Table Of ContentENRICHING LIVES
GLOBALLY
ANNUAL REPORT 2014-15
ENRICHING LIVES GLOBALLY
At Glenmark,
we believe in
ENRICHING LIVES
through
INNOVATION
and
NEWER WAYS
of doing things
big or small
CORPORATE OVERVIEW
20+ 6 16 11.5K
Countries with R&D Centers in India, Manufacturing Facilities Strong Global Team
Glenmark Offces UK & Switzerland across India, US,
Argentina, Czech & Brazil
At Glenmark, we believe in enriching lives of our stakeholders across the world through new ways of doing things.
Glenmark truly lives this by discovering new innovative medicines for chronic ailments and helps people lead fuller lives; by
creating value and wealth for all our business partners and shareholders and through our community interventions to create
a healthier and happier world.
In the pursuit of enriching lives, Glenmark has evolved into a global organization and a leading player in the discovery of
new molecules within a short period of time. We have offces in over 20 countries, 16 manufacturing facilities in 5 countries
and 6 R&D centres dedicated to the goal of enriching lives across the globe. The real force behind Glenmark’s continued
success is its over 11,500 strong workforce from around 50 nationalities committed to creating a new way for a new world.
CORPORATE INFORMATION
RegisteRed office Vysoke Myto, Czech Republic
B/2, Mahalaxmi Chambers, 22, Bhulabhai Desai Road, • Calle 9 Ing Meyer Oks N 593, Parque Industrial Pilar,
Mumbai – 400026, Maharashtra, India B1629MX Buenos Aires, Argentina
• Growth Centre, Samlik-Marchak, Dist. - East Sikkim, Sikkim
coRpoRate office • Plot No. B-25, Five Star MIDC, Shendra, Dist. - Aurangabad,
• Glenmark House, HDO – Corporate Building, Wing A, Maharashtra
BD Sawant Marg, Chakala, Off Western Express Highway, • 4147 Goldmine Road, Monroe, NC 28110, USA
Andheri (East), Mumbai – 400099, India
Tel. : +91 22 40189999 API
Site: www.glenmarkpharma.com • 3109 – C, GIDC Industrial Estate, Ankleshwar,
Email:
CONTENTS
Chairman's Letter 04
Board of Directors 08
Key Financials 09
Innovation 10
Highlights in R&D 12
Innovation Research Pipeline 14
Global Presence 16
One Glenmark 18
Our Processes 19
Our Quality Products 20
Corporate Responsibility 21
Management Discussio n & Analysis 24
Profles of Directors 40
Board's Report and Relevant Annexures 41
Report on Corporate Governance 75
Standalone Auditor’s Report 88
Standalone Balance Sheet 92
Standalone Statement of Proft & Loss 93
Standalone Cash Flow Statement 94
Standalone Notes to Financial Statements 96
Consolidated Auditor’s Report 127
Consolidated Statment of Financial Position 128
Consolidated Statement of Comprehensive Income 129
Consolidated Statement of Changes in Shareholders’ Equity 131
Consolidated Statement of Cash Flows 132
Notes to Consolidated Financial Statements 133
3
CHAIRMAN’S LETTER
Innovative Research
& Development
Global Operations
Enriching Lives
Glenn Saldanha
Chairman & MD
The future of your organization looks promising as each of our
businesses is well poised for sustainable and proftable growth. The
US business remains a critical growth driver and our efforts will be to
Quality Centric
maximize our presence and earnings from this market. We will also
continue to have an India-specifc strategy, which involves focusing on
core therapy areas to help us grow in this market. After the India and US
markets, the Europe region is now the third most important region for
us.
