APIs brought in £216m ($329m) for Johnson Matthey in the 12 months ended March 31, which was an increase of 3% on the 2014 fiscal year.
The firm attributed the growth to steady sales of APIs for attention deficit hyperactivity disorder (ADHD) treatment - products like methylphenidate – explaining that demand for the actives was “broadly in line with last year.”
This contrasted with its bulk opiates business – which produces APIs like codeine, morphine and dihydrocodeine - demand for which was lower in Europe.
The firm said: “Sales of bulk opiates in Europe were down this year as one of our customers relocated production outside of the controlled UK market in which we operate” but did not name the pharmaceutical company involved.
Revenue from specialty opiates was also down due to “increased competition from generic manufacturers for an API used in pain relief medication.”
Overall, sales from Johnson Matthey’s fine chemicals business – which includes its API, catalysis and research chemicals units – increased 1% to £370m.
Johnson Matthey also confirmed it is in advanced talks to sell its research chemicals business – which operates as Alfa Aesar – adding that the sale is expected to complete before the end of the calendar year.
Despite lower European demand and generic competition, Johnson Matthey is confident revenue from its API business will grow over the next 12 months.
The firm said: “Global drivers,such as an ageing population and a shift towards lower cost healthcare, should drive demand from our API customers and longer term we expect to see increasing benefit from the investments we are making toenhance our product offering.”
Johnson Matthey’s investments include the API plant in Scotland that it bought at the end of 2014. The firm said the plant will support its drug actives business in Europe and predicted that site will be operational by mid-2016.
It also outlined plans to focus on more complex, small volume API supply deals and said it is working to formulate and develop new generic products.