The British Virgin Islands-based Khatibi is a limited holding company organized by the Zuellig Group to hold the Class B shares of Interphil.
In a disclosure to the Philippine Stock Exchange, Interphil said it needs to expand volume and reduce costs and expenses in order to make it more profitable.
With the acquisition, Khatibi will undertake the restructuring and rationalization of Interphil’s business, including the expansion of its activities into the area of generic pharmaceutical products manufacturing. These activities are designed to allow Interphil greater possibility of achieving a turnaround to profitability.
Interphil is the largest and most modern pharmaceutical toll manufacturer in the Philippines and probably in Asia today. Patronized by more than 50 transnational companies and producing over 1,000 different brands and forms, the company supplies more than 50 percent of the total pharmaceutical requirement of the entire country.
Based on financial statements filed with the PSE, Interphil incurred a net loss of P48.9 million at the end of the third quarter this year, P7.8 million of which refers to non-cash expenses. This is an increase of 61 percent from the previous level’s P126.5 million, mainly due to cost reduction measures coupled with aggressive price increases.
Income from sales and services went up seven percent to P1.5 million while production volume declined 12 percent due to the drop in clients’ demand.
Interphil said client volume remained soft but this has been compensated by the increase in prices and continuous shift of production towards high value products.
At the same time, the company is expanding regionally by tapping existing multinational corporations and encouraging them to source their products from Interphil to supply regional counterparts.
The company generated additional revenue through aggressive pricing negotiations with clients and the new pricing scheme that started in December 2004 and from the auxiliary services rendered for clients including annual product review, product risk management and supplier management requirements.