Dr Reddy's Q3 net rises 16 times

Dr Reddy's quarterly profit rose nearly 16 times over the year-ago period.

Dr Reddy's Laboratories Ltd said on Tuesday that its quarterly profit rose nearly 16 times over the year-ago period as the Indian drug maker bounced off a low base and saved on research costs.

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The Hyderabad-based company, India's only New York-listed drug maker, said net profit for the quarter to December, based on US accounting standards, was Rs 628 million ($14 million), compared with Rs 40 million a year earlier.

A Reuters poll of 10 analysts had projected the firm to post a net profit of Rs 462 million in the fiscal third quarter.

Dr Reddy's, an early Indian entrant into the US generics market, has been through a rough patch over the past three years. During that time, it's had no big drug launches to fill the hole caused when its exclusive rights to sell a version of Eli Lilly & Co's blockbuster Prozac anti-depressant ended in the financial year ending March 2002.

The company had been bogged down by high research-and-development costs for both its generic and new drug programmes. It entered into cost-sharing deals with venture capitalists last year in a bid to reduce its burden.

Dr Reddy's shares gained 15 per cent during the quarter, outperforming a 1.2 per cent rise in the healthcare index during the same period.