Replies to post #120090 on Biotech Values

[DewDiligence]

RDY is a good company, but the current valuation is a little steep, IMO.

http://www.reuters.com/article/2011/05/13/india-drreddys-results-idUSL3E7GD1MS20110513

›Dr. Reddy’s Reports Higher Q4 Profit

BANGALORE, May 13 (Reuters) - Dr Reddy's Laboratories Ltd , India's second-largest drugmaker by sales, on Friday said consolidated quarterly profit doubled on strong generic drug sales in the United States, topping forecasts and sending its shares up 5 percent.

Indian generic drugmakers including Dr Reddy's and rival Ranbaxy are poised to gain as drugs worth about $100 billion lose patent protection over the next two years but they have to contend with intense competition, rising lawsuits from rivals and a stricter U.S. health regulator.

The launch of the generic version of Sanofi-Aventis' allergy drug Allegra D-24 helped the company's revenue from North America jump 68 percent to 5.9 billion rupees, Dr Reddy's, which is also listed in New York , said in a statement.

However, sales in Europe, another key market, fell 5 percent as its German unit Betapharm struggled with pricing pressure amid intense competition, the drugmaker said.

Germany, one of the largest generics market in the world, has transitioned from branded generics to commodity generics -- or even cheaper copycat drugs -- increasing pricing pressure on branded generic players.

Dr Reddy's German unit Betapharm, on which it took a hefty write-off last fiscal year, has been a drag on its earnings due to regulatory issues. Dr Reddy's has been trying to turn around the unit, which it purchased for $572 million in 2006.

Hyderabad-based Dr Reddy's reported a net profit of 3.35 billion rupees ($75 million) for the fourth quarter ended March, up from 1.7 billion rupees reported a year earlier, under international accounting rules.

A Reuters poll of analysts had forecast net profit of 2.63 billion rupees on revenue of 19.11 billion.

Revenue for the New York-listed company rose 23 percent to 20.17 billion rupees during the quarter.

Dr Reddy's shares have risen 0.08 percent this year, better than a near 9 percent fall in the sector index and a near 10 percent decline in the wider index . ($1=44.9 rupees)‹

[DewDiligence]

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Additional Information

[DewDiligence]

RDY acquires Russian/CIS pharma business:

http://finance.yahoo.com/news/Dr-Reddys-Acquires-bw-1863520190.html?x=0&.v=1

Dr. Reddy’s Laboratories announced today that it has entered into an agreement with JB Chemicals & Pharmaceuticals to acquire their pharmaceutical prescription portfolio in the Russia and other CIS regions. The agreement involves acquisition of 20 brands, key ones being Metrogyl and Jocet, for a consideration of USD 34.85 million.