Dear Shareholder, performed very well which helped the recorded moderate growth; the Mexico
The year under review organization grow revenue in the year and Venezuela subsidiaries grew by
was challenging for the global under review to over ` 6,600 crores over 100% on account of a lower
pharmaceutical industry. The signifcant (USD 1.08 Bn). In FY 2015, the India base and more product launches
depreciation of currencies across business grew by 16%, Europe by over coming through, especially in the
emerging markets coupled with weak 27% and Latam by over 88%. respiratory space. This was also aided
demand in most emerging markets and by the economic situation which
the slowdown in US FDA approvals for We continued to outperform the has caused scarcity for medicines
generic drugs had an impact on the industry in India. In fact, we have been in the Venezuelan market. While we
generic market globally. Further, the among the fastest growing companies will continuously drive growth in the
consolidation of the supply chain in within the Indian formulation space Brazil and the Mexico market, we will
the US added additional pressure on consistently for the last couple of watch cautiously the Venezuela market
the industry. In Europe, the economic years. This is mainly due to several new because of the uncertain political
situation remained unchanged. With product launches that we have in our situation and the unstable currency.
the Greek crisis putting pressure on
economies across Europe, there was We continue to believe that R&D is at the core of the
sustained pricing pressure which pharmaceutical business and it is our endeavor to transition
impacted the generic industry in the Glenmark from a generics organization to an innovation driven
region. Thus, for the year under review, pharmaceutical company. You can expect our continued
the pharmaceutical industry across commitment towards R&D through consistent investments into
developed and emerging markets research. We believe that the R&D thrust will help us sustain
were constrained due to which your growth over the long term.
organization’s performance was also
impacted. focused therapy areas viz. dermatology, We have been investing considerably in
respiratory, cardiovascular and diabetes both our European and Latin American
Due to the challenging economic which is driving the India growth. operations over the past seven to eight
conditions, your organisation’s revenue We expect the India growth story to years, and we are confdent of growing
growth for the year under review was continue in the coming years on the margins from these investments in the
limited to around 10%, as compared to back of our strong portfolio and our years to come.
20% for the last four fnancial years. focus on certain therapy areas where
The above factors played a key role we would like to be a dominant player. Currency Depreciation Afects
in denting our overall performance. Our Rest Of The World (ROW)
In addition, another important factor In the year gone by, we persisted Business, Especialy Russian
which did not go in favour of your with our good performance in the Operations
organization was the almost stable Europe region. Barring Romania, where One of the biggest challenges that
Indian Rupee. While emerging markets the business environment has been we witnessed in the year under review
currencies depreciated across markets, extremely grueling, the Central Eastern was the volatility in emerging market
especially the Russian Rouble which Europe subsidiaries of Glenmark currencies. Our Russian operations
depreciated signifcantly, the Indian recorded good growth. Similarly, our were the most hit as a result of currency
rupee remained unchanged due to weak Western Europe business continued fuctuations leading to de-growth for
commodity prices which benefted the to record good growth in countries our ROW business. The ROW region
country’s economy signifcantly. As like UK and Germany. We expect this as a whole was the most challenging
you are aware, your organization gets high growth trajectory in our Europe region for your organization in this
more than 50% of its revenues in US business to sustain in FY 2016 and fnancial year. While we have witnessed
dollars. Due to the Indian currency beyond. Europe is now become one of a rebound in growth in local currency
remaining stable, your organization the focus regions for your organization for the ROW region in this current
did not get any incremental beneft and we are investing signifcantly in fnancial year, the currencies still remain
from US dollar sales, while emerging product pipeline to ensure that we can volatile and the pressure continues to
markets currencies where we operate sustain the high growth trajectory. remain in these markets.
continuously depreciated which
negatively impacted our numbers Our Latin America business US Market
signifcantly. On the positive side, our witnessed robust growth in the year Revenue growth from our US
India, Europe and Latam business gone by. While our Brazilian subsidiary business was fat during the year
5
Annual Report 2014-15
CHAIRMAN’S LETTER
under review. The industry - including Group’s revenue to be a strong growth initiating a Phase I clinical trial for GBR
your organization - was impacted driver for the company in the next few 1302 in Germany soon.
due to the channel consolidation and years. Your organization will focus
the slowdown in product approvals across the value chain in the US market Our pipeline continues to advance
by the US FDA. Also during the year from developing generic medicines to with GBR 900 - the frst anti-TrkA
under review, we received only fve a range of specialty products in niche monoclonal anti-body entering clinical
product approvals which put further segments apart from having our own development in year under review.
