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October 8, 2013
Sector View Overweight Index Performance as on September 30, 2013
Return (%) Return (%) BSE 500 Sensex BSE Healthcare I-Direct Healthcare 1M 5 4 6 9 3M -2 0 7 8 YTD -7 0 16 23 12M -3 3 26 33
Health Check
Poor IPM growth fails to arrest buying interest
Domestic formulations growth crashed to a five-year low at 1.1% YoY for August 2013. As the implementation process for the new DPCO 2013 is still in progress, distributors/retailers continued to keep inventory channels dry. A sharp reduction in margins for both retailers and wholesalers also caused the slump. Therapies, which witnessed de-growth during the month were anti-infectives (1%), cardiac (4%), vitamins (1%) and respiratory (3%). Key chronic therapies like anti-diabetic and neurology posted single digit growth of 6% and 5%, respectively. In a first of its kind, Cadila Healthcare launched the first NCE in India when it introduced Lipaglyn, a novel drug for treating Diabetic Dyslipidemia and Hypertriglyceridemia in Type II diabetes, not controlled by statins alone. The drug has been approved for launch in India by the Drug Controller General of India (DGCI). Lipaglyn offers a novel action that offers lipid and glucose lowering effects in one molecule and is the first Glitazar to be approved anywhere in the world. The product provides patients suffering from diabetic dyslipidemia the option of a once-daily oral therapy and has beneficial effects on both lipid parameters as well as glycemic control. Ranbaxy again found itself in the dock when the USFDA slapped an import alert on Ranbaxys new Mohali facility for not complying with manufacturing standards. The USFDA also advised that the Mohali facility will be subject to certain terms of the consent decree signed in January 2012. The USFDA had conducted inspections at Ranbaxys Mohali facility in 2012, resulting in certain observations. Another company Strides also found itself at the wrong end when the USFDA issued a warning letter to the Agila Specialties sterile manufacturing facility (SFF2) at Bangalore. In July 2013, the USFDA had inspected the facility and found a deviation in good manufacturing practices followed by the company in this facility. Mylan has said on record that the development will not have impact on the proposed acquisition of Agila. Bowing to the resistance of local retailers/wholesalers, companies such as Cipla, Torrent and Indoco among others have decided to increase trade margins to 10% to stockists and 20% to retailers on the price-controlled basket of drugs, as against the earlier offered 8% and 16%, respectively. Finally, the Supreme Court, at the behest of the All India Drug Action Network (AIDAN) an NGO, will evaluate the new National Pharmaceutical Pricing Policy-2012 for fixing prices of essential medicines in the country and also the Drugs (Prices Control) Order, 2013 (DPCO 2013), notified by the government in May. Observing that the Centre is being guided by marketdriven forces, the Supreme Court sought a comparative analysis including the impact of the new policy on the ceiling prices of drugs. Buying continues on account of better Q2 expectations Contrary to our expectation of underperformance on the back of flat IPM growth and profit booking, the BSEHC managed to outperform the broader indices backed by sustained buying in heavyweights such as Sun, Lupin, Cipla and Doctor Reddys. This, we believe, was on account of better earnings expectations in Q2 driven by US exports. We expect the trend to continue for some time driven by defensive buying.
Stocks Performance
Return (%) Company Sun Pharma.Inds. Dr Reddy's Labs Lupin Cipla Glaxosmit Pharma Glenmark Pharma. Ranbaxy Labs. Cadila Health. Apollo Hospitals Divi's Lab. Ipca Labs. Torrent Pharma. Biocon Aurobindo Pharma Wockhardt Strides Arcolab Pfizer Natco Pharma Unichem Labs. Jubilant Life Elder Pharma Indoco Remedies Opto Circuits 1M 14 4 8 4 5 3 -19 4 8 -2 15 8 -4 11 12 -1 4 5 16 11 12 4 -15 3M 17 7 10 10 6 -3 7 -12 -12 -2 9 7 20 12 -48 -1 0 38 2 -39 3 2 2 -9 YTD 61 30 40 4 14 1 -34 -25 18 -12 38 21 18 7 -67 -21 -9 33 -30 -64 -16 2 -81 -55 12M 45 44 14 25 26 -38 -22 27 -10 48 26 23 43 -59 -2 -13 68 -14 -62 13 -6 -84 -46 Mcap 30-Sep 40503 38342 34725 20904 14389 13976 13916 12933 12881 9028 7415 6754 5892 5746 5091 3240 1924 1523 1274 692 601 498 420 71 122884
Price movement
10000 9000 8000 7000 6000 Sep-12 Dec-12 Mar-13 Jun-13 Sensex (RHS) BSE Healthcare 21000 19000 17000 15000 Sep-13
Analysts name
Siddhant Khandekar siddhant.khandekar@icicisecurities.com Krishna Kiran Konduri krishna.konduri@icicisecurities.com
Drug Name Vinorelbine Tartrate Injection Azacitidine injection Esomeprazole Magnesium; Naproxen Dr tablets Desoximetasone Ointment Hydrocortisone Butyrate Cream Topiramate tablets Zolpidem Tartrate ER tablets Ethinyl Estradiol; Norethindrone tablets Levetiracetam ER Tablets Lansoprazole DR capsules Drug Name Sirolimus tablets
