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Dr Reddy's Q2 net drops as R&D costs, flat sales hit
By siliconindia
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Wednesday, 27 October 2004, 19:30 IST
MUMBAI: Indian drug maker Dr Reddy's Laboratories Ltd reported its quarterly net profit fell sharply on high research costs as well as lacklustre sales.
The Hyderabad-based firm, India's only New York Stock Exchange-listed drug maker said profit for the second quarter ended September 30 was Rs 517 million ($11 million) compared with Rs 929 million a year earlier.
The results fell short of market expectations of a net profit of Rs 552 million on revenue of Rs 5.44 billion, based on US accounting standards, according to a Reuters poll of 10 analysts.
Dr Reddy's, one of the early Indian drug firms to have made headway in the lucrative United States market, has not had any major generic drug launch there since its exclusive marketing rights for a version of Eli Lilly & Co's anti-depressant Prozac ended in January 2002.
Nearly 70 per cent of Dr Reddy's pending applications to market generics in the United States are patent challenges, which raises its legal costs.
Shares have lost some 48 per cent in 2004 so far, compared with a 1.7 per cent rise in the Bombay Stock Exchange Healthcare index and a 4.4 per cent drop in the Bombay Stock Exchange index.