Vista Pharmaceuticals Ltd Management Discussions

FOR THE YEAR 2023-24 INTRODUCTION

India is the largest provider of generic drugs globally. Indian pharmaceutical sector supplies over 50% of global demand for various vaccines, 40% of generic demand in the US and 25% of all medicine in the UK. Globally, India ranks 3rd in terms of pharmaceutical production by volume and 14th by value. The domestic pharmaceutical industry includes a network of 3,000 drug companies and ~10,500 manufacturing units. India enjoys an important position in the global pharmaceuticals sector. The country also has a large pool of scientists and engineers with a potential to steer the industry ahead to greater heights. Presently, over 80% of the antiretroviral drugs used globally to combat AIDS (Acquired Immune Deficiency Syndrome) are supplied by Indian pharmaceutical firms. GLOBAL OVERVIEW: The global economy faced headwinds in FY 2022-23, as inflation rose due to energy price hikes and supply chain disruptions caused by the Russia-Ukraine war and COVID-19 related lockdowns in China. Key developed economies slowed down and central banks struggled to contain inflation despite raising interest rates. As a result, the global economy contracted. However, there were signs of recovery by the end of the year, with India leading the way by growing at a brisk pace and inflation easing to more comfortable levels. As we move into FY 2023-24, many countries will likely continue to implement tight monetary policies to combat inflation while avoiding recession. However, in the post pandemic world, we do not expect governments to deprioritize their pharmaceutical budget allocations. We believe that medical spending in high-income countries such as those in Western Europe, North America and Japan will remain high, as these countries continue to see high per capita usage of prescription drugs. We expect per capita usage of prescription drugs to grow in low-income countries and that the pharmaceutical market will continue to grow at a steady pace, as new products offset the loss of revenue from expiring patents. COMPANY PERSPECTIVE

Vista Pharmaceuticals offers over the counter & prescription generic drug products consisting of tablets, capsules and liquids covering various therapeutic categories. Vista Pharmaceuticals was founded in 1992 to Formulate, Register, Produce, Market and _ Distribute High Quality Pharmaceutical Products, initially focusing on the United States Market with a Vision of expanding Globally. Vista Pharmaceuticals is the first Indian Company to obtain USFDA Approvals to produce OTC as well as Prescription Drugs to US Market in 1994. Vista Pharmaceuticals is the first Indian Company to export OTC as well as Prescription Drugs to US in 1996.

We have established an extensive Marketing and Distribution Network in the United States. Our state of- the-art Facility in India is built according to cGMP and US-FDA standards. It has been operating since 1994 and the Facility built with state-of the art Research & Development (R&D), Quality Assurance/Quality Control (QA/QC) and Production departments. OBJECTIVES:

* Develop ANDAs (Generic version of Off-Patented Branded Drugs) to US market.

* Develop Generic Drug Products to other Global Markets.

* Contract Manufacture Pharmaceutical Drug Products to other Companies. ACHIEVEMENTS:

* USFDA Approved Generic Bactrim (Sulfamethoxazole + Trimethoprim - SMZ) for US Market in October 2005.

* SMZ Product(Generic Bactrim) is First Manufactured in US in 2006.

* SMZ Product (Generic Bactrim) is First launched in US in May 2006.

* USFDA approved the Site Transfer of SMZ Product Manufacturing to India in June 2010.

* SMZ Product from India is launched in US in November 2010. VISTA PHARMACEUTICALS, INIDA (VISTA INDIA) FOCUS IS:

* US Generic Market has better margins and sales volumes compared to other countries.

* Almost 85% of the prescription drug market is of Generic Drugs in US. The company operations are going on as per USFDA cGMP norms. The validations and stability testing studies are going on as per schedules. PRODUCTS TO BE INTRODUCED TO US MARKET: The management of the Company is planning to introduce the following resolution in the US market.

* Cardiac, Respiratory, and CNS drugs. ROAD AHEAD

Medicine spending in India is projected to grow 9-12% over the next five years, leading India to become one of the top 10 countries in terms of medicine spending. Going forward, better growth in domestic sales would also depend on the ability of companies to align their product portfolio towards chronic therapies for diseases such as such as cardiovascular, anti diabetes, anti-depressants and anticancers, which are on the rise. The Indian Government has taken many steps to reduce costs and bring down healthcare expenses. Speedy introduction of generic drugs into the market has remained in focus and is expected to benefit the Indian pharmaceutical companies. In addition, the thrust on rural health programmes, lifesaving drugs and preventive vaccines also augurs well for the pharmaceutical Companies is trying its best to move ahead in planned manner to achieve the higher growth. FINANCIAL PERFORMANCE:

Revenues

Company has recorded the revenue of Rs. 1028.78 Lakhs during 2023-24 as compared to Rs. 100.37 Lakhs in 2022-23. Other Incomes The Other incomes for 2023-24 of Rs. 33.44 Lakhs, compared to Rs. 39.94 Lakhs in 2022-23. Expenditure The expenses for 2023-24 of Rs. 1579.86 Lakhs, compared to Rs. 727.94 Lakhs in 2022-23. Loss Before Tax There is Loss Before Tax for 2023-24 of Rs. 517.74 Lakhs compared to Loss Before Tax of Rs. 587.63 Lakhs in 2022-23. Loss after Tax The Loss After Tax for 2023-24 of Rs. 451.20 Lakhs as against Profit After Tax of Rs. 566.2 Lakhs in 2022-23. Earnings Per Share The EPS for 2023-24 has decreased to Rs. (1.03) as compared to Rs. (1.54) in Previous Year 2022-253. RISK MANAGEMENT

Risks are inherent to our business as our operating environment is complex, highly regulated, and dynamic. To attain our strategic growth objectives, protect the interests of all our stakeholders and meeting legal requirements we have an established process of identifying, analyzing, and responding appropriately to all business risks. We have a well-embedded Risk Management Framework to ensure that we are well-placed to manage any adverse effect posed by financial, operational, strategic or regulatory related risks. Our framework adopts appropriate risk mitigation measures for identified risks across functions. The process ensures that new risks, which might arise, or the impact of existing risks which might have increased, are identified and a strategy is put in place for mitigating such risks. The major risks identified by the management are regulatory, competition, supply chain disruption, cyber and data security.

engagement, Capability development and maintaining cordial industrial relations. It also believes in review of its HR processes and systems on an ongoing basis to optimize costs, time and labour. CAUTIONARY STATEMENT

Statements in the Management Discussion and Analysis describing the Company’s objective, projections, estimates, expectations may be forward-looking statements. Actual results may differ materially from those expressed or implied due to various risks and uncertainties. Important factors that could make a difference to the Company’s operations include global and Indian demand-supply conditions, finished goods prices, changes in government regulations and policies, tax regimes, economic conditions within India and the countries within which the Company conducts business and other such factors. The Company does not undertake to update these statements.