Ranbaxy CEO steps down, as Indian drugmaker posts 52% slump in profits

Indian drug major Ranbaxy Laboratories, which is 64% owned by Japan's Daiichi Sankyo, yesterday posted a poor set of financial results for the quarter ended June 30, 2010, seeing net profit tumble 52% to 3.3 billion rupees ($72 million) as currency volatility offset strong sales of generic drugs. The same day, the company also said its chief executive will step down next week (see later).

However, this was still a lot better than had been expected, as a poll of 21 analysts by Thomson Reuters had forecast net profit of 1.3 billion rupees. Group sales for the reported quarter were 21.0 billion rupees, up 22% from the same period last year. The stock dipped 0.5% to 445.2 rupees on the Bombay Stock Exchange, in an otherwise flat market.

Commenting on the business results for the quarter, Atul Sobti, outgoing chief executive and managing director, said: 'The company delivered another quarter of good growth as a result of our effort to maximize first-to-file opportunities in the USA, and a healthy operational performance led by key geographies. The transfer of New Drug Discovery Research assets to Daiichi Sankyo will provide a sharper focus to our R&D effort, in our core area of generics. This is in line with our commitment to optimize synergies through the Hybrid Business Model.'