Wockhardt Ltd Management Discussions.

Global Pharmaceutical Industry & Economies: The second half of financial year 2021 showcased resilience of the Pharmaceutical Industry with significant outcome of efforts on vaccine development with multiple vaccine approvals. The launch of vaccination in some countries towards the end of FY 2021 raised hopes of an eventual end to the pandemic. Also this was a time which brought the whole world together as all the countries extended mutual all round support to each other on humanitarian grounds. Due to focussed medical research, medical advances and prioritizing investments in unmet medical areas, alternative therapies showed promise in areas of HIV, Oncology, CNS and other rare diseases. As countries were battered with grave challenges, on the other hand they became self-reliant and explored new avenues and opportunities in various areas to sustain the growth. Climate change awareness gained traction globally with key powers injecting fresh urgency on need to undertake positive initiatives. Also renewables energy had a record year with significant flow of investments which marked the commitment of nations to shift to a more sustainable model for the long run. Despite the culture wars, creeping nationalism and rise of authoritarianism, the world has become more socially progressive.

Financial markets volatility increased in end of 2021. In what was believed as a ray of hope and to have subsided over the fourth quarter of FY 2021, the financial year started with havoc struck in the form of worst mutation of the Sars-COV-2 virus by way of Delta variant. The first quarter of Financial year 2021-22 saw the unprecedented outbreak of this variant which first got detected in India and spread across 179 countries through November 2021. Economies were forced to go under lockdown to contain the spread which dampened the already bleak economic prospects of revival. The variant proved to be one of the most devastating forms of the list of mutations leading to large number of hospitalizations & deaths and events believed to have deep and cascading impact across the entire economic chain. Industrial and other economic activity, consumption, mobility slowed down as countries braced themselves eventually to prioritize the healthcare infrastructure. Supply disruptions continued to weigh on activity. While on one hand economies were evolving from the onslaught of Delta in H1, H2 prospects continued to be dampened by the more infectious but less lethal Omicron mutation which expanded presence across the globe. It is noteworthy that the vaccination drive peaked across the globe during this period with the most encouraging results and this helped to contain the effects of the virus, its lineages and sub lineages.

While global economies are literally gasping to breathe a sigh of relief, Russia on 24th February 2022 waged war and aggression to invade Ukraine marking the steep escalation of the crisis which began in 2014. This has led economies on brink of "Perfect storm" of crisis. It has set in motion a three dimensional crisis on Food, Energy and Finance that is producing alarming cascading effects to an ecosystem which is already battered by COVID-19, Food Infiation & Shortages, Energy and commodity price increase, Debt distress, Blackouts and Climate change. Lingering concerns: Surging infections on account of recurrent mutations continue to disrupt the path to economic recovery and consequently uncertainties still continues. Much remains to be done on the health and economic policy fronts to limit persistent damage from the severe contraction and ensure a sustained recovery. Containment efforts will be of key focus through FY 2023. Climate change, food and energy crisis, wide spread inflation and debt distress are serious concerns that are yet to be addressed with concrete solution failing which economies will trap into a downward spiral eventually making it extremely challenging to reverse the effects thereafter. The ongoing war between Russia and Ukraine triggered waves of destruction and an element of uncertainty with no respite as of date. The fallouts of the war have been severe with escalation of the situation and involvement of multiple economies and coalition, military alliances which is a situation last seen prior to World War II.


The COVID-19 pandemic has transitioned to a new phase with widespread use of vaccines and improved therapeutics, but the periodic emergence of viral variants and incomplete vaccine rollouts leaves significant uncertainty in the years ahead. The global spend on medicines for the year 2021 stood at ~USD 1.4Tn with the 5 year CAGR reflecting at 5.1%. However all countries are expected to have significantly low growth rate through 2026 as shown in table below. Growth in Global Medicine Spending will be lifted by stronger pharmerging market growth through 2026 and offset by developed market losses of exclusivity for original brands. New Brand Spending in developed markets projected to be similar to the last five years but represent a smaller share of spending. Global new active substances (NAS) launches are projected at an average of 54–63 per year, totaling 290–315 for five years through 2026. The impact of exclusivity losses will increase to $188 billion over the next 5 years mostly due to the availability of biosimilars. Global savings from biosimilars will have a significant impact on country medicine spending through 2026, estimated at a cumulative $215 billion. Specialty medicines will represent nearly 45% of global spending in 2026 and almost 60% of total spending in Developed markets.

Spending in USD Bn
2021 2017-2021 2026 2022-2026
Global 1423.5 5.1% 1750-1780 3-6%
Developed 1344.9 4.9% 1635-1665 2.5-5.5%
US 580.4 4.9% 685-715 2.5-5.5%
Japan 85.4 -0.5% 73-93 (2)-1%
EU5 209.7 4.8% 245-275 3-6%
o/w UK 36.6 5.9% 46-50 4-7%
Pharmerging 290.8 7.8% 470-500 5-8%
China 169.4 6.1% 190-220 2.5-5.5%
Brazil 31.6 11.7% 47-51 7.5-10.5%
Russia 18.8 11.4% 27-31 7.5-10.5%
India 25.2 11.1% 37-41 8-11%
Low Income 19 0.1% 21-25 2.5-5.5%

Impact of COVID-19 on use of Medicines

While the short-term impact from COVID-19 in 2020 and 2021 has been significant, the long-term impact on growth trends is more muted. Perhaps the largest uncertainty in the next five years will be the potential impact of economic factors on countries’ budgeting and whether there will be shifts in policies regarding healthcare and medicine spending. Including estimates of higher spending growth from COVID-19 vaccines and lower spending from existing treatments due to disruptions from the pandemic, the five-year CAGR to 2025 is expected to be 4.6% compared to 4.5% if the pandemic had not taken place.

