Ranbaxy Laboratories swung to loss for the year ended Dec. 31, 2008. During the year, the company reported loss of Rs 10,323.34 million compared with a profit of Rs 6,177.20 million in the last year.

Net sales for the year ended rose 6.78% to Rs 43,051.07 million, while total income for the year climbed 9.33% to Rs 45,857.80 million, when compared with the prior year period.

The company posted loss of Rs 11.03 a share during the year compared with earnings of Rs 15.76 a share in prior year.

The board of directors at their meeting held today took on record the un-audited standalone results for the Q4`08 and the year ended Dec.31, 2008.

Key financial & operational highlights for the year 2008: 

*Consolidated net sales at Rs 72,507 million, a growth of 8% (USD 1,667 million).

*Emerging markets portfolio achieves sales of Rs 39,114 million, maintaining an upward trend with a growth of 9%; accounts for 54% of sales (USD 899 million).

*Developed markets sales grew by 7% to Rs 28,334 million (USD 651 million); accounts for 39% of sales.

*Earnings before interest, tax, depreciation & amortization (EBITDA) was Rs 6,168 million (USD 142 million); reflecting margin to sales of 8.5%.

*During Q4`08, the company adopted AS30 (financial standard 30 – financial instruments: recognition and measurement) to stay current in its accounting practices and to ensure high level of transparency. As a result of this, change in fair valuation during Q4`08, of forex options taken by the Company to safeguard its receivables, is accounted for in the P&L.

*The results were significantly impacted by three major factors viz., AS30 impact of USD 161 million, forex impact of USD 179 million, US related provisions of USD 59 million. While these three items were non-cash in nature, they primarily contributed to the overall loss of Rs 9,146 million (USD 198 million) for the year.

Through effective working capital management the company strengthened the cash flow by reducing gross working capital by 5% of MAT sales.

In Jun`08, Ranbaxy (Q, N,C,F)* and Daiichi Sankyo, the third largest pharmaceutical company in Japan, signed a landmark deal, with Daiichi Sankyo acquiring majority stake in Ranbaxy. Later in the year, Daiichi Sankyo completed the transaction for acquisition of 63.92% stake in the Company.

The company received Rs 35,849 million against preferential equity and warrants issued to Daiichi Sankyo, significantly bolstering net worth.

A multi-pronged action plan is underway to restore and safeguard the current and future product portfolio in the US market. Ranbaxy is committed to a working towards a swift resolution of all matters.

The company made its first set of authorized generic launches in the US. Both Omeprazole 40 mg Capsules and Felodipine ER Tablets have performed well in the market, with Omeprazole garnering 43% market share.

Following the USFDA Import Alert in Sep`08, Pharmaceutical and Medical Devices Agency, Japan (PMDA) audited three dosage form and one Active Pharmaceutical Ingredient (API) facility of the company during Oct-Nov`08. The dosage form facilities audited were Paonta Sahib, Batamandi and Dewas while the API facility was Toansa. All these inspections were successful and as a result, the company has so far received approvals for Levofloxacin 100mg Tablets and Bicalutamide 80mg Tablets. This reaffirms Ranbaxy`s position as a trusted supplier of generic medicines manufactured in line with the most stringent global standards.

Ranbaxy and Pfizer Inc. entered into an agreement to settle most of the patent litigation worldwide involving Atorvastatin (Lipitor®), the world`s most-prescribed cholesterol-lowering medicine. This decision will allow for an earlier introduction of a generic formulation in several countries. Ranbaxy will have a license to sell generic versions of Atorvastatin and the fixed-dose combination of Atorvastatin-Amlodipine Besylate in the United States. The company will retain the right to the marketing exclusivity of 180 days in the United States.

Ranbaxy reached several agreements with AstraZeneca settling patent infringement litigation for Nexium® (Esomeprazole Magnesium). The settlement allows Ranbaxy to supply API and formulation to AstraZeneca, and later to exclusively sell a generic version of Nexium® under license from AstraZeneca with 180 days exclusivity in USA.

The company settled all matters relating to possible patent litigation with GlaxoSmithKline (GSK) relating to Sumatriptan Succinate Tablets, the generic version of GSK's Imitrex® Tablets. The settlement allows Ranbaxy to distribute a generic version of Imitrex® Tablets (in the 25 mg, 50 mg and 100 mg strengths) in USA. Ranbaxy is currently awaiting approval from USFDA for launch.

The company launched on day-1 of patent expiry, Amlodipine tablets 2.5mg & 5mg in Japan. Amlodipine, the largest molecule that went off-patent in Japan. The product was independently developed by Ranbaxy, and is the first product developed by a foreign generic pharmaceutical company outside Japan and approved by MHLW-Japan.

Sales in emerging markets grew 9% during the year while revenues from developed markets were higher by 7%, as is reflected in the table below for sales in key geographies. 
 

Speaking on the occasion, Malvinder Mohan Singh, chairman, CEO and MD, Ranbaxy Laboratories, said, ``The past year has been a significant one. We saw ourselves, redefining paradigms in the pharmaceutical space through the alliance we reached with Daiichi Sankyo which will strengthen both companies and unleash tremendous growth opportunities for them. We also settled ongoing and potential patent litigations bringing visibility to multiple first-to-file opportunities in the US over several years to come. However, we also faced hurdles like the USFDA Import Alert and unprecedented forex volatility following an unforeseen global financial crisis. Through several path-breaking initiatives we have secured a future of high growth for the company while we are focused on resolving the ongoing issues that have adversely impacted us this year.``

Shares of the company declined Rs 18.15, or 8.89%, to settle at Rs 186.10. The total volume of shares traded was 965,468 at the BSE (Thursday).