Record results buoy Aceto
operating income in the year ended 30 June, helped by its recent
entry into the market for biopharmaceuticals.
In the fourth quarter, sales grew 12 per cent to $77 million, while operating income rose by 28 per cent to $3 million. Full-year revenues were up 10 per cent to $298 million, with operating income reaching $16 million, a rise of 24 per cent.
The company's health sciences division, which mainly comprises pharmaceutical intermediates and active pharmaceutical ingredient (API) supply, was bolstered at the end of last year with the acquisition of Switzerland's Pharma Waldhof from Roche.
Pharma Waldhof's primary business was the distribution of biopharmaceuticals, an area in which Aceto makes no secret of its ambitions, particularly with regard to the possible emergence of a regulatory route to approval of generic versions of established biological drugs.
Some of the biggest-selling biological drugs developed during the first phase of the biotechnology revolution in the 1980s - including human growth hormone (hGH) and insulin - are set to lose patent protection in the US in 2005 and beyond. This opens up a market currently worth $30 billion and growing at 10 per cent a year - but only if a regulatory route to market can be teased out.
While the market for biogenerics in the US and Europe still require resolution of regulatory issues, Aceto plans to start its first 'bioingredient' supplies within 18 months in other territories.
Meanwhile, in the chemical pharmaceutical arena, Aceto has opened an office in Poland to focus on approved APIs to the 10 accession companies that recently joined the European Union. Sales have just started to be generated through this initiative, said Leonard Schwartz, Aceto's CEO.
According to Schwartz, "2004 was Aceto's best year in the company's history, with sales, gross profit, net income and EPS all reaching record levels."
He noted that other significant developments in the last fiscal year at the company included the formation of a joint venture with Nufarm in agrochemicals.
In 2005, Aceto will be focused on organic growth in each of its business segments, namely, launching new APIs and nutritionals in the Health Sciences segment, expanding worldwide sales in the Chemicals & Colorants group, and further developing the Agrochemicals segment by acquiring new products for distribution and intellectual property, continued Schwartz.
In addition, the company said it is continuing to strengthen its sourcing operations in China and India, described as the 'backbone' of the business.
