I attended the Concall today at 4 pm. Sorry for the short notice at 3pm, just escaped my mind for posting it early in the morning. The intimation was received last evening. Hope some others did too and can add to my top-of-mind notes (incomplete, non- exhaustive).
Quick Notes in no particular order - on stuff - that could move the needle significantly? There may be errors in my Notes, or the emphasis misplaced (Invested/bias). Others who made detailed notes, please correct.
Alembic Pharma Concall 4pm, Mar 20, 2020
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US FDA Audit: F1 - Panelev, Main facility audited recently
4 483 observations, quite benign, all procedural, none related to data integrity. So our responses should be adequate, we should be able to file responses in 2-3 weeks. Don’t expect any impact/delay in any of the planned launches
F2 - oncology, twice audited, not expecting now
F3 - just filed products, not expecting audit before end of year
F4 - will be filing, so not before end of year
API facility - already audited and clear -
Suspension of FDA activity by FDA: only Audits on hold, reviews and response to queries going on remotely as usual
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New Govt ruling on API - makes it faster to apply and get approvals for setting up fresh capacity and/or expanded capacity in existing plants. Govt announced financial support/incentives also, details unclear/still being worked out by Ministry
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API - rather than Constraints (intermediates supply disruption), we see more as Opportunities. Govt stance has changed, and fast tracking of approvals mechanism will be in place soon. Looking at expanding capacities in a big way. And hopeful of getting fast approvals. We have enough supply/stock of intermediates for key APIs; We see no constraints.
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Up until 2 weeks, China supply disruption was an issue, but we had stocks and sourced from domestic as well, but now supplies from China have resumed for us
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Business is as usual for us. Progressing in line with plans on all fronts. The only front we may have a bit of a constraint is Outbound logistics may get impacted a bit - delayed by one or two weeks; some reshuffling of packages, due to some flight cancellations
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Logistics share between Inbound/Outbound Air and Sea Cargo.
80/20 sea/air on Inbound
90/10 air/sea on Outbound -
Domestic - Fall under essential supplies - So no disruption. Seeing good traction as per plan. No constraints. Ramped up production, good availability of products at stock points
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We have a large interest and large stake in a new product - chloroquine+azithromycin (azithral)+ some other (cant remember) drug combo for COVID trials; 20-patient non-aggressive study; ongoing and unfolding situation; got triggered 2-3 days ago
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Azithromycin Base material/Intermediates sourcing from China, Europe - adequate stocks. China supplies also resumed
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No direct Front-End in Europe. We sell through distributors. No change in forecasts. Continuing as usual
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Building API capability trend in the industry is already there. for many players API/Intermediates 60-70% internal. bUt in Alembic case, Top 20% of our most profitable products - where 80% of the profitability comes from - we are almost completely backward integrated.
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Rupee depreciation: Works to our advantage; we do only $sales, so benefit accrues to Alembic
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Disruption due to Covid: We try to be nimble, and always try to take advantage of supply disruptions.