ZYDUS,MANAGMENT DISCUSSION REVIEW 2010-11

1. GROUP NO.4

2. In 2007, we set out a VISION to achieve the
'Healthy Billion'

3. 'Healthy Billion‘…..A DREAM OF
CROSSING A BILLION DOLLAR MARK.

4. In fiscal year 2010-11

5. 1,000,000,000
Happiness is in crossing the
$1 billion mark

6. Exhilaration is in aiming for
more!!

7. Stepping beyond
the billion, we aspire to achieve
sales of 3,000,000,000
by 2015.

9. CHAIRMAN: MR.PANKAJ PATEL

10. Financial Highlights (Consolidated)

11. Financial Highlights (Consolidated)

12. • Management’s
Discussion and Analysis – 2010-11

13. GLOBAL ECONOMY
• The real GDP of the global economy is estimated to have expanded
by 3.9% in 2010, led by a strong domestic demand in the developing
countries.
• After the downward trend following the global economic crisis post
2008. This has been supported by a resurgence in the international
and domestic financial flows and a hike in commodity prices, which
has helped economies of the developing countries regain the growth
rates close to those observed in the pre-crisis period.
• Conversely, the recovery process in many high-income countries has
been weaker

14. GLOBAL PHARMA INDUSTRY
• Global pharma industry has grown up by 45 in fiscal year 2010-11.
• While in 2009 it was around 5.5% and average of last 5 years is 5.9%.
• Two regions:
1. Pharmerging markets: 14% growth (Asia , Africa &Latin America).
2. America, europe and Japan :where growth is less than 3%.
Reasons: low cost manufacturing, standard of living ,favorable
regulatory enviornment.

16. Indian economy
• In year 2010-11: GDP growth was 8.6% which is remarkable with respect
to mute global growth.
Pharma market:
 Double digit growth.
 Is in top 10 world markets
 In fiscal year 2010-11,15% growth (Rs 48000 crore size) chronic therapy
dominates and export of generics increased.

17. OPERATING HIGHLIGHTS
• Goal of “HEALTHY BILLION” set 4 years back.
• The year 2010-11 has been a special one for the Company as it
marched ahead to achieve the goal of $1 bn in consolidated
revenues by March 2011.
• An overall improvement in business health parameters – growth,
market share, productivity, margins and returns and increase in
value for all the stakeholders.

18. ACCOUNT OF INITIATIVES AND ACHIEVEMENT:
INDIA FORMULATIONS
• In fiscal year 2010-11:
1. Sales 16,200 mio.,
2. Maintained market share of 3.73%
Reasons: Increase In market reach ,portfolio expansion ,market
penetration,new product introduction.
Strategic expansion of field force in cardiology and respiratory segments.
New divison of “Zydus Heptiza”
• Focus was on strengthening the Pillar Brands.
17 of companies Brands are in top 300 Pharma brands.
• With the launch of VaxiFlu-S, the Company became the first to launch an
indigenously developed and manufactured H1N1 vaccine in India.
• The new products launched in 2010-11 contributed to about 4% in the
growth of the formulations business in India.

19. The Company maintained its strong position in the participated market
segments of cardiovasculars, gastrointestinals, women’s healthcare and
respiratory.

20. MAJOR SEGMENTS:

21. International Formulations Business
• UNITED STATES:
Name: ZYDUS Pharmaceutical Inc.(US)
TYPE: 100% subsidiary Rs 9655 mio up by 44%.
11 products launced in US.
Ranked 1.2 in generics in US.
• EUROPE:
ZYDUS France:2.7 Bn euros french generic market growing by 8%.
Reason:Market Growth slow because absence of patent expiry & lower
generic substitution rates.
• LABORATORIOS COMBIX SL IN SPAIN: Spanish market grewby 16% in 2010
and crossed Euro 836 mio.

22. International Formulations
Business (contd)
• JAPAN:
World’s second largest pharm market.
Name: Zydus pharma japan co.earlier known has Nippon Universal Pharma.
In Japan, generic penetration increased by 22%in volume and 7 % by value.
Reason: over-ageing population
government incentives to lower healthcare cost
AMLODIPINE Is 1st Indian company to get marketing approval for product
in Japan which has approval in India.
Pharma-emerging markets:Brazil:healty groeth in branded and pure
generics
Asia-pacific,africa and middle east show appropriate growth.
Srilanka,Myanmar,Sudan,Uganda CO. Has leadership postions.
Mexico:appro. Pharma market 8 bn $,growth 8%.

23. WELLNESS DOMAIN
• Consumer healthcare and wellness:It is a niche
segment within overall FMCG.
• Name :Zydus wellness (72% stake)
• Brands :sugarfree,everyuth,nutralite.
• These brands have good brand equity.
• Registered sales of Rs. 3355 mio., up by 25% and a
net profit of Rs. 595 mio., up by 31%.
• NEW VARIANTS: Sugarfree tealite & ACTILIFE.

24. API AND INTERMEDIATES
• Stagnant Growth In 2010-11,17% growth
• Challenges :price erosion and appreciation of Rupees.
• JV with NYCOMED not included.
• ANIMAL HEALTH BUSSINESS:
• Name: Zydus Animal Health Ltd.
• Product: Drug ,feed , supplement and vaccine for live stocks and
poultry.
• During the year 2010-11, ZAHL posted sales of Rs. 1,390mio., with a
growth of 17%, driven by robust growth in most of the segments.
• 10 New products launch.
• 3 new vaccines for poultry launced.
• ZAHL received the Indian Poultry Journalists Association Award 2010
for ‘The Best Poultry Health Care Products Company’ of India.

25. Zydus BSV Pharma:
• Zydus BSV Pharma Pvt.
Ltd:(ZBSV), The 50:50 JV set
up in alliance with Bharat
Serums and Vaccines Ltd.,
owns rights to a novel and
patented product for use in
Oncology.
• ZBSV has completed the
Phase II clinical study during
the year and will now initiate
the Phase III study.Its brand
name ‘Nudoxa’ continues to
enjoy a strong brand position
among indian practioners.

26. RESEARCH AND DEVLOPMENT
• NME research , NDDS , biologics,vaccines formulations & API are key
areas of research.
• 1050 dedicated scientists.

27. ALLIANCES
ZYDUS NYCOMED HEALTHCARE PVT LTD: 50:50
JV between Zydus and Nycomed for
manufacturing of key starting materials (KSM)
for Pantoprazole.
ZYDUS HOSPIRA ONCOLOGY (ZHOPL): the 50:50
JV between Zydus and Hospira Inc., USA. During
the year 2010-11, it registered sales of Rs. 4,304
mio.
ABBOTT LOBORATORIES:It has
being given license of 24 of
branded generics in 15 key
emerging markets where
ABBOTTS position is strong.