Torrent Pharma Ltd


(hemtan100) #291

Anyone’s got a clue on Torrent’s oncology greenfield project? What are the timelines and where’s the project location?


(weblinsolutions) #292

It seems to be in Kalol. Search for Torrent on this page of the Environment Clearance Site. http://environmentclearance.nic.in/onlinesearch.aspx?pid=2

You can see about the location and ec clearance status. http://prntscr.com/bw89mw

Edit: It seems to be in a village called Bileshwarpura. Files on the EC site reveals all the details about the project.


(Gaurav Agarwal) #293

Bileshvarpura is close to GIDC Chhatral. Why are we interested in location?

What is the Oncology pipeline of Torrent? Any blockbuster ANDA filed?

I must say the company has lost a big opportunity by not launching gCrestor. Can we ask the management why they could not launch?


(Mukesh Tolani) #294

@Gaurav_Agarwal

I will be attending the AGM on Wednesday.

If this & any other questions are needed to be asked., I can do the same.


(JKS) #295
  • why Crestor launch so delayed? late launches, only compete on price. why not now?
  • what are they doing with the Glochem products?

(Tarun) #296

Thanks @mukesh_gt for taking a lead.

Before coming to my wishlist of questions, just to be sure, are you attending the AGM or the Wednesday evening analyst concall? I think @pikrohit attended Q4FY16 concall and raised 1 question. Just as a suggestion, may be both of you can coordinate to get best out of the effort and opportunity.

coming to my set of questions:

  • This being first investor call post Glochem (i think), I am sure institutional analyst will have good number of questions around this acquisition. This is still worth pursing and probing further if ‘cristal clarity’ does not emerge out of those questions.

-> What is Glochem all about, key API’s it is into, geographies etc. (may sound very very naive but unfortunately dont have much clarity in public domain, at least not to me).
-> If and how this acquisition fits into Torrents scheme of things (specially near to mid term, in long term things can be made to fit.:smirk:).

  • gCrestor (rosuvastatin Calcium) was a real good opportunity (worth ~USD 6B). Unfortunately, seems that Torrent has an (huge) opportunity loss here. Further, last quarter management commented about approx 10 ANDA for entire FY16 however as of now we are in Q2 and so far we dont have any approvals. What is managements perspective on that? where things went wrong?

-> From where management anticipates new growth coming i.e new set of products.

  • Before Glochem acquisition, somewhere management indicated that they have an appetite for upto ~300- 600 USD million acquisition. Likewise they had sought after for QIP + bond worth ~10,000 Cr INR. Now that Glochem has came by at ~300 Cr. INR, do they have an appetite for further acquisitions in near future?
    …this question to understand inorganic growth is important more so since Abilify has ran its due course and new products are not coming out of Torrent stable.

Thanks again for your ownership Mukesh.

Regards,
[email protected]

Disc:

  1. Invested in Torrent, ~10% of my PF. no action in last ~6 months.
  2. Still learning.

(Mukesh Tolani) #297

@KS16 @T11

Dear Kalyan, Tarun.

I will be attending the AGM & not the evening concall.

The queries with me until now :

  1. Why the delay in launching gCrestor ? Its a good opportunity lost.

  2. Regarding the acquisition of Glochem. The rational behind it ? The product range of Glochem ?
    & How does it add value to product profile of Torrent ?
    There has been no clarity offered by the company on this front.

  3. Future acquisition plans., as they had financially planned for it ?

  4. No approvals yet in this financial year ?

  5. Future growth plans ? New geographies ? New products ? etc.


(hemtan100) #298

It was reported in ET recently that Torrent has entered the fray for Teva products in Europe. this is way beyond their sweet spot for acquisitions.

http://economictimes.indiatimes.com/industry/healthcare/biotech/pharmaceuticals/torrent-intas-join-fray-for-teva-products-in-europe/articleshow/53257501.cms


(Amit Aggarwal) #299

The Q1FY17 results are out (as expected):


(Sandeep Patel) #300

Torrent Pharma Q1FY17 results are out. QoQ flat results. YoY not comparable as Q1FY16 include exceptional revenues and profits on account of gAbilify. More or less on the expected lines as @Amit009 mentioned.

Relatively good numbers in Standalone Q1FY17. Considering revenue recognition lag effect, it indicates good Q2FY17 (based on historical trend).