Final Approvals Therapeutic Area Anti-Cancer Anti-Cancer Anti-inflammatory Dermatology Dermatology CNS Insomnia Oral Contraceptive Anti-epileptic Anti-Ulcerent Tentative Approvals Therapeutic Area Immunosuppressant
Innovator company Pierre Fabre Celgene AstraZeneca Taro Triax Pharma Ortho-McNeil Sanofi Aventis Warner Chilcot UCB Inc Novartis Innovator company Pfizer
Generic Version of Navelbine Vidaza Vimovo Topicort Locoid Topamax Ambien Ovcon Keppra XR Prevacid Generic Version of Rapamune
Market Size NA US$ 380 million US$ 25 million US$ 50 million US$ 34 million NA US$ 366million US$ 22 million US$ 1.2 billion US$ 430 million Market Size US$ 200 million
CNS: Central Nervous System; CVS: Cardiovascular, NA: Not available;; Source: USFDA ICICIdirect.com Research
Strides receives USFDA approval for Italian facility Strides has received USFDA approval for a facility in Milan, Italy. This facility manufactures liquids, semi-solids, ointments and creams. The company is expecting its first approval by Q1 2014. The company expects its first semisolid product to be commercialised by the first quarter of next year. Mylan Strides deal gets US, India nods Mylan Inc has won the US antitrust approval to buy Agila, a unit of Strides Arcolab, subject to divesting some products as per the directions of the US Federal Trade Commission (FTC). The Union Cabinet has already approved the deal on September 3. The companies will have to divest assets needed to make 11 generic injectable drugs as a condition for approving the deal, the FTC said.
IP issues/court rulings
Dr Reddys Labs gets unfavourable verdict from US Appeals Court The United States Court of Appeals for the Federal Circuit has ruled against Dr Reddys Labs (DRL) pertaining to a patent litigation for alleged infringement of Sunovion Pharmaceuticals blockbuster drug Lunesta, which is used for the treatment of insomnia. The latest order sets aside an earlier ruling issued by a New Jersey Court, which ruled in favour of DRL. According to the Federal Circuit Court, the lower court has erred in granting the summary judgement of noninfringement by DRL.
Page 2
Sun forms JV with US based Intrexon to develop eye therapies Sun and US-based Intrexon Corp are set to form a joint venture to develop gene-based therapies to treat eye diseases that cause partial or total blindness. The two companies will share the investments in the project and also the revenues generated from it. Intrexon will share its full suite of proprietary synthetic biology technologies, including the RheoSwitch Therapeutic System or RTS platform, a method for controlling the location, concentration and timing of protein expression, through exclusive channel collaboration.
Product launches
Cadila launches NCE Lipaglyn across India Cadila Healthcare has launched Lipaglyn, a novel drug for treating Diabetic Dyslipidemia and Hypertriglyceridemia in Type II diabetes, not controlled by statins alone. The drug has been approved for launch in India by the Drug Controller General of India (DGCI). Lipaglyn offers a novel action that offers lipid and glucose lowering effects in one molecule and is the first Glitazar to be approved anywhere in the world. The product provides patients suffering from diabetic dyslipidemia the option of a once-daily oral therapy and has beneficial effects on both lipid parameters as well as glycemic control. Lipaglyn will be available across India and can be prescribed by cardiologists, diabetologists and general physicians. The cost will be | 25.90 per tablet.
Withdrawals/ product recalls/warning letters
Ranbaxy receives import alert for Mohali facility The USFDA has slapped an import alert on Ranbaxys new Mohali facility for not complying with manufacturing standards. The USFDA has also advised that the Mohali facility will be subject to certain terms of the consent decree signed in January 2012. The USFDA had conducted inspections at Ranbaxys Mohali facility in 2012, resulting in certain observations. Unconfirmed reports suggest the company has filed ~18 ANDAs from the same facility. Strides receives warning letter for Agila Bangalore facility The USFDA has issued a warning letter to the Agila Specialties sterile manufacturing facility (SFF2) at Bangalore. Agila Specialties is a wholly owned subsidiary of Strides Arcolab. Earlier in July 2013, USFDA had inspected the facility and found a deviation in good manufacturing practices followed by the company in this facility. This resulted in an issue of Form 483 to the company. The facility contributes around 25% of Agilas sales or 14% of consolidated sales. Mylan has said on record that the development will not have impact on the proposed acquisition of Agila. Torrent recalls drug from US for defective packaging The USFDA has asked Torrent Pharmaceuticals to recall a batch of Olanzapine tablets of 10 mg - citing defects in its packaging. The drug is used to treat schizophrenia and bipolar disorders. Only one lot of bottles, containing 30 tablets each is affected. The drug in question was to expire only in September 2014.
