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Home » Indian Generics Makers Hit By Taxes, US Expenses
Indian Generics Makers Hit By Taxes, US Expenses
Leading Indian drugmakers Ranbaxy, Cipla, Sun Pharma, Wockhardt and Nicholas Piramal have blamed worsening first-quarter sales on local taxes, marketing expenses in the US and the country's new patent law. Combined profits at the five companies were 36.3% lower year-on-year, at roughly INR2.94bn (US$67.45mn), on a 13.5% fall in sales to INR19.9bn (US$459.18mn).
Generics maker Nicholas Piramal attributed part of its sales decline to confusion over changes to India's value-added tax, which led wholesalers to postpone large orders. Ranbaxy, meanwhile, noted that its results had been affected by the withdrawal of stocks of quinapril, following a US legal challenge by Pfizer on a patent for its antihypertensive Accupril. In the period, only Cipla reported a profit rise.
The investment costs borne by Indian drugmakers on R&D has continued to
affect results; the accounting item that includes R&D expenditure rose 16%
for the five drugmakers in the first quarter. In the wake of the country's new
patent law, it can be estimated that higher drug development costs and a greater
drive to win overseas registrations especially in the US will
continue to affect financial performance.
KEYWORDS Daily International Pharma Alert
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21Oct