Aurobindo Pharma Ltd Management Discussions.

ECONOMIC PERSPECTIVE WORLD

The year 2020 saw the global economy contract following the worst humanitarian and health crisis unleashed by COVID-19 in over a hundred years. Economic activities across the world were impacted for several months owing to complete lockdown and restricted mobility imposed by governments to flatten the COVID-19 curve. As a result, the global output declined 3.3% in 2020 (Source: IMF). To combat the overwhelming challenge, governments and central banks provided unprecedented fiscal and monetary support to protect economies, businesses and support the vulnerable sections of the population.

In terms of the global economic recovery, the IMF forecasts a stronger revival in 2021 and 2022 than its earlier predictions, with a 6% growth in 2021 and 4.4% growth in 2022.

Global growth forecast

(%)
Particulars Actual

Projections

2020 2020-21 2022
World output (3.3) 6.0 4.4
Advanced economies (4.7) 5.1 3.6
US (3.5) 6.4 3.5
Eurozone (6.6) 4.4 3.8
Japan (4.8) 3.3 2.5
UK (9.9) 5.3 5.1
Other Advanced (2.1) 4.4 3.4
Economies
Emerging market and developing economies (2.2) 6.7 5.0
China 2.3 8.4 5.6

Source: IMF April 2021 Outlook

A strong economic recovery depends on rapid and effective vaccination rollout with stronger policy support. The IMF has projected a global economic outlook of 6% for 2021, owing to additional policy support from a few large economies and the expected vaccine-powered recovery. The IMF recommends a tailored approach for each economy based on the pandemic scenario, recovery rate, along with social and economic capabilities.

INDIA

The Indian economy was also impacted by the COVID-19 pandemic in 2020. Among sectors, services and manufacturing sectors including trade, travel, transportation registered the highest degrowth. As a result, the economy contracted by 24% in the first quarter of FY20.

In response to the massive decline in the first quarter, the Government of India (GoI) and the Reserve Bank of India (RBI) proactively took several stimulus measures (comprising both fiscal and monetary measures) to support the economy. On January 16, 2021 India, also launched the first phase of its vaccination programme to inoculate its population.

The combination of support measures, vaccination rollout, pent-up demand and gradual restarting of economic activity after Q2 FY21 enabled the GDP to record 0.4% growth in the third quarter and 1.6% growth in the fourth quarter of FY21. Overall, Indias GDP shrank by 7.3% in FY21.

Outlook

Although the overall outlook for the Indian economy is positive, continued pace of vaccination of larger segment of population and containment of further surge in infections would be critical for the economys growth. Encouragingly, the agricultural sector has been resilient throughout the crisis, and with normal monsoon predicted even in the current fiscal, the agriculture sector is poised to support the economy.

Due to sequential lockdowns and localised mobility restrictions in various states across the country in the wake of COVID 2.0, the aggregate demand conditions may be temporarily affected. The effect of these lockdowns, according to the RBI, is not as severe in the manufacturing and services sectors as it was a year ago, and consumer demand is also gradually picking up.

INDUSTRY INSIGHT

GLOBAL PHARMACEUTICAL INDUSTRY

In 2020, the worldwide pharmaceutical industry was valued at US$ 1.27 trillion and is expected to reach US$ 1.6 trillion by 2025 with a compounded annual growth rate (CAGR) of 3-6%, excluding the expenditure on COVID-19 vaccines. The spending will be driven by the higher growth in pharmerging markets and the continued adoption of new products in developed markets.

The spending pattern was divergent across the world in 2020, which is expected to continue till 2022. The spending in developed countries is likely to rebound in 2021 and can potentially surpass the pre-pandemic outlook in the medium term. Even though the spending in pharmerging markets were disrupted, there was demand for new treatments and COVID-19 vaccines. In the next five years, the global spending of COVID-19 vaccines is expected to reach US$ 157 billion.