Company Performance

With the tightening of monetary condition across the globe and soaring inflation across economies, managing liquidity and smooth business operations has been the key priority during the year and your Company has effectively managed its liquidity position and continued with its sustainable business model without compromising on the overall long term vision of the organization.

Your Company started the year with focus on aligning operations with the long term goals and its vision statement. Primary objectives were to drive robust growth, de-leveraging the balance sheet to achieve operational efficiency, ensuring reasonable flow of working capital into the Business and gradually shifting away from acute to strengthen chronic presence in its portfolio mix, strengthening overall New Chemical Entity (NCE) and vaccines bucket. Amidst turbulent time your Company stood steady and delivered its key priorities thus paving the way for long term sustainability. The below image represents the business ecosystem in which your Company operates which can also be interpreted as the near to long term growth drivers for the Company.

Key developments that took place in your Company during the year have been summarized below:

Wockhardt and Jemincare partner for novel respiratory antibiotic Nafithromycin

Wockhardt Bio AG – a subsidiary of Wockhardt Limited, ("Wockhardt") and Jiangxi Jemincare Group Company Limited, China ("Jemincare") have partnered for Wockhardt’s novel patented antibiotic WCK 4873 (INN: Nafithromycin) in People’s Republic of China, Hong Kong, Macau and Taiwan for the treatment of community-acquired bacterial pneumonia and other respiratory tract infections.

Under the terms of the definitive agreement, Jemincare will be responsible for exclusive development and commercialization of the Nafithromycin in the select markets. A joint steering committee is formed to oversee development and regulatory activities. Wockhardt will receive an upfront payment and will be eligible for regulatory-linked milestone payments. Further, Wockhardt would supply the product to Jemincare and will receive royalties on net sales. Wockhardt would transfer the manufacturing technology to Jemincare at mutually agreed time.

National Institutes of Health (NIH), USA to conduct human Phase 1 trial of Wockhardt’s novel once-a-day MDR Gram-negative antibiotic WCK 6777

The National Institute of Allergy and Infectious Diseases (NIAID), part of the National Institutes of Health (NIH), United States of America (USA) is supporting a Phase 1 clinical trial of Wockhardt’s novel once-a-day, multidrug-resistant (MDR) Gram-negative targeted antibiotic WCK 6777. The trial will be conducted at NIAID’s Phase I clinical trial units in the USA. NIAID will sponsor the investigational new drug (IND) application for the study. The Food and Drug Administration (USA) has granted a Qualified Infectious Disease Product (QIDP) designation to WCK 6777, which signifies its ability to meet unmet medical need and facilitates faster approval process. Interestingly, WCK 6777 is a combination of zidebactam and ertapenem and, zidebactam has also been combined with cefepime, the combination designated as WCK 5222. WCK 6777 operates through a novel ?-lactam enhancer action that enables it to overcome several clinically challenging resistance mechanisms in Gram-negative pathogens. Once-a-day therapeutic profile of WCK 6777 is expected to cut hospital admissions, facilitate early patient discharge and thus introduce patient-centered care for MDR infections. Through independent preclinical studies, WCK 6777 is shown to be active against several carbapenem-resistant Gram-negative pathogens such as Escherichia coli and Klebsiella, which are often the cause of community as well as hospital infections such as urinary tract infections (UTIs). In USA, UTIs alone accounts for about three million annual hospitalizations and are linked to hospital care cost exceeding 2.8 billion USD1. This trial is being funded in whole or in part under NAIID award number HHSN272201500005I.

Collaboration with Serum Life Sciences UK for manufacturing multiple vaccines in the United Kingdom

CP Pharmaceuticals Limited, a subsidiary of Wockhardt Limited and Serum Life Sciences UK have collaborated for delivering a global vaccine programme (~ 150 mn doses annually). A profit sharing arrangement has been made between the two parties. This collaboration is testament to the excellence and innovation that both parties bring to the global vaccine market. It will be instrumental in building long-term capacity in the UK. With this, your Company seeks to further bolster supply resilience and support the global rollout of vaccines. This deal signifies the role that your Company will now step up to play in the global supply of multiple vaccines protecting citizens against infectious diseases – which may include those used to immunise against COVID-19.

Successful fund raising through Rights Issue process:

During the year, your Company has issued and allotted 3,32,44,650 Equity Shares of the face value of 5 each for cash at a price of Rs.225 per Equity Share (including premium of Rs.220 per Share) aggregating to Rs.7,48,00,46,250 pursuant to a Rights Issue of shares in the ratio of 3 (Three) Rights Equity Share for every 10 (Ten) fully paid-up Equity Share of the Company, held by the eligible Equity Shareholders on the Record Date i.e. 9th March, 2022. The Rights Issue opened on 15th March, 2022 and closed on 22nd March, 2022. The Rights offering by your Company received a very good response, and was fully subscribed. The Company received the approval from Stock Exchanges for listing on 29th March, 2022 and trading of Rights Equity Shares on 30th March, 2022. The Rights issue proceeds enabled reduction in Debt and improvement in Balance sheet.

Amidst the challenges, your Company was focused on deployment of funds and setting its investments priorities to ensure maximum return. Secondly it dedicated focus on the expense side with cost containment measures. Significant efforts to identify new revenue streams and enhance profitability and cash flow also translated into new partnerships into international geographies.