Page 3
Glenmark, Forest Labs enters into collaboration for drug development Glenmark has received a small research fee payment from Forest Laboratories on collaboration for the development of novel mPGES-1 inhibitors to treat chronic inflammatory conditions to support the next phase of work. Forest has an exclusive option to obtain license rights to the programme upon completion of pre-clinical trials. Under the terms of the agreement, Forest has made US$6 million upfront payment to Glenmark and also made an additional US$3 million to support the next phase of work for the development of novel mPGES-1 inhibitors to treat chronic inflammatory conditions, including pain. Lupin ties up with US company for Derma brand Lupin has signed a strategic co-promotion agreement with US based Onset Dermatologics, LLC which grants Lupin exclusive rights to promote Onset's Locoid Lotion (hydrocortisone butyrate 0.1%) to paediatricians in the US. Locoid Lotion is a corticosteroid indicated for the topical treatment of mild to moderate atopic dermatitis in patients three months of age and older. Atopic Dermatitis (AD) is one of the most common skin disorders in young children in the US and has a prevalence of 10-20% in the first decade of life.
Others
Companies bow down to pressure tactics of retailers/stockists Companies like Cipla, Torrent and Indoco among others have decided to increase trade margins to 10% to stockists and 20% to retailers on the price-controlled basket of drugs, as against the earlier offered 8% and 16%, respectively. Companies like Torrent are offering a 5% special discount on these medicines to stockists. Since the implementation of the new pharma policy the trade margin has become a major issue as stockists are resorting to reduction in their drug orders leading to scarcity of widely-prescribed medication like painkillers, anti-infectives, cardiac and antibiotics. As per DPCO 2013, the retailers margin for all scheduled (controlled category) products is 16% on price, inclusive of excise duty. Earlier, this was on MRP excluding VAT and excise duty. The stockist margin on controlled products was 8% excluding excise duty. The new price control order has reduced net margins for retailers and wholesalers. Supreme Court to evaluate new pricing policy The Supreme Court has said it will evaluate the new National Pharmaceutical Pricing Policy-2012 for fixing prices of essential medicines in India and also the Drugs (Prices Control) Order, 2013 (DPCO 2013), notified by the government in May. Observing that the Centre is being guided by market-driven forces, the Supreme Court sought a chart from All India Drug Action Network (AIDAN), an NGO, and giving comparative analysis including the impact of the new policy on the ceiling prices of drugs. AIDAN in its new application had sought quashing of both the 2012 policy and DPCO 2013, which would reduce prices of 348 essential medicines, notified by the Department of Pharmaceuticals. AIDAN told the court that the new policy, which puts a ceiling on drug prices based on average market prices, would lead to a higher cap than the earlier one and the new policy will lead to super profits for pharma companies.