Source: http://corporates.bseindia.com/xml-data/corpfiling/AttachLive/307544B8_D7E2_44CF_AABF_C2D2069DB0B1_183050.pdf


(Growth_without Debt) #301

Considering present PE of torrent compare to other pharma., this result already priced. Is it good to add if it correct seriously? Requesting your value assessment


(Vijayk) #302

QoQ 16% fall in PBT. At at time when many cos are growing! Margin contraction while sales is up QoQ


(Growth_without Debt) #303

Q1 FY2017 - Conference Call Audio available at https://www.researchbytes.com/webcast.aspx?WID=98959


(Hitesh Patel) #304

Some rough concall notes I could make.

Domestic growth looks poor bcos some products had to be pulled back from the market due to implementation of NLEM guidelines.

Co had started to focus on rationalisation (discontinuation of bonus, discounts etc) of domestic biz in q2 last year and the impact of those steps would be comparable post q2 this year. Co expects to grow better than market growth in domestic front. Forecast for market growth is 8-10% for full year.

Co’s inventory is 14 days as compared to 19 days for market.

Reconciliation figures according to Indian GAP was for previous quarter.

R&d would reach 7-8% by end of year. Currently at around 6% of sales in q1 fy 17. Mainly, no of ANDA projects going up which includes some dermatology products.

Brazil approvals - 3. Approval timelines are 2 years but communication has improved with ANVISA. Price hike is taken for most of products in Brazil. Most of competitors also doing that. CNS, cardio and diabetes are focus areas in Brazil.

Glochem – Torrent has 2 API plants. Glochem adds overall API capacities by 35%. It was already approved by Torrent as a supply contractor. Objective to file 10-15 DMFs every year and Glochem will help in that.

Besides USA, Germany, Brazil and UK remain growth focus areas.

Higher Personnel cost increase is due to Dahej, increased R&D and one time leave encashments to employees . (more than 10 crores)

In US, co has a few jokers in the pack. Plus Dahej facility helps in increasing volumes. Plus there are 10 launchdes. Taken together these three will reduce the abiify price erosion impact. Abilify is far from bottom. (indicates there is some more juice left) Co doesnt discuss revenues by products, but abilify prices have gone down. But positive effects from nexium and tolteridone (detrol) . detrol is a 4 player market and prices are stable. Nexium also price has declined but not by much (2 players in Nexium play were affected by USFDA actions). No of products approvals from US expected to be 10 and expect commercialisation of all of them this year. Ex-abilify US base biz has grown y-on-y by low double digitsand q-on-q also there is some growth.

In US first new launches for the year likely to be end of August. Crestor approval likely to be in October. Crestor is not as attractive as earlier expected as market fairly competitive in that product.

Margins likely to improve going ahead in India and Brazil
.
Depreciation and amoritisation – phase I not fully capitalised so dep will increase going ahead but output also will increase. Dahej capacity utilisation by end of year should be 70-80%. Next year there will be de bottlenecking. Currently capacity utilisation during the qtr would be 50% but product approvals are coming one by one from US. 6 products approved from Dahej. Expect 10 products approvals from Dahej by year end. Some German approvals also expected.

Tax rate— This qtr exceptionally low but overall will be in range of MAT rate for full year.

Dahej capacity currently 3. 5 billion tab. To be ramped up to 6 billion tab by year end. Co plans to increase to 7.5 by de bottlenecking during phase I itself. Current volumes in US is 300 crore tablets a year. Dahej would be approved for US, Brazil and Europe. Co plans to gradually shift US products to Dahej and free up Indrad for Europe and brazil. Germany tender market likely to be targetted more due to Dahej facility.

ACQUISITION – Acquiring products, acquisition of assets etc are on the cards.


(Hitesh Patel) #305

vijayk,

q on q also impact of abilify has to be thought of in case of Torrent.

the US base business of torrent (if one excludes periodic impacts of one offs like abilify) is quite strong and likely to emerge stronger once Dahej facility starts its ramp up.

Overall I think results are quite good barring the domestic growth which the management in their concall say is likely to pick up by next quarter.

Torrent seems a play on domestic pharma market, plus US, Germany and Brazil markets.