From 2016 to 2020, the pharmaceutical markets in the developed world expanded at a ~4% CAGR and are expected to grow at 1.5-4.5% CAGR to reach US$ 1,130-1,160 billion by 2025. The adoption of new treatments, patent life-cycles impact, new generics launches and increased adoption of biosimilars competitions will be the growth drivers.

On the other hand, the pharmerging markets recorded a growth in spending at 74% CAGR in spending between 2016 and 2020, reaching US$ 290.8 billion in 2020 and it is expected to see a growth in spending through 2025. The larger pharmerging countries (Brazil, India, and Russia) are expected to grow at 7% to 10%, while smaller emerging markets may outperform with a CAGR of 8.5% to 11.5% between 2020 and 2025.

Global pharmaceutical market growth

(US$ billion)
Regions 2020 2016-2020 CAGR 2025 2021-2025 CAGR
Developed 959.5 3.8% 1,130-1,160 1.5-4.5%
Pharmerging 290.8 7.4% 415-445 7-10%
Lower income countries 15.0 3.9% 18-22 3-6%
Global 1,265.3 4.7% 1,580-1,610 3-6%

Source: IQVIA Market Prognosis, September 2020; IQVIA Institute, March 2021

KEY INDUSTRY TRENDS

Specialty drugs: Specialty drugs are those that treat chronic, complex or rare diseases and require detailing to the physicians or specialists by a dedicated field-force and are typically expensive. Specialty drugs will represent nearly half of the global spending in 2025 and almost 60% of total spending in developed markets. The 10 largest developed countries and other high and upper middle-income countries are witnessing consistent increase in their spending share on specialty drugs. Over the next five years, an average of 54-63 new active substances (NAS) are expected to be launched globally every year, totalling 290-315 over five years. This scenario is expected to contribute to a rising number of new product launches in the Specialty segment.

Source: IQVIA Global Medicines Spending and Usage Trends Outlook to 2025

Biosimilars: With the changing regulatory landscape and increasing penetration of biosimilars, a robust growth is likely in the segment with US$ 90 billion worth of biologics is expected to lose exclusivity, as per industry estimates. The total number of biosimilars approved by USFDA is 29 out of which three biosimilars were approved in the US in 2020 and the total number of biosimilars approved in Europe is 69 out of which 13 were approved in 2020. Biosimilars and its originator products accounted for US$ 40 billion in spending in 2019 in key therapy areas where further biosimilars entry would significantly reduce healthcare costs.

The promise of future biosimilar market is the potential for substantial savings in healthcare costs, particularly in developed nations. Biosimilar spending is expected to reach US$ 16-36 billion by 2024 as more biosimilars products get commercialised. Cumulative savings are projected to exceed US$ 100 billion over the next five years (below figure).

Generics: Generics have witnessed an attractive, lucrative development path for over three decades. The global generic drugs market was valued at US$ 387.92 billion in 2020, and it is expected to grow at 5.7% CAGR till 2030 (Source: http://www. globenewswire.com).

Mergers and acquisitions (M&A): The global economy faced headwinds resulting in slowdown in most of the sectors. The M&A activities in the sector was quiet on the megadeal front and the needle swung towards the mid and small size deals where companies sought to restore pipelines rather than transform via large deals which was dominant in the last year. The total value of deals during 2020 stood at US$700 billion. Some of the global companies altered their strategy to an opportunistic approach where they look at small deals and where there are research-based pipeline acquisition opportunities, which is likely to complement or diversify their portfolios. Source: S&P Global Market Intelligence

Precision medicine: It is an emerging way of disease prevention and management. It involves tailored approaches including predictive diagnostic, prevention and treatment strategies for an individual based on their genetic makeup and genetic modifications. Precision Medicine Market size exceeded US$ 52 billion in 2020 and is expected to grow at a CAGR of over 11.5% from 2021 to 2027. Advancements in cancer biologics will drive the growth of precision medicine. Development of newer therapeutics approaches including gene therapy for cancer treatment and increasing number of patients undergoing predictive diagnosis will push the market growth. On the other hand, high cost and potential threat to personal health data are some of the factors that may thwart the market expansion.

