Boston Properties
Annual Report 2005

Plain-text annual report

Beximco Pharma is a leading edge pharmaceutical company based in Dhaka, Bangladesh, and is acclaimed for its outstanding product quality, world-class manufacturing facilities, product devel- opment capabilities and outstanding professional services. Our mission Each of our activities must benefit and add value to the common wealth of our society. We firmly believe that, in the final analysis we are accountable to each of the con- stituents with whom we interact, namely: our employees, our customers, our business associates, our fellow citizens and our share- holders. Key Data Figures in Million Taka Net Sales Domestic Export Gross Profit Net Profit Net Profit on Sales (%) 2005 2004 % Change 3,327.02 3,238.16 88.86 2,402.70 2,323.21 79.49 1,558.50 489.26 14.71 1,023.77 329.38 13.71 38.47 39.38 11.79 52.23 48.54 7.27 26.41 41.04 11.57 35.03 Total Assets (Gross) Total Equity Equity Ratio Earnings per Share (Taka) 10,945.48 6,820.93 62.32 6.36 8,658.50 4,836.01 55.85 4.71 Year of Establishment: 1976 Commercial Production: 1980 Status: Public Limited Company Business Lines: Manufacturing and marketing of pharmaceutical Finished Formulation Products, Large Volume Parenterals and Active Pharmaceutical Ingredients (APIs) Overseas Offices & Associates: UK, USA, Pakistan, Myanmar, Singapore, Kenya, Yemen, Nepal, Vietnam, Cambodia and Sri Lanka Current Export Markets : Cambodia, Kenya, Mozambique, Myanmar, Nepal, Pakistan, Philippines, Singapore, Sri Lanka, Vietnam and Yemen Authorized Capital (Taka): 2,000 million Paid-up Capital (Taka): 959.22 million Number of Shareholders: Over 50,000 Stock Exchange Listings: Dhaka, Chittagong and London Stock Exchanges Number of Employees: 1,981 Operational Highlights Products 49 products launched across a range of therapeutic classes 55 new products registered in export markets Sri Lanka has become a new export market Corporate Successfully integrated Beximco Infusions Limited Successfully raised £12 million and admitted GDRs to trading on AIM in October 2005 Completed construction of new Oral Solid Dosage (OSD) plant built to USFDA standards and two out of five new OSD lines are currently being installed Commenced conversion of Metered Dose Inhaler (MDI) plant to manufacture HFA based MDI. Conversion is scheduled to be completed during Q3 2006 Financial* Net Sales increased by 38% to Tk.3,327.02 million (20% increase on a pro-forma basis) Profit before tax** increased by 37.9% to Tk.509.6 million (21.4% increase on a pro-forma basis) EPS increased by 35% to Tk. 6.36 Declared cash dividend of 15% par value (representing Tk.1.5 per share) * Financial figures on a pro-forma basis include the result of Beximco Pharmaceuticals Limited and Beximco Infusions Limited which was effectively integrated into Beximco Pharmaceuticals Ltd. ** Profit before tax and contribution to Workers' Profit Participation Fund Post Year-End Highlights Introduced Oseflu® (Oseltamivir) to the Bangladesh market which aims to combat the growing threat of Bird Flu Launched 14 new products in the first quarter of 2006 Signed agreement with a world’s leading API manufacturer to set up an API plant in Bangladesh Commenced manufacturing of Penicillin API Management of the Company Board of Directors The Executive Committee The Management Committee A Brief History of the Company CEO speaks about the Company Highlights 2005 Special Feature: Life Made Easy Our Facility Going Global Corporate Communication Corporate Social Responsibility Twenty Ninth Annual General Meeting Extra-Ordinary General Meetings Value Added Statement Notice of the Thirtieth Annual General Meeting Chairman’s Statement Report of the Directors to the Shareholders Key Operating and Financial Data Corporate Governance Compliance Report Explanatory Statements on Corporate Governance Report of Auditors to the Shareholders Financial Statements Balance Sheet Profit and Loss Account Statement of Changes in Equity Cash Flow Statement Contents 2 4 6 7 8 10 18 26 42 58 70 72 80 81 82 83 84 88 91 92 93 95 96 96 97 98 99 Notes to the Financial Statements 100 2 Management of the Company Management of the Company 3 Beximco Pharmaceuticals Ltd. is man- aged by the Board of Directors, an Executive Committee and a Management Committee. Board of Directors is responsible for the corporate governance. The Executive Committee is account- able for both operational and financial performance of the company. This Committee is also responsible for budget approval, policy adoption or changes, new project review, compli- ance audit etc. The Management Committee reviews and manages day-to-day busi- ness operation and recommends strat- egy options to the Executive Committee. The Chief Executive Officer (CEO) is responsible for the overall manage- ment of the business. 4 Management of the Company B o a r d o f A S F Rahman Chairman Salman F Rahman Vice Chairman Mr. Sohail Rahman is the founder of the Company. He graduated with a degree in Physics from the University of Dhaka in 1966 and also studied in the United Kingdom. Throughout his career he has held positions in many companies, including Chairman of IFIC Bank Limited; Director of Industrial Promotion & Development Company; Director of Arab Bangladesh Bank Limited; Director of Pubali Bank Limited and Director of the Investment Corporation of Bangladesh. He is currently a member of the Board of Governors of North South University Foundation, which is the first private sector University in Bangladesh. Mr. Salman Rahman, brother of Sohail Rahman, is also one of the founders of the Company. He graduated from Karachi University in 1971. Mr. Rahman has held a number of positions including: President of the Federation of Chamber of Commerce and Industries from 1994 to 1996; Chairman of the Bangladesh Enterprise Institute, a Bangladeshi institute for private sector advoca- cy and free market development; Chairman of the Board of Editors of "The Independent", an English daily newspaper in Bangladesh; Chairman of Abahoni Limited, a prominent sporting club in Bangladesh; President of SAARC Chamber of Commerce & Industry from 1996 to 1998; President of the Metropolitan Chamber of Commerce & Industry; President of the Bangladesh Textile Mills Association; and President of the Bangladesh Pharmaceutical Manufacturers Association. D i r e c t o r s 5 Iqbal Ahmed Director Mohammad Abul Qasem Director Osman Kaiser Chowdhury Director Dr. Abdul Alim Khan Director Abu Bakar Siddiqur Rahman Director Dr. Farida Huq Director Chowdhury Hafizur Rahman Director Faheemul Huq Director Ahsanul Karim Director 6 Management of the Company The Executive Committee The Executive Committee is headed by Mr. Osman Kaiser Chowdhury. Mr. Chowdhury has been with the Company for 14 years and holds senior positions within the Beximco group of companies. He is a member of the Institute of Chartered Accountants of England and Wales and a Fellow of the Institute of Chartered Accountants of Bangladesh. He has over 13 years' experience working abroad, including the United Kingdom. Osman Kaiser Chowdhury Member of the Board of Directors Chowdhury Hafizur Rahman Member of the Board of Directors Nazmul Hassan Chief Executive Officer Ali Nawaz Chief Financial Officer Afsar Uddin Ahmed Director, Commercial 7 The Management Committee The Management Committee is headed by Mr. Nazmul Hassan. Mr. Hassan graduated from the Department of Public Administration, University of Dhaka. He obtained an MBA degree from the Institute of Business Administration (IBA), University of Dhaka, with major in market- ing. In 1997 and 2000, he took training on ‘Medical Marketing Program’ from University of California Los Angeles, USA and ‘Changing Strategic Direction Program’ from Kellogg School of Management, Chicago, USA. He has also been the Secretary General of the Bangladesh Association of Pharmaceutical Industries for three consecutive terms, and has received several awards for his contribution to the pharmaceuticals sector, particularly in relation to exports and marketing. Mr. Hassan joined Beximco Pharma in 1987 and has held various positions in the company since that time. He also worked as a consultant for Commonwealth Secretariat in Geneva. He was appointed Chief Executive Officer of the company in 2003. Nazmul Hassan Chief Executive Officer Osman Kaiser Chowdhury Member of the Executive Committee and the Board of Directors Ali Nawaz Member of the Executive Committee Rabbur Reza Director, Marketing Lutfur Rahman Director, Works Afsar Uddin Ahmed Member of the Executive Committee Zakaria Seraj Chowdhury Director, Sales Mohd. Tahir Siddique General Manager, Quality Assurance A R M Zahidur Rahman General Manager, Production Jamal Ahmed Choudhury Senior Manager, Accounts & Finance 8 A brief history of the Company A brief history of the Company The history of pharmaceutical business of the company dates back to the early 70s, when it started to import, market and distribute medicines from world renowned companies like Upjohn Inc. of USA and Bayer AG of Germany. Since the very beginning, the company was highly successful in generating increased demand for its products which even- tually justified local production. Accordingly, a pharmaceutical manufacturing facility was designed and constructed in 1980 under the technical supervision of Upjohn Inc. of USA, to manufacture their products under license. Products made under license of Bayer AG of Germany followed. After its initial years of struggle, Beximco Pharma broke ground with the launching of its own products in 1983. This was the beginning of a company with a vision to go a long way. 9 1976 : Registration of the company 1980 : Started manufacturing and marketing of licensee products of Bayer AG of Germany and Upjohn Inc. of USA 1983 : Launching of BPL's own brands 1985 : Listing in the Dhaka Stock Exchange (DSE) as a Public Limited Company (PLC) 1990 : Commissioning of Basic Chemical (APIs) unit 1992 : Started export operation with Active Pharmaceutical Ingredients (APIs) 1993 : First export market operation with finished formulations 1996 : Introduction of Sustained Release Dosage form 1997 : Introduction of Suppository Dosage form; Commissioning of Metered Dose Inhaler (MDI) plant; Introduction of Metered Dose Nasal Spray 1998 : First pharmaceutical company of the country achieving 'National Export Trophy (Gold)' for 1994-95 1999 : UNICEF approval of BPL as an enlisted supplier 2000 : Agreement to manufacture Metered Dose Inhaler (MDI) for GlaxoSmithKline 2001 : Introduction of Small Volume Parenteral (SVP) products; establishment of Analgesic- Antiinflammatory bulk drug plant 2002 : Won the first prize of ICAB National Awards 2000 for 'Best Published Accounts and Reports' in Non-Financial Sector Category The first Bangladeshi company to supply pharmaceuticals to Raffles Hospital- the most prestigious hospital in Singapore 2003 : Received “National Export Trophy (Gold)” for consecutive 2 years (1998-99, 1999-2000) Won the Silver prize of ICAB National Awards 2003 for 'Best Published Accounts and Reports' in Non-Financial Sector Category Won a tender to supply Neoceptin R and Neofloxin to Raffles Hospital of Singapore for the whole year's consumption Introduced Anti-HIV drugs for the first time in Bangladesh Diversification into Anti-Cancer therapeutic class 2004 : Signed contract with Novartis to manufacture their liquid, cream, ointment and suppository products under “Toll Manufacturing” agreement Visit of Saudi delegates headed by Hon'ble Health Minister, Kingdom of Saudi Arabia 2005 : Merger of Beximco Infusions Ltd. with Beximco Pharmaceuticals Ltd. Admission to Alternative Investment Market (AIM) of London Stock Exchange (LSE) 10 CEO, Beximco Pharma CEO of Beximco Pharma speaks on capabili- ties of the company and future opportunities “Beximco Pharma has had an extremely good year in 2005 and the successful floatation on AIM has enabled us to progress our strategic plans. We have contin- ued our growth into 2006, and have already successfully launched a number of new prod- ucts; most significant is the introduction of our generic bird-flu drug, Oseflu® in the Bangladesh market. We believe, Beximco Pharma has a strong platform to continue to grow profitably both in domestic and international markets in the years to come.” 11 Beximco Pharma: 25 years in Healthcare business: A journey of excellence “Beximco Pharma has long enjoyed the reputation of being a leader in setting the trends in Bangladesh Pharmaceutical Industry. 25 years have passed since we started our own operation. In the last 25 years we have led the domestic Pharmaceutical market in several dimensions. Now we have undertaken further strategic expansions to position Beximco Pharma among the top players in the global generic pharmaceutical industry.” Distinguished operational capability In 1980 we were small in operation but big in dreams and passionate with our vision - building a healthier tomorrow where our fellow citizens will live longer, healthier and happier. Our activities have always been centered around developing core compe- tencies to deliver the best in the industry ensuring superior value and return to our customers. Consistently delivering high quality products “We don't have any doubt on the quality of your products, but tell me how this product is clinically superior to other molecules.” This is the recognition that our sales & marketing people receive most when they interact with our valued doctors. In 25 years of operation in healthcare business, the trust and reliability on our products has emerged as one of our core competencies. Today, the name “Beximco Pharma” has become synonymous with ‘trust’ and ‘reliability’. Quality is our relentless passion. Quality is ingrained in our values and in all that we do. Our business processes and practices are designed to achieve quality results that would meet the expectations of patients and physicians by getting the highest quality products, and of shareholders and stakeholders through achieving returns. Today, our Neoceptin-R and Napa are top two brands by value in Bangladesh Pharmaceutical Market. Other brands in various therapeutic categories like Azmasol, Bexitrol-F, Amdocal, Atova, Bextrum Gold, Neofloxin, and Omastin are also acclaimed by the doctors and patients both at home and abroad, due to consistent superior perform- ance. “We are the leader in domestic market to deliver the best when it comes to the quality of the prod- ucts. Adhering to the highest possi- ble standards to deliver the best quality products is one of the criti- cal success factors for Beximco Pharma.” 12 CEO, Beximco Pharma Professional Management Capability Beximco Pharma is the pioneer in implementing corporate governance to professionally run a company in Bangladesh. We believe that people invest their ideas and work in Beximco Pharma; so it is our responsibility to make it easier and convenient for them by providing an environment which fosters creativity, innovation, self-development and entrepreneurship. Our human capital comprises of over 900 young and highly motivated executives who reflect a diversity of background, experience and perspective. They have shown their skills to guide our company to achieve our business goal to transform this company into a truly international one. “Many of the pharmaceutical companies operating in Bangladesh are being led by people who had their first pro- fessional experience in Beximco Pharma.” 13 Adopting innovation in manufacturing process Capability to manufacture technology driven products Beximco Pharma has always been the pioneer in adopting innovative technologies that introduced both sophistication and scale in our business processes. Our focus on technology is intended to take our company to a standard which would match with other top global generic pharma companies. We have shown our capability in the past by installing our state-of-the-art MDI plant and IV fluid plant in collaboration with Pamasol, Switzerland and Pharmaplan, Germany, a sister concern of Fresenius AG, Germany. We also focus on improving manufacturing efficiency to meet the challenge of maintaining the bottom line of the business in an ever-changing competitive mar- ket place. “We are the pioneer in adopting innovative technologies in our operations.” 14 CEO, Beximco Pharma R&D capability in both formulation and API R&D is another area where we have already shown our capability and led the Bangladesh Pharmaceutical Market in both formulation R&D and API R&D. Our formulation R&D capability is proven not only by the con- sistent quality of our products but also by our ability to introduce hi-tech, specialized products and dosage forms. The reverse engineering capability of the R&D team has enabled us to introduce innovative new prod- ucts to serve the ailing people at home and abroad. We believe, the investment in R&D unit to enhance our capability to reverse engineer and manufacture APIs will ensure one of our major competitive edges in the coming years. We have also signed agreements for col- laborative research with leading international API manufacturers to strengthen our API pipeline in order to fully capitalize the WTO patent opportunity. 