India’s largest drugmaker Sun Pharmaceutical Industries Ltd reported a 75% plunge in third-quarter net profit on Wednesday as pricing pressures in the United States, its biggest market, hit sales.
Sun Pharma, along with other Indian pharmaceutical companies, has been battling increased competition in the generics market and greater pricing scrutiny in the United States.
The drugmaker has also struggled as some of its products were banned from sale in the United States because the factories that made them did not meet US quality standards. It was also hit by adjustments for US tax reforms in the third quarter.
Its net profit of Rs365 crore ($57 million) for the October-December quarter was its smallest profit in over two and a half years, and well below analysts forecasts of Rs912 crore in a Reuters poll.
The company said its US sales slumped 35% to $328 million in the quarter, hurt by lower sales of generic versions of cancer drug imatinib and olmesartan, which is used in the treatment of high blood pressure
US sales accounted for nearly a third of the company’s total sales, which fell 14% to Rs659 crore.
The company said its profit was also hit by a one-off deferred tax adjustment of Rs513 crore on account of tax reforms in the United States.
Sun Pharma shares closed 2.53% lower at Rs574.45 on BSE, while the Sensex was down 0.42% at 34,155.95 points