Brands-driven growth

Updated: Jan 26 2002, 05:30am hrs
It is not at all surprising that the acquired brands has helped push Cadila Healthcare’s (CHL) sales up by 29.7 per cent to Rs 151.8 crore in the third quarter to December 2001. The company had acquired Kopran’s “Aten” brand for Rs 75 crore that contributed significantly to its total sales. New introductions from Zydus Neurosciences also helped in improving sales. Expenses increased by 33.5 per cent to Rs 128 crore. Operating profit went up 12.7 per cent to Rs 24 crore but the margin fell from 18.2 per cent to 15.8 per cent. Net profit declined 16 per cent to Rs 14.7 crore. The company is aiming an export of Rs 100 crore in the current fiscal.

The newly launched specialty division Zydus Neurosciences expanded its product range with five new products. These products are expected to contribute more than Rs 10 crore to sales income during the first year of their introduction.

The company has also launched many products in cardiovascular segment.

CHL acquired 50.66 per cent stake in German Remedies for Rs 272 crore, helping it to include leading brands in women’s healthcare (that alone contributes 35 per cent of its total sales), besides respiratory and oncologicals.

This acquisition has catapulted the company to the fourth position in the Indian pharma market in terms of market share.

The company currently invests around eight per cent of its turnover on R&D. The company occupies a top slot in R&D spending.

CHL focuses mainly on three segments: cardiovascular, pain-management and anti-infective. Recently, Cadila invested $3 million in a joint venture with the US-based Onconova Therapeutics for collaborating in research, manufacturing and marketing of anti-cancer therapies.

The company is now focusing on new chemical entities (NCE) and drug delivery systems. It has filed seven patents for novel compounds and processes including three non-infringing process patents for two blockbuster drugs.

So far, the company has not profited much from acquisitions, R&D efforts and various tie-ups with domestic and foreign companies. Its OPM does not compare well with some of its rivals in the pharma industry.

Dhruv Rathi