5.9 billion rupees, marking 25% growth over the same quarter of last year. Revenues were led by a stellar performance by Dr Reddy’s Active Pharmaceutical Ingredients unit, which grew 48% to 2.01 billion rupees, on growth in all regions except the USA, which saw a 6% dip. Branded doses also performed well, with sales up 33% to 1.4 billion rupees internationally and rising 34% to 1.3 billion rupees in India.
But the picture was less rosy on the generics side, which saw turnover slide just under 14% to 831 million rupees, as competition in the USA pushed sales down almost 26% to 480 million in the region.
Although pricing pressures in the USA look set to continue in the near term at least, industry observers feel that Dr Reddy’s future performance will improve substantially, on the back of several planned new product introductions in Europe and the USA over the next year or so.