Source: Global Market Insights report, 2020

KEY GLOBAL MARKETS

USA

The US (worlds largest pharmaceutical market) medicine spending (~4% CAGR growth from 2016-20) is expected to reach US$527.8 billion by 2025. Spending at net levels in the US is projected to grow in low single-digits as increase in off-invoice discounts and rebates are expected to slow spending growth over time. Additionally, ongoing market dynamics around the use of medicines, the adoption of advanced treatments, the impact of patent expiries and new generic or biosimilar penetration will limit growth in the US for the next five years.

US pharmaceutical spending and growth (US$ billion)

2020 2016-2020 CAGR 2025 2021-2025 CAGR
527.8 4.2% 605-635 2-5%

Source: IQVIA Market Prognosis, September 2020; IQVIA Institute, March 2021

Europe

The top five European Union (EU5) markets grew at a 4.4% CAGR from 2016-20 to reach US$180.4 billion. It is projected to grow at about 2-5% CAGR to US$215-245 million by 2025. Medicine spending in the top five European markets is expected to increase by US$35 billion over the next five years, registering the same increase as in the past five years, but with substantial shifts in growth drivers. Generics and biosimilars are likely to add over US$31 billion to the market size over the next five years, as a range of patent expiries and the maturation of biosimilars contribute to lower overall spending.

EU5 pharmaceutical spending and growth (US$ billion)

2020 2016-2020 CAGR 2025 2021-2025 CAGR
180.4 4.4% 215-245 2-5%

Source: IQVIA Market Prognosis, September 2020; IQVIA Institute,

March 2021

PHARMERGING MARKETS

From 2016 to 2020, the spending on pharmaceuticals has increased at 7.4% CAGR, reaching US$290.8 billion by the end of 2020. A significant proportion of this spending and market growth has been driven by an enhanced access to chronic and specialty medications, leading to the ramp up of volumes and the adoption of more novel therapies.

Pharmerging markets - Pharmaceutical spending and growth

(US$ billion)

Region/ Country 2020 2016-2020 CAGR 2025 2021-2025 CAGR
China 134.4 4.9% 170-200 4.5-7.5%
Brazil 28.7 10.7% 43-47 7.5-10.5%
India 22 9.5% 28-32 7.5-10.5%
Russia 17.5 10.8% 33-37 11-14%
Other Pharmerging 89.1 9.6% 120-150 8.5-11.5%
Pharmerging markets 290.8 7.4% 415-445 7-10%

Source: IQVIA Market Prognosis, September 2020; IQVIA Institute, March 2021

India

Indias pharma sector has achieved significant growth in both domestic and global markets during the past five decades. During the same period, the country has established a leading position in the global generic pharmaceuticals landscape and is now known as the ‘Pharmacy of the world. The countrys pharma sector contributes over 20% by volume of the global generics market and 62% of the worldwide vaccines demand.

The pharma sector has been contributing significantly to Indias economic growth as one of the top 10 sectors in reducing trade deficit and attracting the Foreign Direct Investment (FDI). The drugs and pharmaceuticals sector attracted a cumulative FDI inflow worth US$16.54 billion between April 2000 and June 2020

(Source: EY analysis).

The Indian pharmaceutical market had recorded growth at ~9.5% CAGR between 2016 and 2020 to reach US$21 billion. It is expected to grow at 75-10.5% CAGR to US$28-32 billion by 2025.

India pharmaceutical spending and growth (US$ billion)

2020 2016-2020 CAGR 2025 2021-2025 CAGR
21 9.5% 28-32 7.5-10.5%

Indian pharma exports reached US$20.7 billion in FY20 with year- on-year growth of 8.4% (exports size was US$19.1 billion in 2019). They have grown at a CAGR of 6.2% between 2015 and 2020. This was largely driven by exports of generics drugs to >200 countries (including both developed and developing markets). India is the source of 60,000 generic brands across 60 therapeutic categories. The country accounts for 40% of the generics demand in the US and ~25% of all medicines in the UK. India also fulfils about 80% of global demand for antiretroviral drugs for Acquired Immune Deficiency Syndrome (AIDS), significantly contributing towards increasing accessibility of the AIDS treatments.