Business Performance:

Domestic Business recorded healthy growth during the year mainly in the Diabetes segment and NCE portfolio. In addition your Company has also launched new products. The ROW business continues to grow robust even amidst significant global challenges as focus remains on penetrating new geographies and adding new products in addition to winning tenders for existing portfolio. The Company’s International businesses continues to be under pressure because of aggressive channel consolidation and genericisation.

During the year, the Company’s research & development expenses continued to grow keeping in view its strategic focus in Pharma, Biotechnology & NCE segment and was approximately 9.3% of consolidated revenue.


Revenue from Operations during the year was Rs.3,230 crore compared to Rs.2,762 crore in the previous year with an increase of 17%.

The revenue split of European Union Business contributed 7% (compared to 10% in FY 2021). UK operations contributed 43% (compared to 37% in FY 2021). India and Rest of the World contributed 39% (compared to 37% in FY 2021).

On Y-o-Y basis, EBITDA has been significantly higher vs previous year quarters. The increase is driven by high margin vaccine business, higher sales of NCE in India, high proportion sales from the India branded business.

The Company’s strategic focus on R&D initiatives that are futuristic in nature, continue to impact the EBITDA as they are being expensed.

The gross margins across all the quarters continues to be either above or in line with the historic past or long term average for the previous years. The increase is an outcome of changing business mix accompanied with other factors like portfolio swings in favour of high margin business to capture growth opportunities.

Particulars FY 21 FY 22 Change %
Material Consumption 41.4% 39.2% 2.3%
Personnel Cost 25.8% 21.6% 4.1%
R&D 6.2% 4.4% 1.8%
Other Expenditure 28.3% 25.5% 2.7%
Interest 9.0% 9.3% -0.2%
Depreciation 8.9% 7.6% 1.3%
Exchange loss/Gain 0.1% 0.0% 0.1%
Other Income -4.8% -0.6% -4.2%
Exceptional Item Profit/(Loss) 48.1% -5.7% 53.7%
Tax 8.2% -4.1% 12.3%
Profits (Before NCI) 24.9% -8.6% -33.6%
NCI 0.1% -1.1% 1.2%
Profits (After NCI) 24.8% -7.6% -32.4%

Material consumption for FY 2022 stood at ~ 39% of sales compared to ~ 41% in FY 2021.

The Company’s emphasis on R&D continued during the year while adopting selective strategy for rationalizing R&D spends which is reflected in spends for FY 2022 at ~ 9.3% including Capital and Revenue expenditure. Personnel costs as % to sales were lower than PY at ~22%. Both costs were even lower in absolute terms. Other expenses for FY 2022 were at ~ 26% of sales compared to ~ 28% in the previous year. Interest cost in absolute terms was higher by 20% compared to previous year. Profits after Non-Controlling interest (NCI) declined from 25% in PY to -8% in FY 2022 due to exceptional items.

The EBITDA and corresponding margin recorded during the previous financial year was one of the best in past several years, an outcome of cost rationalisation initiatives and revenue growth from high margin segments. Expanding market and therapeutic presence, realignment of portfolio mix to high margin segment, exploring new revenue generation streams and cost rationalisation measures remains the key focus in the near to mid-term.


FY 22 FY 21 Change % Change
Secured 992 1,853 -861 -46%
Unsecured 813 473 340 72%
Total 1,805 2,326 -521 -22%


The Company’s continuous strategic focus in complex research in Pharma, Biosimilars & NCEs for past couple of years have shown encouraging results particularly in the field of Break through Anti-infective space.


Antimicrobial Resistance (AMR) or the ability of infections to resist antibiotics to work against it could negate many of the medical breakthroughs of the last century. Previously curable infectious diseases may become untreatable and spread throughout the world. The report "Antimicrobial resistance: Global report on surveillance" showed that antimicrobial resistance is prevalent everywhere and has the potential to affect anyone, of any age, in any country. Antimicrobial resistance is putting at risk the ability to treat even common infections both in the community and hospitals and without an urgent and coordinated action the world is heading towards a post-antibiotic era.

Antimicrobial Resistance (AMR) is a major threat to human development as it affects our ability to treat a range of infections caused by bacteria, parasites, viruses and fungi. Treatments for a growing list of infections, including urinary tract infections, tuberculosis (TB), sepsis, gonorrhoea and food borne diseases have become less effective in many parts of the world because of resistance. In the absence of an effective antibiotics modern medical procedures, such as major surgery, organ transplantation, diabetes management and cancer chemotherapy will become a very high risk1, 2.

Antimicrobial Resistance (AMR) and COVID-19 are the two pandemics the world is currently challenged with and that pose a significant threat to public health at a global scale. Infections resulting from antimicrobial resistant bacteria are expected to claim 10 million lives globally, per year by 2050 (O’Neill, 2014)14. COVID-19 and AMR are interacting health emergencies which can have mutual impact due to misuse of existing antimicrobials for the treatment of COVID-19 patients since a specific treatment is absent for the disease (Nieuwlaat et al., 2021)15. If the current trend of AMR goes unchecked, it would result in the shortage of available therapeutics in future and may even mark an end to the conventional drug discovery pipeline (Kaul et al., 2019)16. By the year 2050, infections caused by antimicrobial resistant bacteria are projected to cause 2 million deaths in India.