pressure on the business. However, in pipeline of novel innovative molecules. Besides, GBR 830, the frst anti-OX40
the beginning of the current fnancial monoclonal antibody has completed
year, we are witnessing signifcant R&D - A Key Driver For The Future Phase I and Phase IIa studies for Atopic
improvement in the approval rate In the year under review, we made Dermatitis and Coeliac’s Disease are
and we expect this trend to continue; steady progress on our innovation starting in the US and EU. Additionally,
although one cannot be absolutely sure pipeline as we persisted with our GBR 500 is also making steady
while predicting regulatory approvals. relatively high investments in R&D vis- progress. Our partner Sanof has now
à-vis the industry. We currently have announced a Phase II study in multiple
In the year under review, we some exciting developments in our sclerosis which is presently ongoing.
announced our plans to set up a Novel Biologics program.
manufacturing plant in the US, which On the NCE front, in our mPGES-1
will be the company’s maiden facility One of the highlights during the discovery program, GRC 27864, has
in North America. Located in Monroe, year was the announcement of our also moved forward in human trials
North Carolina, the facility is spread frst candidate in the area of oncology and is nearing completion of Phase I,
across 100,000 sq ft plot and has been using our proprietary platform BEAT®. which reaffrms our position globally
designed for manufacturing oral solids Glenmark recently announced its in the development of novel pain
therapies. Besides, GRC 17536, a
Our plan to set up a new plant in the US underlines the fast TRPA1 antagonist, has shown positive
paced growth we have witnessed in a short span of 8 years in the data in a Phase IIa proof of concept
US market and our long term commitment to the country. With study in patients with painful diabetic
this new facility, we would further enhance our manufacturing neuropathy conducted in Europe and
footprint making it truly global in every sense of the term. India. We are now opening an IND
in the US for a Phase IIb dose range
and injectables. On commissioning, frst clinical development candidate fnding study.
the facility is expected to have a in oncology, GBR 1302, using our
capacity to produce 300-400 Million proprietary platform BEAT®. GBR Your organization continues to
tablets and capsules per annum. With 1302, a bispecifc antibody, when believe that R&D is at the core of the
the setting up of this new facility in commercialized will revolutionize the pharmaceutical business and it is our
the US we would further enhance our treatment paradigm in HER2 positive endeavor to transition Glenmark from a
manufacturing footprint making it truly cancers and will pave the way for generics organization to an innovation
global in every sense of the term. discovering more effective treatments driven pharmaceutical company. You
in other forms of diffcult-to-treat can expect our continued commitment
The US business is one of our cancers. BEAT®, Bispecifc Engagement towards R&D through consistent
key markets. We continue to make by Antibodies based on the T-cell investments into research. Even in the
signifcant investments in this market receptor, is a proprietary best-in-class area of generics R&D, your organization
both in terms of manufacturing as wel platform developed by Glenmark has begun working on complex
as product pipeline. The increased R&D that streamlines the design and generics including complex injectables
spends year on year will be allocated development of bispecifc antibodies. like peptides. We believe that the R&D
to the US market. We feel that your For the past 20 years, bispecifc thrust for the organization will help us
organization has built signifcant antibodies have presented a challenge sustain growth over the long term.
capabilities over the past several since all bispecifc formats developed
years and as a result we are best until recently have had stability and/ One Glenmark
positioned to capture the enormous or manufacturing issues. By developing In response to the evolving market
opportunities that the US market has this proprietary platform technology, trends and increasing competition
to offer. We expect the US business, your organization continues to remain across branded as well as generic
which contributes over 30% to the at the cutting edge of R&D. We are products, an organization restructuring
was initiated in the year 2013. The quality and your organization believes organization. In just a short span, we
project was christened as ‘One in consistently training them and have grown this business to over USD
Glenmark’. As a part of the scope of the providing them with the best tools to 100 Million and we will keep investing in
exercise, Glenmark Generics Ltd. has help them in their endeavor to maintain this region so that we continue to remain
amalgamated with the parent company. excellence in quality. on a high growth trajectory. The ROW
Subsequently, multiple activities and the Latam region have high growth
related to various work-streams was Your organization continues to potential in the coming years. However,
coordinated and project-managed by a invest in the community. Our ongoing if the currency situation continues
cross-functional core team. efforts continue to focus on the 8 to remain volatile across emerging
large projects which we initiated markets it may proportionately negate
With the completion of the exercise, over the past few years, positively the performance of these regions.
we have achieved the key objectives impacting over 600,000 people.
of establishing a common brand The focus area for the organization I would like to inform our
image of Glenmark as an integrated remains in child health. This year we shareholders that your company's
company across generic and branded have added sport as an area of focus, business has been built keeping long
term and sustainable growth in mind.
