PETALING JAYA: Pharmaniaga Bhd aims to strike a balance in local pharmaceutical business by reversing the current ratio of non-concession versus concession from 42:58 to 60:40 in the next 3-4 years.
Chairman Tan Sri Lodin Wok Kamaruddin said the company would continue to expand its manufacturing capabilities in a bid to reduce dependency on government concession.
“We are currently at 42:58 ratio. We are optimistic that non-concession business will grow from 42 per cent to the 60 per cent level within three to four years,” Lodin told reporters after the company’s annual general meeting here.
The government-linked company is currently the sole concession holder to purchase, store, supply and distribute approved drugs and medical products to 148 government hospitals and 1,400 clinics and district offices nationwide.
Pharmaniaga’s second cycle concession agreement with the government will end in 2019, but in the meantime allows for an upward price revision every three years, with the last revision done in July 2014.
For the financial year ended Dec 31, 2014 (FY14), Pharmaniaga’s profit before tax surged 33 per cent to RM126 million from RM93 million a year ago, while profit after tax soared 66 per cent to RM94 million from RM57 million, on the back of a nine per cent increase in revenue to RM2.1 billion from RM1.9 billion previously.
Lodin attributed the strong performance in FY14 to the company’s efforts to boost earnings growth, optimise costs and improve operational efficiency.
He said the company had achieved economies of scale in its operations and should be able to maintain its double-digit growth momentum in FY15.
“We will expand our presence in the growing healthcare and pharmaceutical industry in Malaysia and other emerging markets.
“Moving forward, we will maintain our focus on tapping into new opportunities for growth in order to enhance our core business,” said Lodin.
Pharmaniaga recently entered into supply agreements with three university hospitals – Universiti Malaya, Universiti Kebangsaan Malaysia and Universiti Sains Malaysia – for delivering pharmaceutical products and related services up to November 2019.
“We are confident that by leveraging on the inherent prospects of the industry, we will be able to enhance our market reach and strengthen our earnings potential in the long run as we strive to move up the value chain.
“We will further beef up our research and development division, strive to achieve quality and produce products of international standards in our bid to be the best pharmaceutical company in Malaysia,” he added. -- BERNAMA