Burden of resistance to antibacterial drugs

The WHO declared that AMR is one of the top 10 global health threats and although often more silent than the COVID-19 pandemic, it can have equally devastating consequences.17

The overlooked pandemic of antimicrobial resistance: We have seen around 5 million deaths in the last two years owing to Covid-19 pandemic. Over 98% Covid-19 patients were treated with antibiotics. However 50% mortality in Covid-19 cases were linked to bacterial infections. A recent study estimates 4.95 million deaths associated with bacterial AMR globally in 2019 alone18. This draws our attention to the often neglected silent pandemic of antimicrobial resistance in terms of unmet needs for novel antibiotics. The overall health and economic burden resulting from acquired AMR cannot be fully assessed with the presently available data, however some estimates of the economic effects of AMR have been attempted, and the findings are disturbing. In a WHO report on Antimicrobial Resistance: Global Report on Surveillance (2014), the yearly cost to the US health system alone has been estimated at US $21 to $34 billion3 dollars, accompanied by more than 8 million additional days in hospital4. Since AMR has effects far beyond the health sector, it was projected, nearly 10 years ago, to cause a fall in real gross domestic product (GDP) of 0.4% to 1.6%, which translates into many billions of today’s dollars globally3.

The CDC in its 2019 report on Antibiotic Resistance Threats in the United States estimates that 2.8 million antibiotic-resistant infections occur each year in US alone4.

The evidence obtained shows that AMR has a significant adverse impact on clinical outcomes and leads to higher costs due to consumption of health-care resources. Infections caused by antimicrobial resistant strains of bacteria are unlikely to respond to standard treatments resulting in prolonged illness and a greater risk to health. For example, MRSA (Methicillin-resistant Staphylococcus aureus) is estimated to cause 64% more deaths than infections caused by a non-resistant strain of the bacteria5 as per a report published in 2015 ( The Antibiotic Resistance Crisis- by C.Lee Ventola ). Antimicrobial resistant strains of bacteria are also more likely to be passed on to other people because those infected are sick for longer. The O’Neill Review (The Review on Antimicrobial Resistance, December 2014) estimated that the global impact of AMR could be 10 million deaths annually by 2050, and cost up to US $100fitrillion in cumulative lost economic output6. The nature of this global problem emphasises the challenge that the UK faces when tackling AMR in the food supply chain.

The cost of health care for patients with resistant infections is higher than care for patients with non-resistant infections because of longer duration of illness, additional tests and the need for more expensive medicines. The rise in resistance not only impedes our ability to treat infections, but has broader societal and economic effects, and endangers the achievement of the Sustainable Development Goals1,7. The direct and indirect impact of AMR will mostly fall on low and middle-income countries, which often lack the infrastructure, and human and financial resources to adequately counter drug resistance epidemics7. The consequences of AMR are aggravated in volatile situations such as civil unrest, violence, famine and natural disasters, as well as in settings with poor health care services or without access to health care2, 8.

Antimicrobial resistance (AMR) is a widely recognised and growing global public health problem. Though there are no exact figures that capture the true global burden of AMR, let alone in low- and middle-income countries (LMICs), latest estimates from the Antimicrobial – Resistance – Benchmark 2018, show that AMR causes over 700,000 deaths annually worldwide5. At the same time, millions of people lack access to much needed antimicrobial medicines for curable infections, which is evident by the 445,000 community-acquired pneumonia deaths that occur in children under five9. The issue of AMR and lack of access must be addressed in tandem. Steps to increase access must include measures to prevent resistance, and steps to curb resistance must include measures to enable appropriate access. Addressing both requires a coordinated effort from various stakeholders, not just the government, but also across the healthcare and farming industries, and the development and global health communities.

The worst-case scenario in the coming would be, world might be left without any potent antimicrobial agent to treat bacterial infections. The global economic burden would be about US $120 trillion (US $3 trillion per annum), which is approximately equal to the total existing annual budget of the US health care. Overall, the global population would be dramatically affected: By the year 2050, 444 million adults would have died or not been born in this scenario.10,20

Growing Demand

The global antibiotic market was valued at USD 41 Bn in 2020 and is expected to grow at a compounded annual growth rate of 4.5% from 2021 to 202811. Between 2002 and 2010, global consumption of antibiotics increased by 36%, and three quarters of this increase was accounted for by Brazil, Russia, India, China and South Africa (BRICS)5. Growing demand coupled with poor surveillance and stewardship is likely to further drive the emergence of resistant strains, particularly in high-burden areas.

There has been a steady decline in the number of the new antibacterial drugs approved and the decline in new antimicrobial agents along with the need to manage an increasingly complex health care environment may require even more robust activity and innovative solutions.

In the near future, the next challenge will be to identify newer agents for the treatment of multidrug-resistant Gram-negative pathogens which are emerging at a rapid rate.

It is essential to take appropriate measures to preserve the efficacy of the existing drugs so that common and life-threatening infections can be cured.

Facts about Antibiotic Resistance13 (Antibiotic Resistance Threats in the United States, 2013- by Centers for Disease Control and Prevention -USA)

• Antibiotic resistance is one of the most urgent threats to the public’s health.

• Every time a person takes antibiotics, sensitive bacteria are killed, but resistant ones may be left to grow and multiply.

• Overuse of antibiotics is a major cause of increases in drug-resistant bacteria.

• Overuse and misuse of antibiotics threatens the usefulness of these important drugs. Decreasing inappropriate antibiotic use is a key strategy to control antibiotic resistance.

• Antibiotic resistance in children and older adults is of particular concern because these age groups have the highest rates of antibiotic use.

• Antibiotic resistance can cause significant su ering for people who have common infections that once were easily treatable with antibiotics.

• When antibiotics do not work, infections often last longer, cause more severe illness, require more doctor visits or longer hospital stays and involve more expensive and toxic medications. Some resistant infections can even cause death.