15 Sales & Marketing capability focused on brand building Our major strength is our sales and marketing team. Our marketing team is composed of innovative people from diverse discipline. Because of the innovative & creative approach adopted by our marketing team, we have been able to create many vibrant brands like Napa, Neoceptin-R, Amdocal, Neofloxin, Tycil, Omastin, Azmasol, Bexitrol-F, Atova, Bextrum Gold etc. Infact, the ability of our sales & marketing team to differentiate our brands even in a crowded generic market is our major competitive advantage. Experience in foreign markets Beximco Pharma always took the leading, proactive and pioneering role in exporting phar- maceuticals from Bangladesh. We are pioneer in exporting APIs, IV Fluids and hi-tech spe- cialized products. We are the first pharmaceutical company in Bangladesh to enter CIS countries. We are also pioneer to enter African markets. Beximco Pharma is the only phar- maceutical company in Bangladesh having its operation in Singapore - one of the most stringently regulated market in Asia. We are the only company in Bangladesh to supply medicines to Raffles Hospital and KK Women & Children Hospital of Singapore. Beximco Pharma is the only company in Bangladesh to receive highest national accolade -National Export Trophy (Gold) for record three times for its outstanding contribution to pharma- ceutical export. With our exposure, expertise and skills in overseas markets, we aim to further facilitate our market expansion strategies in coming years. 16 CEO, Beximco Pharma Well established partnership with world’s leading pharmaceutical companies Beximco Pharma has well established partnerships with some of world's leading pharmaceutical companies. We started our journey partnering with Bayer AG of Germany and Upjohn Inc. of USA. We have also part- nered with Roche of Switzerland and Pharma Italia Carlo Erba of Italy. Today, we contract manufacture world’s number one inhaler brand Ventolin for GlaxoSmithKline, and will soon commence to contract man- ufacture liquid, cream, ointment and suppository products for Novartis. On the other hand, we have out- sourced two of our injectable products from Sanofi Aventis. These partnerships with world’s leading phar- maceutical companies have enabled us to acquire expertise and skills of global standard. Future growth potential Domestic and existing export markets Our past and present performances clearly suggest that we have ample scope to grow even in the domestic as well as in our existing export markets. We have successfully continued our effort in registering products in the overseas markets despite the fact that we do not have the capacity at present. We would also like to explore all segments of the domestic market where our major competitors are presently enjoying free-hold due to our absence in those areas. Moreover, we have already identified some attractive niche markets where the investment is negligible as compared to its expected returns in terms of profitability. Once the new OSD plant is operational and we have the capacity, we are confident, we will be able to capitalize on these oppor- tunities and increase our market share in the domestic market as well as in other existing export markets. New export markets Each year patents on pharmaceutical products expire with annual sales worth billions of dollars. Datamonitor estimates that there are blockbuster drugs coming off-patent by 2007 which have sales in excess of US $82 billion. This will be one of the key factors which will help drive generic pharmaceutical growth over the next decade. We seek to position Beximco Pharma to take advantage of this growing generic market by regularly introducing new products in our existing and new markets. We believe our low manufacturing cost will pro- vide a competitive edge over our global competitors in any international generic pharmaceutical market. Infact, export of off-patented products in the developed and developing countries will probably remain as our single largest opportunity to grow exponentially. As per TRIPS guidelines, Bangladesh as an LDC is now legally allowed to reverse engineer, manufacture and sell generic versions of on-patent pharmaceutical products for domestic consumption as well as for export to other LDCs. The 50 LDC countries represent a large market for pharmaceutical products with a total popula- tion of over 700 million and with an increasing demand for quality healthcare. 17 Map showing Least Developed Countries(LDCs) Contract Manufacturing Cost of medication is becoming a major concern even in the developed countries. This particular issue coupled with severe price competition from the generic manufacturers has prompted a number of giant multinational companies to shift or outsource their production from developed to developing and less developed countries, because of huge cost advantage. It is believed that the world pharmaceutical market will continue to see more consolidation than ever across the entire value chain of the pharmaceu- tical business. Big companies will continue to look for suitable partners in their supply chain management in order to reduce their cost of production. Beximco Pharma has always operated like a ‘multinational’ in terms of professionalism and infrastructure so as to build the plat- form to become a global player. Management has adhered to international regulatory standards which is more preferable to our international partners. Today, we have already established ourselves as a reliable partner for a number of world’s leading pharmaceutical companies. These partnerships have given us expertise and know-how to contract manufacture products for reputed MNCs for the developed markets like UK, USA and Europe as soon as our new OSD plant gets certified by their respective agencies. Nazmul Hassan Chief Executive Officer 18 Highlights 2005 19 Highlights 2005 Strategic merger of Beximco Infusions Ltd. One of the major events that significantly con- tributed to the company's progress in 2005 was the successful merger of Beximco Infusions Ltd. with Beximco Pharmaceuticals Ltd. Both the companies belong to the Beximco group. Before merger with Beximco Pharmaceuticals Ltd. Beximco Infusions Ltd. was the leading local player in large volume Intravenous fluid (IV) market, supply- ing about 48% of country's total IV needs. This merger has provided synergies across the busi- ness - improved organisational capability, ensured ‘value for money’ by reducing cost & improving effi- ciency, and increased sales productivity resulting in increased shareholders’ return. 20 Highlights 2005 21 Beximco Pharma…thinking big, thinking impossible and making it happen!! Listing in AIM of London Stock Exchange October 21, 2005. The clock rang at 8:00 am and the honorable British Minister for Pension Reforms Mr. Stephen Timms pressed the electronic button at the London Stock Exchange (LSE) building and Beximco Pharma opened a new chapter in the corporate business history of Bangladesh by starting trading of its shares in the Alternative Investment Market (AIM) of London Stock Exchange. Beximco Pharma became the first and the only company from Bangladesh to get listed in the LSE. Commenting on this listing on that ceremonial opening the British Minister for Pension Reforms said, “It is a great day for London and it is a great day for Beximco as well as for Bangladesh”. The British government welcomes “this milestone event,” he added further. Addressing the ceremony Beximco Group Vice Chairman Salman F Rahman said that the entry of Beximco Pharma shares in the LSE would boost the confidence of the investors in the company. “It is a day of excitement and pride for us,” he said while expressing his reaction. 22 Highlights 2005 Aiming to build the most robust product portfolio in the market The company aims to build the most robust product port- folio in the domestic market. In 2005, forty nine (49) new products were launched in the domestic market. Some major new products are: Amdopril® (Amlodipine 2.5/5/10 mg and Benazepril 10/20 mg capsule) This product is a fixed-dose combination drug containing amlodipine and benazepril in a single capsule. It is used to treat high blood pressure when monotherapy with either agent fails to achieve goal blood pressure. In the world market, amlodipine/benazepril fixed-dose combination drug is marketed by Novartis under the brand name LotrelTM. Atralin® (Sertraline 50 mg tablet) Atralin® is indicated for the treatment of mixed anxiety and depression, major depressive illness, obsessive-compulsive disorder, post-traumatic stress disorder, panic disorder, social anxiety disorder and premenstrual dysphoric disorder. Sertraline is available from Pfizer under the brand name ZoloftTM in the US mar- ket and in the UK market under the brand name LustralTM. Cefida® (Cefdinir 300 mg capsule and 125 mg/5 ml suspension ) Cefida® is a third generation cephalosporin antibiotic. It has a broad spectrum bactericidal activity against a wide range of common pathogens, including beta lactamase producing strains. Cefida® is indicated for the treatment of communi- ty acquired pneumonia, acute exacerbation of chronic bronchitis, acute maxillary sinusitis, pharyngitis, tonsillitis, uncomplicated skin and skin structure infections. Cefdinir is available in the US market under the brand name OmnicefTM from Abbott Laboratories. 23 Iprasol® (Salbutamol 100 mcg & Ipratropium Bromide 20 mcg per actuation) Iprasol® is a combination inhaler of salbutamol & ipratropium bromide. Iprasol® provides the simultaneous release of ipratropium bromide and salbutamol allow- ing the synergistic efficacy on the muscarinic and beta-2 adrenergic receptors in the airways to cause bronchodilation which is superior to that provided by each single agent. This combination inhaler is patented and marketed by Boehringer Ingelheim under the brand name CombiventTM. Odrel® Plus (Clopidogrel 75 mg and Aspirin 75 mg tablet) Odrel® plus is indicated for the prevention of ischemic events, MI, stroke and car- diovascular death in patients with acute coronary syndrome and patients at high risk who need management by both aspirin and clopidogrel for strong antiplatelet activity. Pantobex® (Pantoprazole 20 mg & 40 mg delayed release tablet) Pantobex® contains pantoprazole in delayed release tablet form. Pantobex® is indicated in peptic and duodenal ulcer diseases, gastroesophageal reflux diseases (GERD) and ulcers induced by the long term therapy with NSAIDs. This molecule is an original research product of Wyeth and marketed by Wyeth in the US mar- ket under the brand name ProtonixTM. 24 Highlights 2005 Valcap® (Valsartan 80 mg & 160 mg capsule) Valcap® is a preparation of valsartan which is an angiotensin-ll receptor antago- nist. Valcap® is indicated in high blood pressure as monotherapy and with other antihypertensive agents as well. This molecule is available in the US and UK mar- ket from Novartis under the brand name DiovanTM . Vivis® (Antioxidants and minerals capsule) Vivis® capsule is indicated for age-related eye diseases. This is an advanced new antioxidant supplement formulated to provide nutritional support for the eye and to reduce the progression of age-related macular degeneration (AMD). Vomec® (Meclizine Hydrochloride 50 mg tablet) Vomec® is indicated for prevention and treatment of nausea, vomiting, motion sickness, radiation sickness and vertigo. The antiemetic and antivertigo action of Vomec® is sustained up to 24 hours. This drug is proved to be safe even in preg- nancy. Meclizine is marketed by Pfizer in the US market under the brand name AntivertTM . 25 Zolmit® (Zolmitriptan 2.5 mg tablet) Zolmit® is indicated for the treatment of acute migraine with or without aura in adults. Zolmitriptan is available in the US market under the brand name ZomigTM from AstraZeneca. Zybex® SR (Bupropion Hydrochloride 150 mg sustained release tablet) Zybex® SR is a preparation of bupropion hydrochloride. Zybex® SR is indicated for the short term treatment to help quit smoking provided patients take appropri- ate counseling. Zybex® SR reduces withdrawal symptoms and the urge to smoke. Bupropion hydrochloride is marketed as smoking cessation therapy under the brand name ZybanTM by GlaxoSmithKline. 26 Life Made Easy 27 Life Made Easy Life Made Easy Our activities contribute to the humanity in its quest for longer, healthier, and happier life. We produce and market 'branded generics' for almost all diseases from AIDS to cancer, from infection to asthma, from hypertension to diabetes, for both national and international markets. We make life easy when it is challenged. 28 Life Made Easy “Now I can stand before camera without any fear of getting out of breath” Ridhika 29 “Hello, I am Ridhika. I love playing with my friends at school. And I love to act in drama, advertisement and music videos. But, you know, I have asthma. My mother, who is also an actress, told me the story of the first few days of my brief career as an artist and how I was diagnosed with asthma. ‘You were then only 18 months old. I took you to the shooting spot and asked you to come and stand for a while before camera and smile. You were so smart! You did what you were asked to do. Some men then took your video though they had to try a couple of times for a good video. But, suddenly after the shoot- ing was complete, you started sneezing frequently with watery discharge through your nose. In your sec- ond day of shooting, you experienced the same symptoms and your symptoms worsened day by day. Then I took you to a doctor. We came to know that intense light during shooting caused the problem. The dust outside also aggravated the symptoms.’ Then I knew I had asthma. But, asthma could not control my life. My doctor says, ‘little kid…well done. You have full control on your asthma.’ I know how to control my asthma. I take Bexitrol®-F regularly twice a day. Sometimes I use Azmasol® also but very occasionally. So far, I have acted in 8 advertisement, 9 dramas and 2 music videos, all without getting out of breath. Thanks to those inhalers. They make it possible. Now, I have no fear of getting out of breath.” Bexitrol®-F The simple solution to ensure total control of asthma Bexitrol®-F is a combination inhaler containing fluticasone and salmeterol in a single can- ister. This ensures greater compliance to the patients because it reduces the number of inhalers used by the patients at a time. This is the fastest growing medicines in the global asthma and COPD market. Beximco Pharma has strong focus in this fast growing market with Bexitrol®-F. Bexitrol®-F is a prescription only medicine. Before relying on any statement to take a medicine, all should obtain relevant profes- sional and medical advice from a registered doctor. We do not advocate to take any medicine of your own decision. 30 Life Made Easy “Thanks to Beximco Pharma. They have made my inhalers available and accessible. Today, I find my inhalers even at my nearest drug store.” Dr. M. Mustafa Hussain 31 “I've had asthma for a very long time. I used to keep a blue inhaler all the time with me. But one day….Oh no! I just want to forget that day. I can still feel the shivers going down my spine. I suddenly got an asthma attack. I knew what I had to take but unfortunately my blue inhaler was out of drugs. I asked my friend to buy a blue inhaler immediately. He left at once but I kept waiting and waiting and my condition was fast deteriorating. After about an hour my friend came back with one blue inhaler, but it could do nothing to improve my condition. I was then hospitalized in the emergency department, and it took 3-4 hours to make me stable. I returned to my residence, and tried to sleep but I couldn't. I still remember that day. I had to go with these types of asthma attacks and fears of death until the inhalers were locally available and accessible. Today, there is nothing to worry about my asthma problem. I live normally as other non-asthmatics do. I take Azmasol® and Bexitrol®-F, the two best medicines available in Bangladesh, manufactured by Beximco Pharma. Thanks to Beximco Pharma. They make my inhalers affordable and accessible. Now, I find my inhalers even at my near- est drug store.” Azmasol® The number one asthma reliever brand in Bangladesh Beximco Pharma entered the Metered Dose Inhaler market with the landmark intro- duction of Azmasol® in 1997. Azmasol® is the short acting beta-2 agonist which is con- sidered to be the first line therapy in the treatment of asthma and COPD to get imme- diate relief. Today, Azmasol® is the number 1 asthma reliever brand in Bangladesh. Azmasol® is a prescription only medicine. Before relying on any statement to take a medicine, all should obtain relevant pro- fessional and medical advice from a registered doctor. We do not advocate to take any medicine of your own decision. 32 Life Made Easy Asthma is a global health problem; Bangladesh is not an exception Asthma is a serious global health problem. People of all ages in countries throughout the world are affected by this chronic air- way disorder that can be severe and sometimes fatal. The prevalence of asthma is increasing everywhere, especially among chil- dren. Asthma is a significant burden, not only in terms of healthcare costs but also of lost productivity and reduced participation in family and social life. According to the first National Asthma Prevalence Study in Bangladesh which was carried out in 1999, Dr. Mustafa was not alone suffering from asthma. The study predicted that there were approximately 7 million asthma patients including four million chil- dren during the study period. From 1999 to date, the population grew by 1.48% and number of asthma patients might be much more than it was in 1999. There are more children like Ridhika who are diagnosed with asthma or have come under asthma treat- ment. To help patients like Dr. Mustafa and Ridhika, Beximco Pharma launched the essential Metered Dose Inhalers (MDIs) for the first time in Bangladesh which required sophisticated technology and a significant investment. Worldwide Metered Dose Inhalers (MDIs) are considered the first line of treatment for asthma & COPD. MDIs form one of the most widely used pulmonary drug delivery technologies in the world, accounting for over 80% of drugs used. Before 1997, the supply of these essential MDIs were controlled by a single multinational company. Due to the very nature of monopoly business, millions of asthma patients had to suffer for not having their best asthma treatment affordable and accessi- ble. The launching of Beximco Pharma's MDIs is considered to be a huge leap forward in the treatment of asthma and COPD in Bangladesh making it affordable and accessible. Millions trust us. We are the leader in supplying essential MDIs in Bangladesh Since the commissioning of the MDI plant in 1997, Beximco Pharma has acquired over 8 years of excellence in manufacturing MDI products in Bangladesh and has emerged as one of the leading pharmaceutical companies in the asthma and COPD market in South Asia region with a broad portfolio of MDI products. The company's sophisticated manufacturing process maintaining global standard of quality has earned the trust of millions of asthma and COPD patients and their doctors. Currently Beximco Pharma supplies more than 52% of MDIs produced locally in Bangladesh. Besides meeting the local demand, Beximco Pharma is also exporting its MDI products to various regional markets such as Pakistan, Nepal, Myanmar and other markets principally in East Africa (including Kenya) and South East Asia (including Singapore). The Company also undertakes contract manufacturing for the leading reliever MDI brand of GlaxoSmithKline in Bangladesh, which meets about 23% of country's total MDI demand. That means, around 75% of total MDI demand of Bangladesh is met by our MDI plant. 