Standalone earnings for the fiscal ended March 31, 2009

The Chennai-based pharma major, Orchid Chemicals & Pharmaceuticals Ltd (Orchid) registered a turnover and operating income of Rs 1211.27 crore for the fiscal year ended March 31, 2009 compared to the previous year’s revenues of Rs 1240.14 crore.

Earnings before Interest & Tax (EBIT) stood lower at Rs 157.77 crore compared to Rs 248.40 crore of the last fiscal. After providing for higher interest expenses of Rs 155.75 crore (Rs 81.12 crore last fiscal) and depreciation and amortisation expenses of Rs 129.97 crore (Rs 97.67 crore last fiscal), Orchid registered a loss before tax (after exceptional item) of Rs 36.85 crore as against the previous year’s profit before tax (after exceptional item) of Rs 238.54 crore.

At the net level, the company registered a loss after tax of Rs 52.17 crore as against a profit after tax of Rs 184.54 crore registered during the last fiscal.

Consolidated earnings for the fiscal ended March 31, 2009

On a Consolidated basis, Orchid registered a marginal gain in turnover at Rs 1315.56 crore for the fiscal ended March 31, 2009 compared to Rs 1300.96 crore of the corresponding fiscal.

EBIT (Earnings before Interest and tax) stood lower at Rs 163.02 crore compared to Rs 239.30 crore of the same period last fiscal.

The company registered a loss of Rs 48.99 crore at the net level for the fiscal ended March 2009 compared to a profit of Rs 175.34 crore of the corresponding fiscal.

Orchid’s board that met today to adopt the audited financial results for the fiscal ended March 31, 2009 recommended a dividend of 10%.

Quote from the Managing Director

Orchid’s Managing Director Mr K Raghavendra Rao, commenting on the earnings said, “Although the fiscal year ended March 31, 2009 was flat, several initiatives are culminating well and will lead to a robust growth pattern going forward. During the year under review, Orchid forayed into the Penicillin injections segment by securing the approval for Tazobactam-Piperacillin in the Canadian, ANZ and European markets. This is the 3rd product segment for Orchid after Cephalosporins and Non-antibiotics. This would lead to an increased utilisation of our asset base resulting in greater unlocking of value.”

US Generics

The fiscal 2008-09 witnessed a plateau in the US Generics business of Orchid partly attributed to the overall recession in the US economy with the distributors and trade channels at large being cautious with orders. However, the new launches on the anvil will drive strong growth in the forthcoming quarters.

EU Generics

The fiscal 2008-09 witnessed approvals from several countries in EU for launch of Piperacillin-Tazobactam Injections. This coupled with approvals being received by our distribution partners pan-Europe and in specific countries for our cephalosporin products, would lay a solid foundation for growth of the EU generics business in the quarters to come.

Regulatory update

Formulations

United States / Canada

During the fiscal ended March 31, 2009, Orchid’s cumulative ANDA filings moved to 58 with 29 of the filings in the cephalosporins space, 5 in Betalactams, 21 in the NPNC segment and 3 in the Penems segments. These also include 7 Para IV FTF (First-to-File) ANDA filings.

With 2 ANDA approvals received during the fourth quarter, Orchid’s cumulative count of ANDA approvals moved to 31, out of which 26 are in Cephalosporin segment and 5 are in NPNC segment.

In the Canadian market, Orchid’s cumulative count of ANDS approved moved to 5 with the recent approval received for Cefepime Arginine Injections. Of the total ANDS approved, 4 are in Cephalosporin Segment and 1 in the Betalactam segment.

EU

Orchid’s cumulative filing count of Marketing Authorizations (MA) in the EU region moved to 29. Of these MA filings, 23 are in the cephalosporin segment, 1 in the penicillin injections segment, 2 in Carbapenem Segment and 3 in NPNC segment.
On the approval side, Orchid has cumulatively received 19 MA approvals so far.

In the other regulated markets like EU & ANZ, several dossiers are expected to be approved from the respective regulatory bodies in the ensuing quarters.

API segment

In the Active Pharmaceutical Ingredients (API) segment, Orchid increased the cumulative filings of its US DMF count to 72. The break-up of the total filings is 26 in the cephalosporin segment, 33 in NPNC segment, 2 in the betalactam segment and 11 in the carbapenems segment.

In the European market, the cumulative filings of CoS (Certificate of Suitability) count remained at 20 which includes 12 in Cephalosporin segment, 7 in NPNC segment and 1 in the betalactam segment.

Orchid had also made its first Japanese DMF filing during the fourth quarter of the fiscal under review. The cumulative DMF filing count in Japan as of date stands at 3.

Drug Discovery

In the area of drug discovery, Orchid’s wholly-owned drug discovery subsidiary, Orchid Research Laboratories Limited (ORL) continued to progress in the core therapeutic areas of inflammation, oncology, diabetes and anti-infectives. During the year, Orchid executed a Research collaboration and Licensing Agreement with Merck & Co., USA to discover and develop novel anti-infective compounds. Orchid is also engaged in developing a novel anti-coagulant compound from its US-based discovery affiliate, Diakron Pharmaceuticals, Inc.