Page 4
Innovator Pfizer & Warner-Lambert Co Hoffman-La Roche & Genentech, AstraZeneca; KBI-E & Pozen Novartis Novartis Novartis Novartis Mallinckrodt & Novo Research Pfizer & Pharmacia & Upjohn Intendis & Bayer G.D. Searle & Pfizer Purdue Pharma Helsinn Healthcare & Roche Acura Pharma Senju Pharma & Allergan Fresenius Kabi USA LLC Pfizer AbbVie Inc Novartis Janssen Producs MSD & BMS UCB Alpex Pharma Pfizer & UCB Pfizer & UCB UCB UCB UCB UCB UCB Alcon Pharma Pfizer & UCB AstraZeneca
ANDA Filer Wockhardt Aurobindo Pharma Dr. Reddy's Labs Dr. Reddy's Labs Agila, Strides Arcolab Sun Pharma Wockhardt Taro Pharma Lupin Glenmark Pharma Lupin Dr Reddy's Labs Aurobindo Pharma Ranbaxy labs Agila, Strides Arcolab Dr Reddy's Labs Dr Reddy's Labs Dr Reddy's Labs Sun Pharma Lupin Cipla Cadila Healthcare Cadila Healthcare Lupin Cadila Healthcare Sun Pharma Ranbaxy labs Glenmark Pharma Aurobindo Pharma Alembic Pharma Lupin Wockhardt Wockhardt
Brand Name Lyrica Boniva Vimovo Reclast Reclast Reclast Reclast Pennsaid Detrol La Finacea Celebrex Intermezzo Aloxi Oxecta Zymaxid Diprivan Pristiq Zemplar Gleevec Prezista Sustiva Vimpat Suprenza Toviaz Toviaz Vimpat Vimpat Vimpat Vimpat Vimpat Moxeza Toviaz Nexium
API Pregabalin Biphosphonic Acid Naproxen/Esomeprazole Magnesium Zolendronic Acid Zolendronic Acid Zolendronic Acid Zolendronic Acid Diclofenac Tolterodine Tartrate Azelaic Acid Benzenesulfonamide Zolpidem Tartrate Palonosetron Hydrochloride oxycodone hydrochloride Gatifloxacin Propofol Desvenlafaxine Paracalcitol Imatinib mesylate Darunavir Efavirenz Lacosamide Phentermine Fesoterodine Fesoterodine Lacosamide Lacosamide Lacosamide Lacosamide Lacosamide Moxifloxacin hydrochloride Fesoterodine Esomeprazole
Used for Anti-Seizure Osteoporosis Osteoporosis Osteoporosis Osteoporosis Osteoporosis Osteoporosis Osteoporosis Anti-Muscarinic Dermatology Anti-Inflammatory Insomnia Nausea and vomiting Pain Anti-bacterial Anti-epilepticus Anti-Depression Anti-thyroid Leukemia Anti-Retroviral Anti-Retroviral Epilepsy Weight Loss Overactive bladder Overactive bladder Epilepsy Epilepsy Epilepsy Epilepsy Epilepsy Bacterial conjunctivitis Overactive bladder Heartburn
Page 5
9.8
(%)
7.4
5.2
5.6
8.7
9.3
4.1
4.6
Nov-12
Sep-12
Dec-12
Jan-13
Oct-12
Aug-12
Mar-13
Feb-13
Apr-13
May-13
Cipla
Page 6
Sun Pharmaceuticals
Stock Performance
180
135 90 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Sun Pharma Jul-13 Sep-13
BSE Healthcare
Exhibit 6: Company growth vis--vis Indian pharma market growth Brands contribution to domestic sales (MAT Aug13)
19%
14.9
15.0
7.4
0 Nov-12 Aug-12 May-13 Aug-13 Oct-12 Dec-12 Jan-13 Sep-12 Mar-13 Jun-13 Feb-13 Apr-13 Jul-13
(| crore)
9.4 8.5 7.4 6.9 7.2 6.4 5.5 6.2 4.2 4.6 -3 9 -2 6 -2 -4 12 -4 15 -2
(| crore)
QoQ (%) -4 -4 -5 11 -2 -7 -6 8 -6 -1
Neuro 34%
Cardiac 25%
Page 7
1.1
4.1
5.2
5.6
8%
4.6 11.9
10
8.7
9.3
51%
9.8
14.9
11%
9.4 15.6
15
12.5 17.4
18.8 24.1
Cipla
Stock Performance
140 110 80
Sep-12
Nov-12
Jan-13
May-13 Cipla
Jul-13
Sep-13
Exhibit 11: Company growth vis--vis Indian pharma market growth Brands contribution to domestic sales (MAT Aug13)
