Ranbaxy Laboratories edged higher on Tuesday following reports that the company has received the regulator's nod to market a new drug in the US.
The stock of the domestic pharma major has ruled firm in recent sessions on the back of its strong financial performance driven by US generics business. However, the stock has witnessed some volatility. It has moved in a band of Rs 600-650 in the last few weeks. The stock is close to its 52-week high now.
There were reports that Ranbaxy Laboratories has received approval from the US Food and Drug Administration to market Flecainide Acetate Tablets USP, in 50 mg, 100 mg, and 150 mg strengths. The division of bio-equivalence has determined RLL's Flecainide Acetate tablets to be bio-equivalent and, therefore, therapeutically equivalent to the listed drug, Tambocor tablets, of 3M Pharmaceuticals, Inc. RLL has not revealed as to when it will launch the drug and its estimated market size.
Recently, RLL received the USFDA's approval for a few drugs, which has ensured a firm trend for the company's stock. The company got permission to market Cefadroxil powder for oral suspension USP in 125 mg /5 ml, 250 mg/5 ml and 500 mg/5 ml strengths. In mid-March 2003, RLL got clearance to market Amoxicillin and Clavulanate Potassium for oral suspension, which is indicated for the treatment of infections caused by susceptible strains of the designated organisms in conditions like lower respiratory tract infections, otitis media, sinusitis, skin and skin structure infections, and urinary tract infections.
RLL has been aggressively pursuing the US generics market. The American operations have accounted for 44% of its turnover in 2002, which is expected to rise to 47% by 2004 and 49% by 2005. The contribution from European operations is expected to remain steady at 23%. However, in the US, generic products are witnessing tremendous price erosion and competition. In the first quarter of the current fiscal, RLL had launched Amoxicillin, Clavulanate Potassium (Augmentin) and will soon launch Isotretinoin (Accutane).
At an analysts meet held on 21 January 2003, RLL had said that it will continue to push its key generics business, but it also plans to diversify into the speciality segment in the medium-term and new drug research in the long-term.
In new drug discovery research, the pharma major has decided to focus on the urology, anti-infective and pulmonary segments.
RLL reported a 45% rise in sales to Rs 776.45 crore (Rs 7.76 billion) for the fourth quarter ended 31 December 2002, compared to the corresponding previous quarter. The spectacular rise in sales was on account of a 77% rise in exports (inclusive of trade discounts) to Rs 547.10 crore (Rs 5.47 billion). On the other hand, domestic sales grew by a modest 0.5% to Rs 261.70 crore (Rs 2.61 billion). Net profit ballooned by 323% in Q4 to Rs 212.70 crore (Rs 2.12 billion).
BSE code: 500359
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