may 2020 - wockhardt · long term debt obligations as per schedule. net debt- equity ratio as on...

May 2020

Investor Communication – Q4 FY 20

INVESTOR COMMUNICATION – Q4FY20

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Wockhardt: at a glance

Source: IQVIA, MAT’ Mar 2019

Wockhardt: Innovation driven Organisation


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Wockhardt : Multi-disciplinary R&D

Wockhardt: Long term commitment in R&D


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Wockhardt receives US FDA Qualified Infectious Disease Product designation for WCK 6777, a first ever once-a-day β-lactam enhancer class antibiotic

In April 2020 Wockhardt received the Qualified Infectious Disease Product (‘QIDP’) designation for WCK 6777 from the United States Food and Drug Administration (‘USFDA’). WCK 6777 is a once-a-day combination antibiotic based on Wockhardt’ s NCE Zidebactam, which imparts WCK 6777 novel mechanism of β-lactam enhancer. Driven by the enhancer action, WCK 6777 overcomes an array of problematic bacterial resistance mechanisms such as metallo-β-lactamases, KPC and OXA carbapenemases. Further, Zidebactam has the unique ability to overpower other tough resistance mechanisms such as reduced drug uptake and drug efflux encountered in contemporary multidrug (MDR) resistant Gram negative pathogens. Being a once-a-day drug, WCK 6777 would be the first ever antibiotic facilitating the treatment of MDR infections in out-patient settings. WCK 6777 for injection has been awarded QIDP for the following indications:

Treatment of complicated urinary tract infections, including pyelonephritis (cUTI)

Treatment of complicated intra-abdominal infections (cIAI)

“Wockhardt has planned for the global development of WCK 6777 covering important markets of

the US, Europe, China and India”, said Dr Habil Khorakiwala, Founder Chairman, Wockhardt Group.

The dual coveted objectives attained by this drug are the prevention of hospitalization and the facilitation of early discharge of hospitalized patients. With WCK 6777 getting the QIDP status, Wockhardt has become the only company in the world to hold QIDP status for six antibiotics emerging from its anti-bacterial discovery programme. Three of these antibiotics target Gram Negative pathogens, and the other three are effective against Gram positive difficult-to-treat ‘Superbugs’. 1 The QIDP status is granted to drugs that are effective against a set of multidrug resistant pathogens identified by the CDC (Centre

for Disease Control, USA), which have a high degree of unmet need in the treatment of patients infected by such pathogens. The

status provides fast track clinical development and review of the drug application by US FDA for approval. The QIDP drug is also

entitled for five-year extension of market exclusivity. QIDP was constituted under Generating Antibiotic Incentives Now (GAIN) Act

in 2012, as part of the FDA Safety and Innovation Act, to underline the urgency in development of new antibiotics.


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Update on Breakthrough NCE:

Note: ABSSSI: Acute bacterial skin and soft tissue infection; CABP: Community-Acquired Bacterial Pneumonia, RTI: Respiratory Tract Infections; MDR: Multi drug resistant; XTR: Extensively drug-resistant; cUTI: Complicated urinary tract infection; HABP: Hospital acquired bacterial pneumonia VABP: Ventilator associated bacterial pneumonia; QIDP: Qualified Infectious disease product;


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Share of Global Revenues:-

Region-wise Revenue Highlights

India Business: de-growth is mainly on account of lower sales in Quality Generics division and in some of the therapeutic areas. US Business: de-growth is mainly on account of pricing pressure.

EU 32%

USA 19%

ROW 13%

INDIA 36%

FY 19

EU 35%

USA 22%

ROW 16%

INDIA 27%

FY 20

India & Emerging Market

235 India INR Cr 177 301 883 1,514

138 Emerging Market INR Cr 133 151 547 539

EU

25 UK GBP Mn 25 28 101 109

5 Ireland Euro Mn 5 6 19 21

2 Others Euro Mn 1 3 6 10

30 USA USD Mn 27 26 104 115

2 France Euro Mn 2 2 8 8

869 Total Consolidated 791 979 3,325 4,158

FY 20 FY 19 Q3 FY 20 Regions Q4 FY 20 Q4 FY 19

Currency


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R&D Highlights

The focus in strategic R&D initiatives of the Company in the global arena continued to remain one of the key priorities. Such strategic R&D expenses though meant for the future are expensed off. Total pending ANDAs as on 31st March, 2019 is 51.

Intellectual Property (IP):

The company’s continued pursuit in creating strong Intellectual Property (IP) base resulted

into filing of 3 patents during the Quarter ended 31st March, 2020 taking the cumulative

filings to 3,165. The company was granted 5 patents during the quarter and now holds 722

patents.

Wockhardt to raise INR 1,850 crore by sale of part of portfolio of its Domestic Branded Business to Dr. Reddy’s Laboratories Limited:

During the quarter the Shareholders of Wockhardt vide postal ballot dated 16th March, 2020 approved the intended sale of part of the Domestic Branded Business comprising of 62 products and related business, assets and liabilities including manufacturing facility at Baddi, Himachal Pradesh, India for a consideration of INR 1,850 crore to Dr. Reddy’s Laboratories Limited. The sale of Business will enable the Company to:

Have adequate liquidity for robust growth in international operations and investments in Biosimilars for the US market;

Augment remaining significant Domestic Branded Business portfolio of the Company and re-focus towards chronic segment with differentiated product portfolio

Continue its ongoing research and development activities;

Necessary action for completion of clinical trials of the Company's breakthrough NCEs in the anti-infective space, duly approved by coveted QIDP Program of United States Food & Drug Administration (US FDA); and

Strengthen the balance sheet.

