BENGALURU (Reuters) – GlaxoSmithKline Pharmaceuticals, the Indian unit of the UK’s GSK, reported a 3% fall in third-quarter profit on Monday, hurt by the government’s pricing cap on certain medicines.
Consolidated profit before exceptional items and tax for the quarter ended Dec. 31 was 2.29 billion rupees ($27.6 million), compared with 2.36 billion rupees a year earlier.
GlaxoSmithKline, which derives most of its revenue from India, continued to grapple with challenges following the inclusion of its key products such as Ceftum antibiotic and T-Bact ointment in the country’s National List of Essential Medicines (NLEM) in September 2022, mandating sales below a government-set price ceiling.
It’s revenue declined for three straight quarters following the adoption of the list before rebounding on the growth in its vaccine business in the June quarter of last fiscal year.
Revenue from operations rose a meagre 0.4% to 8.05 billion rupees in the latest quarter.
The company, which makes Augmentin antibiotic, incurred a one-time charge of 1.63 billion rupees, related to the cost of a voluntary retirement scheme and other employee dues.
It also had a one-time charge of 113.7 million rupees in the year-ago period, due to restructuring costs.
Last month, parent GSK beat market estimates for its fourth-quarter results and provided an upbeat forecast for 2024 and beyond, citing the expansion of its vaccines and cancer drugs pipeline.
Earlier this month, rival Abbott India reported a 26% jump in third-quarter profit on elevated sales.
($1 = 82.9720 Indian rupees)
(Reporting by Kashish Tandon in Bengaluru; Editing by Dhanya Ann Thoppil)
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