Further in the vaccine market, India exports vaccines to >150 countries. It contributes 40%-70% of the World Health Organisations (WHOs) demand for Diphtheria, Pertussis and Tetanus (DPT) and Bacillus Calmette-Guerin (BCG) vaccines, and 90% of the WHO demand for the measles vaccine. In addition, with its strong vaccine manufacturing capability and capacity, India will play a critical role in meeting the demand of COVID-19 vaccines globally. Some of the top global companies have already tied up with Indian companies for manufacturing the vaccines.

Indias pharma sector has been a key contributor in improving the countrys healthcare and economic outcomes. The pandemic has opened up several opportunities and challenges for the industry. The country is also dependent on China for approximately two- thirds of its imports of bulk drugs or drug intermediaries and is looking at several policy initiatives to reduce dependence on imports.

The government has approved a total of 33 applications with a committed investment of 5,082.65 crore under the production linked incentive (PLI) scheme for Active Pharmaceutical Ingredients (APIs), Intermediates, Key Starting Materials and allied raw materials. The setting of these plants will make the country self-reliant with respect to these segments.

The disbursal of PLI by the government over six years will be up to a maximum sum of 5,440 crore. Under the Aatmanirbhar Bharat campaign and with the aim to reduce import dependence on critical bulk drugs, the Department of Pharmaceuticals had launched a PLI Scheme for the promotion of domestic manufacturing by setting up greenfield plants in four different target segments with a total outlay of 6,940 crore for 2020-21 to 2029-30. The PLI scheme for the pharmaceutical sector was approved on February 25, 2021 with an outlay of 15,000 crore.

ABOUT AUROBINDO PHARMA

Aurobindo Pharma Limited (Aurobindo Pharma) is a Hyderabad based leading global pharmaceutical company manufacturing generic formulations and Active Pharmaceutical Ingredients (API). Aurobindo is a largely vertically integrated company, focused on developing complex and difficult-to-manufacture pharmaceutical products for the global markets.

The Company is among the top 2 listed pharmaceutical companies in India by FY21 revenues. The Company has 27 manufacturing and packing facilities for its API and formulations business, which has the requisite approval from global regulatory authorities such as US FDA, EDQM, UK MHRA, Japan PMDA, WHO, Health Canada, MCC South Africa, ANVISA Brazil, etc. The Companys robust product portfolio spans major therapeutic areas encompassing Anti-Retrovirals, CVS, CNS, Gastroenterologicals, Anti-Allergies, Antibiotics and Anti-Diabetics. The Company markets its products in 155+ countries. With an expanding global footprint, Aurobindo employs over 24,000 people across 35 countries.

The Companys R&D team of 1,700+ scientists working in eight research facilities spread across the globe is focused on difficult- to-develop, niche oral, sterile, specialty injectable products, biosimilars, and peptide-based products, involving clinical and end-point studies. As on March 31, 2021, Aurobindo filed 639 ANDAs with the USFDA and over 3,900 dossiers (multiple registration) across Europe and other geographies. The Company also filed 252 DMFs with USFDA and 3,200+ DMFs (multiple filings) in Europe and other geographies.

Achievements of 2020-21

• Recorded highest ever revenues of 247,746 million, registering a growth of 7% amid a tough operating environment

• Clocked an EBITDA of 53,334 million, with margins improving to 21.5%

• Deleveraged the balance sheet and turned into a net cash company

• Filed 55 ANDAs with USFDA, of which 16 are injectables

• Received final approval for 42 ANDAs, including 17 injectables

• Launched 53 products in USA including 21 injectables

• Divested our dietary supplements business (Natrol) at an Enterprise Value of US$550 million

• Filed first Meter Dose inhaler (MDI) ANDA with the USFDA

• Signed an exclusive agreement with Covaxx (now known as Vaxxinity), a US based Company to commercialise their COVID-19 vaccine candidate in India and UNICEF markets. Vaxxinity is developing the first ever Multitope Peptide-based Vaccine against COVID-19

• Completed Phase I trials for the lead molecule in biosimilar division and Phase III study activities have been initiated; Clinical trials for 3 more molecules were started in FY21

• Phase II trials for Pneumococcal Conjugate Vaccine (PCV) was completed and initiated the process for conducting Phase III trials in India

• Received first dossier approval in China from our Indian facility

• Completed the construction of injectable facility in USA.

