RANBAXY?s LOSS MAY TURN INTO GAIN FOR DR REDDY?s LAB

January 16, Jan 16, 2009 (Asia Pulse Data Source via COMTEX) -- RBXLF | Quote | Chart | News | PowerRating -- With Gurgaon-based drug manufacturer Ranbaxy Laboratories still struggling to get out of the mess with US health regulator Food and Drug Administration (FDA), it is now bound to lose more than Rs 300 crore opportunity in US market which may turn into a gain for the another Indian drug major Dr Reddy?s laboratories. Drug major Ranbaxy Laboratories could suffer a potential revenue loss to the tune of Rs 300 crore due to delay in receiving approval from the US Food and Drug Administration (FDA) for generic version of GSK?s anti-migraine medicine Imitrex, according to analysts.

Ranbaxy had last January said it expected to launch in December 2008 the 25 mg, 50 mg and 100 mg strengths of generic Imitrex in US market with an exclusivity period of 180 days after settling a patent litigation with GlaxoSmithKline (GSK). Ranbaxy had entered into an out of court settlement with GSK to resolve the patent litigation with GSK over Imitrex. Under the terms of the agreement, the Indian company got the 180 exclusivity period in US, which is the largest drug market globally. Industry estimates put Imitrex total annual sales at over one billion dollars.

However, it has not been able to launch the drug due to delay in getting approval from the USFDA.

?Ranbaxy is likely to suffer a potential revenue loss of up to Rs 300 crores as it has not been able to meet the deadline of fourth quarter for launching Imitrex in the US market,? Angel Broking Pharma Anal Sarvajeet Kaur told PTI Economic Services. However, this also provides a good opportunity for Hyderabadbased Dr Reddy?s laboratories as it has already launched the drug in US market, Kaur said.

?Since, Ranbaxy has not been able to launch the drug in US and patent for the drug is also going to expire in Feb 2009, the company may have to suffer a potential revenue loss of Rs 240-250 crore in the current year,? Prabhudas Liladhar Research Head (Pharma) Ranjit Kapadia said.

When contacted Ranbaxy Spokesperson said, ?The company is waiting for US FDA approval for launching the drug at US,? while declining to give any other details.

In September last year, US FDA has imposed an import ban on 30 drugs manufactured at two of its plant located in Dewas, Madhya Pradesh and Poanta Sahib in Himachal Pradesh. However, according to the company sources Imitrex is not in the list of banned drug and neither the drug is produced in these manufacturing units.

Meanwhile, delay in Ranbaxy Laboratories getting approval from the USFDA for launching generic version of GlaxoSmithKline?s (GSK) migraine and headache drug Imitrex may turn out to be a gain for Hyderabad-based Dr Reddy?s Laboratories (DRL), which has already launched the drug in US.

According to analysts, DRL could end up gaining a major chunk of the estimated 80 million dollars sales from the drug by Ranbaxy in the first year of launch in the US.

DRL, which is the authorised generic manufacturers from GSk had already launched the drug in November last year. ?As Ranbaxy was expecting a sale of upto 80 million dollars from generic Imitrex but now DRL is the only generic manufacturer of the drug,? Kaur said, adding the advantage is with DRL to garner a large chunk if Ranbaxy failed to launch the drug anytime soon. It will be very difficult for the Ranbaxy to now opt for any other alternative to launch the drug in US market and on the other hand DRL launched the generic version of Imitrex in November last year after settling patent litigation with GSK, thus becoming the first company to launch an authorised generic version of the drug. However when contacted, DRL officials refused to comment on the projected revenues from generic Imitrex sales. Imitrex a patent drug from the global Pharma giant GlaxoSmithKline has reported sales worth more than one billion dollars in 2007.

A number of other generic manufacturers had filed application with US FDA for launching the drug in US after expiry of its patent but US FDA has not granted permission to any one yet. GSK?s patent over the anti-migraine drug is scheduled to expire on Febraury 2009.

DRL is able to launch the drug under an arrangement with GSK meanwhile other companies including Ranbaxy are still waiting for the approval.

More News:   Market Updates | Stock Alerts | All Trading News | Stock Index