AMR is a global health security threat that requires concerted cross-sectional action by governments and society as a whole. The overuse of antibiotics clearly drives the evolution of resistance. Epidemiological studies have demonstrated a direct relationship between antibiotic consumption and the emergence and dissemination of resistant bacteria strains. In emerging economies like Middle East, Latin America, Asia – Pacific are important for the future growth drivers and one can expect the rising trend to continue for the next decade amidst unanimous shift in focus to put issues pertaining to AMR and Antibiotic access on the world priority list.


1. WHO Antimicrobial resistance (WHO Fact sheet). Geneva: World Health Organization; February 2018 (http://www.who.int/ en/news-room/fact-sheets/detail/antimicrobial-resistance, accessed 25 September 2018)

2. Laxminarayan R, Duse A, Wattal C, Zaidi AK, Wertheim HF, Sumpradit N, et al. Antibiotic resistance-the need for global solutions. Lancet Infect Dis. 2013;13:1057– 98. doi:10.1016/S1473-3099(13)70318-9

3. World Health Organization. (2014). Antimicrobial resistance: global report on surveillance. World Health Organization. https://apps.who.int/iris/handle/10665/112642

4. Antimicrobial resistance: global report on surveillance.2014

5. CDC report "ANTIBIOTIC RESISTANCE THREATS IN THE UNITED STATES 2019" on https://www.cdc.gov/drugresistance/pdf/ threats-report/2019-ar-threats-report-508.pdf

6. The Antibiotic Resistance Crisis PMCID: PMC4378521; PMID: 25859123–

7. The Review on Antimicrobial Resistance, Chaired by Jim O’Neill–

8. Ayukekbong JA, Ntemgwa M, Atabe AN. The threat of antimicrobial resistance in developing countries: causes and control strategies. Antimicrob Resist Infect Control. 2017;6:47. doi:10.1186/ s13756-017-0208-x

9. Gould IM, Bal AM. New antibiotic agents in the pipeline and how they can help overcome microbial resistance. Virulence. 2013;4(2):185–191. [PMC free article] [PubMed] [Google Scholar] 10. Anti-microbial – Resistance – Benchmark 2018—11. Bartlett JG, Gilbert DN, Spellberg B. Seven ways to preserve the miracle of antibiotics. Clin Infect Dis. 2013;56(10):1445–1450.

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12. Overview on Antibiotics market on https://www.grandviewresearch.com/industry-analysis/antibiotic-market 13. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7086080/ 14. Antibiotic Resistance Threats in the United States, 2013- by Centers for Disease Control and Prevention (USA)

15. Antimicrobial resistance. Tackling a crisis for the health and wealth of nations- https://www.who.int/antimicrobial-resistance/news/amr-newsletter-no13-july2016.pdf (2014)

16. R. Nieuwlaat, L. Mbuagbaw, D. Mertz, L.L. Burrows, D.M. Bowdish, L. Moja, H.J. Sch?nemann Coronavirus Disease 2019 and antimicrobial resistance: parallel and interacting health emergencies- Clin. Infect. Dis., 72 (9) (2021), pp. 1657-1659

17. G. Kaul, M. Shukla, A. Dasgupta, S. Chopra Update on Drug-repurposing: Is it Useful for Tackling Antimicrobial Resistance?

(2019), 10.2217/fmb-2019-0122

18. WHO. Global Action Plan on Antimicrobial Resistance. https://www.who.int/publications/i/item/9789241509763 19. https://www.thelancet.com/journals/lancet/article/PIIS0140-6736(22)00087-3/fulltext

20. The Global Economic Costs of Antimicrobial Resistance by Jirka Taylor, Catherine A. Lichten, Elta Smith on https://www.rand.org/blog/2016/05/the-global-economic-costs-of-amr.html (May 20, 2016)


Global markets continue to offer a plethora of opportunities because of transition in the form of lifestyle shift and related diseases in these countries. In view of the existing presence of operations in these economies, your Company is well poised to capitalise and tap these growth opportunities. Your Company is striving in all aspects to establish its brand and ramp up its presence and operations in larger GCC countries, Latam Countries, New markets like Australia, New Zealand, Turkey, Malaysia and not last but significant partnerships in China, Japan and Korea. Global crisis of antibiotics availability continues to pose threat and the gap in Anti Infective segment has widened as relatively few drugs have been discovered in the last decade. However your Company’s relentless focus for almost two decades in the Anti-Infective space has started showing recognition with consecutive approvals for QIDP in quick successions as well as approval from US FDA by granting abridged clinical trial for Phase III for its Superdrug antibiotic WCK 5222. This was based on the evaluation by US FDA of its preclinical and clinical data of Phase I establishing safety and clinical scope of efficacy for the drug. Notably your Company has 6 molecules (NCE) as on date which are at various stages of development.

The Covid-19 induced pandemic which started in year 2020 and its ongoing effects have opened up sea of opportunities for pharma companies with nearly almost all major pharma companies leveraging either their R&D capabilities or Manufacturing strengths. Many R&D based pharma companies are into race for vaccines development while those with stronger manufacturing capabilities and capacity are getting into CMO arrangements to reap the near to long term benefits of the same. India is expected to become the second largest COVID-19 vaccine manufacturer after US, given its capacity to produce for its local population and to export to other countries. India’s track record for vaccine manufacturing predates the pandemic, which means that scalable plans for contract manufacturing to meet global demand is as good as an industry given.

The pandemic has gone long way to disrupt the global supply chain with too many countries focussed on single location for sourcing of supplies. As a result of the disruption in supplies, economies have realised the importance of localisation and decentralisation. This has increased considerable opportunities for countries with dominant API manufacturing capabilities as well as robust CMO infrastructure. Importantly such initiatives are being backed by government incentive schemes and investment back up.

