Sep. 25, 2009 (The Hindu Business Line) --
The company is set to raise funds by reviving its plans to sell stake in its generics subsidiary and out-license one of its molecules, both by the year end, said Glenmark’s Chief Executive and Managing Director, Mr Glenn Saldanha.
The company looks to raise funds either through an IPO or through a private placement, he said, without getting into details. A volatile stock market last year had forced the company to defer its earlier plans to off-load between 15-30 per cent equity in its generics subsidiary.
In late 2007, Glenmark Pharmaceuticals had reorganised its business, retaining the speciality business and transferring its generics and active pharmaceutical ingredients (API) businesses to its subsidiary, Glenmark Generics Ltd (GGL).
GPL also expects to spend $ 40 to 50 million this year on research, of which about $ 35 million will go towards supporting the research of GPL and the rest to support GGL.
Despite the setbacks with its out-licensed molecules, the company is looking to continue investing in research and expects an outlicensing deal for its diabetes molecule melogliptin by March 2010, Mr Saldanha said. There are seven prospective molecules in the company’s current product pipeline, he said.
Only last month, Glenmark had said that its first prospective drug molecule Oglemilast that was out-licensed for further development to Forest Laboratories (NYSE:FRX) has been shelved for Chronic Obstructive Pulmonary Disease.
Glenmark’s prospective diabetes molecule outlicensed to Merck (NYSE:MRK) in 2006 had returned to its stable after Merck opted out of this segment last year. Glenmark’s deal with Eli Lilly (NYSE:LLY) for its prospective pain molecule also ran aground last year. Nevertheless, the company had earned about $ 117 million in milestone and upfront payments, Mr Saldanha told shareholders, earlier in the day.
Saddled with a debt of about Rs 1,600 crore, the company is looking to be deleveraged by the end of the year, Mr Saldanha said. It expects profits of about Rs 400 crore this year. There will, however, be no additional capacity expansion, he said.
