Pharmaniaga foresees better performance with Sinovac supplies


PHARMANIAGA Bhd remains cautiously optimistic for its second quarter ending June, 2021 (2Q21), and expects to post better performance by focusing on operational efficiencies and fiscal discipline throughout its value chain.

In an virtual media conference last Friday, Pharmaniaga group MD Datuk Zulkarnain Md Eusope said this will be backed by the company’s progress on the supply and distribution of Covid-19 vaccines in the country.

Zulkarnain said early this year, the company signed an agreement with Sinovac Biotech Ltd to import and to fill-and-finish Sinovac vaccine which is being carried out by Pharmaniaga’s wholly owned subsidiary Pharmaniaga LifeScience Sdn Bhd (PLSB).

To date, the company is expected to receive some 10 million doses of the Sinovac vaccine from China while a total of 12 million doses will be locally bottled by PLSB.

Last Thursday, Coordinating Minister of the National Covid-19 Immunisation Programme (NCIP) Khairy Jamaluddin Abu Bakar said within the next two months, the pharmaceutical company would be able to supply a total of 12 million doses of Sinovac of which 6.9 million will be flown from China to speed up the NCIP programme’s progress.

Zulkarnain added the company has received strong demand from private parties in purchasing the vaccine, including state governments. The price of each vaccine is yet to be determined, he said.

“Upon completion of our obligation to the (federal) government, we can start offering the Sinovac Covid-19 vaccine to the private sector.

“We expect to supply to the state governments and private sector by the third week or the fourth week of June, depending on the current obligations and requests from the government,” Zulkarnain said at the briefing on its 2Q21 results.

Recent reports stated the World Health Organisation would approve the Sinovac Covid-19 vaccine by next month, hence, increasing orders from other nations.

Zulkarnain said Pharmaniaga had made the initial booking of 10 million doses of the vaccine to avoid delays in delivery.

Pharmaniaga posted a 3.3% year-on-year (YoY) rise in net profit to RM23.14 million for 1Q21 on the back of lower finance costs. Earnings per share increased to 8.84 sen from 8.57 sen.

Despite the rise in earnings, Pharmaniaga’s revenue fell 3.22% YoY to RM793.5 million due to lower demand at its Indonesian business amid the Covid-19 pandemic.

“This was mainly attributable to the ongoing Covid-19 pandemic, which saw the company registering lower Ebitda of RM45 million,” the company stated in its recent exchange filing.

Pharmaniaga Bhd CFO Norai’ni Mohamed Ali attributed the lower earnings to the Indonesian government’s move imposing stringent control measures from the second half of 2019.

“Looking at the current economic situation in Indonesia, there is no doubt there would be an impact in terms of our performance in the country.

“Having said that, the various internal control measures being put in place can mitigate whatever economic problem that has impacted our Indonesia operation,” she added.

Moving forward, Zulkarnain said Pharmaniaga is looking for a stable income and expects to be a financially profitable year.

Zulkarnain also revealed that China Food and Drug Administration has approved the manufacturing of two-dose per vial Sinovac vaccine and it is now waiting for documents from the manufacturer before submitting them to the National Pharmaceutical Regulatory Agency.

Once approved, he said PLSB will be able to ramp up production from two million to four million doses a month.

Pharmaniaga’s long-term sustainable growth strategy includes plans to accelerate the growth of its vaccine manufacturing business by embarking on a halal vaccine project, which is targeted for completion by 2024.

Pharmaniaga rose 5.64% or 27 sen to RM5.06 last Friday, valuing the company at RM1.32 billion.