The rising costs and regulatory pressure in developed markets are forcing many global pharmaceutical companies to reduce their internal capacities in Research and Development (R&D), manufacturing, etc. and turn to Contract Research & Manufacturing Services (CRAMS), and outsourcing of Research and Clinical trials to developing Countries. These strategies help multinational companies reduce costs, increase development capacity, and focus on their core profit makings activities, such as drug discoveries and marketing, rather than on manufacturing. India, with a large patient population and genetic pool, is fast emerging as a preferred destination for such multinationals seeking efficiencies of cost and time. The country’s CRAM industry offers a significant cost-quality proposition, with potential savings of about 30-40 percent compared to western markets such as the US and Europe. Technology trends are driving a shift towards patient-centric healthcare, as evidenced by wearable biometric devices and telemedicine. This trend is resulting in more informed patients who are likely to take more active role in any treatment plan their doctor may prescribe. Patient-centric care can provide challenges and rewards for the pharmaceutical industry. In the near future, the direct consumer may become the pharmaceutical company’s most strategic partner. The rise of consumerism provides an interesting dynamic for competition in this industry. The pharmaceutical industry will be driven by three levels of integration: products and services as well as data and technology. These three aspects will have a positive impact on the patients’ experience, as they will allow to adapt the medicines and treatments to each patient. This will change the approach to Clinical R&D as it will be based on real time accurate information the result of which would not just be medicine but more than that.

Disruptive technologies and emerging trends such as robotics, artificial intelligence, 3D printing, precision medicine or patient design will impact the manufacturing and distribution of pharmaceuticals. In order to prepare successfully for a better future of healthcare, the pharma industry has to embrace new technologies and put a greater focus on prevention and digital health.


Last year has witnessed extreme volatility on macro-economic parameters globally. The Novel Coronavirus (COVID-19) and its mutations has infected millions of people in more than 150 countries - a scourge confronting all of humanity, impacting lifestyles, businesses, economies, and the assumption of common well- being. Recurring waves of infections surpassing its earlier peaks have triggered element of uncertainty in many countries shadowing the already bleak prospects of economic recovery around the globe.

Elevated inflation is expected to persist for longer than envisioned, with ongoing supply chain disruptions and high energy prices continuing in 2022. Assuming inflation expectations stay well anchored, inflation should gradually decrease as supply-demand imbalances wane in 2022 and monetary policy in major economies responds. Risks to the global baseline are tilted to the downside. The emergence of new COVID-19 variants could prolong the pandemic and induce renewed economic disruptions. Moreover, supply chain disruptions, energy price volatility, and localized wage pressures mean uncertainty around inflation and policy paths is high. As advanced economies lift policy rates, risks to financial stability and emerging market and developing economies’ capital flows, currencies, and fiscal positions—especially with debt levels having increased significantly in the past two years—may emerge. Other global risks may crystallize as geopolitical tensions remain high, and the ongoing climate emergency means that the probability of major natural disasters remains elevated. With the pandemic continuing to maintain its grip, the emphasis on an effective global health strategy is more salient than ever. Worldwide access to vaccines, tests, and treatments is essential to reduce the risk of further dangerous COVID-19 variants. This requires increased production of supplies, as well as better in-country delivery systems and fairer international distribution. Monetary policy in many countries will need to continue on a tightening path to curb inflation pressures, while fiscal policy—operating with more limited space than earlier in the pandemic—will need to prioritize health and social spending while focusing support on the worst affected. In this context, international cooperation will be essential to preserve access to liquidity and expedite orderly debt restructurings where needed. Investing in climate policies remains imperative to reduce the risk of catastrophic climate change.

Even before the onset of this pandemic, the global economy was confronting turbulence on account of disruptions in trade flows and attenuated growth. The situation has now been aggravated by the demand, supply and liquidity shocks that COVID-19 has in icted. Once the pandemic is controlled, the shape and speed of the recovery in the US and China will be key factors determining the nature and traction of global economic recovery.

While your Company has been focusing in India and the rest of world on securing the population from health hazards and on providing relief, especially to the poor, we also need to think long-term - to secure the health of the economy, the viability of businesses, and the livelihoods of people. Apart from providing robust safety nets for the vulnerable, ensuring job continuity and job creation is the key. Also there is an urgent need to mobilize resources to stimulate the economies.

Given the events of economic activity halts and lockdowns in many parts across the globe has created shock both on demand side and Supply side and led to imbalances in almost each and every corner which has a huge cost associated with it and the biggest challenge is to ensure that economies get back on track and operations resume normally while keeping a robust check and slew of measures to prevent relapses of new waves of COVID-19 infections. Ensuring more than adequate supplies of effective vaccines and covering masses through vaccination drives is perhaps the biggest challenge in the time to come which would require collaborated efforts from Pharma sector on one side who would provide the R&D, manufacturing infrastructure on one hand while governments would need to co-ordinate and set the platforms to ensure deliveries.

It would not be wrong to mention that customer expectations are rising and scientific productivity is lackluster and stagnant which poses bigger challenge as to how the mismatch would be addressed. There is dire need of developing and researching new medicines that can cure or prevent incurable complex diseases of the future. The ongoing pandemic is a perfect example of how unpreparedness for the worst could be disastrous in today’s world. In the back drop of all the challenges and ongoing issues, there are seven ways in which the business landscape will shift, not only in India, but the world around. Leveraging these will certainly help navigate the economically and socially viable path to the next normal:

1) Continuous Innovations and think beyond the unexpected.

