Building for the Future
We believe better health outcomes are fundamental to building a better world for all.We are on an exciting journey to offer integrated pharmaceutical solutions to facilitatewellness and well-being across the world. Our overall performance and the determination ofevery member of Team Laurus makes me confident that we are on the right course to growsustainably and create lasting value for all stakeholders.
When we talk about growth it has to be powered by a sound strategy in motion. We arefocusing on enhancing and enriching our current portfolio stepping up our R&Dinvestments for product development and strengthening our manufacturing capabilities. Ourdiversified and integrated capabilities enable us to capture significant opportunities inmargin-accretive segments and foray into emerging markets while continuing to grow in ourtraditional regions.
Our consolidated revenues stood at '22919 million in 2018-19 against '20562 millionin 2017-18. We have once again demonstrated excellence in our operational efficiencies.Each of our core business segments (Generics - API FDF Ingredients and Synthesis)registered good performance in 2018-19. However margins were affected as major rawmaterial procurement prices increased due to shortage of intermediaries environmentalissues and closure of manufacturing facilities in China. We have received all appropriateregulatory approvals have a noticeable frontend presence in the US a strong productportfolio and a growing presence in global markets. Considering these encouragingdevelopments your Company appears attractively placed to report satisfactory growthgoing forward.
The margins were affected due to the high raw material costs and incremental fixedoperational expenses pertaining to the new formulation facility. We expect formulationsales to increase with new approvals in regulated markets and enhanced traction inexisting products and geographies. This will improve the margins for the Company asoperating leverage will kick in.
Formulations: Growth opportunity
Formulations play for us involves both scale and technology. Backward integration wasour core forte the focus now is to take our APIs forward. During the year we startedcommercial supplies of FDFs to European markets and started shipping Metformin tablets tothe US markets as well. We entered into a strategic partnership agreement with Global Fundfor three-and-a-half years. This long-term agreement will enable us to fulfill our volumecommitments to Global Fund for the treatment of HIV/AIDS.
This partnership has enhanced our determination to contribute to the global mission fortreating millions of HIV/AIDS patients. We are optimistic about the future and ourbackward integration for the key molecule is already in place and the formulationsbusiness is expected to gather momentum with fresh orders.
So far we have filed 19 ANDAs 4 dossiers in Canada 6 in Europe and 6 with WHO. Wealso filed 2 dossiers in South Africa and 2 in India; and close to 100 dossiers in therest of Africa for product approvals.
Other business segments to supplement growth
We completed the validation of all second-line ARV APIs and we can now offer acomprehensive basket of APIs. Until now we have been offering first-line APIs. Now wehave a new basket of APIs which will encompass both the first and second line.
During the year we also started commercial supplies from Unit 5 to Aspen and got neworders from existing CMO partners.
With robust demand for our currently marketed products and a sizeable pipeline weinvested to ensure we have the capacity to continue delivering as we grow. This investmentwill enable us to quickly and efficiently execute our medium-term to long-term productlaunch programme and expand across our national and international markets.
Quality is non-negotiable
Our quality standards remain uniform for all our products regardless of the markets inwhich they are launched.
We differentiate markets based on price not on quality standards. Quality isparamount to us and remains a 24x7 priority for us for all markets. This quality approachenables us to navigate the regulatory environment effectively at a time when manypharmaceutical companies have experienced significant regulatory and compliance issues.
Our Company has been built around a quality culture that is reflected not just in theproducts we manufacture but also in the mindset of our people. Our quality mindsetensures we continue to deliver consistent standards with unwavering focus. We conductedmultiple audits during the year under review and I am pleased to report that the outcomeswere encouraging validating our competence in the segment.
People drive change
An institution cannot be built for the long term unless people put their hearts to itsprogress. A capable workforce is created by integrating good health practices into thedaily life of every member of our team. We seek to promote health in all aspects of ouremployees' lives both at the workplace and outside of it. Our programmes perceivewell-being and occupational health as interdependent and view prevention and riskmanagement as holding equal status.
We have put in place a firm foundation for value creation and with our strengthenedportfolio are well positioned in global markets. With a solid strategy and disciplinedexecution the opportunities for us are immense. We are building on our strengths tofurther extend our product portfolio and target fast-growing segments. I am grateful toall our stakeholders for their guidance and support in our journey. It is an honour for meto lead this great company which is built for the long term.
Dr. C. Satyanarayana