(Vijayk) #307

Management indicated Abilify is far from bottom, which means margin contraction and flat sales overall would continue.
Also, R&D expenses going up will further add to Margin pressures.


(Rajesh_R) #308

My take on Q1FY17 result:

Positives:

  1. Brazil and Germany growth.

Negatives:

  1. India growth is just 3% – Management clarified the reason so most likely a one-off event.

  2. ANDA filings – Just 1 ANDA filed during Q1 and 2 more in July which is Q2. This is way below management guidance of 3 to 5 ANDAs per quarter. Thin ANDA pipeline is still a concern.

Disc: Invested.


(Ankit Gupta) #309

I had attended the AGM of Torrent yesterday. I also met @mukesh_gt at the AGM venue and we asked few questions to the management for which my brief notes are given below:

  • Vision for 2020: The company’s focus remains to grow all the four key markets namely - US, domestic, Brazil and Germany. We do not want to focus on other markets until we consolidate our position in these four markets. US business is expected to be our key focus market. In Brazil, we had just got four new products approved over the past four years. However, three new products are expected to get approval in the current year. We also have a pipeline of 19 products for the Brazil market which is submitted to ANVISA, the regulator. The company wants to emphasize more on speciality products, productivity of employees and increasing our pipeline.
    US market: gAbilify continues to be a good product for the company. Despite more than 15 ANDA filers, most of the company’s ANDA filings were rejected by USFDA thus limiting competition. gCrestor is expected to be approved in October this year after the FTF exclusivity expiry of early entrants. Management wished that the generic companies do not engage in price cutting for this drug like they did in gAbilify. The company plans to launch 7 - 8 products in the US markets in the current year. However, replicating the success of gAbilify will be difficult.
    Domestic market: The company has been focussing on field force productivity of employees and rationalising its marketing costs. The field force productivity has improved from Rs.2.40 lakh five years ago to around Rs.6 lakh plus in current year. The company has launched 2 biosimulars in the domestic markets and plans to launch 10 - 12 more in the coming five years with total market size of Rs.200 crore. The management sounded that the domestic markets have healthy PBILDT margins of more than 30% (its just a hunch from my interaction).
    R&D: Our R&D spent is expected to increase from 4% of revenue during FY16 to 6 - 8 % of revenue during next few years. We have already filed our first ANDA through Zyg Pharma. This year we plan to file 15 - 20 ANDA filings and increase it to 30 over the next three years. Our focus remains on complex generics in Oncology and dermatology. We will be filing our first oncology ANDA this year. Although, a lot of companies are planning to enter oncology space, the molecules are complex and difficult to manufacture. Early entrants in the space will have an edge over late entrants (discussed with the IR guy before the start of AGM).
    Expansion plans: The construction of the oncology plant is expected to be completed in March, 2018 and USFDA approval for the facility will take a year or two post completion of construction. The Dahej second phase expansion has also started. The Dahej facility will focus mainly on oral solids for formulations and APIs. The company started manufacturing products from Dahej plans from April 6 onwards and recorded sales of Rs.60 crore in Q1 from it. Currently, it has six products approved from this plant which are expected to be ramped up gradually along with sales. The company is also expanding capacity of its Sikkim plant and some of the third party manufacturing for Elder portfolio will be transferred there post completion of expansion. However, this wont be much margin accretive.
    Inorganic Growth: The company is focussed on acquiring assets which are supplementary to its current business. Elder portfolio acquisition has been great success. Zyg had a USFDA approved derma manufacturing facility. Glochem was already an API supplier to the company and with company’s focus on complex generics, it became important to have a reliable API source. The recent rumours of company in fray of acquiring some of Teva’s molecules is just a rumour.
    @mukesh_gt If I have missed something, please add.

(Growth_without Debt) #310

Thanks Ankit and Mukesh for updates from AGM


(Tarun) #311

gCrestor is expected to be approved in October this year after the FTF exclusivity expiry of early entrants…

@ankitgupta - with respect to above statement, just want to check my understanding vs. What u heard from management. My understanding is that Creator patent has expired in first week of this month and Watson is the first entrant as generic. Guess they would havr exclusivity till December.Also AstraZenca made some aggrement with Alergen to allow them marketing much ahead of patent expiry. Very curious on what do u mean by October exclusivity expiry for FTF?