Post above sale, Wockhardt continues to own:

All international operations in UK, USA, Ireland and other locations through its stepdown subsidiaries.


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Formulation plants located at Waluj, Shendra and Chikalthana in Aurangabad, Bhimpore and Kadaiya in Daman; bulk drugs plant at Ankleshwar, India and manufacturing facilities at all existing international locations.

Research & Development centers located at Chikalthana, Aurangabad, India and existing facilities in the international locations.

Significant part of Domestic Branded Business constituting Chronic & Speciality portfolios.

Debt Repayments

During the year ended FY20, the Company repaid Rs.813 crore (PY Rs.817 crore) towards various

Long term debt obligations as per schedule.

Net Debt- Equity ratio as on 31st March, 20 stood at 0.84.

Continuous reduction in Long term Debts:

Note: Long term loan does not include Preference Share Capital. Gross Debt Equity ratio above has been calculated

only on the basis of Long Term Loans outstanding.

3182 2955

2469

2045

0.86

0.92

0.82

0.66

-

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60

1.80

2.00

0

500

1000

1500

2000

2500

3000

3500

Mar 17 Mar 18 Mar 19 Mar 20

(Rs. Crore)

Long Term Loans Gross Debt Equity Ratio


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Consolidated Profit & Loss Statement

*Inclusive of impact of IND AS 116 (Lease Accounting) in FY20.

The Company has reported PAT of Rs.48 cr in Q4FY20 as against Loss of Rs.15 cr in the

corresponding period. EBIDTA for FY 20 improved by ~183% to INR 245 cr (PY INR 134 cr).

Particulars Q4-FY20 Q3-FY20 Q4-FY19 FY20 FY19

Revenues from Operations 791 869 979 3325 4158

Material Consumption 302 348 430 1321 1804

Gross Margins 489 522 549 2005 2355

Gross Margin % 62% 60% 56% 60% 57%

Staff Cost 185 188 169 773 836

R&D Expenses 43 45 69 208 291

Other Expenditure* 224 180 277 779 1094

Total Expenditure 754 760 945 3081 4024

EBITDA* 37 109 34 245 134

EBITDA Margin 5% 13% 4% 7% 3%

EBITDA before R&D* 80 154 103 453 425

EBITDA Margin before R&D 10% 18% 11% 14% 10%

Interest Expenses (Net)* 61 79 64 276 265

(Income)/Expense due to Exchange Rate Fluctuation (7) (25) (21) (21) 25

Depreciation* 61 56 45 226 166

Other Income / (Loss) 14 17 5 39 21

Profit/(Loss) Before Tax before exceptional items (65) 16 (49) (197) (301)

Exceptional Item Profit/(Loss) - - - - -

Profit/(Loss) before Tax (65) 16 (49) (197) (301)

Tax Expense (Including Deferred Tax) (133) (3) (34) (153) (84)

Profit After Tax (PAT) 68 19 (14) (43) (217)

Less: Non-Controlling Interest 20 10 1 26 (22)

PAT after Non-Controlling Interest 48 10 (15) (69) (195)

PAT after Non-Controlling Interest Margin % 6% 1% -2% -2% -5%

Particulars Mar-20 Mar-19

A. Fixed Assets 3,646 3,683

B. Right of use assets 622 -

C. Goodwill on consolidation 875 821

D. Other assets 834 793

E. Cash, Bank Balance, Liquid Investment 268 449

F. Net Current Assets 919 1,170

Total Assets 7,165 6,915

A. Shareholders' Funds 2,672 2,675

B. Non - Controlling Interest 386 330

Long term Loans 2,045 2,469

Working capital Loans 800 566

Preference Share Capital 350 330

C. Total Loans 3,195 3,365

D. Other Liabilities 543 546

E. Lease liabilities 369 -

Total Liabilities 7,165 6,915


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About Wockhardt

Wockhardt is a research based Global Pharmaceutical and Biotech company. Wockhardt’ s New Drug Discovery programme has focussed on unmet need of Anti-bacterial drugs that are effective against the menace of untreatable superbugs. Wockhardt is the only company in the world where USFDA has given QIDP Status (Qualified Infectious Diseases Programme) for 6 of our Anti-bacterial discovery programmes – 3 of them are Gram Negative and 3 Gram Positive effective against untreatable “Superbugs”. It has a comprehensive Drug Discovery team and clinical organisation. Wockhardt is employing 7000 people and 27 nationalities with presence in USA, UK, Ireland, Switzerland, France, Mexico, Russia and many other countries. It has manufacturing and research facilities in India, USA & UK and a manufacturing facility in Ireland. Wockhardt has a significant presence in USA, Europe and India, with 73% of its global revenues coming from international businesses.

Disclaimer Except for historical information contained herein, statements in this communication, which include words or phrases such as “will”, “aim”, “will likely result”, “would”, “believe”, “may”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “plan”, “contemplate”, “seek to”, “future”, “objective”, “goal”, “likely”, “project”, “should”, “potential”, “will pursue” and similar expressions or variations of such expressions may constitute “forward looking statements”. These forward looking statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those suggested by the forward looking statements. These risks and uncertainties include, but are not limited to our ability to successfully implement our strategy, our growth and expansion plans, obtain regulatory approvals, our provisioning policies, technological changes, investment and business income, cash flow projections, our exposure to market risks as well as other risks. Wockhardt Limited does not undertake any obligation to update forward looking statements to reflect events or circumstances after the date thereof.

Contact Information [email protected]

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may 2020 - wockhardt · long term debt obligations as per schedule. net debt- equity ratio as on...

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