Nicholas Piramal Strikes Pact With Israeli Firm Teva

The arrangement has been confirmed by C M Hattangadi, managing director, Nicholas Piramal. However, the exact price at which exports would be undertaken could not be ascertained.

But, Ibuprofen, manufactured by the same plant, may not receive much of an export boost for the moment, according to Ajay Piramal, chairman, Nicholas Piramal. This is because the prevailing market conditions are not favourable for this bulk drug. Besides, Ibuprofen has faced anti-dumping levies in certain developed countries like the US.

Piramal intends to concentrate on bulk drugs which have regular buyers on long-term contracts. A diltiazem drug intermediary, cis-lactam, produced by the same plant, would also be marketed to Hoffman La Roche and Boehringer Mannheim.

 

Of late, the countrys performance in bulk drug exports has been under pressure following dumping and price-cutting indulged in by Chinese bulk drug manufacturers. The domestic price of diltiazem has not faced major fluctuations and has been hovering around Rs 5,200 per kg.

Sumitra Pharma, before its merger with Nicholas Piramal, exported almost 60 per cent of its turnover. At the point of merger, exports of bulk drugs were a strategic decision for Nicholas Piramal.

According to Piramal, strategic alliances are part of the Piramal strategy. The alliance in Botswana, which gives the company easy access to all signatories of the South African customs union, is part of this strategy, says Piramal. The new marketing arrangement in neighbouring Myanmar is also a strategic alliance.

Teva is listed internationally on most of the major stock exchanges including the NYSE. After the takeover of Sumitra Pharma, Nicholas Piramals income from operations for the six months ended September 30, 1996, stood at Rs 144.88 crore, compared with Rs 100.04 crore during the corresponding period last year.

Its PAT stood at Rs 16.54 crore during the six months ended September 1996, compared with Rs 18.31 during the corresponding period in 1995. The drop in PAT is due to an increased interest burden of Rs 5.75 crore for the first six months of 1996, compared with Rs 1.19 crore during the first six months ended September 1995.

At the domestic level, Nicholas Piramal has planned substantial expansions for its formulations plant at Pithampur and a 5 mw gas-based captive power generation plant is under implementation at Kosamba. This plant is likely to be commissioned by the end of the current financial year.

The expansion of the Pithampur plant is expected to improve delivery schedules to export customers. However, in the area of exports, the pharma division has received a mild setback in 1995-96, with a drop of almost Rs 50 million, compared with previous year on account of some missed tenders.