FORMULATIONS BUSINESS

Over the years, the Company has strengthened its formulations business, which contributed to~88% of total revenues in FY21. The formulation business posted 8.4% y-o-y growth in revenues to 216,860 million. From a geographical standpoint, the US and Europe accounted for 74% of total revenue and are our key markets. During the year, the Company has manufactured 40+ billion units in various dosage forms such as tablets, capsules, injectables, and so on in its 15 state-of-art manufacturing facilities, which are located in India, USA, Portugal and Brazil.

US formulations

The Company has maintained its dominant position in the US market and is ranked as the largest volume player as per IQVIA QTR March21 data. The Company has a presence across segments such as generics (oral, injectable and OTC) and branded oncology (injectables and orals). The Company has divested Natrol, the dietary supplements business in the year under review. It continues to expand its product basket with new product launches. During the year, the Company launched 53 products across orals, injectables, OTC and branded divisions. Overall, the US Formulations business increased by 7.3% to 123,245 million, driven by strong growth in the orals business.

Filings and approvals in the US

Filings
FY17 FY18 FY19 FY20 FY21
31 47 63 55 55
Approvals
FY17 FY18 FY19 FY20 FY21
61 49 48 22 42

Oral solids: Aurobindos oral solids business in the US witnessed a healthy growth of 12% YoY on the back of improvement in market share of existing products and new product launches. This business segment accounted for ~67% of total US revenue. The Company has launched over 25 products during the year. Aurobindo actively markets (directly) around 230 oral solid products and it ranks amongst the top 3 in more than 62% of the products. The Company is awaiting final approval from the USFDA for 107 ANDAs as on March 31, 2021.

Injectables: This segment faced challenges owing to the COVID-19 pandemic as many of the elective surgeries were postponed and the hospitals witnessed lesser footfall in terms of patient visits. The Company however, maintained its volume market share during the year. It actively markets 54 products, of which 60% rank among the top 4 in the US market. The Company is awaiting approval for 54 ANDAs as on March 31, 2021. With the pandemic situation easing out, the Company expects an upsurge in the growth trajectory, and is focused on creating a diversified product portfolio of complex injectables.

Over-the-counter drugs (OTC): The OTC segment recorded 10% growth led by new product launches, and it contributed 3% to the US revenues in FY21. The business was initially impacted due to lockdown measures and reduction in footfalls in pharmacies. The foot traffic at pharmacies is beginning to show signs of recovery, which will improve the business outlook in the current fiscal.

Branded oncology: Aurobindo entered the branded oncology space through the acquisition of seven marketed branded oncology injectables. During the financial year, Acrotech Biopharma (Aurobindo Pharmas subsidiary) recorded 5% revenue growth on the back of improved performance of the product portfolio. It also launched Hemady (dexamethasone oral) for the treatment of multiple myeloma in the US. It is the first USFDA approved dexamethasone with an indication in combination with other anti-myeloma products for the treatment of adult patients with multiple myeloma.

Dietary supplements: During the year, the Company divested the dietary supplements business (Natrol) for US$550 million. It created significant value for the Company and enabled the Company to become a net cash company.

Europe formulations

Europe formulations revenue trend

Aurobindo is ranked among the top 10 generics companies in 7 out of 11 countries in EU/UK where it operates with presence in full-fledged pharmacy, Hospital and Tender sales infrastructure with commercialised 550+ INNs (International Non-proprietary Names). The Europe formulations business witnessed a marginal growth of 2% to 60,608 million owing to pre-buying in most of the countries in Q4 FY20 and reduction in elective surgeries.