20 12.5 15 13.3 18.8 14.8
9.8
27%
(%)
9.1
7.4
5.2
5.6
39%
11.1
5.8
6.3
4.8
4.1
4.6
11.5
10
9.3 12.1
8.7
Nov-12 -0.5
Mar-13 -1.1
Oct-12
Jan-13
Aug-12
May-13
12% Top 10 11 to 20 21 to 30
9% 31 to 50 Others
-5
Cipla
(| crore)
11.4 10.8 9.7 7.1 7.0 7.3 1.3 7.0 6.5 5.6 6 6 -3 6 8 2 -27 2 -8 12
(%)
Nov-12
Cipla
May-13
Aug-13
Oct-12
Jun-13
Sep-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
Jul-13
(| crore)
QoQ (%) 4 1 1 -3 -7 -4 0 -14 -11 -4
Respiratory 30%
Anti-Infectives Cardiac Gynaecological Gastro Intestinal Ophthal Neuro Pain Vitamins Derma
Page 8
Aug-13
Sep-12
Dec-12
Feb-13
Apr-13
Jun-13
13%
0.4
1.1 4.9
Dr Reddys Laboratories
Stock Performance
140 110
80 Sep-12 Nov-12 Jan-13 Mar-13 BSE Healthcare May-13 Dr. Reddys Jul-13 Sep-13
Exhibit 16: Company growth vis--vis Indian pharma market growth Brands contribution to domestic sales (MAT Aug13)
35 30 18.8
31%
13.3
9.8
15 10
12.5
20.2
(%)
32%
20
24.0
26.5
25
28.7
5.6 10.4
5.2
0 Aug-12
Nov-12
Oct-12
Jul-13
May-13
Others
(| crore)
9.8 6.3 4.9 5.5 4.6 3.6 3.5 3.3 4.3 1.9 -3 -4 -13 4 -17 1 0 4 -1 -33
(| crore)
QoQ (%) -4 -3 3 -4 2 1 8 2 -2 1
Anti-Infectives 8%
Page 9
Aug-13
Jan-13
Mar-13
Dec-12
Sep-12
Jun-13
Feb-13
Apr-13
1.1 2.0
5.5
4.9
3.6
5.4
1.2
4.1
4.6
9.4 13.1
9.3
7.4
14.2
8.7
Lupin
Stock Performance
155 115 75 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Lupin Jul-13 Sep-13
BSE Healthcare
Exhibit 21: Company growth vis--vis Indian pharma market growth Brands contribution to domestic sales (MAT Aug13)
44% 20%
(%) 25 20 13.3 15 10 8.8 5 12.5 18.8 21.3
16.0
9.8 13.7
8.7 14.3
9.3 14.4
12.6
4.1 9.8
7.4 11.3
4.6
7.6 Jul-13
14% 13% 9% 21 to 30
5.2 8.7
5.6
9.4
0 Nov-12 Oct-12 Jan-13 Mar-13 Dec-12 Sep-12 May-13 Aug-12 Feb-13 Apr-13
Top 10
11 to 20
31 to 50
Others
Lupin
(| crore)
6.8 7.4 3.9 3.8 3.2 3.5 3.6 3.2 3.0 3.4 -13 11 -2 -2 -4 -2 -10 -5 6 -8
(%)
Nov-12
May-13
Aug-13
Oct-12
Jun-13
Sep-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
Jul-13
Lupin
(| crore)
QoQ (%) -7 -4 -2 13 -9 -5 -2 -7 -12 -15
Anti Diabetic 9%
Respiratory 11%
Cardiac 24%
Page 10
Aug-13
Jun-13
1.1 0.1
3.2
Ranbaxy Laboratories
Stock Performance
Acute, 2461.8, 82%
110 75 40 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Ranbaxy Jul-13 Sep-13
BSE Healthcare
Exhibit 26: Company growth vis--vis Indian pharma market growth Brands contribution to domestic sales (MAT Aug13)
25
20.1 9.8 15.6
13.3
15
(%)
12.5
38%
33%
20
18.8 21.6
11.8
7.4
10
6.2
5.2 7.0
5.6
8.7
9.3
6.0
4.6
1.5
4.8
Nov-12
Oct-12
Jul-13
Top 10
11% 11 to 20 21 to 30
31 to 50
Others
-5
Ranbaxy Laboratories
May-13
Aug-12
(| crore)
21.5 20.0 6.3 5.6 6.2 8.2 4.6 4.5 5.4 9.2 5 9 14 -9 1 5 28 -3 -10 -74
(%)
4.0 3.6
Nov-12
Aug-12
Ranbaxy Laboratories
May-13
Aug-13
Oct-12
Jun-13
Dec-12
Sep-12
Jan-13
Feb-13
Mar-13
Apr-13
Jul-13
Aug-13
Jan-13
Mar-13
Dec-12
Sep-12
Feb-13
Apr-13
7%
Jun-13 -1.1
11%
4.0
1.1 0.1
4.1
4.6
9.4
(| crore)
QoQ (%) -3 4 2 2 -1 -6 1 5 1 11
Cardiac 11%
Vitamins 11%
Derma 12%
Pain 13%
Page 11
Cadila Healthcare
Stock Performance
140
110 80 50 Sep-12 Nov-12 Jan-13 Mar-13 BSE Healthcare May-13 Cadila Healthcare Jul-13 Sep-13