®
BEAT is Glenmark’s proprietary best-in-class platform that And over the years we have built a strong
streamlines the design and development of bispecifc antibodies. foundation which will propel us to the
For the past 20 years, bispecifc antibodies have presented a next level of growth. A robust pipeline
challenge since all bispecifc formats developed until recently of products across geographies, a
have had stability and/or manufacturing issues. By developing strong innovative engine, a well spread
®
BEAT , Glenmark continues to remain at the cutting edge of R&D. and diversifed manufacturing setup, a
strong team of qualifed professionals
markets. It also builds in signifcant considering the lack of support and and sound systems and processes - all
fexibility to move across lines of infrastructure available to sportsmen speak of capabilities which will help us
businesses irrespective of market size in our country. We have formed the sustain growth in the long run and help
and helps us achieve considerable Glenmark Aquatic Foundation which us scale the next peak.
synergies throughout our operations aims at transforming the ecosystem for
to grow faster in all geographies. swimming as a sport in India. Glenmark I would like to thank you for
Congratulations to the team on a job Aquatic Foundation will achieve its your continued support and your
well done, and I am certain that we are vision by building a core team of commitment towards our organization.
now in the right position to achieve highly motivated experts, developing As we surge ahead, your belief in
success across al possible channels of meaningful partnerships with national Glenmark’s potential wil remain
growth. and international organizations and wil invaluable source of strength to
focus on maximizing the potential in us as we take Glenmark forward
Quality & Compliance Excellence every athlete. towards emerging as a truly global
Quality has always been one and innovative pharmaceutical
of the pillars of our business. I am Conclusion organization.
pleased to inform you that despite The future of your organization
many manufacturing facilities drawing looks promising as each of our Yours sincerely,
fak from regulatory authorities businesses is well poised for sustainable
of developed markets, all our and proftable growth. The US market,
manufacturing facilities consistently remains a critical growth driver for Glenn Saldanha
remain in a state of constant the organization. Our efforts will be to Chairman & MD
compliance and have successfully maximize our exposure and earnings
cleared several stringent audits from from this market. The India business
authorities like the US-FDA, MHRA-UK will also be one of key drivers and we
and others. Quality at Glenmark is a will continue to have an India-specifc
continuing journey towards perfection. strategy, which involves focusing on
We have endeavored to set robust core therapy areas to help us grow
processes to ensure consistency and in this market. After the India and US
reproducibility. All our personnel across markets, the Europe region is now the
different functions are committed to third most important region for your
7
BOARD OF DIRECTORS
mr. glenn saldanha
Chairman & Managing Director
mr. Rajesh desai mrs. cherylann pinto
Executive Director Director - Corporate Affairs
mr. d. R. mehta mr. sridhar gorthi
Non-Executive Director Non-Executive Director
Ex Deputy Governor, Reserve Presently a partner at Trilegal, he
Bank of India and Ex Chairman, has been involved in legal advisory
Securities and Exchange Board of services to various multinational
India, he has over 4 decades of rich and domestic corporations on
experience in civil services. restructuring, debt fnance, joint
ventures, acquisition/ mergers etc.
mr. J. f. Ribeiro dr. Brian W. tempest
Non-Executive Director Non-Executive Director
A retired Government ofcer, he He has worked in the
has served the country under various Pharmaceutical Industry for the last
assignments like Commissioner of 40 years and managed healthcare
Police, Mumbai and Special Secretary businesses across numerous regions.
to Government of India, Ministry of He is a Fellow of the Royal Society of
Home Affairs. Chemistry and a Fellow of the Royal
Society of Medicine.
mr. Bernard munos mrs. B. e. saldanha
Non-Executive Director Non-Executive Director
The Founder, InnoThink Center for During her 23 year tenure with
Research in Biomedical Innovation Glenmark, she was responsible
served Eli Lilly & Company, USA as for developing and growing the
Advisor - Corporate Strategy. He has company’s export business.
presented his fndings at numerous
meetings sponsored by academies,
foundations, universities in the US
and Europe.
