Sun Pharma to spend Rs 332 cr in R&D

NEW DELHI: Sun Pharmaceuticals, India's biggest drug company by market capitalisation, will spend Rs 332 crore in research & development of

low-cost version of original drugs to be sold in domestic and global markets, a top company executive said. The Mumbai-based drug maker had last year spent Rs 290 crore on R&D activities. In an analysts call on Monday, the company's chairman and managing director Dilip Shanghvi said the firm will file 30 ANDA applications with the US Food and Drug Administration (FDA) before March 2010. ANDA or abbreviated new drug applications are filed by generic drug makers to sell their low-cost copies of original drugs sold in the US.

Last year, the Mumbai-based company and its American subsidiary Caraco Pharma got approval to sell nine products in the US, Mr Shanghvi added. Drug development for riskier new products is done through the company's subsidiary Sun Pharma Advanced Research Company (SPARC). Sun Pharma's research team of 500 scientists will focus on its core strengths - cardiology, psychiatry, neurology and gastroenterology segments. The investments will be used to develop active pharmaceutical ingredients, the basic chemical used in a medicine, for both domestic and international market, besides the ANDA applications to the US, the world's largest drug market. Mr Shanghvi said it was not possible to give a potential earnings estimate from the US, where it has 108 pending applications, because revenue of such drugs are dependent on multiple factors. More than a third of the company's sales come from the US. Due to an ongoing regulatory hurdle at its Detroit facility the company's sales from the US market has dropped significantly and was partly responsible for global sales declining 10% to Rs 1,134 crore for the quarter ended March 31, 2009. The company, which reported revenues of Rs 4,272 crore for 2008-09, expects its sales to grow 13-15% this year, if the rupee-dollar exchange rate remains constant at the current level of Rs 48.