Page 152 - CW E-Magazine (19-9-2023)

Pharmaceuticals

OUTLOOK

Indian pharma industry to witness 8-10% revenue

growth this fi scal: Crisil

The Indian pharmaceuticals in- lity is also seen improving 50-100 emphasis on health awareness, post the
dustry is expected to log in a revenue basis points (bps) to 21 percent this pandemic, Crisil said. Formulation ex-
growth of 8-10 percent in current fi scal fi scal, supported by moderation in input ports are seen up 7-9 percent in rupee
aided by a steady domestic growth and and logistics costs, and abating pricing terms this fiscal, more driven by vol-
increased exports to regulated mar- pressure in the US generics market, the umes, from new product launches,
kets, even as semi-regulated markets report said. This follows two consecu- and abating price pressure in the US
face headwinds, according to a report tive years of margin contraction due to generics markets, it said. On the other
by Crisil. The report covers 186 drug high pricing pressure in the US and a hand, increase in claw-back taxes in
fi rms, which accounted for about half sharp rise in input costs caused by sup- select European markets could lead
of the Rs. 3.7-lakh crore annual revenue ply chain disruption during the COVID to lower growth in exports to Europe
of the sector last fi scal. pandemic, and thereafter, Crisil noted. this fiscal, it added.

“Similar to last fi scal, domestic Credit profi les will remain stable “Growth in exports to Asia will im-
growth in fi scal 2024, will be led by owing to low-leverage balance sheets prove this fi scal, after clocking a modest
5-6 percent increase in realisations, and moderate capex plans, it stated. growth last fi scal, while exports to Africa
supported partly by high price hikes will continue to remain sluggish on
allowed by the National Pharmaceuti- Domestic and export trends account of low forex reserves (impacting
cal Pricing Authority (NPPA) for drugs In the ongoing fi scal, domestic the purchasing power) and high currency
under price regulation,” Crisil Research sales are expected to witness 8-10 per- volatility,” Crisil said. Lower input prices
Director Mr. Aniket Dani said. In cent growth with the chronic segment and normalisation of supply chains
addition, sale of existing drugs and new expected to be the key contributor to reve- should cull inventories to pre-pandemic
launches will drive 3-4 percent volume nues, because of the steady increase in levels, resulting in smaller incremental
growth, he noted. Operating profi tabi- lifestyle-related diseases and continued working capital debt this fi scal, it added.
DIVESTMENT

Ind-Swift Labs to sell API and CRAMS services

to IndiaRF

Drugmaker Ind-Swift Laboratories’ ness transfer agreement),” the company that Synthimed will also acquire an
board has approved the sale of its active said in a stock exchange communica- intermediate manufacturing facility
pharmaceutical ingredients (API) and tion. Ind-Swift has two manufacturing from the promoter group.
contract research and manufacturing sites in Punjab and Jammu, and a com-
services (CRAMS) to Synthimed Labs bined reactor capacity of about 700-kl Capacity expansion
Private Ltd., a portfolio company of catering to both regulated and unregu- Mr. Shantanu Nalavadi, Managing
India Resurgence Fund (IndiaRF), for lated markets, it said. “The API business Director of IndiaRF, said in a statement
Rs. 1,650-crore. IndiaRF is an India- has a strong market and cost position with that the business needed capital infusion
focused investment platform promoted diverse therapeutic presence across the for it to acquire scale and grow. “We
by Piramal Enterprises and Bain Capital. US, Japan, Korea, EU, Brazil and India,” are committed to invest further primary
it added. Ind-Swift reported a con- capital into the businesses to expand
“Equity value for this transaction for solidated revenue of Rs. 1,207-crore and capacity on the back of growth from
the company is Rs. 850-crore, considering consolidated EBITDA of Rs. 256-crore newer geographies and investment in new
an approximate debt of Rs. 800-crore, in FY23. Shareholder and regulatory product development across both API and
subject to other adjustments in accor- approvals are still required for the com- CRAMS, to provide a larger portfolio of
dance with the terms of the BTA (busi- pletion of the transaction, it said, adding products to its customers,” he added.

152 Chemical Weekly September 19, 2023

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