LAURUS LABS LIMITED Q1 FY19 RESULTS PRESENTATION August 03, 2018 BSE: 540222 NSE : LAURUSLABS
Disclaimer Certain statements in this document may be forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties like regulatory changes, local political or economic developments and many other factors that could cause our actual results to differ materially from those contemplated by the relevant forward-looking statements. Laurus Labs Limited (Laurus) will not be in any way responsible for any action taken based on such statements and undertakes no obligation to publicly update these forward-looking statements to reflect subsequent events or circumstances. 2
Business Snapshot • • • • Development, manufacture Developing and manufacturing Contract development and Sale and manufacture of Overview and sale of active oral solid formulations manufacturing services for specialty ingredients for use in pharmaceutical ingredients global pharmaceutical nutraceuticals, dietary (APIs) and advanced companies supplements and intermediates cosmeceutical products • • • • Anti-retroviral (ARV) ARVs Commercial scale contract Nutraceuticals, dietary Product and manufacturing supplements and • • Service Hepatitis C Anti-diabetic cosmoceutical products • Clinical phase supplies • • Offerings Oncology Cardio Vascular • Analytical and research • Set up a dedicated block in • • Large volume APIs for cardio- Proton Pump Inhibitors services Unit 4 for global partner , C2 vascular, antidiabetic, anti- • CNS Pharma • asthmatic, gastroenterology Several projects executed therapeutic areas • Small volume APIs for the ophthalmic therapeutic area • • • • Commercialized 50+ products Filed 13 ANDAs with USFDA Commenced commercial NA Filings • 2 dossier in Canada, 4 dossiers supplies from Unit 5 • 48 DMFs filed in Europe, 5 dossier with WHO, 2 dossier in South Africa, 2 dossier in India & 26 in ROW. In addition, completed 5 products validations. • • • • Manufacturing facilities (2) Infrastructure 4 Manufacturing facilities, 5 bn Units / year capacity. Dedicated manufacturing (2,784 KL (1) (2) (Unit – 5) Capacity (125 KL) for Aspen. (1) Includes ingredients products excluding Unit 2 API (2) APIs , Ingredients and Synthesis (other than Aspen & Kilo lab capacity supplies) are manufacturing at Unit 1,3 ,4 & 6 3
Significant Investments in Generic FDF Business Approval from Global fund under ERP Leverage API production and R&D (Expert Review Panel) for DLT and will capabilities to forward integrate into able participate in WHO and in country FDF tenders (ROW) Capture significant operating Got product approval for Tenofovir and efficiencies by housing both API and generated Sales in US, Canada and Africa. FDF facilities in the same location As on date filed 13 ANDAs and in addition Targeting various Triple Combination completed 5 validations for formulations. filings for ARV products in LMICs for Filings Strategy tender business Filed our First NDA with USFDA under PEPFAR, for LMIC tenders Product specific filings done in various markets. De-risking the revenue Approvals from USFDA, BGV – Germany, concentration from markets like US. WHO-Geneva and several African countries FDF Business to be Gross Margin accretive Rising Pharma INC. • Entered into a profit and cost • Spent INR 274 mn towards FDF product sharing partnership for developing development expenses for Q1 FY19 and and selling a basket of FDFs in the INR 2,628 mn cumulatively US market. • INR 4,180 mn capex invested as on date Dr. Reddy’s Laboratories Limited Investment & to set up and expand FDF manufacturing Partnerships • Entered into a partnership for facility Infrastructure development & sale of ARV FDFs for US market on profit and cost • FDF currently contributed INR 51 million sharing basis revenue in Q1 FY 19 • Infrastructure in place to support NATCO Pharma Limited • manufacturing with a current capacity of Entered into a profit sharing 5 bn units. partnership for development & sale of HEP C products in India and emerging markets. 4 4
