Fredun Pharmaceuticals Ltd Management Discussions.

1) Management Discussion and Analysis

The core business of the Company is exporting formulations as Branded Generics and introducing new formulations to meet the growing requirements of different customers globally. The shift in healthcare from treatment to prevention has made many Pharma Companies to think differently about health & disease. As the Pharma Companies have an edge with respect to innovation and technology your Company having an R & D Department is planning to develop such neutraceuticals & Dietary Supplements. The Company has plans to diversify into Neutraceuticals & Dietary Supplements not only for humans but also for veterinary use.

2) Business Highlights

The growth of the Company was mainly due to the revenue from exports to African and ASEAN Countries. The Company has the capabilities to produce latest generics and enter niche areas where there are good sales potential with relatively limited competition. Over the years the Company has focused on increasing the Export activities and as on date the Company has its presence in various countries and plans to expand globally. The Company is in a continuous process of modernizing the technology and introducing new formulations to meet the growing requirements of different customers. The Company has made various process improvements to cut down the cost and improve the qualify of the products.

The Company also caters to development of formulation of drugs that are equivalent to the innovator products for sale in the emerging markets and also enter local market. Highly technical personnel are involved in the process and analytical method validations and BA/BE studies.

3) Business Outlook

To increase volumes of the product portfolio, the Company has been systematically investing in its productive infrastructure by installing high speed tableting and blister packing machines. The Company has made well planned investments to increase capacity in existing infrastructure and create new manufacturing departments to manufacture ointments, creams and gels and also pellets manufacturing department of different APIs.

4) Challenges

The Regulatory Authorities for approving pharmaceutical products are getting tougher. This is a positive development, but it also creates greater challenges for the manufacturer. The market conditions are getting seriously competitive and healthcare costs everywhere continue to rise. The Indian manufacturers will have to synchronize Indian manufacturing standards with the ones adopted globally to help Indian manufactured products gain a steady stand in the International Market.

5) Key Growth Segments

The launch of biosimilars at relatively lower cost will be the major boost especially for the Indian Market. Fredun Pharmaceuticals Ltds growth was largely driven by new product launches in the ARV drugs segment and validating some Psychotropic products and registering the same for export market. The Company expects to maintain robust growth due to strong acceptance of our newly launched ARV products. The Company has also launched a herbal galactagogue and a few dietary supplements for veterinary use in the local market as well as registering the same in different countries for exports. The cash flow generated by your Company will be deployed in creating infrastructure, to produce ointments, creams / gels department and pellets manufacturing department.

6) Human Resource Management at Fredun Pharmaceuticals Ltd

The Company has a positive Outlook for the next year. The Company continues to put concerted efforts in recruiting quality people and lowering work stress. Development programs remain the key focus areas for the Company. This will increase the productivity and support the Companys business plan especially in its key Emerging Markets. The Company has installed the ERP System having GST operating systems to modernize and develop the business with complete transparency and efficiency.