Ind-Swift Laboratories Ltd.- Manufacturer of Active Pharmaceutical Ingredients

NEWS FLASH

	Outlook for the year 2008
	Unaudited financial results for the quarter ended 30th June, 2006

News Update

Ind-Swift Labs enter into contract research tie-up with two European companies.
Targets 40-45% revenues from CRAMS in next 2-3 years

Making a dent in the US$ 7.5 billion market for Contract Research, Ind-Swift has entered into contract research agreements worth over 3-5 Million US$ with two leading European Pharmaceutical Companies for the molecules with Market size of Over US$ 8 bn to be completed in next 18 months . Ind-Swift has focused on CRAMS in a big way and the Company projects 40-45% of the bottom line to come from the CRAMS business in the next two to three years.

Commenting Mr. V.K.Mehta , Joint Managing Director told that " The contracts are a part of our focus on the regulated markets where we intend to enter into more such tie-ups and joint ventures for the development of products for the international majors ".

He further added that "it is a two pronged strategy, besides development of the products for the pharma majors, in one molecule we are entitled to launch the molecule in the US market and in the other molecule we will be entitled to royalty payment. The tie-up would ensure a smooth entry for the Company's products in the regulated markets".

Ind-Swift laboratories limited a one of the largest manufacturers of the API and advanced intermediates in Domestic and International market has already builtup World Class manufacturing and Research facilities . It is possesses large scale capacities for all the Complex molecules where it is present. Over the last few years, ISLL has shifted its focus to complex molecules and development on non - infringing processes, so as to minimise the risk of severe competition and commoditisation.

The company has launched and built global scale capacities in several high potential molecules like Clarithromycin, Fexofenadine and Atorvastatin ' ISLL is in fact the largest producer of Clarithromycin (around 15% of global capacity) and Fexofenadine in the World after the innovators.

The company has recently filed 1 DMF with USFDA and 2 Common Technical Documents (CTDs) with European authorities. In addition ISLL has already filed 2 new patents and its R&D is in the process of developing non-infringing processes for 4-6 new molecules. In addition to existing 20 products, the company has 20 products in pipeline whose combined global sales were approximately USD 18 bn in 2002.

Recently the Company has launched an anti-diarroheal molecule 'Nitazoxanide' for the first time in Asia. This is the first molecule approved by the FDA in last 40 years for Gardia and is the only drug approved for the treatment of Diarrhea caused by Cryptosporidium parvum in children aged 12 month to 11 years of age. The molecule was launched in India by the Company within a year of its Global launch by the Originator.

The next new launches planned by the Company includes an Anti-Alcoholic drug (sales of US$ 16.2 mn in Europe), a molecule for Breast Cancer (a US$ 100mn product) . Besides the company is also going to launch two molecules from Statin range, which include an Anti-Hyperlipidemic drug with world market of over USD 5 bn by 2005. ISLL will be the third company globally, to launch this product. 3 of these new products are slated to be commercially launched during the current quarter

To enter the regulated markets like USA, EU, Australia, and New Zealand, the Company is focusing on getting its manufacturing plant approved by regulatory agencies like USFDA, TGA and MCA. The company expects the USFDA inspection and approvals by 2004.

The company has invested INR 45.80mn during the year in enhancing and sharpening its capabilities in research and development. The company's capex plans over the next three years is estimated at around US$ 15mn

The company has recently set up a subsidiary in US and has also recruited top officials for the same . The new outfit would essentially seek Custom Research, Custom Manufacturing arrangements and strategic partnership in the US market. The Company has already tied up with four US companies, which figure among the top 15 Companies in the US, for supply of its products.

The company has chalked out expansion plans which include investments to facilitate ISLL's entry into regulatory markets, particularly of US & Europe, with filing of 25 DMFs by 2007-08, as drugs worth US$ 84 billion go off patent by 2008. We expect an annual ROI of 35-40 per cent on total investment. Further the company expects the number of global companies with which it has long term tie up to double in next 2-3 years.

To facilitate the filing of 25 DMFs by 2008, a strong R&D support is imperative, so the company plans to set up a new R&D centre. The R&D of the company has already launched 8-10 products in the past and it plans to launch 22-25 products in next 3-4 years. Company plans to create USP for its products through R&D.

The company has already filed patent for 2 non-infringing processes. It is ready with filing 4 non-infringing processes in the current year and 12 more in the next year. We are working on developing molecules under the statins, cardiology, diabetology and oncology segments. Efforts are also on for a tie-up with the originator through development of non-infringing processes and undertaking contract research for development of their molecules with an additional investment of US $ 5 million apart from the investment of US $2 million last year. Besides we also plan to increase our existing R&D strength from 70 to 150 by next year

The company is also among the first few players to launch other complex products like Clopidogrel, Candesartan, Atorvastatin, Pioglitazone and Citalopram. ISLL has invested around INR 250 mn over the last three to four years to build capacities (it now has six manufacturing plants) and make its facilities cGMP compliant and approvable by regulatory bodies like the US FDA and UK MCA. The company has already filed its first DMF in the US market and expects to be ready for US FDA inspection over the next few months.

ISLL is in fact the only company in the world apart from the innovator (Abbott) to have developed Clarithromycin granules, and was also the first to develop Roxithromycin granules. The R&D of the Company is ready with four new patents . These are patents for non - infringing processes of an Anti-Diabetic, Cardiovascular, Anti-Histamine & Antibiotic drug respectively. All these drugs are scheduled to be launched in the financial year 2004-05.

Ind Swift Laboratories Ltd (ISLL) is an emerging API player, with a clear focus on positioning itself as a primary supplier of bulk drugs to regulated markets. Hitherto focused on unregulated / soft regulated markets, ISLL has been steadily building a platform for a foray into regulated markets – the company has invested heavily in manufacturing and R&D infrastructure, and efforts are also on to develop a front end in the target markets. With six cGMP compliant plants and a robust product basket of 18 molecules (20 more in the pipeline), ISLL is well set to reap the rewards of its initiatives over the next few years.

ISLL is positioning itself as a primary supplier of APIs to generic players in regulated markets. The company already has a good presence in unregulated / soft regulated markets (exports 18 products to over 40 countries) ' it is now in negotiations with global players for the supply of high potential drugs like clarithromycin, atorvastatin and fexofenadine to regulated markets on patent expiry.

ISLL has already built up sizable capacities in some of these molecules. ISLL has built a full fledged R&D centre with a team of around 70 people, which is clearly focused on developing new drugs and non infringing processes for the same. The company has strong process chemistry skills, which helps it develop cost effective and complex processes for various APIs and intermediates.

Besides developing new molecules and building large capacities for the same, ISLL has also been actively building a channel for marketing in the targeted markets. While the company is already well entrenched in most unregulated markets, it is in talks with several players in Europe and US for supply contracts. ISLL has already tied up with a couple of companies in Europe, while discussions are on with several generic players for the US markets as well for the supply of various products post patent expiry. The company intends to set up an office in the US and is also seriously considering some small acquisition which could help accelerate its plans for this market.

During the Quarter ended June,2004 the Company posted an impressive growth in Profit after Tax of 106.61% from Rs. 13.84 millions to Rs.28.59 millions and the Turnover saw an increase of 15.21% from Rs.381.91 mns to Rs. 440 mns . The Company has declared a maiden dividend of 10% for the FY 2003-04 . The Earning per share of the Company for the Fy 2003-04 also increased from Rs. 4.78 to Rs. 5.24 per share.

To know about our Formulation Division, please visit us at Ind-Swift Limited, our other group company.