Strategy in Motion Synthesis Oncology & Other APIs Ingredients ARV & HEP-C FDFs • Focus on supply of key • Leverage process • Leverage API capabilities; • Significant increase in HIV • Leadership in select starting materials and chemistry skills to capture operating patient population with Oncology API. Launching intermediates for new strengthen presence in efficiencies through revised WHO guidelines few more products in chemical entities nutraceutical and backward integration FY19 & beyond in • New opportunities in cosmeceutical sectors as regulated markets • Contract with Aspen for • 2 Partnerships in place Second Line therapies they adopt quality supply of hormonal for commercialization of • Leverage process • ARV drugs patent expiry standards at par with intermediates FDFs in US market. chemistry skills to expand in US & European pharma industry API product portfolio in • Generate revenue from • Completed several markets other growing the emerging markets by projects in various stages • Strong opportunity in therapeutic areas participating through from pre clinical to Hepatitis C in emerging tenders. commercial with • Contract manufacturing markets development & of generic APIs • Setting up our own front Manufacturing. And end in the US market many more in pipeline • Looking to capitalize in other EMs and developed markets • Contract manufacturing Capitalize on our Further expand our API for European Customers Expanding from Synthetic Leadership Position in APIs Portfolio in key therapeutic Develop our Synthesis process to Natural in Select, High-Growth areas such as Oncology, Business through various Leverage API Cost Advantage Extraction Therapeutic Areas . Foray CVS, Anti-Diabetic & global Innovators including for Forward Integration into into regulated markets Ophthalmology Aspen Generic FDF Therapeutic Focus Areas – ARV, CVS, CNS, PPI & Anti Diabetic 5 5
Transformation of Business Model • Crossed INR 20 billion of revenue • Commenced commercial operations from Unit 4 • Incorporated a subsidiary in Germany • • Investment of Incorporated First • Unit 2-Formulations, inspected by INR 600 Mn by Subsidiary in USA, • Successfully listed on BSE & USFDA with Zero 483 observations • Set up the R&D FIL Capital Laurus Inc. NSE • Launched maiden FDF product • Centre at IKP, Management Investment of INR • Filed first ANDA for US market Tenofovir in USA, Canada and Knowledge Park, and Promoters. 3000 Mn by • Acquired 100% stake in Sriam emerging markets. Hyderabad Warburg Pincus Labs Pvt Ltd. • Certified as Great Place to Work for the year 2018 • • • Commenced Crossed INR 10 Commenced • Commenced commercial commercial billion of revenues commercial operations at Unit 2 operations at Unit 1 operations at Unit 3, • Commenced commercial • Forged partnership supplies from Unit 5 for with NATCO Aspen • Launched Velpatasvir in the HEP - C segment • Received EIR from USFDA for Units 1,2 & 3 • Incorporated subsidiaries in UK & USA 6
Strong R&D Capabilities Key Accreditations “Research - first” approach – Set up dedicated R&D center in Hyderabad in 2006 prior to commissioning API manufacturing facility in 2007 and further expansion completed in 2017. R&D team comprising 750 plus scientists (24.0% of total employee strength) including over 47 PhDs Kilo Lab at R&D center accredited by international regulators Currently setting up new R&D center in Visakhapatnam Increasing R&D Spend (INR mn) 1,402 1,196 13 50+ 48 63 227 907 7.4% 586 Products Filed Patents 424 Patents ANDAs & NDA 5.9% 345 5.1% DMFs granted commercialized 4.3% filed /Dossiers filed 3.6% 6.5% since inception FY14 FY15 FY16 FY17 FY18 Q1 FY19 • R & D spent includes OPEX, CAPEX and RMC of FDF validation batches R&D Spend % of Revenue 7 FY 17 numbers are high due to additional CAPEX and initial FDF validation batches •
Quality Focus & Regulatory Audits Laurus ’ Philosophy “One Quality Standard for all markets” Regular Inspection at different manufacturing units 2018 USFDA We maintain consistent quality, efficiency and product 2017 WHO, USFDA, EU (Germany) safety. 2016 USFDA We have adopted uniform manufacturing standards across 2015 WHO, USFDA, EU (Germany) all facilities to achieve standardized quality for all markets. Good manufacturing practices across all the manufacturing 2014 WHO, USFDA, CDSCO facilities, encompassing all areas of business processes 2013 WHO right from supply chain to product delivery. 2012 USFDA 2011 KFDA, USFDA, WHO 2010 MHRA 2009 TGA, USFDA 8
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