Exhibit 31: Company growth vis--vis Indian pharma market growth Brands contribution to domestic sales (MAT Aug13)
28%
35 30 25
24.4 (%) 32.6
18.8
24.0
25.2
27.4 20.0
13.3
38%
20 15 10
12.5 18.8
18.8
18.0
9.8
23.4
5.2
0
Nov-12 Oct-12 Jul-13 Jan-13 Mar-13 Dec-12 Sep-12 May-13 Aug-12 Jun-13 Feb-13 Apr-13
Cadila Healthcare
(| crore)
10.1 8.2 6.9 7.5 7.4 6.1 6.1 5.4 4.1 4.1 -2 -2 -2 -2 3 13 5 3 56 3
(%)
Nov-12
Cadila Healthcare
May-13
Aug-12
Aug-13
Oct-12
Jun-13
Dec-12
Jan-13
Sep-12
Feb-13
Mar-13
Apr-13
Jul-13
(| crore)
QoQ (%) 4 1 3 3 0 -3 1 -4 -6 5
Pain 8%
Page 12
Aug-13
1.1 2.2
4.6 8.6
4.1
9.4 11.4
7.4
5.6
8.7
9.3
GlaxoSmithKline Pharmaceuticals
Stock Performance
140 110
Acute, 2839.3, 91%
BSE Healthcare
25
9.8
5.2
9.3 -5.2
12.0
7.4
5.6
8.7
4.6 -7.7
4.1
8.0
1.6
2.1
0
Oct-12 Aug-12 Sep-12
Nov-12
0.5
-9.0
5 -5 -10
10% Top 10 11 to 20 21 to 30
16% 31 to 50 Others
May-13
(| crore)
30.9 20.4 14.1 10.4 13.2 8.7 7.9 9.7 9.4 8.1 -35 -20 -13 7 -24 5 6 -31 -31 -13 25.2 15.5 12.0 10.5 12.2 9.0 8.0 6.0 4.0 7.6 -20 5 3 5 -18 1 5 11 62 -8
Therapy Anti-Infectives Pain Gastro Intestinal Hormones Anti-Infectives Derma Derma Hormones Anti-Infectives Derma
Aug'13 Aug'12 Var. (%) Jul'13 Var. (%) 20.0 16.3 12.3 11.1 10.0 9.1 8.3 6.6 6.5 7.0
(%)
Nov-12
Aug-12
Glaxosmithkline Pharmaceuticals
May-13
Aug-13
Oct-12
Jun-13
Sep-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
Jul-13
(| crore)
QoQ (%) -12 1 2 -2 7 -5 -1 -1 -21 -19
Pain 11%
Page 13
Aug-13
Jan-13
Mar-13 -7.8
Dec-12
Feb-13
Jun-13
Apr-13
1.1 -17.6
Wockhardt
Stock Performance
265 205 145 85
25 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Wockhardt Jul-13 Sep-13 BSE Healthcare
13.3
20 15 10 5
(%)
12.5
9.8
12.0
7.4
5.2 -5.0
5.6
8.7
9.3
1.4
-6.8 4.6
8.6
4.1
25
0 -5
2.0
Aug-12
Wockhardt
May-13
(| crore)
6.8 0.5 5.1 3.9 4.3 4.1 3.7 3.3 3.3 3.4 11 2 -3 -8 7 -1 -4 -8 -9 -17
(%)
Nov-12
Aug-12
Wockhardt
May-13
Aug-13
Oct-12
Jun-13
Dec-12
Jan-13
Sep-12
Feb-13
Mar-13
Apr-13
Jul-13
(| crore)
QoQ (%) -1 -2 5 1 -18 -22 -6 -10 -17 75
Vitamins 29%
Derma 8% Neuro 9%
Page 14
Aug-13 -11.6
Oct-12
Dec-12
Jan-13 2.6
Sep-12
Feb-13
Apr-13
Jul-13
1.1
Glenmark Pharmaceuticals
Stock Performance
200 160 120
80 Sep-12 Nov-12 Jan-13 Mar-13 BSE Healthcare May-13 Glenmark Jul-13 Sep-13
Exhibit 46: Company growth vis--vis Indian pharma market growth Brands contribution to domestic sales (MAT Aug13)
28% 38%
25
13.3 20.5 21.8 Aug-13 1.1 Jul-13
20.0
20 15
(%)
18.8 23.3
12.5
9.8 15.7
17.7
9.3 14.5
12.4
10.9
5.2 9.6
7.4 10.3
10 5
11% 10% Top 10 11 to 20 21 to 30 13% 31 to 50 Others
5.6
8.7
4.1
0
Nov-12 Oct-12 Jan-13 Mar-13 Dec-12 Sep-12 May-13 Aug-12 Jun-13 Feb-13 Apr-13
Glenmark Pharmaceuticals
5.0
4.6
9.4
Therapy Cardiac Cardiac Respiratory Derma Derma Cardiac Respiratory Derma Anti-Infectives Derma
Aug'13 Aug'12 Var. (%) Jul'13 Var. (%) 11.4 8.9 7.2 6.8 4.8 3.8 2.2 2.5 2.4 1.7 8.1 7.1 7.4 6.3 4.4 2.8 1.9 1.9 2.2 1.6 41 26 -2 7 9 33 14 30 10 8 10.7 9.0 7.1 6.6 4.5 3.6 2.2 2.4 3.0 1.7 7 -1 1 2 6 4 1 4 -20 1
Telma Telma H Ascoril Plus Candid-B Candid Telma Am Alex Candid Mouth Lizolid Elovera
Glenmark Pharmaceuticals
May-13
Aug-13
Oct-12
Jun-13
Dec-12
Sep-12
Jan-13
Feb-13
Mar-13
Apr-13
Jul-13
18.9
