Tue, Nov 11, 2014 - Page 14 News List

ScinoPharm records decline in profit

ALL NOT LOST:The firm’s sales are expected to rise significantly next year following the completion of an inspection of the company’s China-based factory, Patricia Chou said

By Camaron Kao  /  Staff reporter

ScinoPharm Taiwan (台灣神隆), which makes active pharmaceutical ingredients, yesterday reported a 36.95 percent decline in net profit for last quarter because of slow orders and mounting price pressure.

Net profit fell to NT$121.4 million (US$3.97 million), or NT$0.17 per share, last quarter, from NT$192.56 million, or NT$0.28 per share, a quarter ago, according to the company’s filing to the Taiwan Stock Exchange. The figure was 51.92 percent lower than NT$252.5 million, or NT$0.36 per share, a year earlier, filing said.

“Sales of weight-loss drug Qsymia were lower than expected, resulting in high inventory level for the drug’s developer, US-based Vivus Inc. Therfore, the company reduced its purchase of ingredients for the drug this year,” company chief financial officer Patricia Chou (周珮芬) said in an investors’ conference yesterday.

Lower sales not only affected ScinoPharm’s top line but also reduced its utilization rate, Chou said.

The company also faced pressure from its clients that make generic drugs to cut prices, Chou added.

ScinoPharm Taiwan also had difficulty acquiring paclitaxel, which is used to make “10 dab” for manufacturing ingredients for cancer drugs, because of unstable weather in Europe, Chou said, adding that higher prices for paclitaxel is expected to reduce the firm’s gross margin by 5 percent this year.

The company’s gross margin dropped to 37.23 percent last quarter, from 43.56 percent the previous quarter and 42.75 percent a year ago, according to filing.

Revenue for ScinoPharm Taiwan also declined to NT$1 billion, down 13.04 percent from NT$1.15 billion the previous quarter and 19.35 percent from NT$1.24 billion a year ago, the filing said.

Chou said prices for paclitaxel would return to normal next year, but the company’s utilization rate would still remain low over the next year.

Chou said ScinoPharm Taiwan’s sales and profit would rise significantly after next year, when the US Food and Drug Administration completes its inspection of the company’s factory in Changshu, China to make active pharmaceutical ingredients.

Meanwhile, the company said it inked a deal with Nanjing King-friend Biochemical Pharmaceutical Co (南京健友生化) to make ingredients for Regadenson, which is used to facilitate the examination of human hearts.

The drug is expected to receive approval to enter the Chinese market in 2020, with expected sales of 200 million to 300 million Chinese yuan (US$32.68 million to US$49.02 million) per year, ScinoPharm Taiwan said, citing Nanjing King-friend.

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