Cipla to focus on open market drug sales to sustain profitability 

Cipla Quality Chemical has said it will, going forward, focus on direct sales of pharmaceutical products on the local market to sustain profitability. 

Addressing shareholders during its fifth annual general meeting in Kampala yesterday, Mr Ajay Kumar Pal, the Cipla chief executive officer, said the company had embarked on a long term sustainable growth strategy underpinned on growth and sustainability, cost leadership, business development and balance between profitability and investment for future. 

“We have signed a memorandum of understanding with the Ministry of Health to manufacture cancer, sickle cells and tuberculosis medicines,” he said, noting that these will, in addition to newly launched products such as Azee500, Cipladon+ QTiB, seek to diversify product portfolio in therapeutic areas such as cardiovascular, diabetes, pain and anti-infectives. 

Mr Kumar also noted that Cipla will within the year launch nine new products as well enhance its digital roadmap, which seeks to digitize all service aspects to improve customer-company connectivity. 

During the period ended March, Cipla registered a net profit of Shs24.1b, returning to profitability from a loss making position in the 2020/21 financial year mainly due to improvement in gross margins, lower financing costs, part recovery of the Zambian debt and the full impact of cost reduction initiatives during the period. 

However, the company experienced a 6 percent reduction in revenues but the liquidity position improved due to recovery of $5.3m from the government of Zambia. 

Mr Emmanuel Katongole, the Cipla chairman, said the company had remained resilient in the face of challenges such as Covid-19, which heavily impacted supply drugs in and outside Uganda.  

“We continued to implement our diversification strategy aimed at boosting sales growth by expanding our product portfolio while tapping into new business opportunities in the private market. Our private market growth strategy led to 100 percent growth in Lumartem sales, our flagship product for the treatment of malaria,” he said, noting that Cipla’s product portfolio also grew through the introduction of an antibiotic, anti-tuberculosis prophylactic for HIV patients and Cipladon+.  This, Mr Katongole said, will be expanded further with the introduction of 20 more products, which are currently in the pipeline following attainment of regulatory approvals in various regions, which has subsequently allowed the company to, for the first time, export drugs to DR Congo and Malawi.  

Currently, Cipla products are approved and registered in 31 countries in Africa, which gives the company an opportunity to explore both institutional, government and private market at the same time. 

Mr Katongle also noted that they were waiting for approvals to enter Burundi, Madagascar and Sudan. 

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