(| crore)
(| crore)
QoQ (%) 2 2 5 43 0 -5 -16 -9 1 14
Anti-Infectives 15%
Respiratory 16%
Cardiac 22%
Page 15
Torrent Pharmaceuticals
Stock Performance
140
110 80 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Torrent Pharma Jul-13 Sep-13
BSE Healthcare
9.8 11.5
8.9
9.8
8.7 10.5
(%)
9.9
7.4
9.3
4.1
4.6 8.6
5.6 7.6
5.2
8.0
7.7
7.8
9.4
36%
27%
Oct-12
Aug-12
Top 10
11 to 20
21 to 30
31 to 50
Others
Torrent Pharmaceuticals
(| crore)
5.2 4.0 3.4 3.6 3.2 2.9 2.7 2.6 2.5 2.3 -3 -18 -2 3 -9 -2 9 -5 -16 2
(%)
Nov-12
Aug-12
May-13
Aug-13
Oct-12
Jun-13
Sep-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
Jul-13
Torrent Pharmaceuticals
(| crore)
QoQ (%) -35 -50 -71 -43 -68 -36 -46 -38 -67 -16
Neuro 17%
Anti-Infectives 20%
Page 16
Aug-13
Jan-13
Mar-13
Dec-12
Sep-12
Jun-13
Feb-13
Apr-13
14%
14% 9%
1.1
6.6
Ipca Laboratories
Stock Performance
200 140 80 Sep-12 Nov-12 Jan-13 Mar-13 BSE Healthcare May-13 Ipca Jul-13 Sep-13
Exhibit 56: Company growth vis--vis Indian pharma market growth Brands contribution to domestic sales (MAT Aug13)
23% 35%
30
18.8 21.2 26.1
25
12.5 21.1
20
13.3
9.3 15.8
15
(%)
7.4 13.8
5.6 10.5
9.7
5.2
10 5 0
4.1
Nov-12 -3.7
Oct-12
4.4
Jul-13
May-13
Aug-12
12% Top 10 11 to 20 21 to 30
18% 31 to 50 Others
-5 -10
Ipca Laboratories
(| crore)
6.7 5.2 5.6 7.0 5.1 3.8 3.7 2.6 2.1 2.7 -7 19 18 -6 -11 0 5 8 3 -9
(%)
Nov-12
Aug-12
May-13
Aug-13
Oct-12
Jun-13
Sep-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
Jul-13
Ipca Laboratories
(| crore)
QoQ (%) -4 -3 -5 -19 -1 6 -12 7 2 -4
Anti-Infectives 8%
Gastro Intestinal 9%
Cardiac 17%
Pain 21%
Page 17
Aug-13 2.2
Jan-13
Mar-13
Dec-12
Sep-12
Jun-13
Feb-13
Apr-13
1.1
12%
11.3
4.6
14.2
8.7
9.4 18.1
9.8
Biocon
Stock Performance
130 110
90 Sep-12 Nov-12 Jan-13 Mar-13 BSE Healthcare May-13 Biocon Jul-13 Sep-13
Exhibit 61: Company growth vis--vis Indian pharma market growth Brands contribution to domestic sales (MAT Aug13)
19%
120 100 80 60 (%) 12.5 55.5 99.0 13.3 18.8 48.7 9.8 Jan-13 -12.3 5.2 -2.8 7.4 5.6 Mar-13 -28.2 8.7 9.3 4.1 May-13 31.1 Nov-12 -5.9 Apr-13 -21.1 4.6 Jul-13 9.4 Dec-12 Feb-13 1.0 Indian Pharma Market Biocon Jun-13
20
6% 2%
Oct-12 -7.3
0 -20
Others
8.2
Top 10
11 to 20
21 to 30
31 to 50
-40
Aug-12
(| crore)
6.0 2.3 2.0 3.3 0.8 0.6 1.1 0.6 0.1 0.5 -6 4 3 -57 -1 4 -5 -6 223 -20
Biocon
(| crore)
QoQ (%) 0 8 -36 19 -6 0 -12 -16 41 48
Cardiac 15%
Page 18
Aug-13
Sep-12
1.1 34.0
65%
8%
40
Pfizer
Stock Performance
Acute, 1458.2, 85%
135 105 75 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Pfizer Jul-13 Sep-13
BSE Healthcare
Exhibit 66: Company growth vis--vis Indian pharma market growth Brands contribution to domestic sales (MAT Aug13)
9% 8% 7%
17.0
18.8
9.8 14.0
10.8
7.4
5.2
5.6 9.0
4.1 7.4
6.2
4.6
8.7
9.3
63%
May-13 -0.3
Aug-12
Top 10
11 to 20
21 to 30
31 to 50
Others
-5
Pfizer
(| crore)
23.3 16.8 13.6 9.3 8.4 7.1 6.0 5.4 3.4 3.7 3 -13 12 -2 -1 9 3 -8 5 -3
(%)
2.35
2.31
2.2
2.0
Nov-12
Aug-12
May-13
Aug-13
Oct-12
Jun-13
Dec-12
Sep-12
Jan-13
Feb-13
Mar-13
Apr-13
Jul-13
Pfizer
(| crore)
QoQ (%) 8 2 -12 6 -1 -2 -6 -1 -3 3
Page 19
Aug-13 -2.9
0.1
13%
Apr-13
Jun-13
Jul-13
1.1
Novartis India
Stock Performance