33 Protecting the Environment Due to the potential risk to the environment posed by CFCs, the tech- nology shift in MDI industry is currently towards using hydrofluo- roalkane (HFA) as propellants. Considering this changing trend in pul- monary drug delivery technologies, the company has signed a collab- orative agreement with a leading developer of innovative drug deliv- ery technologies to develop the HFA based MDIs. This collaboration will ensure essential MDIs for millions of asthma and COPD patients in Bangladesh when there will be no CFC based MDIs available. A brief description on the MDI plant is given in ‘our facility’ chapter. 34 Life Made Easy “Napa® has become a part of our family. My wife, me and my daughter get excellent results with Napa®. Now, my new born granddaughter also takes Napa® considering its reliable safety profile. My family relies on Napa® in pain and fever. My close friends call my family a “Napa family”. Eng. Tajul Islam with his wife, daughter and granddaughter Napa® The #1 choice in pain & fever Napa® has gained millions of physicians’ trust and confidence and thereby became the number one selling brand by volume in the Bangladesh pharma market (according to IMS 4th Quarter, 2005). Napa® is highly effective in relieving pain and fever. It has an excellent safety and efficacy profile. Napa® is now available in 12 different forms. It is one of the most successful brands in this decade in Bangladesh. Napa® is a prescription only medicine. Before relying on any statement to take a medicine, all should obtain relevant professional and medical advice from a registered doctor. We do not advocate to take any medicine of your own decision. 35 “I have been using Neoceptin® R for around 20 years. Before trying Neoceptin® R, I took several antiulcerant brands but no drug gave me as good results as Neoceptin® R. I fully rely on this trusted antiulcerant brand.” Mr. Shamsul Huda Neoceptin® R The #1 brand in Bangladesh Pharmaceutical Market Neoceptin® R is the number 1 brand in the Bangladesh pharmaceu- tical market for more than a decade. The leadership continued in 2005 as well. This brand is an icon of Beximco Pharma's proven sales and marketing capability. Today, Neoceptin® R is the most tested and trusted antiulcerant brand in Bangladesh. It has gained millions of doctors’ and patients' trust and confidence in acid related disorders. Neoceptin® R is also exported to many countries across the conti- nents including the prestigious Raffles Hospital of Singapore for their whole year's consumption. Neoceptin® R is a prescription only medicine. Before relying on any statement to take a medicine, all should obtain relevant professional and medical advice from a registered doctor. We do not advocate to take any medicine of your own decision. 36 Life Made Easy “As a kid I missed my grandfather. He died before I was born. When my friends were playing, kidding with their grandfathers, I felt very lonely. Now, I am a doctor. I guess my grandfather died of stroke due to hypertension. My father is also suf- fering from hypertension. But, I make it sure that he takes Amdocal® regularly. I don't want my next generation to miss their grandfather. Thanks to Beximco Pharma. They have provided me with such a wonderful drug for my father who lives normally even with hypertension.” Dr. Md. Iqbal Hossain Amdocal® The #1 antihypertensive brand in Bangladesh Beximco Pharma launched the amlodipine molecule with the brand name Amdocal® in 1995. Over 10 years this brand has remained as the #1 antihypertensive brand in Bangladesh due to its outstanding efficacy, tolerability and safety. Amdocal® delivers precise control of both diastolic and systolic blood pressure. Amdocal® represents Beximco Pharma's strong presence in cardio- vascular market in Bangladesh. Amdocal® is a prescription only medicine. Before relying on any statement to take a medicine, all should obtain relevant professional and medical advice from a registered doctor. We do not advocate to take any medicine of your own decision. 37 “I suffered a major heart attack 4 years ago. Only then I came to know that my total cholesterol and LDL was very high. During discharge my doctor prescribed me Atova®. It worked like magic in reducing my cholesterol numbers. My total cho- lesterol reached below 150 and LDL below 100 in just three months time. I really believe your product has helped me. In the first few months after my heart attack, I had to restrain myself from taking my favorite dishes in social gathering. But now-a-days, I take my favorite dishes occasionally in ceremo- nial gatherings. My Atova® gave me this confidence.” R. A. M. Obaidul Muktadir Chowdhury Atova® The number one lipid lowering brand in Bangladesh Atova® (atorvastatin calcium) is used in patients with multiple risk factors for heart disease such as familial history, high blood pressure, age, low HDL or smoking to lower cholesterol and to reduce the risk of heart attack and stroke. It is also used in patients with type-2 dia- betes and at least one other risk factor for heart disease to reduce the risk of heart attack and stroke. Atorvastatin is the highest selling molecule in the world pharmaceutical market. Beximco Pharma's Atova® demonstrates growing presence in this generic market with millions of patients like Mr. Chowdhury having their trust on Atova®. Atova® is a prescription only medicine. Before relying on any statement to take a medicine, all should obtain relevant professional and medical advice from a registered doctor. We do not advocate to take any medicine of your own decision. 38 Life Made Easy “I have had diabetes for last 26 years. But, my diabetes could not keep me away from my daily activities….walking in the park early in the morning, taking breakfast as usual, shop- ping in the market, seeing my granddaughter walking one km away from my residence and so on. I live a normal life even with diabetes. Antidiabetic drug Diapro® made my life easy.” Dr. Moshtaque Ahmed Chowdhury Diapro® Diapro® (Gliclazide) is an oral blood glucose lowering drug. Diapro® is used to treat patients with type-2 diabetes mellitus or non-insulin dependent diabetes mellitus (NIDDM) when dietary modification fails. Type-2 diabetes mellitus is a condition in which the body does not make enough insulin or where the insulin that the body produces does not work as good as it should. Beximco Pharma has a strong focus in the oral antidiabetic market with wider product portfolio including Gliclazide, Glipizide, Glimepiride, and Metformin. Diapro® is a prescription only medicine. Before relying on any statement to take a medicine, all should obtain relevant professional and medical advice from a registered doctor. We do not advocate to take any medicine of your own decision. 39 “Now everything seems different to me - I had never had a major disease, even though no one would ever tell I was healthy. I could not participate in any outdoor games ever. But now - I am looking healthier, feeling healthier and even better - doing healthier. I am now more vibrant in both my professional and family life - exploring new dimensions, putting on extra pressure in the office and still be able to give some extra effort for my family. If it was not Bextrum® Gold, I would never know how much of life I was missing - Bextrum® Gold enabled me living a complete and healthy life. I feel great with Bextrum® Gold.” Mahbubul Arefin Shuvo Bextrum® Gold Bextrum® Gold is a special formulation comprising of high potency multivitamins and multiminerals. Each film-coated tablet contains 32 vitamins and minerals. Bextrum® Gold is indicated for all as a nutritional supplement. Bextrum® Gold has been manufactured employing hi-tech formulation engineering, sophisticated manufacturing machinery and state-of-the-art testing facilities to ensure the best outcome of therapy. Bextrum® Gold is a prescription only medicine. Before relying on any statement to take a medicine, all should obtain relevant professional and medical advice from a registered doctor. We do not advocate to take any medicine of your own decision. 40 Life Made Easy “As a child I saw my grandmother suffering from ankle pain - she could hardly move. In my youth I saw my mother suffering due to her bone loss, especially her knee. Now I am 35, and those symptoms of bone loss which I saw in my mother and grandmother are slowly beginning to surface with me. But this time, I am taking no chance - I am taking Aristocal® D regu- larly as advised by my doctor.” Mrs. Jasmin Khan Aristocal® D Vitamin D is as important as calcium for building good bones. Adequate supplementation of vita- min D significantly increases the absorption of calcium. Aristocal® D fulfills the demand of both calcium and vitamin D to ensure optimum bone health for the body. Aristocal® D is a prescription only medicine. Before relying on any statement to take a medicine, all should obtain relevant professional and medical advice from a registered doctor. We do not advocate to take any medicine of your own decision. 41 “I was a chain smoker and I had a chronic cough. It was so debilitating that I had to avoid my friends and relatives. I knew I had to quit smoking but I failed to quit after taking several attempts. Then I saw my doctor. My doctor advised me Zybex® SR. Zybex® SR came as a miracle cure to my addiction to smok- ing. I was able to quit smoking within 12 weeks time.” Md. Talha Bin Abaed Chowdhury Zybex® SR A simple solution to quit smoking Zybex® SR is a preparation of Bupropion Hydrochloride. It is a non- nicotine aid for smoking cessation and is the most prescribed smok- ing cessation therapy worldwide. Smoking may cause a number of diseases including cancer, heart diseases and COPD. Moreover, most diseased conditions including CVD, diabetes etc. are aggra- vated if the patients continue to smoke during the treatment peri- od which ultimately leads to treatment failure. Zybex® SR is a prescription only medicine. Before relying on any statement to take a medicine, all should obtain relevant professional and medical advice from a registered doctor. We do not advocate to take any medicine of your own decision. 42 Our facility 43 Our facility Our facility Highlights 2005 In 2005, we have completed the two lines of new OSD plant while 3 new lines are underway. Each line in this plant has the capacity to produce 1.8 billion tablets per annum, using only a single shift. We have also initiated the conversion of our CFC based MDI plant to manu- facture HFA MDIs with the technical collaboration of a Europe based lead- ing company in pulmonary drug deliv- ery technology market. Once the con- version work is completed we will be ready to enter developed markets with our MDI products. 44 Our facility Our manufacturing facilities are spread across a 20 acres site located in and around Dhaka, Bangladesh. They comprise of a num- ber of purpose built plants, including the new Oral Solid Dosage (OSD) plant. The land and buildings are wholly owned by the company and approximately 13 of the 20 acres of land are currently in use. The site includes facilities for manufacturing intra- venous fluids, liquids, creams, ointments, suppositories, metered dose inhalers, active pharmaceutical ingredients as well as the existing and new OSD plants for tablets and capsules, the research laboratory and a number of warehouses. The plant and machinery throughout the site has been designed, procured and installed by partners from Germany, Switzerland, Sweden, Italy and the United Kingdom, amongst others. The site has its own utility infrastructure to ensure the adequate generation and distribution of pure water at all times. The cur- rent installed electrical capacity is 4 MW and this will be increased to 8 MW soon. There are also water purifying and liquid nitro- gen generation facilities on site. The entire site is at least 10 meters above sea level and is approximately 250 kilometres from the nearest sea - the Bay of Bengal. 45 New OSD Plant Beximco Pharma has invested over US $ 50 million on this new Oral Solid Dosage (OSD) plant complying with guidelines of highly regulated markets (for example, USFDA, UKMHRA, TGA Australia etc.). This state-of-the-art facility incorporates modern technolog- ical advancements. The building of the plant was completed in 2005 and process equipment is now being procured from Germany, Switzerland and Italy for two OSD lines, which is expected to be operational in second half of 2006. The building finishes have been made to comply with our design standards which has been prepared with the global standards (e.g. non shedding materials, resistant to clean- ing agents, flush fitting etc.). Same is the case for HVAC system which has been installed to meet the global standards for air classification, air changes etc. The manufacturing and packaging facilities have been designed to minimize generation and maximize containment of dust particles using closed transfer system and clean in place facility. All practicable measures have been taken to ensure that members of the staff are not exposed to unacceptable concentrations of dust particles. Process area, cubicles, storage area have been connected to vacuum dust cleaning. The design of the plant ensures automated materials handling systems and multilevel designs to enable gravity feed between processing stages. The building design has also allowed maximum engineering maintenance access without entering into the production areas. Precise selection of equipment is also critical to improve process capability and ensure process robustness. A wide range of equipment has been procured from world renowned companies like Glatt, Romaco, Noack, Korsch and Nicomac. A state-of-the-art chemical laboratory and dedicated microbiological laboratory equipped with a wide range of equipment have been set up to facilitate the quality control activities. The major equipment include HPLCs, UV spectrophotometer, FTIR spectrophotometer, AA Spectrophotometer, Karl Fischer titrator etc. This plant provides greater capacity and a strong platform to launch Beximco Pharma’s products into highly regulated developed markets including Europe and the USA. 47 “In our ten years of experience in the consulting business in Pharmaceutical Industry, we could find only a few companies like Beximco Pharma with so much dedication to achieve a dream. The dream is to build a plant that would meet all the requirements for getting approved by USFDA, UKMHRA and TGA Australia. It has been a nice and wonderful experience for us to be a part of team “Beximco Pharma” in building this fabulous new OSD plant. We wish all the best to Beximco Pharma.” Dr. A. K. Singal Managing Director Pharmaplan (India) Ltd. 48 Our facility 49 Foreign nationals working in new OSD facility “We heard a lot about Beximco Pharma's multi million dollar investments in new OSD facility while working in Indian pharma- ceutical companies. We were then skeptical whether it could get the approval of USFDA, UKMHRA, EMEA or TGA Australia. Now, we are a part of the Beximco Pharma team in getting all the necessary formalities done to get the approval by USFDA, UKMHRA, EMEA and TGA Australia. From our experience in Indian pharmaceutical companies, and what we have observed so far in Beximco Pharma, we can say this new OSD plant incorporates much more than the manufacturing plants we worked for in India which are approved by such regulatory bodies. We are proud to be part of Beximco Pharma where people invest their ideas and capability in building a healthier tomorrow.” Subrata Kumar Bala Product Development Manager Pradip Devidas Chaudhari Manager, Validation Govind Doulatrao Bhagnure Executive Director, Quality Vasant Pandit Jagtap Head of Engineering Shashank Vyapari Head of Production 50 Our facility 51 “In last 25 years, Bangladesh has achieved a signifi- cant advancement in pharmaceutical industry. Once import dependent, today more than 95% of its demand is met by the local companies. Not only that, our capability to manufacture quality medicine is endorsed by our proven track record of exporting medicines in many countries across the continents. Now, I am sensing a new wave of development in Bangladesh Pharmaceutical Industry, the develop- ment which will take place in getting our manufac- turing plant in Bangladesh being approved by the regulatory bodies in the USA and Europe. Company like Beximco Pharma is one step ahead in this run with their new OSD plant incorporating modern technological advancements. I wish them the best.” Professor Dr. Md. Habibur Rahman Director, Directorate of Drug Administration, Ministry of Health and Family Welfare Government of the Peoples’ Republic of Bangladesh 52 Our facility 53 State-of-the-art MDI Plant The Metered Dose Inhaler (MDI) manufacturing plant of Beximco Pharma is one of the finest facilities in the world to produce MDI products. The plant was designed and installed under the technical collaboration of Pamasol, Switzerland. The facility has dedicated areas for dispensing, manufacturing, canister and valve cleaning, canister filling, quarantine storage area, spray testing, packaging, propellant storage and in process control. As the inhaler manufacturing operation requires stringent control of humidity and temperature, automatic monitoring equipment are in use to continuously record temperature and relative humidity in areas like dispensing room, suspension man- ufacturing room, filling room, quarantine room etc. The manufacturing equipment like manufacturing vessel, filling machine, weight checker, spray checking have been procured from Pamasol, Switzerland, a world renowned equip- ment supplier for Inhaler product manufacturing. The state-of-the-art Quality Control lab- oratory has been equipped with equipment like HPLC, Karl Fischer Titrator, Andersen Cascade Impactor etc. Our MDI facility is the only approved outsourced facility of GlaxoSmithKline for their Ventolin inhaler. We are happy to make our production and technical facilities open to inspection by existing and potential customers. Our MDI plant has been audited by many local and overseas auditors and was acclaimed by them. As the largest manufacturer of MDI products in Bangladesh, Beximco Pharma recognizes that its operations have an impact upon local and global environment. The company is committed to achieve corporate environmental goals. To comply with both national and international environmental legislations, it has already undertaken a large scale invest- ment program to convert its CFC based MDIs into HFA based MDIs which involves major changes in manufacturing lines, process control and packaging facility. 