The fire broke out at Ranbaxy Laboratories' (RLL) Mohali factory in Punjab Wednesday evening after a powerful blast that killed two workers and injured 18 occurred. However, the fire is reported to have been brought under control, but the damage caused due to the fire has still not been assessed. The blast occured at the solvent recovery section of the facility.

The rest of the plant, in any case, is believed to be operating normally.

Analysts are of the opinion that the scrip has declined only in knee-jerk reaction. The bigger concerns for the market is that RLL has no major near term trigger by way of new developments and launches. Even so, RLL has strong fundamentals. But the company's significant exposure to stagnating therapy areas, limited flexibility in pricing and the increasing competition may put it under tremendous pressure.

Though the company has 33 pending approvals, no visibility is seen regarding the size of the pending molecules as well as over the time-frame of their approvals. Considering these factors, the growth of Ranbaxy looks limited in the current year, according to analysts.

Last week, the company reported that it will set up a research and development (R&D) facility in North America. RLL said the R&D facility is essentially being put in place to complement the company's strengths, particularly for carrying out phase-III clinical trials. However, it did not give further details.

Last month, RLL announced that it entered into an agreement with Medicines for Malaria Venture (MMV) Geneva for the development of the synthetic peroxide anti-malarial drug. Besides pharmaceutical and clinical development, RLL will have worldwide rights for the registration and commercialisation of the product. RLL's team of scientists will work in collaboration with scientists and researchers from the University of Nebraska Medical Centre, Monash University and the Swiss Tropical Institute in identifying a candidate for development.

Earlier, the export-focused Indian drug maker announced that it received tentative approval from the Food & Drug Administration, USA for manufacturing and marketing Fluconazole tablets, 50mg, 100 mg, 150mg and 200 mg, therapeutically equivalent to the reference listed drug Diflucan tablets of Pfizer Central Research.

Diflucan is indicated for the treatment of vaginal candidiasis, oropharyngeal and esophageal candidiasis and cryptococcal meningitis.

Recently, RLL had secured a tentative approval from the US FDA to market a generic form of Bristol-Myers Squibb's anti-depressant Serzone (Nefazodone Hydrocholride tablets) in 50 mg, 100 mg, 150 mg, 200 mg and 250 mg dosages.

There were also recent reports that RLL had received approval to market Flecainide Acetate Tablets USP, in 50 mg, 100 mg, and 150 mg strengths in the US. RLL's Flecainide Acetate tablets are bio-equivalent and, therefore, therapeutically equivalent to the listed drug, Tambocor™ tablets, of 3M Pharmaceuticals, Inc.

The recent wins follow a string of approvals in the US, boosting the company's stature as the No. 1 Indian drug exporter to the U.S. and other markets . The company had earlier got permission to market Cefadroxil powder for oral suspension USP in 125 mg /5 ml, 250 mg/5 ml and 500 mg/5 ml strengths. In mid-March 2003, RLL got clearance to market Amoxicillin and Clavulanate Potassium for oral suspension, which is indicated for the treatment of infections caused by susceptible strains of the designated organisms in conditions like lower respiratory tract infections, otitis media, sinusitis, skin and skin structure infections, and urinary tract infections.

RLL has been aggressively pursuing the US generics market. The American operations accounted for 44% of its turnover in 2002. This is expected to rise to 47% by 2004 and 49% by 2005. The contribution from the European operations is expected to remain steady at 23%. However, in the US, generic products are witnessing tremendous price erosion and competition.

At an analysts meet held on 21 January 2003, RLL had said that it will continue to push its key generics business, but it also plans to diversify into the speciality segment in the medium term and new drug research in the long term.

In new drug discovery research, the pharma major has decided to focus on the urology, anti-infective and pulmonary segments.

For Q1 ended 31 March 2003, on a standalone basis, Ranbaxy registered a massive 195% rise in net profit to Rs 279.8 crore compared to Rs 94.9 crore in the corresponding period in the previous year. Net sales increased by 94% to Rs 1,024.9 crore from Rs 528.9 crore.