150 100 50 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Novartis India Jul-13 Sep-13
BSE Healthcare
20
12.5
9.8
(%)
7.4
10
4.1 8.0
5.2
5.6
Mar-13 -1.7
May-13 2.2
0
Top 10 11 to 20 21 to 30 31 to 50 Others
Nov-12
Oct-12
Jan-13
Jul-13
Aug-12
-5
Novartis India
(| crore)
18.0 11.0 5.9 5.9 4.8 4.7 5.0 3.3 3.9 2.7 -23 -2 -10 4 13 -27 8 -6 -16 5
(%)
Nov-12
Aug-12
May-13
Aug-13
Oct-12
Jun-13
Sep-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
Jul-13
Novartis India
(| crore)
QoQ (%) -19 0 -17 7 -6 6 14 -10 -1 -8
Page 20
Aug-13
Sep-12
Feb-13
Dec-12
Apr-13
Jun-13
1.1 2.7
15%
2.8
2.8
3.8
1.2
2.6
1.4
62%
6.4
4.6
9.4 11.3
8.7
9.3
7%
15.4
15
13.3
18.8
Unichem Laboratories
Stock Performance
160 Acute, 281.2, 39% 130 100 70 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Unichem Labs Jul-13 Sep-13
BSE Healthcare
Exhibit 76: Company growth vis--vis Indian pharma market growth Brands contribution to domestic sales (MAT Aug13)
18%
25 20 13.3 15 (%) 12.5 18.8
9.8
13.3
9.9
8.8
5.2
5.4
5.4
5.6 Jul-13
4.6
4.9
Nov-12
Aug-12
Jun-13
-5
Top 10
11 to 20
15%
-10
21 to 30
31 to 50
Others
Unichem Laboratories
(| crore)
5.6 5.4 6.7 4.4 2.4 2.3 1.7 1.5 1.3 1.4 -4 -20 -15 2 -25 -23 5 -11 -9 -4
Unichem Laboratories
(| crore)
QoQ (%) -7 -9 -7 -5 -4 7 -5 -5 -2 -20
Cardiac 47%
Derma Gynaecological
Page 21
-6.5 Aug-13
Sep-12
Oct-12
Jan-13
Mar-13
Apr-13
May-13
Dec-12
Feb-13
8%
1.0
1.1
8.1
4.1
4.6
49%
5.6
10%
7.4 9.1
10
8.7 11.1
9.3
9.4
Indoco Remedies
Stock Performance
150 115 80 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Indoco Jul-13 Sep-13
BSE Healthcare
Exhibit 81: Company growth vis--vis Indian pharma market growth Brands contribution to domestic sales (MAT Aug13)
13% 9%
20
12.5
16.4
9.8
(%)
7.4
10
5.2
5.6
8.7
9.3
4.1
Nov-12
Jan-13
Feb-13 -2.7
0
Oct-12 Sep-12 Aug-12
16% Top 10 11 to 20 21 to 30 31 to 50 Others
-1.8
Jul-13
May-13
-5
Indoco Remedies
(| crore)
6.1 5.5 2.6 2.6 1.8 2.0 1.5 1.7 1.8 1.2 6 -2 2 -26 8 11 4 11 -12 16 6.3 6.3 2.8 2.3 1.8 2.1 1.8 1.9 1.7 1.4 3 -14 -7 -17 12 5 -12 2 -6 -2
Therapy Respiratory Gastro Intestinal Stomatologicals Anti-Infectives Gynaecological Anti-Infectives Stomatologicals Derma Anti-Infectives Stomatologicals
Aug'13 Aug'12 Var. (%) Jul'13 Var. (%) 6.5 5.5 2.6 1.9 2.0 2.2 1.6 1.9 1.6 1.4
(%)
Nov-12
Oct-12
Sep-12
Dec-12
Jan-13
Feb-13
Mar-13
May-13
Aug-12
Jul-12
Apr-13
Indoco Remedies
(| crore)
QoQ (%) 5 -4 -6 -11 11 -5 -1 -1 7 -4
Gynaecological 5%
Gynaecological Ophthal / Otologicals Pain / Analgesics Vitamins / Minerals / N Derma Anti Diabetic
Page 22
Aug-13
Mar-13
Dec-12
Apr-13
Jun-13 0.0
1.1 0.8
55%
3.6
2.7
2.7
2.7
-0.5
7%
4.1
8.7
4.6
9.4
12.0
15
13.3
18.8
Exhibit 86: One year forward P/E of BSE Healthcare Index vs. Sensex
35 30 25 20 x 15 10 5 0 Mar-06 Mar-09 Mar-12 Dec-09 Dec-06 Dec-12 Sep-10 Sep-07 Jun-08 Jun-11 Sensex 38% premium
Page 23
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Pankaj Pandey
Head Research ICICIdirect.com Research Desk, ICICI Securities Limited, 1st Floor, Akruti Trade Centre, Road No. 7, MIDC, Andheri (East) Mumbai 400 093 research@icicidirect.com
pankaj.pandey@icicisecurities.com
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