54 Our facility 55 IV Fluid Manufacturing Plant Beximco Pharma's IV fluid manufacturing plant may be regarded as one of the most technologically advanced plants in the world. The plant was designed and installed in collaboration with Pharmaplan of Germany, a sister concern of Fresenius AG of Germany. In designing the whole process, special care has been taken by providing absolute ster- ile manufacturing conditions. The prime feature of the process is that there is no human physical contact with the product at any given time. This has been ensured by way of a series of fully automated manufacturing procedures including robotics. The bottle pack aseptic system (Form-Fill-Seal or FFS) is a unique and innovative man- ufacturing technology. Plastic bottles are blow moulded, filled with the solution and sealed under sterile conditions, in a single working cycle where there is no environ- mental exposure or human contact during manufacturing. The IV fluids are presented in a scientifically designed bottle where there is an extra protective eurohead cap and a resealable rubber disk. The whole process is performed in a class 100 clean room. The air inside this room is cleaned upto 100 particles per cubic feet passing it through HEPA (High Efficiency Particulate Air) filters. Thus, an advanced sterile environment is maintained in manu- facturing the IV fluids in order to avoid the entry of bacteria, pyrogen and inert particles into products. This ensures the highest standards of quality and purity in order to ensure the highest level of safety. The plant is ISO 9001: 2000 certified. 56 Our facility 57 R&D: Investing for the secured future Research and Development (R&D) has been our core focus to transform our company into a truly international one. This is another area where we have already shown our capability. In proprietary research, we have collaborative research agreement with Ciba Specialty Chemicals of Switzerland for a joint research initiative. In formulation R&D, our Research and Development (R&D) team focus- es principally on developing new formulations, predominantly through reverse engineering techniques and on simplifying manufacturing processes and improving cost efficiency. Over the last few years, the team successfully developed a number of hi-tech formulations that include Ultrafen® Plus - a multi-layer formulation for relief from pain and inflammation, Pretin®-D - a 24-hour acting formulation for relief from allergic rhinitis with congestion, and Deflux® DT- a dispersible tablet for- mulation for prompt relief from nausea and vomiting. These formula- tions are now commercially available in Bangladesh following regulatory registrations. In addition, we are also developing a number of Active Pharmaceutical Ingredients (APIs) to ensure availability of raw materials across the range of therapeutic classes. Until now, Beximco Pharma is the only company in Bangladesh to man- ufacture anti-retroviral drugs complying with the WHO recommended treatment guidelines. More recently, we have added an anti-cancer prod- uct in our product portfolio. We also have over eight years of R&D and manufacturing experience in producing highly sophisticated Metered Dose Inhaler (MDI) products, including salbutamol (albuterol), beclomethasone, salmeterol, salme- terol plus fluticasone, budesonide, ipratropium, tiotropium inhalers and have emerged as one of the leading pharmaceutical companies in asth- ma & COPD market in South Asia region. The reverse engineering capability of the R&D team and the drive towards new product development and innovation are central to build- ing a proprietary research operation within Beximco Pharma. 58 Going Global 59 Going Global Going Global Highlights 2005 Sri Lanka has become a new export market in 2005 55 products are newly registered in various export markets 60 Going Global We are the largest exporter of pharmaceutical products from Bangladesh and received National Export Trophy (Gold), the highest national accolade for export, for record three times. We commenced international market operations with the export of Active Pharmaceutical Ingredients (APIs) to Hong Kong in 1992 and finished formulation products in 1993. We first exported intravenous fluids in 1995 to Russia and Vietnam. Beximco Pharma is the only pharmaceutical company in Bangladesh having its operation in Singapore. Along with selling products to regular retail outlets, we also supply products to renowned hos- pitals and institutions in many countries, including Raffles Hospital, and K K Women & Children Hospital in Singapore, MEDS and Kenyatta National Hospital (KNH) in Kenya, Jinnah Hospital, and Agha Khan Hospital in Pakistan. Another important business activity of Beximco Pharma is the contract manufacturing for major international brands of leading multinational companies. 61 Products registered in / exported to: Iran Malaysia Hong Kong Ukraine Pakistan Singapore Yemen Sri Lanka Kenya Mozambique South Korea Taiwan Russia Georgia Myanmar Nepal Vietnam Cambodia Philippines Export Market We aim to build Beximco Pharma as a world-class manufacturer of pharmaceutical products for operat- ing in domestic and international markets, including Least Developed Countries (LDCs), developing and developed countries like USA and UK. We believe that entry into developed markets in particular will lead to significant sales and profit growth. 62 Going Global Brands manufactured in our Plant in Bangladesh are being dispensed in Kenya 63 Dr. Stephen J. Ndombi is a Consultant Physician practicing in Kenya for over 21 years. He holds an MB CHB, MMED and FCCP. He is an Admitting Specialist in the major hospitals in Nairobi and Senior Lecturer at the University of Nairobi, Faculty of Medicine, Department of Medicine. His major area of interest is Cardiovascular Medicine. Dr. Ndombi received a patient with a chronic headache, neck and shoulder pain for three weeks. She was 40, a mother of two children and had fami- ly history of hypertension. Her BP was measured to be 140/90 mm of Hg. Initially Dr. Ndombi prescribed her a tranquilizer for a week with some change in life style and food habit and suggested her to monitor BP twice a day and keep the records. After seven days there was no change in her average blood pressure. Dr. Ndombi suggested her to make some labora- tory investigations such as blood for CBC, Hb%, ECG, ETT, Urine for RME etc. There was no abnormality found in her renal, cardiovascular or any other system. Finally she was diagnosed to have developed essential hyper- tension. Dr. Ndombi prescribed her Amdocal®. “Considering her condition and medical reports, I decided to give her a cal- cium channel blocker”, Dr. Ndombi said, ”as she is only 40, she has to use an antihypertensive as a monotherapy for a long time and in that case diuretics and beta-blockers would be a burden because of their side effects. Nifedipine is not safe for long term use as it may cause end organ damage. Moreover, considering her overall condition I was looking for a calcium channel blocker which is safe in long term use, excellent in quality, has the convenience of once-daily dose and mostly, affordable. In view of all these factors the best option for me was Amdocal® of Beximco Pharmaceuticals Ltd. Amdocal® is good in quality, nice in presentation, convenient once- daily in dosing and affordable. All my patients are highly satisfied with Amdocal®. I am very much happy with Beximco Pharma for their up-to- date knowledge based support and looking forward to see them become a company of global distinction and carry the hallmark of their quality to a wider horizon.” Dr. Stephen J. Ndombi Consultant Cardiologist Nairobi, Kenya 64 Going Global Our product is being dispensed in Myanmar 65 Dr. Thein Aung is presently a Professor and Head of Department of Child Health, Institute of Medicine, Yangon Children Hospital, Yangon, Myanmar. Professor Aung is also the Programme Manager of IMMCI/WCHD, Vice-President of Myanmar Medical Association and President of Paediatric Society of Myanmar. At 1:00 am on February 20, 2006 Prof. Aung received a patient, a female child aged 4 years with severe febrile convulsion. She caught fever in the afternoon of February 19 and her temperature rose to 1020 F abruptly at about 8:00 pm. She was tried with paracetamol syrup, but immediately vomited out the medicine. However, her temperature fell slightly after- wards. But at 11.30 pm her temperature rose again and this time it went high up to 1040 F. At 12:30 noon, she developed severe convulsion and was taken to the emergency department of Yangon Children Hospital. Prof. Aung immediately applied diazepam to stop the convulsion and after the convulsion subsided he applied Napa® Suppository to control the tempera- ture. Within half an hour her temperature came down to normal. “During my long career as a paediatrician, I saw many cases of acute febrile illness, sometimes associated with convulsions in young children, especial- ly under 5 years of age. This is an emergency situation and an urgent con- trol of hyperpyrexia is one of the important goals of management. With introduction of paracetamol suppository (Napa® suppository) my job became very easy and effective. I have been using Napa® suppository for the past 5 years.” Professor Thein Aung MBBS, FRCP(Edin.), DCH(London), FRCPCH, Dr. Med.Sc. Professor and Head of Department, Department of Child Health, Institute of Medicine, Yangon Children Hospital, Yangon, Myanmar. 66 Going Global Retailer is selling our brand to a patient in Pakistan 67 “Acute respiratory tract infection (ARTI) is a leading cause of morbidity and mortality in today's practice. Recently, a patient named Mr. Ahmed Imtiaz, age 12, came to my chamber with serious laryngitis of recurrent infection. Earlier he was prescribed with Co-amoxiclav and my clinical finding was relapsed due to poor coverage of atypical pathogens in upper respiratory tract infection. So, I prescribed him with Azithrocin® capsule; just 2 capsules OD for 3 days and got satisfactory clinical response even before the com- pletion of the course. Two of the major reasons for the growing problem of resistance to antibi- otics are indiscriminate use of antibiotics and poor patient compliance. Shorter duration of treatment and single daily dosing are associated with better patient compliance. I have found Azithrocin® (Azithromycin) to be effective in the treatment of respiratory tract infections in a single daily dos- ing regimen of three days duration.” Dr. Zawar Khan MBBS, KEMC (Lahore), RMP, PMDC, MD (Paediatrics) Child Specialist and General Physician Lahore, Pakistan 68 Going Global Our Medical Representative is detailing Deflux® to a doctor in Nepal 69 Prof. Dr. Tara Man Amatya is the founder Chairman of “Asthma Society of Nepal”, General Secretary of “Nepal Association of TB and Chest Physicians (NATCP)” and is a Professor at T. U. Teaching Hospital, Kathmandu, Nepal. Prof. Dr. Amatya received a patient, Mrs. Laxmi Jha, age 54 years, who was admitted into Hardic Lifestyle Clinic due to severe attack of asthma in September 2005. This patient had been suffering from asthma for years and her attacks were getting acute day by day. Though she was on medication for a long time, nothing helped in reliev- ing her symptoms during attacks. She had to trim her lifestyle and daily work to the extreme. Dr. Amatya prescribed her Azmasol® as a bronchodilator. In March 2006 Mrs. Jha came to him in a scheduled visit. She was looking much healthier and happier. All her agony due to asthma had disappeared; using Azmasol® she got very quick relief from bronchospasm every single time she had an attack. “This medicine works like magic, I am getting much better relief at a very affordable cost. My life is on full swing now, I don't have to constantly remind myself that I have asthma, I just have to remind myself my Azmasol®”, she told Dr. Amatya and thanked him for all this. “It has been three years since we started using Azmasol®.”, as Dr. Amatya puts it, ”This has been the scenario in most of the cases - patients were delighted with Azmasol®, for its unsurpassable quality, elegant presentation, unprecedented service - all these at a very affordable price. I first came to know about Azmasol® from a representative of Beximco Pharmaceuticals Ltd. Whenever he visited me I had up-to-date scientific information regarding respiratory medicine. I am very thankful to Beximco Pharma for providing me with a product like Azmasol®. I am eagerly looking forward to see the same patient satisfaction from all Beximco Pharma products in future.” Dr. T. M. Amatya MBBS(PU), DTCD(DU), MD(AIIMS, New Delhi) PGT, Chest Diseases (Italy and Switzerland) PGT, Neurosciences (Japan) PGT, Lifestyle Medicine (USA) General Physician and Chest Specialist Hardic Lifestyle Clinic Kathmandu, Nepal 70 Corporate Communication 71 Corporate Communication Corporate communication at Beximco Pharma continues to work towards building and enhancing Beximco Pharma's local and global brand equity. Media relations During the year 2005 global and local media relations were further extended with target- ed interventions in the local market, UK market and other export markets. The company's activities are regularly covered in the World Generic Markets Report and also in www.lank- abusinessonline and www.reuters.com etc. Corporate Identity An ongoing initiative to increase our corporate identity was further enhanced in 2005. Unified corporate presentation was exposed to audiences in meeting with high officials of Government of Bangladesh, Government of other export markets and potential investors in various fairs in export markets. The company participated in many single country or multi country fairs in the existing export markets or potential markets where the company is planning to enter with its prod- ucts. To best capitalize on the alliance opportunity with our new OSD plant nearing inaugura- tion, the plant was exposed to various delegations comprising of high officials of the gov- ernment of various countries including USA, Sri Lanka, Japan, Bahrain, Maldives, Yemen, key customers from many countries and the journalists. 72 Corporate Social Responsibility 73 Corporate Social Responsibility At Beximco Pharma, we are in the business which deals with human health and this makes us more responsible to keep the highest standards of our products. Through our products we try to deliver clear benefits to the patients. Good products, however are only one side of our expression of commitment. We believe our responsi- bility lies even more in ensuring that our society gets benefited while we continue to grow. Corporate social responsibility is an integral part of our business strategy which is reflected in our mis- sion statement. Every employee of our company knows that the company does not view its success and achievements in financial terms only, but also in terms of its deep relationship with the society. Each year, an increasing amount of contribution is ploughed back into social causes, demonstrating Beximco Pharma’s commitment to the nation. More importantly the company's contribution extends beyond one-time donation to ongoing participation as reflected in our partnership with NGOs working for AIDS patients, in supporting sports, and in raising disease awareness among the people. We donated medicines worth millions of taka to victims in national and international calamities. Donation of medicines to victims of earthquake in Pakistan and victims of tsunami in Sri Lanka are worth mentioning. 