2) Shift towards localization.

3) Push of Digital wave.

4) Cash being new king for Businesses.

5) Shift towards variable cost models.

6) Supply Chain resilience.

7) Building agility.

Apart from the above, evolving cGMP regulations have become stringent and the industry is striving unanimously to create world class capabilities to adhere to the mandates. Corrective measures for US FDA clearance are still in process with significant automation, technology upgrades and rollout of best practices at the manufacturing facilities. Your Company is monitoring the situation closely and is working with best of class consultants for resolution. Risk of regulatory quality compliance shall continue to remain critical for your Company in future. Pricing pressures in India continue to impact several organizations with latest NPPA circulars to include many critical drugs under the scope of price fixation / reduction. This has impacted the earnings of many Indian companies including yours. Amidst such challenges the Company has put remediation measures in place while ensuring growth and strengthening of its other business which consists of new product portfolio, new revenue streams and better brand management. Your Company is a global player and is not insulated against such external risks despite wide range of measures being taken. This has also to some extent impacted the earnings w.r.t. to countries where your Company operates in the home currency of these nations or where it is exposed to international transactions. This inherent risk will continue to pose challenges to a Company like yours that has a significant share of revenues from cross border operations.

New Drug Discovery Programme of Wockhardt

Your Company continues to focus on New Drug Discovery Program to bring novel antibiotics to market for catering to unmet needs in the area of resistant Gram-positive and Gram-negative infections where there is dearth of medicine across the world.

With the global rise in the prevalence of resistant strains, and the emergence of newer resistance mechanisms as well as new pathogenic organisms, where the existing antibiotics are having little impact, the overall infectious disease scenario is highly concerning. This is further buttressed by a recent publication in reputed journal the Lancet which estimated the annual global mortality touching to 4.95 million due to antibiotic resistant infections. The Company with its array of drugs under development in this space aims to counter these diseases in both regulated and unregulated markets.

Current status of QIDP products: Spurring Clinical development of NCEs in different territories:

WCK 5222: An abridged Phase 3 global study protocol finalized in consultation with US FDA EMA and Chinese FDA (NMPA). The study which was expected to commence in second half of 2020 could not be initiated due to COVID-19 pandemic. With pandemic in most part of the world showing receding trend, the study is expected to start in the second half of 2022.

WCK 4282: A leading global infectious disease expert opined in 2021 that WCK 4282 has genuine potential to be workhorse antibiotic as a superior replacement to ceftriaxone and piperacillin-tazobactam. After the start of WCK 5222 study, Phase 3 study for WCK 4282 is estimated to commence in December 2022.

WCK 4873: The Phase 3 Study recommenced in February 2022 following the availability of clinical sites previously occupied by COVID patients.

WCK 771 & WCK 2349: Since their launch, both Emrok & Emrok O have been gaining wider clinical acceptability by virtue of them addressing unmet need in the management of serious Gram-positive infections with about 20,000 patients already treated with these novel drugs.

WCK 6777: World’s most prestigious and the largest bio-medical research organization, the National Institutes of Health (NIH, USA) has recognized the clinical significance of WCK 6777 and accordingly selected for the conduct of Phase 1 study. The study will be undertaken at NIH’s Phase 1 clinical trial unit in consultation with two top notch US infectious disease experts Dr Robert Bonomo and Dr Thomas Lodise.

Your Company has strong focus in developing intellectual property and filed 41 patents during the year under review. During the year, 40 patents were granted of which 36 patents were for NCEs. Thus, year after year an impressive success rate for the grant of NCE patents is maintained. As on 31st March, 2022, combined pool of Company’s patent has reached 3,228 filings and 803 grants.

Biotechnology Research of the Company

Development of Biosimilars and Biobetters is our Biotech R&D team’s primary focus area. Biotechnology is viewed by global experts as the pharmaceutical technology of the future, and we have a very strong commitment to this field. Our highly accomplished multidisciplinary team of committed biotechnologists, biochemists, biophysicists, biochemical and chemical engineers as well as protein chemists are poised to develop biological drugs to address unmet clinical needs. Biotechnology R&D team of the Company has succeeded in developing and commercializing Recombinant Hepatitis-B Vaccine (Biovac-B), Recombinant Human Erythropoietin (WEPOX), Recombinant Human Insulin (WOSULIN), Recombinant Insulin Glargine (GLARITUS), which have all been well received in the market.

Your Company has a robust pipeline of recombinant therapeutic proteins for major healthcare needs. Out of these, Recombinant Interferon Alfa 2b and PEGylated G-CSF have already been approved for manufacturing and marketing in India. The overall focus is development and commercialization of antidiabetic Biosimilar products. Other products at different stages of development are: Recombinant Insulin analogues (Insulin Aspart, Insulin Lispro), Recombinant Darbepoetin, GLP-1 agonists etc. Pharmacokinetic and Pharmacodynamic (PK/PD) study for Insulin Aspart has been initiated and is estimated to be completed in FY22-23. E. coli based platform technology for Insulin has started displaying its potential, as revealed by the scale up studies in Project E, promising more than 24 Kg/batch in Project C and a capacity of ~3 tons/year in the existing plant and with DSP up-gradation a capacity of >6 tons/annum is achievable. The platform technology offers opportunity with surmountable challenge to replicate the same for other insulin analogues. E. coli based platform technology for Insulin Aspart has also been successfully scaled up in project E.