The major milestone achieved in the year was the successful turnaround of acquired Apotex business and increased volume sourcing to India (up by 36% compared to previous year), which resulted in improved profitability. We reduced the cost of production for these markets by optimising supply chain and procurement and enhancing operational efficiency. We also launched products from the Eugia facility (one injectable and one oral).

GROWTH MARKETS FORMULATIONS

The growth markets formulations business grew by 6% to reach 14,379 million, contributing 6% to the total revenue. Canada continues to remain a key market within the Growth markets.

During the year, the Canadian business remained flat, despite 7 months lockdown in major provinces, which resulted in clinic closures, reduction in new prescription generation, delayed surgeries in hospitals and the reduction in prescription fills from 90 days to 30 days. Auro Pharma Inc, the Canadian subsidiary ranks as the 8th largest generic company as per revenues with a market share of ~3%. The Company launched 7 products during the year. The Company has filed 26 dossiers during the year taking the total dossier filed to 185. The Company received approval for 13 dossiers taking total approvals to 154 products. The Company is building a robust pipeline including oncology injectables, inhalers and biosimilars.

ARV formulations

The Company participates in global tenders floated by multilateral organisations like Global Fund, USAID, PEPFAR and country-specific Ministry of Health tenders. The segment posted a robust y-o-y growth of 49% to 18,628 million in the ARV segment, which was achieved through fostering excellent customer relationships with major ARV buyers such as Global Fund, PEPFAR and MOH, South Africa. The Company leveraged the rapid conversion from TLE (Tenofovir + Lamivudine + Efavirenz) to TLD (Tenofovir + Lamivudine + Dolutegravir) tablets. The Company witnessed transitioning to the new TLD combination at a faster pace in South Africa during the year. The Company aims to retain large portion of the market share achieved by it in the respective products in the ARV segment.

ARV formulations revenue trend

Revenue ( in Million)
FY17 FY18 U FY19 m FY20 FY21
11,854 8,396 9,725 12,515 18,628

API BUSINESS

Aurobindos API business is one of the most important pillars for the business as it enables the Company to be vertically integrated and have supply reliability. The API business contributed 12% to the total revenues of the Company for FY21. The Company manufactures and markets Betalactam and Non-Betalactam products manufactured at its 11 API and intermediate facilities. There has been a focus on increasing the capacities and continuously improving its manufacturing processes to meet customer requirement as well as to remain cost-effective. With a view to further strengthen the business and reduce dependence on importation with cost efficiency the Company had participated in the Production Linked Incentive (PLI) scheme for KSMs and APIs and was awarded for 3 products by the Government of India.

API revenue trend

Revenue ( in Million)
FY17 FY18 m FY19 1 FY20 FY21
30,421 29,622 34,030 30,834 30,859

FINANCIAL REVIEW - CONSOLIDATED

Key ratios
As on March 31, 2021 As on March 31, 2020
Debtors turnover 6.6 5.1
Inventory turnover 3.1 3.1
Interest coverage ratio 61.2 24.9
Debt equity ratio (0.04) 0.16
Operating profit margin (EBITDA Margin %) 21.5% 21.1%
Net profit margin (%) 21.5%* 12.3%
Return on net worth (%) 18.9% 18.2%

Includes exceptional items - sale of Natrol

MANUFACTURING REVIEW

Aurobindo has created a robust manufacturing base with world-class formulation and API assets. The Company has 27 manufacturing and packaging units spanning the USA (3), India (22), Portugal (1), and Brazil (1). Its well-equipped production facilities have requisite approvals from international regulatory agencies. The Company is largely backward integrated and ensures seamless production schedules with on-time availability of raw materials and finished products. Going forward, the Company will continue to enhance capacities of its existing units and set up new facilities catering to new technologies for future growth.

