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Sun Pharmaceutical Industries posted a 5.2 percent year-on-year (YoY) rise in net profit for the third quarter of Financial Year 2022-23 to Rs 2,166 crore, riding on the back of sales in India and the US and an uptick in the global specialty portfolio.
The Mumbai-headquartered firm’s results were in line with analyst estimates, but the stock was down 1.5 percent on BSE on Tuesday.
Total sales grew by 13.1 per cent YoY to Rs 111,00 crore. Of this, India formulation sales were at Rs 3,391 crore, up 7.1 per cent over Q3 last year. US formulation sales were up 6.3 per cent to $422 mn. India formulations sales account for 31 per cent of Sun Pharma’s consolidated sales, while the US accounts for another 31 per cent.
Global specialty sales came in at $235 million (including a $12.5 million milestone payment). Excluding the milestone, specialty sales were up 21.6 percent YoY. Emerging markets formulation sales were at $ 257 million, up 7.7 per cent versus Q3 last year and the Rest of World formulation sales were at $ 189 million, up 4.8 per cent.
While the US sales were up, its subsidiary Taro posted a flat performance growth” $139 mn revenues YoY and net profit of $7.3 mn, which was down from $26.3 mn in Q3 FY22.
Dilip Shanghvi, managing director of Sun Pharmaceutical, said: “Specialty is expected to continue as a key growth driver for Sun. We are investing to scale up this business, especially in our core therapy areas. Proposed Concert acquisition is a step forward in this direction. Concert’s lead asset, deuroxolitinib has a potential best-in-class profile in Alopecia Areata, an area of dermatology with high unmet need. We are excited to offer this new treatment option to dermatologists worldwide. Given our commercial strength, we would be well-positioned to bring this product to market.”
Shanghvi added that the US sales growth has come from Ilumya and Winlevi for the quarter. Sun Pharma intends to expand its specialty products footprint further in dermatology, ophthalmology, onco-dermatology.
The import alert on the Halol plant, however, has resulted in some decline in generics business in the US, the company admitted.
In January 2023, Sun Pharma entered into a definitive agreement to acquire Concert Pharmaceuticals Inc. The acquisition would add a late-stage asset—deuruxolitinib for treating Alopecia Areata—to Sun’s offering in dermatology. The transaction is expected to be completed in the first quarter of calendar 2023.
Shanghvi said that the immediate priority is the file a new drug application with the USFDA for Concert Pharma’s lead product (deuruxolitinib). “Additional costs are expected in R&D before the product gets commercialized,” he added.
For Q3FY23, external sales of API were at Rs. 5,154 million, up by 9.4 per cent over Q3 last year.
The company has added sales force in India during the quarter and is expanding further into tier-2 and tier 3 cities.
Consolidated R&D investment for Q3FY23 was at Rs 670 crore as compared to Rs 547 crore for Q3 last year. “Our specialty R&D pipeline includes 4 molecules undergoing clinical trials. We have a comprehensive product offering in the US market consisting of approved ANDAs for 517 products while filings for 96 ANDAs await US FDA approval, including 28 tentative approvals,” Sun Pharma said.
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