UPDATE 2-India Dr Reddy's Q1 net falls, maintains guidance
(Adds Perlecan purchase, detail from conference call)
MUMBAI, July 21 (Reuters) - Indian drug maker Dr Reddy's Laboratories Ltd (REDY.BO) posted a worse-than-expected 26 percent drop in quarterly profit on Monday, but maintained its full-year revenue guidance on new launches and better sales.
Dr Reddy's (RDY.N), the only Indian drug maker listed in New York, said it was seeing higher returns from Germany-based Betapharm, which it acquired in 2006 for $572 million, on an improving supply situation.
It also said it would buy the remaining 85 percent in drug research firm Perlecan Pharma Pvt Ltd held by ICICI Ventures and Citgroup Venture Capital for $18 million, and expects to complete the transaction in a couple of weeks.
"We're off to a good start for the year," Chief Executive G.V. Prasad said on a conference call.
"There was some pricing pressure in some products, but this is likely to be offset by better volumes and new products."
The drug maker maintained its guidance of a 25 percent increase in full-year revenue and an overall profit margin of "50 percent-plus and improved profitability", Prasad said.
Dr Reddy's April-June consolidated net profit fell to 1.35 billion rupees ($31.6 million) from 1.83 billion a year earlier, lagging a Reuters survey forecast of 1.58 billion rupees.
Its revenue rose by a quarter to 15 billion rupees, slightly higher than the Reuters survey forecast of 14.12 billion.
The Hyderabad-based firm, which had previously taken a hit from its Betapharm acquisition, is moving Betapharm's manufacturing operations to India and other manufacturers within Europe to cut costs.
Revenues from Betapharm rose by 20 percent to 2.5 billion rupees in its fiscal first quarter. But revenue from the rest of Europe fell by a quarter to 341 million rupees, it said.
Revenues from the global generics business rose by a quarter in the June quarter, driven by new launches and growth in North America, Russia and Germany. Revenues from pharmaceutical services and active ingredients rose by 27 percent.
Revenues from North America jumped by 55 percent. During the June quarter, Dr Reddy's launched 26 new generic products and filed 20 new generic product registrations.
It expects to launch acute migraine drug sumatriptan, a generic of GlaxoSmithKline's (GSK.L) Imitrex, in the fiscal third quarter, and its specialty drug business in the United States in the fiscal year to March, Prasad said.