During the year under review, the Company made significant progress at its China facility coming on-stream where the first validation batch will be taken soon. It also added capacities at Unit IV, Unit XVI, APL Healthcare Unit IV (formerly known as Unit X), Unit XI, APL Healthcare and AuroNext.

SCORE ANALYSIS

1
Strengths Challenges Options Responses Effectiveness
• Vertically integrated manufacturing • Competitors with similar offerings • Vaccines for new diseases • Capacity creation and capability building measures • Approvals from regulatory agencies of largest markets
• Presence in multiple therapeutic areas • High mobility of workforce within the industry • Rise in demand for lifestyle products and geriatric care • Expanding into new areas like biologics, dermatology, transdermal patches and respiratory medicines • Earned shelf space on a global scale
• Global footprint
• Strong R&D • Pricing pressures for generics • Control over raw material sourcing
• Skilled workforce • Dominant API player
• Capability of delivering high- quality, cost-effective generics • Global response to pandemic/s • In-house R&D capabilities; technology strength in manufacturing and robust marketing infrastructure

WORKFORCE

Aurobindo Pharma exists and prospers because of its committed, highly experienced and talented workforce who represent the organisation to the external world. Thus, people are the most vital assets and crucial stakeholders for the Company.

Aurobindo offers a healthy and safe work environment for its employees, with equal opportunity, flexibility, and empowers them through various learning and development programmes across all business functions.

Nurturing human potential

Aurobindo Pharma continues to thrive in the changing business landscape with a people-focused workplace through effective leadership and continuous knowledge development. The Company focuses on unlocking human potential across the organisation by:

• Leveraging technology, processes and various performance measurement for capability building.

• Conducting various leadership initiatives and programmes in partnership with world-class business schools and organisations.

• Promoting a collaborative environment by integrating its global workforce through projects and other tools

• Encouraging a dynamic and positive work culture by recognising people for their productivity, innovation and excellence.

For Aurobindo, the growth and well-being of its people is critical. The Company has instituted various measures to ensure requisite protocols and promote covid-appropriate behaviour to ensure that the work environment is safe and healthy for its people in a post-COVID world.

SUSTAINABILITY AT AUROBINDO

Environment, health and safety are of paramount importance for the Company. It adheres to the safety and environmental standards across all its business processes and facilities. The Company continuously monitors and regulates its emissions and discharge of wastage to protect the environment by integrating new technologies and waste management processes.

The Company being a healthcare service provider, collaborating with ‘The Access to Medical Foundation that is tracking what 30 most active companies in antimicrobial R&D and manufacturing are doing to bring antimicrobial resistance under control. The Company is also a member of the ‘AMR Industry Alliance that is driving progress in curbing antimicrobial resistance through shared goals and commitment to improve access to high quality antimicrobial products, support appropriate use and minimise environmental risks.

Aurobindo takes several initiatives to upgrade and enhance the workplace safety. The Company follows and monitors the safety rules and policies for all its new projects, existing manufacturing units, distribution centres, etc. The Company also conducts various safety training programmes for its people to prevent the occurrence of any accidents.

In order to ensure that we communicate our comprehensive Sustainability Approach across our global network of operations, we aim to publish our First Sustainability Report very soon. This would provide full perspective on this critical subject matter to our stakeholders.

A RESPONSIBLE ORGANISATION

Aurobindo Pharma Foundation (APF), the philanthropic arm of the Company remains committed towards the growth and well-being of the community through various programmes and initiatives. The Foundations CSR efforts focus on several aspects of society, including, nutrition, education, health & hygiene, women empowerment, rural development and disaster management.

With a dedicated team of 11 people, the Company has partnered with several charitable organisations for improving the quality of life in the society. Here are some citizenship efforts of the Aurobindo Pharma Foundation during FY21:

• Providing nutritious meals to the underprivileged.

• Funding for infrastructure development of various educational institutions.

• Skill development programmes.

• Financial support, distribution of groceries, tablets, face masks, sanitisers to underprivileged people during the COVID-19 pandemic.

• Providing pure oxygen and ventilators to needy patients during the pandemic.