Insulin for insulin resistant/higher BMI diabetic patients:

In-house developed Biobetter Recombinant Human Insulin (200IU/mL): Consegna R and Consegna 30/70, have already been launched in India. With 50% volume reduction per dose, Consegna which promises reduced pain and better compliance has been well received in the market.

Biotechnology team is also developing other Biobetter drugs like combination of insulin and insulin analogues; insulin/insulin analogues and GLP-1 agonist for addressing the patients’ needs, particularly of insulin resistant/higher BMI diabetic patients. Preclinical study for one of the Insulin/Insulin Analogue biobetter drug products is planned to be initiated in 2022.


During the covid-19 pandemic, your Company successfully transferred non-replicating viral vector based covid-19 vaccine technology and carried out process validation at manufacturing facility. The Company also successfully obtained the necessary regulatory approvals for manufacturing and export of the Covid-19 vaccine.


The Company’s long term outlook continues to be promising given the following: a. Overall growth in the global pharmaceutical industry b. Continued focus on R&D in regards to its complex generic, bio technology and NCE programs. c. Company’s global reach in regulated market and continued efforts to enhance its reach in emerging markets. d. Increasing pipeline of niche & complex technology generic products. e. Expanding Revenue streams by adding New Partnerships and tie-ups to manufacture COVID-19 Vaccines.


The Company is exclusively into pharmaceutical business segment.


a) Interest coverage ratio (0.2) to 1.57 - Favorable
b) Operating profit margin (2%) to 9% - Favorable
c) Net profit margin 25% to (9%) - Adverse
d) Return on Net worth 18% to (7%) - Adverse
e) Debtors turnover ratio 2.51 to 3.52 - Favorable
f) Inventory Turnover ratio 1.51 to 1.61 - Favorable
g) Current Ratio 0.78 to 0.81 - Favorable

There was a positive movement in the ratios such as Interest coverage, Operating profit margin, Debtors turnover and Inventory turnover ratios, current ratio.


The Company has internal control procedures commensurate with its size and nature of the business. These business procedures strive to optimum use and protection of the resources and compliance to the policies and procedures. The internal control systems provide for well-defined policies, guidelines and authorizations and approval procedures. Internal audits are performed to test the adequacy and effectiveness of the internal controls laid down by management and to suggest improvements. Internal Financial Controls laid out by the Company in accordance with the requirement of the Companies Act, 2013, were tested by Management using a self-assessment Tool implemented with the assistance from M/s Ernst and Young.

The Company has adopted a co-sourced model for internal audit. The internal audit team is assisted by M/s. Ernst & Young who carried out internal audit reviews in accordance with the approved internal audit plan. Internal audit team reviews the status of implementation of internal audit recommendations. Summary of Critical observations, if any, and recommendations under implementation are reported at quarterly Audit Committee meetings.


During the year, your Company has transitioned to a "Risk Enabled Performance Management" with the help of Ernst & Young with an overall risk management practices across the organization integrated with business planning. The overall objective of the framework was:

• Assess the impact of changes that have occurred in the business landscape over the past one year including key events, revisit identified risks impacting the Company, include emerging risks such as those arising out of COVID 19 and remove redundant ones.

• Assess importance and implication of applicable risks and identify key risks requiring attention and monitoring by leadership team. Strengthen the risk culture of the organization by enhancing awareness and shared understanding of the purpose of risk management across Wockhardt.

• Review the risk management structure, risk policy and framework for periodic review of risk events and mitigation plans.

• Satisfactorily meet compliance obligations relating to risk management that are applicable to the Company.


Wockhardt’s global talent base, as on March 31st, 2022 stands at ~ 4000.

Wockhardt recognizes that Associates are the most valuable assets and always encourage them to meet business requirements while meeting their career aspirations. The Human Resource (HR) division mainly focus on supporting the business in achieving sustainable and responsible growth by building the right competencies and capabilities in the organization. It continues to emphasize on progressive Human Relations policies and building a high-performance ethos with a progressive mind-set where Associates are Empowered, Engaged, Efficient and Productive.

At Wockhardt, ‘Life Wins’ is a simple yet profound theme that defines our efforts, reflects our goals, highlights our aspirations and characterises our business.

Our ‘One Wockhardt’ motto creates a unique value driven, high performance and business driven work culture. At Wockhardt, HR plays a central role in implementing the organisation’s vision and strategy by aligning HR to the business. Better HR policies provide more innovative and forward looking HR focus and initiatives. Promoting diversity, learning environment and work-life balance establish a credible and integrated employee performance goal setting. We are very happy to share that Wockhardt has been adjudged as recipient of prestigious MAHARASHTRA STATE BEST EMPLOYER BRAND AWARDS 2021 as a Winner by World HRD Congress across Industries.

Our leadership values of Ownership, Respect, Trust, Integrity are the fundamental principles on which we have built our business. We truly believe that the progress of our associates and business are interlinked and thus created a work culture that offers a unique combination of our core values and functional pro ciency.

At Wockhardt, we believe that associates are the key players in business success and sustainable growth. In order to provide meaningful opportunities to our associates for learning and growth, we have strengthened our internal talent management pool by launching various career programs for our field associates, ‘Emerge’, ‘Surge’ and ‘Upsurge’ which provides career visibility to development to our sales force.

Using psychometric tests for senior level hiring has helped Company’s understanding of employees, potential strengths and particular characteristics.

The Companies "Whistle Blower Policy" encourages the Whistle Blower to report genuine concerns or grievances of illegal, unethical or inappropriate events (behaviour or practices) that affect Company’s interest / image. It also provides adequate safeguard to the Whistle Blower against victimization. The policy is available on the Company’s website at www.wockhardt.com