74 Corporate Social Responsibility When the last hope is gone, We still stand by the distressed We are the first and only company to offer anti-AIDS medi- cines in Bangladesh Beximco Pharmaceuticals Ltd. is the first and only company in Bangladesh to introduce anti-retroviral (ARV) drugs despite know- ing the fact that it will not increase our sales value significantly. We just wanted to be a proud partner of doctors and people of this country who have been serving the HIV/AIDS patients. As a part of that commitment, Beximco Pharma and Dutch Bangla Bank Ltd. (DBBL) signed an agreement in April 2005 under which BPL would supply ARV drugs to DBBL for AIDS patients of Bangladesh. These ARV drugs will be distributed through Ashar Alo and Mukto Akash, two NGOs working for the treatment of HIV/AIDS patients of Bangladesh. We are giving these medicines at a very discounted price. 75 “Anti-retroviral (ARV) treatment interferes in the way the HIV virus reproduces in the body. ARVs do not destroy HIV but they can reduce its effects and help a person to live a longer life. HIV is not only a health issue; it is also a development issue world- wide. Beximco Pharmaceuticals Ltd., a leading pharmaceutical company of Bangladesh is producing ARV drugs for the first time in Bangladesh. Beximco Pharma is helping to prolong the life of HIV positive persons. We hope that Beximco Pharma will produce more affordable ARVs that will be helpful for poor AIDS patients.” A.K.M Anisuzzaman Program Manager Mukto Akash Bangladesh 76 “Prevention is better than cure” “Prevention is better than cure”: Disease Awareness Campaign by Beximco Pharma Probably everyone remembers one sentence from our primary school days: “Prevention is better than cure”. But, how many of us do really apply this maxim in real life? Beximco Pharma believes a drug can cure a disease only when the patient is aware of that disease and sees the doctor. Keeping this in mind Beximco Pharma has always worked closely with the doctors, various associations and NGOs in mass awareness cam- paigns on smoking, AIDS and asthma. Fight against Bird Flu 77 We launched Oseltamivir (Oseflu®) as a part of the pre- paredness to stockpiling to fight against Bird Flu In March 2006, we launched Oseltamivir capsule under the brand name Oseflu®, for the prevention and treatment of human cases of Avian Influenza. This was to prepare ourselves in the event of any flu pandemic. We have also donated Oseflu® to the government of Bangladesh and Myanmar as a part of our corporate social responsibility initiatives. “Introduction of Oseflu® is a major breakthrough in the generic business of Beximco Pharma” 78 National hero Supporting Sports Sports has always been a vital component in the development of society throughout human history. Infact, a nation's capability in sports reflects its progress towards human development. Beximco Pharma has always been one of the leading patrons of Bangladesh’s sports among the corporate houses. We sponsored different sporting events like SAAF Games, regularly participated in the Corporate Cricket League, employed a num- ber of national cricketers in our company. We feel great pride to state that we are the pres- ent champion of the Corporate Cricket League. We wish to be continuously involved in Bangladesh sports also in the future. As a part of the committment to the spirit of sports, we rewarded all the members of the winning Bangladesh National Cricket Team after defeating Australia. Bangladesh National Cricket Team including the coach with the high officials of Beximco Pharma Mr. Dave Whatmore , Coach of Bangladesh National Cricket Team is receiving cheque from Mr. Salman F Rahman, Vice Chairman of the company 79 Raising a national hero Cricket is one of the very few sectors in Bangladesh which brought pride to the nation. Our victories against the giant Sri Lanka and the number one team in the Cricket World - Australia were stupendous achievements. The single most important player of our National Cricket Team who has the largest share in those victories is, no doubt, Mohammad Ashraful. He is perhaps the brightest cricketer in the Bangladesh squad and a national hero to be fol- lowed in the sports arena. To Beximco Pharma he is more than a superstar. He has been with the company as an employee since he was in the squad of Bangladesh Under- 19 cricket team. We take pride in having a share in the making of one Mohammad Ashraful. When he needed to concentrate more on crick- et, we made it convenient for him. Today, he is also a key member of the Beximco Pharma Cricket Team, the defending champion of Corporate Cricket League in Bangladesh. Beximco Pharma Cricket Team after winning the Corporate Cricket League in Bangladesh 80 Twenty Ninth Annual General Meeting The 29th Annual General Meeting (AGM) of the shareholders of BPL was held on 2nd June 2005. Around 8,000 shareholders attended the meeting. Mr. A S F Rahman, Chairman of the Board of Directors presided over the meeting. The chairman thanked the shareholders for their interest and confidence upon the com- pany. The shareholders were informed about the performance of the company in 2004. Strategies and future vision of the com- pany were also briefed at the AGM. The meeting approved 5% cash dividend and 25% stock divi- dend (Bonus Shares) for the year 2004. Extra-Ordinary General Meetings 81 Extra-Ordinary General Meetings Two Extra-Ordinary General Meetings were held in 2005. First one was held on Thursday, the 2nd June, 2005 to deal with the agenda of amal- gamation of Beximco Infusions Limited with Beximco Pharmaceuticals Limited. Shareholders attending the meeting unanimously approved the Amalgamation Scheme. Another Extra-Ordinary General Meeting was held on 9th July, 2005. The agenda of the meeting were the amendment of Clause-V and Article-4 of the memorandum and Articles of Association of the Company respective- ly to increase the Authorized Capital of the Company from Tk. 1,000 (one thousand million) to Tk. 2,000 (two thousand million) and also issuance of Global Depository Receipts (GDRs) up to GBP 30 (thirty) million . The meeting approved the same unanimously. Mr. A S F Rahman, Chairman of the Board of Directors presided over both the meetings. 82 Value Added Statement Value Added Statement For the year ended 31 December 2005 2005 % 2004 % Figures in Taka Turnover & Other Income Brought-in-Materials & Services 3,879,420,007 (1,895,584,603) 2,795,655,796 (1,348,020,468) 1,983,835,404 100 1,447,635,328 100 APPILCATIONS: Retained by the Company Salaries and Benefits to Employees Interest to Lenders Dividend to Shareholders Duties & Taxes to Government Exchequer 473,037,848 448,555,707 221,949,324 143,882,343 696,410,182 24 23 11 7 35 262,837,380 291,976,823 190,578,415 167,928,750 534,313,960 1,983,835,404 100 1,447,635,328 18 20 13 12 37 100 2005 35% 2004 37% 24% 23% 11% 7% 18% 20% 13% 12% Retained by the Company Salaries and Benefits to Employees Interest to Lenders Dividend to Shareholders Duties & Taxes to Government Exchequer Notice 83 BEXIMCO PHARMACEUTICALS LIMITED 17, Dhanmondi R/A, Road No. 2, Dhaka-1205 Notice of the Thirtieth Annual General Meeting Notice is hereby given that the THIRTIETH ANNUAL GENERAL MEETING of the Shareholders of Beximco Pharmaceuticals Limited will be held on Thursday, the 22nd June, 2006 at 10.30 a.m. at 1, Shahbag C/A, Dhaka to transact the following business: AGENDA 1. To confirm the proceedings of the Extra-Ordinary General Meetings of the Company held on 2nd June, 2005 and 9th July, 2005. 2. To confirm the proceedings of the Twenty-Ninth Annual General Meeting of the Company held on 2nd June, 2005. 3. To receive, consider and adopt the Audited Accounts as of 31st December, 2005 together with reports of the Auditors and the Directors thereon. 4. To elect Directors. 5. To declare 15% cash dividend. 6. To appoint Auditors for the year 2006 and to fix their remuneration. 7. To transact any other business of the Company with the permission of the Chair. By order of the Board, (MD. ASAD ULLAH, FCS) Company Secretary Dated: April 30, 2006 NOTES : (1) The Record Date in lieu of Book Closure shall be on 1st June, 2006. The Shareholders whose names will appear in the Share Register of the Company on the Record Date will be entitled to the dividend. (2) A member entitled to attend and vote at the General Meeting may appoint a Proxy to attend and vote in his/her stead. The Proxy Form, duly stamped, must be deposited at the Registered Office of the Company not later than 48 hours before the time fixed for the meeting. (3) Members are requested to notify change of address, if any, to the Company. (4) Admission to the meeting room will be strictly on production of the attendance slip sent with the Notice. 84 ßY~JroqJPjr k´KfPmhj ßY~JroqJPjr k´KfPmhj xÿJKjf ßv~JrPyJflJrVj, 2005 xJPuS ßmKéoPTJ lJotJKxCKaTqJux& KuKoPac xJlPuqr iJrJmJKyTfJ m\J~ ßrPUPZÇ IJKo IJjPªr xJPg \JjJKò, KmVf mZrèPuJr jqJ~ F mZrS IJorJ IJoJPhr ßTJŒJjLr xJKmtT k´mOK≠r kNmt kKrTK·f uãq oJ©J I\tPj xão yP~KZÇ lPu ßv~JrPyJflJrPhr xŒh mOK≠ S fJ xMxÄyf TrJr ßp ßTRvuVf uãq fJ k´fqJvJ IjMpJ~L IK\tf yP~PZÇ F ßk´KãPf IJKo 2005 xJPur ßTJŒJjLr xJKmtT TJptâPor FTKa KY© IJkjJPhr oNuqJ~Pjr \jq Ck˙Jkj TrKZÇ ßmKéoPTJ AjKlCvjx&ßT FTLnëfTre” Vf mZr IJkjJrJ ßmKéoPTJ AjKlCvjx&ßT ßmKéoPTJ lJotJKxCKaTqJuPxr xJPg FTLnëfTrPer ßTRvuVf Kx≠JP∂r kPã rJ~ KhP~KZPujÇ mJÄuJPhPvr Hwi KvP· F irPjr WajJ Kmru FmÄ FaJ KZu IJoJPhr \jq FTaJ mz YqJPu†Ç IJorJ VPmtr xJPg \JjJKò ßp, IJkjJPhr xKâ~ xyPpJKVfJ FmÄ xogtPj ßTJŒJjLr mqm˙JkjJ FA YqJPu† xJlPuqr xJPg ßoJTJPmuJ TPrPZ Ç hMKa ßTJŒJjLr FA FTLnëf vKÜ IJoJPhr mqmxJr mMKj~Jh o\mMf TPrPZ FmÄ mqmxJ kKrYJuj TJptâo xy\fr TrJr kJvJkJKv xJKmtT hãfJ mOK≠ TPrPZÇ NKÜ” u¥j ÓT FéPYP† I∂nt IJPuJYq mZPr IJorJ ßmKéoPTJ lJotJKxCKaTqJux&ßT FTKa IJ∂\tJKfT Hwi k´˜áfTJrL k´KfÔJPj kKref TrJr uãq mJ˜mJ~Pj CPuäUPpJVq IV´VKf I\tj TPrKZÇ IJkjJPhr FA k´KfÔJj 2005 Fr IPÖJmPr KmT· KmKjP~JV mJ\Jr AIM - F k´PmPvr oJiqPo u¥j ÓT FéPYP† xJlPuqr xJPg KjmKºf yP~PZÇ ßmKéoPTJ lJotJKxCKaTqJux&A mJÄuJPhPv k´go FmÄ FToJ© ßTJŒJjL pJ ßhPvr mJAPrr ßTJj ÓT FéPYP† KjmKºf yPf ßkPrPZÇ F I\tj ÊiMoJ© ßTJŒJjLrA xJluq j~ mrÄ ßhPvr \jqS KmrJa ßVRrPmr mqJkJrÇ ßTJŒJjLr âo mitoJj Cjú~e TJptâo FmÄ hLWt ßo~JhL KmKjP~JV k´T·xoNPyr IgtJ~Pjr \jq xP∂Jw\jT oNPuq Global Depository Receipt (GDR) AxqMr oJiqPo IJorJ 12 KoKu~j kJC¥ xÄV´y TrPf xão yP~KZÇ GDR Fr oNuqJ~j FmÄ KmPhvL KmKjP~JVTJrLPhr IJvJfLf xJzJ ßTJŒJjLr mqmxJK~T x÷JmjJ S mqm˙JkjJ hãfJr k´Kf fJÅPhr hO| IJ˙JrA mKy”k´TJvÇ xJKmtT mqmxJK~T TotTJ¥ ” Kmâ~ k´mOK≠ Kv· VzPTS ZJKzP~ ßVPZ ” IJkjJrJ KjrLKãf k´KfPmhPj ßhUPf kJPmj ßTJŒJjL mqmxJr k´KfKa ßãP© k´mOK≠ iPr rJUPf xão yP~PZÇ IJPuJYq mZPr IJoJPhr Kmâ~ KZu 3,327.02 KoKu~j aJTJ pJ Vf mZPr KZu 2,402.70 KoKu~j aJTJÇ Kmâ~ k´mOK≠r yJr 38%Ç 2004 xJPur ßmKéoPTJ lJoJtKxCKaTqJux& Ku: FmÄ ßmKéoPTJ AjKlCvjx& Ku: FA hMKa ßTJŒJjLr xKÿKuf KmâP~r xJPg fáujJ~ k´mOK≠ hJÅzJ~ 20% pJ Kv· Vz 17.5% Fr ßYP~S IKiTÇ IJoJPhr mqmxJP~r oNu vJUJ loN tPuvj kPeqr Kmâ~ k´mOK≠r yJr 23.4% FmÄ fJ AjKlCvjx& kPeqr ßãP© yP~PZ 7.7%Ç FUJPj CPuäUq ßp AjKlCvjx& TJrUJjJKa KmVf TP~T mZr iPrA kNet ãofJ~ YuPZÇ Kmâ~ k´mOK≠r FA I\tPjr oNPu KZu xKbT ßTRvuVf kKrT·jJ FmÄ Fr xMhã mJ˜mJ~jÇ IJoJPhr r¬JjL 88.86 KoKu~j aJTJ~ ßkRÅPZPZ pJ Vf mZr KZu 79.49 KoKu~j aJTJÇ iLPr yPuS âov: IJorJ IJoJPhr IJ∂\tJKfT CkK˙Kf mOK≠ TrKZÇ 2005 xJPu IJoJPhr r¬JjL mJ\JPr vsLuÄTJ xÄPpJK\f yP~PZÇ IJPuJYq mZPr r¬JjL mJ\JPr jfáj 55Ka keq KjmKºf yP~PZ FmÄ IJrS ßmv KTZM keq KjmºPjr IPkãJ~ IJPZÇ IJoJPhr USFDA oJjxŒjú jfáj Oral Solid Dosage (OSD) k´T·Ka YJuM yPu r¬JjL jfáj oJ©J kJPm mPu IJorJ UMmA IJvJmJhLÇ mqmxJ kKrYJuj mq~ ” IJoJPhr hLWtPo~JhL nKmwqf kKrT·jJr IJPuJPT IJorJ ßhPv FmÄ IJ∂\JtKfT IñPj IJoJPhr Kmâ~ ToLt mJKyjL mOK≠ TPrKZ, Kmâ~ ßTRvu ßdPu xJK\P~KZ, Kmkej TotTJ¥ CPuäUPpJVqnJPm mOK≠ TPrKZ FmÄ xrmrJy ImTJbJPoJr kKrKiS xŒsxJKrf TPrKZÇ CkPrJKuäKUf TJrPe IJPuJYq mZPr IJoJPhr Kmâ~, Kmkej S xrmrJy mq~ CPuäUPpJVq kKroJPj mOK≠ ßkP~PZÇ Kmâ~ Kmkej FmÄ xrmrJy UJPf FA KmKjP~JPVr xMlu IJorJ F mZPrA kJS~J ÊÀ TPrKZ, pJ nKmwqPfS xoMjúf gJTPm mPu IJorJ hO|nJPm IJvJmJhLÇ 85 oMjJlJ: ßTJŒJjL mrJmPrr of oMjJlJ mOK≠r iJrJ m\J~ ßrPUPZÇ cuJPrr KmkrLPf ßhvL~ oMhsJr fLms hrkfj xPfôS IJorJ IJoJPhr V´x oMjJlJr yJr mOK≠ TrPf xão yP~KZÇ Tr S WPPF kNmt oMjJlJr kKroJj 37.9% ßmPz 509.6 KoKu~j aJTJ~ ßkRÅPZPZ (2004 F ßmKéoPTJ lJoJtKxCKaTqJux& Ku: FmÄ ßmKéoPTJ AjKlCvjx& Ku: Fr xKÿKuf oMjJlJr fáujJ~ FA mOK≠ 21.4%)Ç IJPuJYq mZPr ßv~Jr k´Kf IJ~ yP~PZ 6.36 aJTJ pJ Vf mZPr KZu 4.71 aJTJÇ jfáj keq: ˝J˙q UJPfr YJKyhJ kNrPj IJoJPhr IñLTJPrr iJrJmJKyTfJ~ IJPuJYq mZPrS ßmvKTZM ßgrJKkCKaT& ßvseLPf KmKnjú Dosages Form S oJ©Jr 49Ka jfáj keq IJoJPhr mftoJj keq x÷JPr xÄPpJK\f yP~PZÇ F xTu jfáj Hwi KYKT“xT oyPu mqJkT k´vÄxJ FmÄ V´yePpJVqfJ I\tj TPrPZÇ \jxŒh: \jxŒh xoO≠vJuL TrJr \jq IJorJ Hwi KvP·r ßoiJmL S k´VKfvLu ßkvJhJrPhr IJoJPhr \jxŒPh xÄPpJ\j TPr pJKòÇ FA iJrJ~ GlaxoSmithkline mJÄuJPhv ßgPT C“kJhj kKrYJuT KyxJPm \jJm IJmMu yJxjJf ßoJ: \JPTr; Quality Assurance k´iJj KyxJPm Ranbaxy Laboratories Ltd., India ßgPT Mr. Govind Doulatrao Bhagnure; General Manager, Quality Asurance KyxJPm Û~Jr lJoJtKxCKaTqJux& ßgPT \jJm k´mLr ßWJw; Sigma Laboratories Ltd., India ßgPT Sr. Manager, Engineering KyxJPm Mr. Vasant Pandit Jagtap; Validation Manager KyxJPm Matrix Lab Ltd., India ßgPT Mr. P D Chaudhari; Manager, Production KyxJPm Nicholas Piramal, India ßgPT Mr. Shahsank Vyapari FmÄ Mr. Subrata Kumar Bala, Product Development Manager KyxJPm Dr. Reddy’s Laboratories Ltd., India ßgPT IJoJPhr USFDA oJjxŒjú Oral Solid Dosage k´TP· ßpJV KhP~PZjÇ FPhr oPiq India ßgPT IJVf xmJA USFDA S UK MHRA IjMPoJKhf Hwi k´˜áfTJrL k´KfÔJPjr TJ\ TrJ~ hLWt IKnùÇ F ZJzJS IJ∂\tJKfT Hwi KmkePj IKnù \jJm rJæMr ßr\J IJoJPhr Kmkej kKrYJuT KyxJPm ßpJV KhP~PZjÇ Fr kNPmt KfKj Milton Pharmaceuticals, AGENIX Group, Australia ßf Totrf KZPujÇ nKmwqf kKrT·jJ: Vf mJKwtT xJiJre xnJ~ IJKo IJkjJPhr \JKjP~KZuJo ßp, ˝P·Jjúf ßhvèPuJr oPiq mJÄuJPhvA FToJ© ßhv ßpUJPj Hwi KvP·r \jq k´P~J\jL~ xMhO| ImTJbJPoJ IJPZÇ F TJrPe WTO - TRIPS krmfLt Kmvõ kKrK˙KfPf ˝P·Jjú úf ßhvèPuJr \jq ßp InJmjL~ xMPpJV xOKÓ yP~PZ ßx ßãP© mJÄuJPhv xMhO| Im˙JPj IJPZÇ IJorJ F xMPpJV kMPrJkMKr TJP\ uJVJPjJr \jq xTu k´˜Kf k´J~ xŒjú TPr FPjKZÇ IJoJPhr USFDA oJjxŒjú k´T·Ka FUj xoJK¬uPVúÇ F mZPrr ßvw jJVJh IJorJ TJrUJjJKar USFDA xjh k´JK¬r \jq k´Kâ~J ÊÀ TrmÇ pKhS IJorJ FA k´T·KaPT xmJtKiT èÀfô KhKò KT∂á IjqJjq ßp xm ßãP© IJoJPhr xMPpJV rP~PZ ßxèPuJr kNet xÆqmyJPrS IJorJ x\JV rP~KZÇ F ßk´KãPf IJorJ ßmv KTZN uJn\jT k´T· V´ye TrKZ pJr oPiq TJÅYJoJu C“kJhj k´T·S rP~PZÇ F xTu k´T· mJ˜mJK~f yPu IJoJPhr C“kJhj ãofJr CPuäUPpJVq mOK≠ WaPm FmÄ mqmxJPf jfáj oJ©J xÄPpJK\f yPmÇ Fr lPu IJkjJPhr ßTJŒJjLr KnK• ßpoj hO| yPm ßfoKj IJkjJPhr ßv~JPrr I∂tKjKyf oNuq mÉèj mOK≠ kJPm mPu IJoJr KmvõJxÇ CkxÄyJr : kKrPvPw IJKo ßv~JrPyJflJrPhr ijqmJh \JjJA IJoJPhr k´Kf fJÅPhr IJ˙J FmÄ KmvõJPxr \jqÇ IJkjJPhr xKâ~ kOÔPkJwTfJA IJoJPhr xJlPuqr oNu YJKuTJvKÜÇ ijqmJh \JjJA IJoJPhr hã ToLt mJKyjLPT - pJPhr hãfJ, kKrvso, hJK~fôvLufJ FmÄ KjÔJ IJoJPhr mqmxJP~r xJlPuqr oNu YJKmTJKbÇ IJKo FA xMPpJPV IJoJPhr mqJÄTJr, xrmrJyTJrL, ßâfJ xJiJre, xrTJrL KmnJV S Kj~πeTJrL xÄ˙JxoNy FmÄ IjqJjq xÄKväÓ xTPur xyPpJKVfJ FmÄ xogtPjr TgJ TífùfJr xJPg ˛re TrKZÇ AjvJIJuäJy& @orJ xmJA KoPu FTKa ˝JP˙qJöôu Cjúf nKmwqf rYjJ TrmÇ IJkjJPhr xTuPT IxÄUq ijqmJhÇ F Fx Fl ryoJj ßY~JroqJj 30 FKk´u 2006 86 Chairman's Statement Chairman’s Statement Dear Shareholders 2005 was yet another year of continued success of Beximco Pharma. I am pleased to inform that during the year we progressed as per plan towards successful accomplishment of our strategic goals to grow the company and strengthen the shareholders value. I am pleased to place before you some of the highlights of our business operations in 2005 for your valued judgment and consideration. Successful Integration of Beximco Infusions Limited with BPL Last year you gave your valuable mandate towards our strategic decision to integrate Beximco Infusions limited with Beximco Pharma. This being a unique case in the pharmaceutical industry of Bangladesh was a great challenge for us. We take pride to say that with your active support and co-operation management has met this challenge with smooth and ease. Merger of the two companies have effectively reinforced our business base, helped enhanced operational efficiency and synergy. Listing with Alternative Investment Market (AIM) under London Stock Exchange In this past year we made remarkable progress to extend our horizon in line with our vision to make your company a global phar- maceutical company. In October 2005 Beximco Pharma was enlisted in the Alternative Investment Market (AIM) under London Stock Exchange and thus became the proud claimant of the only Bangladeshi Company to be enlisted with any Stock Exchange outside Bangladesh. This not only has raised the international profile of the company but the image of Bangladesh as well. We raised GBP 12 million through issue of Global Depository Receipts (GDRs) at a considerable premium pricing to finance the current growth phase of the company as well as our long term investment projects. The pricing of the GDRs and the amount of responses of the overseas investors is clearly indicative of their trust on the business potentials as well as management capability of Beximco Pharma. Operating Results Sales growth Outperforms Industry Average As you will find in the detailed audited financial statements, your company continued to retain its growth in all key areas. During the year, the company attained net sales of Tk. 3,327.02 million as against Tk. 2,402.70 representing significant 38% overall growth. Even a pro-forma analysis including Beximco Infusion’s sales in the comparative, shows impressive 20% growth in sales as against the industry average of 17.5%. The sales of the formulation products-our core business, however, grew by 23.4%. We also managed to achieve 7.7% growth in sales of infusions products given the fact that the plant is operating at full capacity. Our extremely focused strategies have produced this result & helped us to achieve this growth. Our exports reached Tk. 88.86 million as compared to Tk. 79.49 million of prior year. Slowly but gradually we are expanding our global presence. In 2005 Sri Lanka has been added to the list of our export markets. 