Standalone earnings for the first quarter ended June 30, 2008

Chennai-based Generic pharma major, Orchid Chemicals & Pharmaceuticals Ltd. (Orchid) achieved a total income of Rs 306.33 crore for the quarter ended June 30, 2008 (Q1 FY08-09) in comparison to Rs 236.27 crore registered during the corresponding first quarter of last fiscal, growing by 29.6%. Earnings before Interest and tax (EBIT) was Rs 57.16 crore compared to Rs 43.23 crore during the corresponding quarter of last year. The Profit before exceptional item and tax was Rs 26.91 crore as against Rs 23.05 crore of the Q1 of last fiscal. The Company registered a net loss after tax of Rs 31.65 crore after exceptional item (loss) of Rs 58.80 crore compared to a net profit of Rs 51.30 crore after exceptional item (gain) of Rs 52.86 crore for the Q1 last fiscal.

Consolidated earnings for the first quarter ended June 30, 2008

On a consolidated basis, Orchid’s total income for the first quarter ended June 30, 2008 grew by 31.6% and stood at Rs 328.30 crore in comparison to Rs 249.55 crore registered during the corresponding first quarter of last fiscal. Earnings before Interest and tax (EBIT) stood Rs 55.01 crore compared to Rs 40.76 crore during the corresponding quarter of last year. The Profit before exceptional item and tax was Rs 24.71 crore as against Rs 20.35 crore of the Q1 of last fiscal. At the net level after tax, the company registered a loss of Rs 33.85 crore after exceptional item (loss) of Rs 58.80 crore as against a profit after tax of Rs 48.59 crore after exceptional item (gain) of Rs 52.86 crore of Q1 last fiscal.

Quote from the Managing Director

“The first quarter (Q1 FY09) of this fiscal has witnessed a decline at the net level due to the exchange loss on the FCCBs issued earlier. But we are happy that we have maintained a strong profitability and growth platform at the operational level despite no new products being launched during the first quarter. Though the notional loss on account of the FCCBs has dampened the net profitability of the company during the first quarter, we are confident of enhancing our performance positively in the further quarters as we continue to operationally tread on a strong growth path and are well poised to achieve our projected growth earnings on a full year basis. Our regulated market journey backed by our strong regulatory base will continue to drive the business upwards in the subsequent quarters with a strong product launch calendar spread across the US and EU markets”, said Mr K Raghavendra Rao, Managing Director, Orchid Chemicals & Pharmaceuticals Ltd.

US Generics

During the first quarter of this fiscal, Orchid continued to achieve steady growth in its US Generics business. Though there were no new products launched during the first quarter, the earlier launched products like Cefoxitin and Cefdinir continued to show increasing trends in demand. Products like Ceftriaxone and Cefepime among others also witnessed a positive consolidation despite additional competition.

In the NPNC (non-penicillin, non-cephalosporin) product space, Orchid launched its second product, Granisetron in the US market during the first quarter of this fiscal. Orchid is the first Indian generic company to receive US FDA approval for this product.

Piperacillin-Tazobactam approval for Canada and Australia

Another salient highlight of the first quarter has been the approval and launch of Piperacillin-Tazobactam in the Canadian and Australian markets. The patent for this product expired in June 2008 in Australia and Orchid is the first generic company to launch this product in this geography.

Orchid also received the approval for this product in Canada. This is the fourth product to be approved for the Canadian market.

Regulatory update

During the first quarter of this fiscal, Orchid’s regulatory journey progressed well. Orchid filed 3 ANDAs during the first quarter for the US market achieving a cumulative count of 50 ANDAs.

Of the 50 ANDAs filed, 29 are in the cephalosporin space, 16 in the NPNC space and 5 in the penicillin injectables space.

For the Canadian market, Orchid has cumulatively filed 6 ANDS and has received approvals for 4 till date. Of these 6 filings, 5 correspond to the cephalosporin segment and 1 to the penicillin injectable segment.

In the EU market, Orchid made one more filing during the first quarter taking the cumulative count to 19 Marketing Authorizations (MAs). Of the 19 filings, 15 are in the cephalosporin segment, 1 in the penicillin injectable segment and 3 in the NPNC segment.

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