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Granules profit surges on higher paracetamol sales

Revenue share from the U.S. also increased to 49.4% against 43.1% in the year earlier

January 24, 2023 07:49 pm | Updated January 26, 2023 10:15 am IST - HYDERABAD

Drugmaker Granules India on Tuesday reported consolidated net profit increased 23% for December quarter to ₹124.32 crore on the back of higher paracetamol API offtake.

Total income increased almost 15% to ₹1,147.07 crore. However, both the net profit and total income were lower on a sequential basis. For the September quarter, Granules had reported ₹145.09 crore net profit and a total income of ₹1,155.52 crore.

Driving the revenue during the third quarter were the higher Paracetamol active pharmaceuticals ingredients (API) sales in the U.S. Revenue share from the U.S. also increased to 49.4% against 43.1% in the year earlier period.

“We continued to cater to higher demand for paracetamol. Opportunities in paracetamol are likely to continue and our geography expansion strategy in Europe is likely to yield higher turnover and EBITDA in future,” CMD Krishna Prasad Chigurupati said. There was an erosion in price and margin during the quarter, something likely to stretch into Q4 too.

Granules also suffered some sales loss in USA as it transitioned from one 3PL partner in the U.S. to another. “That is the reason for better standalone financial performance as compared to consolidated financial performance... smoothening of the logistics in USA could take a quarter more,” he said.

API, pharmaceutical formulation intermediates (PFI) and finished dosages contributed 35.8%, 18.6% and 45.6% respectively to revenue from operations that stood at ₹1,416 crore.

While operating cash flow is “quite healthy at ₹161 crore, free cash flow at ₹32.5 crore has got impacted due to additional deployment of ₹50 crore in our new expansion plan with green initiatives in Kakinada and ₹42.5 crore for land acquisition in Vishakhapatnam,” the company said.

U.S. FDA nod

U.S. subsidiary Granules Pharmaceuticals Inc. has received U.S. Food and Drug Administration approval for Amphetamine Mixed Salts, 5mg, 10mg, 15mg, 20mg, 25mg and 30mg Extended-Release (ER) capsules.

Bioequivalent to Adderall XR ER capsules of Takeda Pharmaceuticals USA Inc., the approved product will be manufactured at Granules facility in Chantilly, Virginia. It is expected to be launched shortly.

Mixed Salts of a Single-Entity Amphetamine ER Capsules are indicated for the treatment of Attention Deficit Hyperactivity Disorder (ADHD). The current annual U.S. market for Amphetamine Mixed Salts ER capsule product is around $1.56 billion, the company said citing IQVIA/IMS Health numbers.

“Pleased to receive approval of Amphetamine Mixed Salts ER Capsules within 10-months of ANDA filing, which is an ER dosage form of controlled substance (C-II),” GPI Executive Director Priyanka Chigurupati.

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