55 new products have been registered in different international markets during this period while a number of other products are in the pipeline. We are hopeful that once our new Oral Solid Dosage (OSD) plant comes into operation, our export sales will take a different dimension. Operating Expenses In line with our long term plan we strengthened our sales force domestically and internationally, re-designed and re-aligned the sales strategies, revitalized our marketing efforts and extended the distribution network. All these combined together have result- ed significant increase in selling and distribution expenses during the period. However, our investment has paid off as reflected in impressive sales growth achieved in 2005 and we believe this will continue to give results in the future days as well. 87 Profitability The Company continued to maintain its profit growth. Despite sharp decline in local currency against dollar, we managed to improve our gross margin ratio. Profit before tax and contribution to Workers’ Profit Participation fund increased by 37.9% to Tk. 509.63 million (21.4% increase on a pro-forma basis1). Earnings per share stood at Tk. 6.36 as against Tk. 4.71 of previous year. Product Consistent to our committed efforts to cater to the health care needs of the country, 49 new products including dosage forms and strength across wide range of therapeutic classes have been added to the existing product portfolio during the year under review. The products have got appreciations of the medical community. Human Resource We continued to draw talented and dynamic professional of the industry to further strengthen our pool of human resources. The joining of Mr. Abul Hasnat Md Zaker as Director, Manufacturing from GlaxoSmithKline, Bangladesh, Mr. Govind Doulatrao Bhagnure as Head of Quality Assurance from Ranbaxy Laboratories Limited, India, Mr. Prabir Ghose as General Manager, Quality Assurance from Square Pharmaceuticals, Bangladesh, Mr. Vasant Pandit Jagtap as Sr. Manager, Engineering from Sigma Laboratories Limited, India, Mr. P D Chaudhari as Validation Manager from Matrix Lab. Ltd., India, Mr. Shahsank Vyapari as Manager, Production, from Nicholas Piramal, India, Mr. Subrata Kumar Bala as Product Development Manager, from Dr. Reddy’s Laboratories Ltd., India in our US FDA approvable Oral Solid Dosage Plant were valuable additions during the year. Their highly recognized expertise and wide working experience in US FDA, UK MHRA certified plant is an added impetus. Besides, Mr. S M Rabbur Reza a well experienced pharmaceutical executive with international marketing exposure has joined as Director Marketing. Prior to that he was working with Milton Pharmaceuticals, Agenix Group, Australia. Looking Ahead As I told you in last AGM, Bangladesh being the only LDC with strong pharmaceutical base has got some competitive edge in the post-TRIPS era. We are mindful of the opportunities ahead and confident of our capabilities to make use of these advantages. Our strategic investment project- US FDA approvable Oral Solid Dosage Plant is now in its final stage of completion. Two out of five lines have been installed. We plan to go for certification of the plant by end of 2006. While we are extremely focused on this project, we at the same time are going for certain other profitable projects including APIs, as well. These projects will help build our capacities and would add significant value to the business. We believe all combined will enable us to leverage our success to build a stronger Beximco Pharma with higher shareholders’ value. Finally, we are thankful to you, dear shareholders, for your trust and confidence on us. Your continued support is the driving force behind the growth and development of our business. Thanks to the commitment, dedication and hard work of the Beximco Pharma employees who are core to our success. I also take this opportunity to recall with appreciation the support and co-oper- ation we have received from our bankers, suppliers, customers, government agencies, regulatory bodies and everyone the com- pany interacted with in conducting its business. Together we will build a healthier tomorrow. Thank you all. A S F RAHMAN Chairman Dhaka 30 April, 2006 1Financial figures on a pro-forma basis includes results of Beximco Pharma and Beximco Infusions Limited which was effectively integrated with Beximco Pharma 88 Report of the Directors Report of the Directors to the Shareholders For the year ended 31 December 2005 The Directors are pleased to present their report to the shareholders together with the audited accounts for the year ended 31st December, 2005 Financial Results and Profit Appropriations Net Profit Before Providing Income Tax Less : Provision for Income Tax Net Profit After Tax Add : Profit brought forward from previous year Profit Available for Appropriation Recommended for Appropriations: Transfer to Tax-holiday reserve Proposed Dividend Tax-Holiday Reserve no longer required Un-appropriated Profit Carried Forward Figure in ‘000 Taka 2005 2004 485,367 3,895 489,262 2,173,216 2,662,478 (117,824) (143,882) 148,630 2,549,402 353,661 (24,285) 329,376 1,367,072 1,696,448 (99,575) (167,929) 744,272 2,173,216 Dividend The Board of Directors has recommended 15% cash dividend for your approval for the year ended 31st December, 2005. Directors Mr. A S F Rahman, Director of the Company retires by rotation as per Articles 126 and 127 of the Articles of Association of the Company and being eligible offer himself for re-election. Mr. A. B. Siddiqur Rahman and Barrister Faheemul Huq (Nominees of Beximco Holdings Limited), Advocate Ahsanul Karim (Nominee of Bangladesh Export Import Company Limited) Directors of the Company retire by rotation as per Articles 126 and 127 of the Articles of Association of the Company and being eligible offer themselves for re-election. Auditors The Directors hereby report that the existing Auditors, M/S M. J. Abedin & Co., Chartered Accountants, National Plaza (6th Floor), 1/G Free School Street, Sonargoan Road, Dhaka-1205 who were appointed as Auditors of the Company in the Twenty- ninth Annual General Meeting of the Company has carried out the audit for the year ended 31st December 2005. M/S. M. J. Abedin & Co., Chartered Accountants, National Plaza (6th Floor), 1/G Free School Street, Sonargoan Road, Dhaka- 1205, the Auditors of the Company retire at this meeting and have expressed their willingness to continue in office for the year 2006. 89 Board Meetings and Attendance During the year 26 Board Meetings were held. The attendance record of the Directors is as follows: Name of Directors Mr. A S F Rahman Mr. Salman F Rahman Mr. Iqbal Ahmed Mr. M. A. Qasem Mr. O. K. Chowdhury Mr. A. B. Siddiqur Rahman Dr. Farida Huq Mr. C. H. Rahman Barrister Faheemul Huq Advocate Ahsanul Karim Dr. Abdul Alim Khan Meetings attended 26 23 26 26 24 26 21 25 25 25 26 Statement of Directors on Financial Reports (a) The financial statements together with the notes thereon have been drawn up in conformity with the Companies Act, 1994 and Securities and Exchanges Rules, 1987. These statements present fairly the Company’s statement of affairs, the result of its operation, cash flow and statement of changes in equity. (b) Proper books of accounts of the company have been maintained. (c) Appropriate Accounting Policies have been consistently applied in preparation of the financial statements except those referred to in the financial statements and that the accounting estimates are based on reasonable and prudent judgement. (d) The International Accounting Standards, as applicable in Bangladesh, have been followed in preparation of the financial statements. (e) Internal Control System is sound in design and has been effectively implemented and monitored. (f) There is no significant doubts about the ability of the Company to continue as a going concern. Pattern of Shareholding Name-wise details (i) Parent/Subsidiary/Associate companies and other related parties : Beximco Holdings Ltd. Bangladesh Export Import Company Ltd. No. of Shares held 11,820,561 6,259,523 90 (ii) Directors, Chief Executive Officer, Company Secretary, Chief Financial Officer, Head of Internal Audit and their spouses and minor children : Mr. A S F Rahman, Chairman Mr. Salman F Rahman, Vice Chairman Dr. Abdul Alim Khan, Director Dr. Farida Huq, Director Mr. Nazmul Hassan, Chief Executive Officer Mr. Afsar Uddin Ahmed, Director Commercial Chief Financial Officer, Company Secretary and Head of Internal Audit and their spouse and minor children (iii) Executives (iv) Shareholders holding ten percent (10%) or more voting interest in the company: Beximco Holdings Ltd. (mentioned in Sl. No. (i) ) The Bank of New York International Nominees Key Operating and Financial Data The summarised key operating and financial data of last four preceding years is annexed. 1,653,132 1,209,949 525,694 3,111 4,737 2,885 Nil Nil 11,820,561 20,000,000 Corporate Governance Compliance Report In accordance with the requirement of the Securities and Exchange Commission, “Corporate Governance Compliance Report” is annexed. Thank you all. On behalf of the Board A S F RAHMAN Chairman Dhaka 30 April, 2006 Key Operating and Financial Data 91 Key Operating and Financial Data Particulars Authorized Capital Paid up Capital Turnover (Net) Turnover (Export) Gross Margin Profit Before Tax Net Profit Tangible Assets (Gross) Shareholders' Equity Dividend Return on Paid up Capital Shareholders' Equity Per Share Earnings Per Share (EPS) Market Price Per Share (at end of the year) Price Earning Ratio (Time) Number of Shareholders Sponsors, General Public & Other Institutions Foreign Investors ICB including ICB Investors Account HUMAN RESOURCES Number of employees Officers Staff 2005 2004 2003 2002 2001 Amounts in thousand Taka 2,000,000 959,216 3,327,023 88,858 1,558,500 485,367 489,262 8,623,969 6,820,925 15% 51% 71 6.36 57.80 9.09 50,591 48,429 55 2,107 1,981 1,505 476 1,000,000 559,763 2,402,701 79,485 1,023,772 353,661 329,376 6,822,860 4,836,013 30% 63% 86 4.71 92.10 19.55 50,750 41,882 49 8,819 1,385 964 421 1,000,000 508,875 2,183,830 59,594 828,081 263,619 207,140 6,669,824 4,596,421 20% 52% 90 2.96 39.72 13.42 47,811 35,568 42 12,201 1,328 862 466 1,000,000 442,500 2,508,788 50,284 888,295 362,232 341,680 5,512,974 4,411,406 20% 82% 100 4.88 41.83 8.57 49,960 37,317 43 12,600 1,218 747 471 1,000,000 442,500 2,401,241 47,325 942,133 430,420 401,780 5,141,780 4,165,791 15% 97% 94 5.74 49.50 8.62 50,367 37,568 43 12,756 1,151 695 456 Shareholders’ Equity 4,411,406 4,596,421 4,165,791 4,836,013 6,820,925 2001 2002 2003 2004 2005 a k a T d n a s u o h t n i t n u o m A 92 Corporate Governance Compliance Report Corporate Governance Compliance Report Status of compliance with the conditions imposed by the Commission's Notification No. SEC/CMRRCD/2006-158/ Admin/02-08 dated 20th February 2006 issued under section 2CC of the Securities and Exchange Ordinance, 1969. (Report under Condition No. 5.00) Title Compliance status Complied Not com- plied Explanation for non-compliance with the condition Boards Size Independent Directors Independent Directors Appointment Chairman & Chief Executive Directors’ Report on financial statements Books of Accounts Accounting Policies IAS Applicable in Bangladesh System of Internal Control Going Concern Deviation in Operating Results Key operating and Financial Data Declaration of Dividend Number of Board Meetings Pattern of Shareholdings CFO, HIA & CS Appointment Board Meeting Attendance Audit Committee Composition of Audit Committee Audit Committee Members Appointment Terms of service of Audit Committee Chairman of Audit Committee Audit Committee Chairman's Qualification Reporting to the Board of Directors Report of Conflicts of Interest Defect in the Internal Control System Suspected infringement of Laws Any other matter Reporting to the Authorities Reporting to the Shareholders Appraisal or Valuation Services Financial information system Book keeping or other services Broker dealer services Actuarial services Internal Audit services Any other services √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ Condition No. 1.1 1.2(i) 1.2(ii) 1.3 1.4(a) 1.4(b) 1.4(c) 1.4(d) 1.4(e) 1.4(f) 1.4(g) 1.4(h) 1.4(i) 1.4(j) 1.4(k) 2.1 2.2 3.00 3.1(i) 3.1(ii) 3.1(iii) 3.2(I) 3.2(ii) 3.3.1(I) 3.3.1(ii)(a) 3.3.1(ii)(b) 3.3.1(ii)(c) 3.3.1(ii)(d) 3.3.2 3.4 4.00 (I) 4.00 (ii) 4.00 (iii) 4.00 (iv) 4.00 (v) 4.00 (vi) 4.00 (vii) Explanatory Statement on Corporate Governance 93 Explanatory Statement on Corporate Governance In Beximco Pharma, we always nurture and nourish good corporate governance. Board of Beximco Pharma places the greatest emphasis on maintaining the highest standard of corporate governance. As trustee of all the stakeholders of the company, the board is fully aware of its responsibilities and therefore, endeavors to safeguard the interest of all concerned. The statement below describes how the principles of good governance are applied in Beximco Pharma. Size, Composition and Functioning of the Board The board of directors is the highest level of authority in the organization structure of Beximco Pharma. The board is responsible for the overall direction and is ultimately accountable to the shareholders for the activities, strategies and performance of the com- pany. Currently, it comprises of 11 members with Mr. A S F Rahman as Chairman and Mr. Salman F Rahman as Vice Chairman. A director, Dr. Abdul Alim Khan, a general public shareholder of the company, is an independent director in terms of the Corporate Governance Principles set out by the Securities and Exchange Commission. The prime concern of the board is to ensure that the overall activities of the business are conducted responsibly and with focus on long – term value creation. The board meets periodically to transact matters placed before them that require board’s approval and/or direction. Board reviews the overall activities of the business and where necessary, strategic guidelines are given for onward implementation. Executive Committee Next to the board, there is a five-member Executive Committee (EC) for closer monitoring of business performance and to pro- vide operational guidance. The scope of work of the committee includes but not limited to, review of business performance, approval of budget, evaluation of capital expenditure proposals, appraisal of senior level managers etc. The review, evaluation and recommendations of the Executive Committee provide significant input to enable the board to take well-informed decisions. Management Committee The responsibility to implement EC decisions and supervision of day to day business affairs of the company lies with the man- agement committee. They are also responsible for achieving the business plan. The committee consists of functional heads of dif- ferent operating/business segments and is headed by CEO. Chairman EC is also a member of this Committee. Audit Committee The company had no Audit Committee on 31 December 2005. In conformity with the Corporate Governance Principles set out by the Securities and Exchange Commission, the board constituted an Audit Committee with Dr. Abdul Alim Khan as its Chairman, and Barrister Faheemul Huq and Mr. Chowdhury Hafizur Rahman FCMA as its Members on 30 April 2006. Key Officers Mr. Nazmul Hassan, Mr. Ali Nawaz, Mr. Md. Asad Ullah and Ms. Roksana Hassan are the Chief Executive Officer, Chief Financial Officer, Company Secretary and Head of Indernal Audit of the company respectively in terms of the Corporate Governance Principles set out by the Securities and Exchange Commission. 