KUALA LUMPUR: Duopharma Biotech Bhd
will resume mergers and acquisitions (M&A) opportunities particularly inside ASEAN to remain relevant over the long run and develop.
Group managing director Leonard Ariff Abdul Shatar stated the corporate has been comparatively profitable in penetrating the Malaysian market with a market share of seven per cent regardless of being the biggest producer.
“The market is very fragmented in Malaysia and there’s a restrict in what you’ll be able to obtain on this market. To develop over a long run, it couldn’t simply be natural, therefore we wanted to take a look at M&A.
“For the two-year interval through the Movement Control Order (MCO) interval, we really suspended worldwide corporations as we aren’t comfy doing due diligence on-line, and targeted on the home sector.
“But this 12 months, we’re beginning to look internationally, significantly the ASEAN market, for potential acquisition targets,” he advised reporters after the corporate’s annual basic assembly right here in the present day.
Apart from the expansion limitation within the Malaysian market, the corporate can be balancing its portfolio to have the next proportion of its gross sales denominated outdoors of the Malaysian foreign money, stated Leonard Ariff.
Currently of the corporate’s whole share for enterprise, about 43 per cent is contributed by the federal government sector, an extra 47 per cent from the non-public and the stability is from export, he stated.
“So we do need to enhance the worldwide element of it and it is going to be within the healthcare area which is definitely fairly broad,” he added.
He stated the corporate had lately invested in a neighborhood startup known as Naluri Hidup Sdn Bhd in its digitalisation effort and as a part of its Digital Health Strategy, crafted to determine opportunities that may enable the corporate to present one of the best resolution alongside the healthcare worth chains.
“One factor that the pandemic confirmed us is that e-commerce is one thing that’s not going to go away and we want to discover out the place Duopharma will ultimately match within the ecosystem of the phase,” he stated.
Leonard Ariff shared that the corporate has fairly a big publicity to the federal government sector through a number of tenders and among the many massive ones is for the Approved Product Purchase List (APPL) generic drugs resembling paracetamol, cough syrup and insulin, which constituted 40 per cent of presidency gross sales.
“The final time the federal government tendered for it was in 2017, since then it has really rolled over the tenders with the present rollover expiring on the finish of December this 12 months.
“To renew, I believe there can be challenges from inflation for certain. When we final tendered for this enterprise, the change charge was circa 4.20 towards the US greenback however in the present day’s change charge is round 4.40 towards the buck,” he stated.
However, he highlighted that the influence of importing inflation is just not particular for Duopharma however an trade phenomenon, which occurred to these concerned in a buying and selling surroundings the place the vast majority of uncooked supplies are denominated in US greenback.
To mitigate the influence of the rising price of uncooked supplies, he stated that’s one cause why the corporate is focusing to have a bigger proportion of export gross sales in its general portfolio to act as a pure hedge towards the shopping for of uncooked supplies within the US greenback.
He added that Duopharma additionally retains a excessive inventory of uncooked supplies, from three to six months, relying on the merchandise by shopping for ahead fairly a good bit, particularly through the MCO amid considerations over the provision chain influence popping out of the pandemic. – Bernama