94 Internal Control Beximco Pharma employs a sound system of internal control including internal financial control to ensure compliance of its activ- ities with the desired objectives. Over the years we have successfully implemented a well designed corporate management struc- ture with clearly defined responsibility, delegation of authority and proper accountability. Beximco Pharma has an appropriate organization structure manned with qualified professionals for properly carrying out planning, executing, controlling and moni- toring functions of each of the business subunits. The company has a specially assigned team to carry out internal audits of different segments of the business. The team is head- ed by a manager who reports to the CEO. After appropriate review of the reports, necessary corrective actions are undertaken. Going Concern Directors are convinced after making appropriate enquires at the time of approving the financial statements that the company has adequate resources to carry out its operational existence for the foreseeable future. It is therefore appropriate to adopt going concern basis in preparing the financial statements. Shareholder Relations The Company has about fifty thousand shareholders. The directors place high importance on maintaining good relationships with the shareholders and ensure to keep them informed of significant company developments. The company formally reports twice a year-summarized half yearly report and detailed annual report. Annual general meeting is an important opportunity to meet and communicate with shareholders. Every Shareholder or his/her duly authorized representative has the right to attend such meeting. It provides the forum for discussion of the business, its future prospects and other matters of interest and concern to the shareholders. In addition, the Company has a full fledged corporate affairs secretarial department who addresses different shareholders’ issues like dividend payment enquiries, share transfer, loss of share certificate/dividend warrants etc. Report of Auditors to the Shareholders 95 BEXIMCO PHARMACEUTICALS LIMITED Report of Auditors to the Shareholders We have audited the accompanying Financial Statements of Beximco Pharmaceuticals Limited consisting of Balance Sheet, Profit and Loss Account and the Statement of Changes in Equity and Cash Flow as well as the Notes to the financial statements for the year from January 1 to December 31, 2005. The company law requires the directors to prepare financial statements which give a true and fair view. In prepar- ing financial statements which give a true and fair view, it is fundamental that appropriate accounting policies are selected and applied consistently. It is our responsibility to form an independent opinion, based on our audit, on those statements and to report our opinion to you, in accordance with section 213 of the Companies Act, 1994. We conducted our audit in accordance with Bangladesh Standards on Auditing. These standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from materi- al misstatement. Evidence supporting the amounts and disclosures in the financial statements is examined on a test basis within the framework of the audit. An audit also includes assessing the accounting principles used and signifi- cant estimates made by the board of directors, as well as evaluating the overall financial statements presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, based on our audit, the financial statements referred to above give a true and fair view of the finan- cial position, the results of operations and cash flows of the company, in all material respects, for the year referred to above, in accordance with the Companies Act 1994, the Securities and Exchange Rules 1987 and the Bangladesh Accounting Standards. We also report that : (a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit and made due verification thereof; (b) in our opinion, proper books of accounts as required by law have been kept by the company so far as it appeared from our examination of those books ; (c) the Company's Balance Sheet and Profit and Loss Account dealt with by this report are in agreement with the books of accounts ; and (d) the expenditure incurred were for the purpose of the Company's business. National Plaza (6th Floor) 1/G, Sonargaon Road Dhaka - 1205 30 April, 2006 M. J. ABEDIN & CO. Chartered Accountants 96 Financial Statements BEXIMCO PHARMACEUTICALS LIMITED Balance Sheet As at 31 December 2005 ASSETS Non-Current Assets Property, Plant and Equipment- Carrying Value Investment in Shares Current Assets Inventories Accounts Receivable Loans, Advances and Deposits Cash and Cash Equivalents TOTAL ASSETS SHAREHOLDERS' EQUITY AND LIABILITIES Shareholders' Equity Issued Share Capital Share Premium Excess of Issue Price over Face Value of GDRs Capital Reserve Tax-Holiday Reserve Retained Earnings Non-Current Liabilities Long Term Borrowing-Net off Current Maturity (Secured) Liability for Gratuity & WPPF Deferred Tax Liability Current Liabilities and Provisions Short Term Borrowing from Banks Long Term Borrowing-Current Maturity Creditors and other Payables Accrued Expenses Dividend Payable Income Tax Payable Notes 2005 2004 7,449,630,817 7,412,474,567 37,156,250 3,495,849,163 1,683,722,059 779,798,943 603,764,931 428,563,230 6,186,983,049 6,149,826,799 37,156,250 2,471,513,225 1,394,794,907 600,028,183 468,680,833 8,009,302 Tk. 10,945,479,980 8,658,496,274 6,820,925,052 959,215,620 1,489,750,000 969,175,305 294,950,950 414,548,999 2,693,284,178 1,622,730,360 1,387,455,909 190,053,550 45,220,901 2,501,824,568 1,062,011,192 1,066,030,957 216,660,743 101,859,834 830,440 54,431,402 4,836,012,658 559,762,500 1,489,750,000 - - 445,355,048 2,341,145,110 2,120,954,071 1,919,349,651 158,595,611 43,008,809 1,701,529,545 1,121,910,904 298,448,322 206,448,378 46,716,287 1,065,437 26,940,217 7 8 9 10 11 12 13 14 15 16 17 18 19 6 (j) & 20 21 22 23 24 25 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY Tk. 10,945,479,980 8,658,496,274 The Notes are integral part of the Financial Statements. Approved and authorised for issue by the board of directors on 30 April 2006 and signed for and on behalf of the Board : Salman F Rahman Vice Chairman O. K. Chowdhury Director Dhaka 30 April, 2006 Ali Nawaz Chief Finance Officer Per our report of even date. M. J. Abedin & Co. Chartered Accountants 97 BEXIMCO PHARMACEUTICALS LIMITED Profit and Loss Account For the year ended 31 December 2005 Notes 2005 2004 26 27 32 33 34 35 36 3,327,022,574 2,402,700,962 (1,768,522,363) 1,558,500,211 (1,378,929,381) 1,023,771,581 (834,148,493) (119,006,535) (715,141,958) (467,453,733) (86,698,334) (380,755,399) 724,351,718 556,317,848 7,232,609 (221,949,324) 509,635,003 3,851,006 (190,578,415) 369,590,439 (24,268,333) (15,929,409) Net Sales Revenue Cost of Goods Sold Gross Profit Operating Expenses : Administrative Expenses Selling and Distribution Expenses Profit from Operations Other Income Finance Cost Net Profit Before Contribution to WPPF Contribution to Workers' Profit Participation/ Welfare Funds Net Profit Before Tax Income Tax Income/(Expense) Current Tax Deferred Tax Income Net Profit After Tax Transferred to Statement of Changes in Equity 6 (j), 20 & 37 485,366,670 3,895,094 (46,169,026) 50,064,120 Tk. 489,261,764 353,661,030 (24,285,250) (28,469,983) 4,184,733 329,375,780 Earnings Per Share (of Tk. 10 /- each) Number of shares used to compute EPS 38 Tk. 6.36 4.71 76,878,446 69,970,312 The Notes are integral part of the Financial Statements. Approved and authorised for issue by the board of directors on 30 April 2006 and signed for and on behalf of the Board : Salman F Rahman Vice Chairman O. K. Chowdhury Director Dhaka 30 April, 2006 Ali Nawaz Chief Finance Officer Per our report of even date. M. J. Abedin & Co. Chartered Accountants 98 Financial Statements BEXIMCO PHARMACEUTICALS LIMITED Statement of Changes in Equity For the year ended 31 December 2005 Share Capital Share Premium Excess of Issue Price over Face Value of GDRs Tax Holiday Reserve Capital Reserve Retained Earnings Total 508,875,000 1,489,750,000 1,090,052,509 1,507,743,468 4,596,420,977 At 01.01.2004 Net Profit After Tax for 2004 Tax Holiday Reserve provided for 2004 Tax Holiday reserve no longer required Issue of Bonus Shares for Prior Period (2003) 50,887,500 Cash Dividend of Prior Period (2003) Dividend Distribution Tax of Prior Period (2003) Effect of Changes in Accounting Policies 99,574,755 (744,272,216) 329,375,780 329,375,780 (99,574,755) 744,272,216 (50,887,500) - - - (50,887,500) (50,887,500) (5,088,750) (5,088,750) (33,807,849) (33,807,849) Restated Balance on 01.01.2005 559,762,500 1,489,750,000 - 445,355,048 - 2,341,145,110 4,836,012,658 Net Profit After Tax for 2005 Tax Holiday Reserve provided for 2005 (Note : 39) Capital Reserve on amalgamation of BIL with BPL (Note : 16) Tax Holiday Reserve no longer required Exchange of BPL shares for BIL shares in 2005 59,512,500 Issue of Bonus Shares for Prior Period (2004) 139,940,620 Cash Dividend of Prior Period (2004) Shares issued against GDR in 2005 200,000,000 969,175,305 117,823,763 (117,823,763) - 489,261,764 489,261,764 294,950,950 294,950,950 (148,629,812) 148,629,812 - 59,512,500 (139,940,620) - (27,988,125) (27,988,125) 1,169,175,305 At the end of year 2005 Tk. 959,215,620 1,489,750,000 969,175,305 414,548,999 294,950,950 2,693,284,178 6,820,925,052 Total Number of shares Shareholders' Equity per share 95,921,562 Tk. 71.11 The Notes are integral part of the Financial Statements. Approved and authorised for issue by the board of directors on 30 April 2006 and signed for and on behalf of the Board : Salman F Rahman Vice Chairman O. K. Chowdhury Director Dhaka 30 April, 2006 Ali Nawaz Chief Finance Officer Per our report of even date. M. J. Abedin & Co. Chartered Accountants 99 BEXIMCO PHARMACEUTICALS LIMITED Cash Flow Statement For the year ended 31 December 2005 2005 2004 3,303,531,937 (2,754,388,271) 549,143,666 2,372,385,819 (2,103,959,720) 268,426,099 (202,541,434) (34,977,184) 311,625,048 (157,393,995) (28,079,483) 82,952,621 (908,660,504) (8,311,848) 3,844,428 (913,127,924) (290,232,620) - 1,155,218 (289,077,402) 65,200,780 200,000,000 969,175,305 (180,510,567) (34,318,673) 1,019,546,845 418,043,969 8,009,302 2,509,959 Tk. 428,563,230 78,212,767 - - 182,038,263 (51,028,814) 209,222,216 3,097,435 4,911,867 - 8,009,302 Cash Flows from Operating Activities : Cash Receipts from Customers and Others Cash Paid to Suppliers and Employees Cash Generated from Operations Interest Paid Income Tax Paid Net cash Generated from Operating Activities Cash Flows from Investing Activities : Acquisition of Property, Plant and Equipment Amalgamation Expenditures (Note: 16) Disposal of Property, Plant and Equipment Net cash Used in Investing Activities Cash Flows from Financing Activities : Net Increase in Long Term Borrowings Issue of Shares against GDR Net Excess of Issue Price over Face Value of GDRs (Note : 15) Net (Decrease)/Increase in Short Term Borrowing from Banks Dividend Paid Net Cash Generated from Financing Activities Increase in Cash and Cash Equivalents Cash and Cash Equivalents at Beginning of Year Cash and Cash Equivalents of BIL obtained on amalgamation Cash and Cash Equivalents at end of Year The Notes are integral part of the Financial Statements. Approved and authorised for issue by the board of directors on 30 April 2006 and signed for and on behalf of the Board : Salman F Rahman Vice Chairman O. K. Chowdhury Director Dhaka 30 April, 2006 Ali Nawaz Chief Finance Officer Per our report of even date. M. J. Abedin & Co. Chartered Accountants 100 Financial Statements BEXIMCO PHARMACEUTICALS LIMITED Notes to the Financial Statements 31 December, 2005 1. Incorporation and Background Beximco Pharmaceuticals Limited (BPL/ the Company) was incorporated in Bangladesh as a Public Limited Company in the year 1976. It commenced its manufacturing operation in 1980. In 1985, the company went for public issue of shares in Bangladesh. In 2005, BPL becomes a global company by issuing and listing its shares in the form of Global Depository Receipts (GDRs) on the Alternative Investment Market (AIM) of the London Stock Exchange. Also during the year under review, the company took over, under a scheme of Amalagamation Beximco Infusions Ltd., a listed com- pany of the Beximco Group engaged in manufacturing and marketing of intravenous fluids. The shares of the Company are traded in Dhaka and Chittagong Stock Exchanges of Bangladesh and also in the London Stock Exchange. The registered office of the company is located at House No. 17, Road No. 2, Dhanmondi R/A, Dhaka. The industrial units are locat- ed at Kathaldia, Auspara, Tongi, Gazipur. 2. Nature of Business Operations The Company operates in a single industry segment. It is engaged in manufacturing and marketing of pharmaceuticals finished Formulation Products, Active Pharmaceutical Ingredients (APIs) and life saving Intravenous (I.V.) Fluids which it sells in the local as well as international markets. The company also provides contract manufacturing services. 3. Financial Statements - Its Preparation, Presentation and Disclosures “Historical Cost” is the basis of preparation of Financial Statements while the presentation and disclosures of information are based on the relevant and applicable requirements of the “Companies Act 1994; Securities and Exchange Rules 1987; Listing Regulations of Dhaka and Chittagong Stock Exchanges; and Bangladesh Accounting Standards (BASs)” adopted by the Institute of Chartered Accountants of Bangladesh (ICAB) based on International Financial Reporting Standards. 4. Reporting Currency and Level of Precision The financial statements are presented in Bangladesh currency (Taka), which have been rounded off to the nearest Taka except where indicated otherwise. 5. Comparative Amounts Wherever necessary, figures of the prior year has been re-arranged to conform to the current year's presentation. 6. Significant Accounting Policies And Valuation Principles (a) The Accounting policies and methods of computation used in preparation of the financial statements for the year ended 31st December 2005 are consistent with those adopted in the financial statements for the year ended 31 December 2004, except for changes in accounting policies as explained in (b) below. (b) Changes in Accounting Policies The Company has changed its accounting policies in the case of leases from “Operating Lease” to “Finance Lease” and in the case of stock dividend from “inclusion to” to “exclusion from” income. Had these policies been not changed, the net profit before tax for the year would have been under by Tk.32,092,224. 101 (c) Revenue Recognition Sales are recorded at the time of delivery of products along with issue of invoices. In conformity with the requirements of provisions of BAS 18 "Revenue", VAT as included in sales price and collected on behalf of customers is not considered as "Revenue". Dividend income on investment in shares has been recognized on approval of said dividend in the annual general meeting of relevant company. (d) Property, Plant and Equipment All property, plant and equipment is initially recorded at cost and depreciated over their expected useful life. The cost of acqui- sition of an asset comprises its purchase price and any directly attributable cost of bringing the asset to its working condition for its intended use inclusive of inward freight, duties and non-refundable taxes. In respect of major projects involving con- struction, related pre-operational expenses form part of the value of asset capitalized. Expenses capitalized also include appli- cable borrowing cost. Expenditure incurred after the assets have been put into operation, such as repairs & maintenance, is normally charged off as revenue expenditure in the period in which it is incurred. In situation, where it can be clearly demon- strated that the expenditure has resulted in an increase in the future economic benefit expected to be obtained from the use of the fixed assets, the expenditure is capitalized as an additional cost of the assets. Software are generally charged off as revenue expenditure. Fixed Assets include cost of assets (including exchange loss) acquired under finance lease. On retirement or otherwise disposal of fixed assets, the cost and accumulated depreciation are eliminated and, any gain or loss on such disposal is reflected in the profit and loss account which is determined with reference to the net book value of the assets and the net sales proceeds. (e) Depreciation on Property, Plant and Equipment No depreciation is charged on land. In respect of all other fixed assets, depreciation is provided to amortize the cost of the assets after commissioning, over their expected useful economic lives. Depreciation is computed using the reducing balance method. Full year's depreciation is charged on additions and no depreciation is provided on retirement, irrespective of date of addition or retirement respectively. The annual depreciation rates applicable to the principal categories of assets are: Building and Other Construction Plant and Machinery Furniture & Fixtures Transport & Vehicle Office Equipment 5% to 10% 7.5% to 15% 10% 20% 10% to 50% (f) Investment in Shares This is valued at cost. (g) Borrowing Costs Borrowing costs relating to projects already in commercial operation are charged as expenses for the year under review. In respect of projects that have not yet commenced commercial production, borrowing costs are debited to capital work in progress. 102 Financial Statements (h) Inventories Inventories are carried at the lower of cost and net realizable value. Cost is determined on weighted average cost basis. The cost of inventories comprises of expenditure incurred in the normal course of business in bringing the inventories to their present location and condition. Net realizable value is based on estimated selling price less any further costs expected to be incurred to make the sale. (i) Cash and Cash Equivalents This comprises cash in hand and at banks. (j) Income Taxes Current Tax Current tax has been provided on the estimated taxable profit for the year under review @ 30%, being the tax rate applica- ble for publicly traded company. It also includes adjustments for earlier year's short/excess provision. Deferred Tax The company has adopted deferred tax in compliance with the provisions of Bangladesh Accounting Standard (BAS)-12 “Income Taxes”. The Company's policy of recognition of deferred tax assets/liabilities is based on temporary differences (Taxable or deductible) between the carrying amount (Book value) of assets and liabilities for financial reporting purposes and its tax base, and accordingly, deferred tax income/expenses has been considered to determine net profit after tax and earn- ings per share (EPS). (k) Leases In compliance with the BAS 17 “Leases”, cost of assets acquired under finance lease along with obligation there against have been accounted for as assets and liabilities respectively of the company, and the interest element has been charged as expens- es. (l) Cost of Post Employment Benefits The Company's post employment benefits to eligible employees comprise of recognized contributory provident fund, unfunded gratuity and group insurance scheme. Assets of provident fund are held in a separate trustee administered fund as per the relevant rules and is funded by contributions from the employees and the company at pre-determined rates. Employees are entitled to gratuity benefit after completion of minimum five years of service in the company. The gratuity is calculated on the last basic pay and is payable at the rate of one month basic pay for every completed year of service. The company's contributions to the provident fund, gratuity and group insurance are charged off as revenue expenditure in the period to which the contributions relate. (m) Share Premium The balance in Share Premium Account shall be utilized in accordance with provisions of the Companies Act 1994 and as directed by the Securities and Exchange Commission in this respect. The Section 57 of the Companies Act 1994 provides that the share premium account may be applied by the company : (a) in paying up unissued shares of the company to be issued to members of the company as fully paid bonus shares ; (b) in writing off the preliminary expenses of the company ; (c) (d) in writing off the expenses of or the commission paid or discount allowed on any issue of shares or debentures of the company ; and in providing for the premium payable on the redemption of any redeemable preference shares or of any debenture of the company. 103 In this respect, a statutory notification was issued in 1992 by the Controller of Capital Issues (now the Securities and Exchange Commission), allowing the above stated utilization of share premium including one additional purpose in adjusting or amor- tizing of intangible assets, subject to prior approval. The said notification also provides that the fund of the premium account is to be utilized in order of priority. (n) Tax Holiday Reserve This is being created out of tax holiday profit to invest in the same undertaking or in any new industrial undertaking or in stocks and shares of listed companies or in government bonds or securities or for other purposes as required by the Income Tax Ordinance 1984. (o) Proposed Dividend Dividend if any proposed by the board of directors for the year under review shall be accounted for after approval by the shareholders in the annual general meeting. (p) Earnings Per Share (EPS) This has been calculated by dividing the basic earnings by the weighted average number of ordinary shares outstanding dur- ing the year. Basic Earnings This represents earnings for the year attributable to ordinary shareholders. As there was no preference dividend, minority inter- est or extra ordinary items, the net profit after tax for the year has been considered as fully attributable to the ordinary share- holders. Weighted Average Number of Ordinary Shares Outstanding during the year Basis of Computation The basis of computation of number of shares is in line with the provisions of BAS 33 "Earnings Per Share". The logic behind this basis is, that the bonus shares are issued to the existing shareholders without any consideration, and therefore, the num- ber of shares outstanding is increased without an increase in resources generating new earnings. In contrast, other shares were issued against consideration in cash or in kind, and accordingly there is an increase in resources generating new earnings. Therefore, the total number of shares issued in 2005 has been multiplied by a time weighting factor which is the number of days the specific shares were outstanding as a proportion of total number of days in the period. (q) Foreign Currencies The financial records of the company are maintained and the financial statements are stated in Bangladesh Taka. Foreign cur- rency transactions are recorded at the applicable rates of exchange ruling at the transaction date. Other monetary assets and liabilities, if any, denominated in foreign currencies at the balance sheet date are translated at the applicable rates of exchange ruling at that date. Exchange differences are charged off as revenue expenditure except exchange loss relating to obligation under lease which has been capitalized to relevant fixed assets being procured under the said obli- gation, as a requirement of the Companies Act 1994. The rates of relevant foreign exchanges at year end are : 1 US Dollar ($) = 1 EURO ( ) = 2005 Tk. 67.2500 Tk. 78.9381 2004 59.6250 81.5374 104 Financial Statements 7. Property, Plant and Equipment - Tk. 7,412,474,567 Particulars Land Building and Other Constructions Plant and Machinery Furniture and Fixtures Transport and Vehicle Office Equipment Total Cost At 01.01.2005 Additions out of BIL's amalgamation Effect of changes in accounting policy for Leases Additions during the year Exchange Loss Disposal during the year 1,089,985,327 14,961,444 501,296,222 86,445,073 - - - 8,543,035 94,366,839 - - - 638,654,224 472,067,695 145,887,587 10,659,015 13,048,609 (47,044,952) 40,023,039 8,499,879 - 5,774,302 41,408,687 25,700,483 14,743,300 25,292,952 - - (1,062,759) (1,346,710) 118,895,079 44,334,360 - 13,978,581 310,766 (555,000) 2,430,262,578 652,008,934 160,630,887 64,247,885 107,726,214 (50,009,421) Cost at 31 December, 2005 1,199,313,610 596,284,330 1,233,272,178 53,234,461 105,798,712 176,963,786 3,364,867,077 Accumulated Depreciation At 31 December, 2004 Additions out of BIL's amalgamation Effect of changes in accounting policy for Leases Depreciation during the year Adjustment for assets disposed off - 266,174,675 30,919,948 - - - - 27,086,312 - - 385,849,489 228,187,004 47,018,211 74,184,469 (44,285,999) 17,998,799 3,457,096 - 3,199,325 (214,684) 28,203,707 10,067,341 7,028,964 12,334,425 (1,173,423) 81,390,533 23,616,203 - 10,853,896 (402,254) 779,617,203 296,247,592 54,047,175 127,658,427 (46,076,360) Accumulated Depreciation at 31 December, 2005 - 324,180,935 690,953,174 24,440,536 56,461,014 115,458,378 1,211,494,037 Net Book Value at 31 December, 2005 Capital Work in Progress Carrying Value as on 31 December, 2005 Tk. 1,199,313,610 272,103,395 542,319,004 28,793,925 49,337,698 61,505,408 2,153,373,040 Tk. 5,259,101,527 Tk. 1,199,313,610 272,103,395 542,319,004 28,793,925 49,337,698 61,505,408 7,412,474,567 Assets includes lease hold assets of Tk. 1,336,389,964 at cost and Tk. 1,014,737,573 at written down value. Capital Work in Progress is arrived at as follows : Opening Balance Addition during the year Exchange Loss 2005 2004 4,392,597,712 844,412,619 22,091,196 Tk. 5,259,101,527 4,135,897,148 255,592,338 1,108,226 4,392,597,712 105 8. Investment in Shares - Tk. 37,156,250 2005 2004 This Consists of : a) 3,800,671 Shares of Tk. 10 Each of Padma Textile Mills Ltd. b) 1 Share of Tk.1,000,000 Each of Central Depository Bangladesh Ltd. (CDBL) 36,156,250 1,000,000 37,156,250 Tk. 36,156,250 1,000,000 37,156,250 The shares of the Padma Textile Mills Ltd. are listed in the Dhaka and Chittagong Stock Exchanges. The market value of each share of Padma Textile Mills Ltd. as on 29th December, 2005 was Tk. 21.90 ( on 31-12-04 Tk. 39.50) in the Dhaka Stock Exchange Ltd. and Tk. 22.10 (on 31-12-04 Tk. 40.40) in the Chittagong Stock Exchange Ltd. The investment in 3,800,671 shares represents 6.25% of total 60,810,750 issued, subscribed and paid-up shares of Padma Textile Mills Ltd. 9. Inventories - Tk. 1,683,722,059 This consists of as follows : Finished Goods Work in Process Raw Material Packing Material Laboratory Chemical Literature & Promotional Material Physician Sample Raw & Packing Material in Transit Stock of Stationery Spares & Accessories 378,744,903 156,374,814 695,165,382 229,060,186 2,145,268 18,745,269 12,998,593 107,063,860 1,874,526 81,549,258 Tk. 1,683,722,059 294,831,219 113,067,980 631,820,233 212,162,685 465,253 9,456,983 8,236,593 64,806,398 1,569,863 58,377,700 1,394,794,907 10. Accounts Receivable - Tk. 779,798,943 This is unsecured, considered good and is falling due within one year. This includes receivable of Tk. 48,424,050 equivalent to US$ 826,785 (on 31-12-2004 Tk. 45,146,352 equivalent to US $ 795,717) against export sales. This also includes Tk. 683,362,096 ( on 31-12-2004 Tk. 487,675,820) due from I & I Services Ltd., the local distributor of the pharmaceutical products of the company and a "Related Party". The maximum amount due from that company during the year was Tk. 693,297,037 on 28-11-2005 (on 27-10-2004 Tk. 489,724,178). This further includes Tk. 46,740,428 (2004 : Tk. 66,740,428) due against sale of plant & machinery. No amount was due by the directors, managing agent, managers and other officers of the company and any of them severally or jointly with any other person. 106 Financial Statements 11. Loans, Advances and Deposits - Tk. 603,764,931 This is unsecured, considered good and consists of as follows : Clearing & Forwarding VAT Claim Receivable Security Deposit Lease Deposit Earnest Money Bank Guarantee Margin Employees Rent Advance Motor Cycle Raw & Packing Material Others 2005 2004 41,109,112 128,957,135 14,705,569 10,231,066 23,635,890 3,033,844 1,539,813 28,039,033 1,627,297 68,811,816 233,898,656 48,175,700 Tk. 603,764,931 18,657,163 93,702,643 7,882,871 8,948,772 25,242,790 1,582,993 1,310,813 12,982,787 1,169,260 30,581,337 212,153,433 54,465,971 468,680,833 (a) The maximum amount due from the officers during the year was Tk. 28,345,169 on 17.10.2005 (on 29.11.04 Tk. 13,042,512). (b) No amount was due by the directors, managing agent, managers and other officers of the company and any of them severally or jointly with any other person, except as stated above. (c) No amount was due by any related party. 12. Cash and Cash Equivalents - Tk. 428,563,230 This consists of as follows : (a) Cash in Hand (b) Imprest Cash (c) Cash at Banks : 529,884 780,965 (i) In Current Accounts (ii) In FDR Accounts (iii) In F.C. Accounts (Equivalent US$ 125,353.72) (on 31-12-2004 US$ 100,531) 16,520,973 402,301,370 8,430,038 427,252,381 Tk. 428,563,230 771,836 337,027 906,299 - 5,994,140 6,900,439 8,009,302 13. Issued Share Capital - Tk. 959,215,620 This represents : Authorized : 200,000,000 Ordinary Shares of Tk. 10/- each Issued, Subscribed and Paid-up : Tk. 2,000,000,000 1,000,000,000 43,600,000 Ordinary Shares (2004: 23,600,000) of Tk. 10/- each fully paid-up in cash 46,370,312 Bonus Shares (2004: 32,376,250) of Tk. 10/- each 5,951,250 Shares of Tk. 10/- each issued in Exchange of Shares of Beximco Infusions Ltd. 95,921,562 Shares 436,000,000 463,703,120 59,512,500 Tk. 959,215,620 236,000,000 323,762,500 - 559,762,500 107 The movement of issued shares during the year 2005 is as follows : (a) As on 01.01.2005 Issued in 2005 against : Bonus for 2004 Exchange of Shares of Beximco Infusions Ltd's Underlying Shares against GDRs Closing as at 31.12.2005 Number of Shares Amount in Taka 55,976,250 559,762,500 13,994,062 5,951,250 20,000,000 39,945,312 95,921,562 139,940,620 59,512,500 200,000,000 399,453,120 959,215,620 (b) Composition of Shareholding : Sponsors Foreign Investors ICB including ICB Investors Account General Public and Institutions (c) Distribution Schedule : 2005 No. of shares 21,471,970 20,870,436 14,191,356 39,387,800 95,921,562 % 22.38 21.76 14.79 41.07 100.00 2004 No. of shares 15,082,122 763,808 12,073,243 28,057,077 55,976,250 % 26.94 1.36 21.57 50.13 100.00 Range of Holdings In number of shares No. of Shareholders 2005 2004 % of Shareholders 2005 2004 No. of Shares % of Share Capital 2005 2004 2005 2004 1 to 499 500 to 5,000 5,001 to 10,000 10,001 to 20,000 20,001 to 30,000 30,001 to 40,000 40,001 to 50,000 50,001 to 100,000 100,001 to 1,000,000 Over 1,000,000 Total 40,419 9,122 563 278 76 31 23 40 29 10 50,591 42,259 7,705 380 220 66 26 20 40 28 6 50,750 79.89% 18.03% 1.11% 0.55% 0.15% 0.06% 0.05% 0.08% 0.06% 0.02% 83.27% 5,268,754 15.18% 12,783,259 3,966,045 0.75% 3,973,112 0.43% 1,867,586 0.13% 1,067,595 0.05% 1,001,725 0.04% 2,835,678 0.08% 0.06% 8,980,367 0.01% 54,177,441 100.00% 100.00% 95,921,562 5,296,489 10,087,931 2,684,555 3,095,361 1,590,746 907,814 864,500 2,684,561 5,749,746 23,014,547 55,976,250 5.49% 13.33% 4.13% 4.14% 1.95% 1.11% 1.04% 2.96% 9.36% 56.49% 100.00% 9.46% 18.02% 4.80% 5.53% 2.84% 1.62% 1.54% 4.80% 10.27% 41.12% 100.00% (d) Market Price : The shares are listed in the Dhaka, Chittagong and London Stock Exchanges. On 29.12. 2005, each share was quoted at Tk. 57.80 (on 31.12.04 Tk. 92.10) in the Dhaka Stock Exchange Ltd. and Tk. 58.00 (on 31.12.04 Tk. 93.00) in the Chittagong Stock Exchange Ltd., and in London Stock Exchange at Tk. 74.88 equivalent to GBP 0.655 at 31.12.2005 (e) Option on unissued shares : There is option regarding authorized capital not yet issued but can be used to increase the issued, subscribed and paid-up capital through the issuance of new shares against GDRs in the number of 6,666,667 (2004 : none). 108 Financial Statements 14. Share Premium - Tk. 1,489,750,000 This is made-up as follows : (a) 590,000 shares issued in 1992 at the premium of Tk. 325/- per share (b) 1,180,000 shares issued in 1994 at the premium of Tk. 1,100/- per share 2005 2004 191,750,000 1,298,000,000 Tk. 1,489,750,000 191,750,000 1,298,000,000 1,489,750,000 15. Excess of Issue Price over Face Value of GDRs - Tk. 969,175,305 This represents the issue price of 20,000,000 GDRs at Tk. 1,397,400,000 net of face value of underlying shares against GDRs and GDR expenses. 16. Capital Reserve - Tk. 294,950,950 This is created out of amalgamation of Beximco Infusions Ltd. (BIL) with the company and is arrived as follows : Shareholders' Equity of BIL as on 1 January 2005 Prior years adjustment for changes in accounting policy Cash Dividend Shares of BPL issued in exchange of shares of BIL at 4.5 BPL shares for 1 BIL share Amalgamation Expenses 336,941,728 31,583,570 (5,750,000) (59,512,500) (8,311,848) Tk. 294,950,950 Pursuant to a Scheme of amalgamation of Beximco Infusions Limited (BIL) with the Company approved by the High Court Division of the Supreme Court of Bangladesh on 14 June 2005, the assets, liabilities, rights, benefits and obligations of BIL as of 1 January 2005 were deemed to have been transfered to the company on 1 July 2005. The shares of the Company were issued on 10 July 2005 in exchange for the shares of BIL after approval by SEC and the shareholders of the Company and BIL. On 11 July 2005, the BIL ceased to exist; and the listing of BIL shares with DSE and CSE were cancelled. The excess of the assets over liabilities of BIL and amalgamation expenses thereof were transfered to Capital Reserve on amalgamation. 17. Tax-Holiday Reserve - Tk. 414,548,999 This has been provided for as per provisions of the Income Tax Ordinance, 1984 which is arrived at as follows : Opening Balance Add: Provided during the year (Note : 39) Less : Tax Holiday Reserve no longer required 445,355,048 117,823,763 (148,629,812) Tk. 414,548,999 1,090,052,509 99,574,755 (744,272,216) 445,355,048 109 18. Long Term Borrowing (Secured) - Tk. 1,387,455,909 This Consists of : (a) Project Loan (b) Interest and PAD (c) Obligation to Shamil Bank under Lease (d ) Obligation Under other Finance Lease (a) Project Loan 2005 2004 1,182,785,716 148,209,229 - 56,460,964 Tk. 1,387,455,909 750,486,906 200,627,709 913,653,134 54,581,902 1,919,349,651 This loan was sanctioned under the consortium arrangement of Janata Bank, Sonali Bank, Agrani Bank, Rupali Bank and United Commercial Bank Ltd. for the US FDA standard oral solid dosages facility of the company. Janata Bank was the lead bank to the consortium. This Loan is secured against : (i) First (registered mortgage) charge on paripassu basis with the participating banks on 1,112.82 decimals of land along with the building and other construction to be built thereon at Kathaldia and Aushpara of Gazipur; and (ii) First paripassu charge by way of hypothecation on all assets of the company both present and future. (iii) This Loan, carrying interest at 11% to 13% per annum, is repayable in half-yearly installments by 2012. The first installment date is yet to be fixed. (b) Interest and PAD This represents PAD and blocked interest of Janata Bank to be paid in quarterly installments over a period of 7(seven) years ending by 30.04.2011. 19. Liability for Gratuity & WPPF - Tk. 190,053,550 This consists of payable to the permanent employees at the time of separation from the company and Loan from Workers' Profit Particiaption/Welfare Funds as detailed below : (a) Gratuity Payable Opening Balance Additions out of BIL amalgamation Provided during the year Paid during the year (b) Loan from Workers' Profit Participation/Welfare Funds 67,963,396 5,175,566 16,030,813 89,169,775 (5,571,721) Tk. 83,598,054 106,455,496 Tk. 190,053,550 59,454,204 - 11,049,142 70,503,346 (2,539,950) 67,963,396 90,632,215 158,595,611 110 Financial Statements 20. Deferred Tax Liability - Tk. 45,220,901 This is arrived at as follows: Opening Balance Additions out of BIL amalgamation Deferred Tax Income for the year (Note : 37) 21. Short Term Borrowing from Banks - Tk. 1,062,011,192 This represents : (a) Janata Bank : Cash Credit-Pledge Cash Credit-Hypothecation LIM (b) Citibank NA (c) Standard Chartered Bank (d) IPDC 2005 2004 43,008,809 52,276,212 (50,064,120) Tk. 45,220,901 47,193,542 - (4,184,733) 43,008,809 152,305,681 582,349,567 218,200,735 40,853,947 18,301,262 50,000,000 Tk. 1,062,011,192 158,595,289 639,130,578 237,836,094 55,993,037 30,355,906 - 1,121,910,904 22. Long Term Borrowing-Current Maturity - Tk. 1,066,030,957 This consists of as follows and is payable within next twelve months from the Balance Sheet date : Interest & PAD Obligation to Shamil Bank under Lease Project Loan Obligation under Finance Lease Obligation to Shamil Bank under Lease 92,679,968 921,329,543 - 52,021,446 Tk. 1,066,030,957 69,772,113 - 186,407,266 42,268,943 298,448,322 Pursuant to a Settlement Agreement dated 20 June 2005, a sum of US$ 13,500,000 is due to Shamil Bank of Bahrain EC of Bahrain, payable in two installments by December 2006. This lease finance represents assets acquired for various expansion projects of the company. 23. Creditors and other Payables - Tk. 216,660,743 This consists of : Trade Creditors Provident Fund Customs Debenture Others These are unsecured, and falling due within one year. 103,097,124 88,291,329 - 25,272,290 Tk. 216,660,743 80,912,808 70,651,017 1,758,387 53,126,166 206,448,378 111 24. Accrued Expenses - Tk. 101,859,834 This is falling due within one year and consists of as follows : For expenses - Unsecured Workers' Profit Participation/ Welfare Funds (current year’s provision) 2005 2004 77,591,501 24,268,333 Tk. 101,859,834 30,786,878 15,929,409 46,716,287 25. Income Tax Payable - Tk. 54,431,402 This is arrived at as follows : Opening Balance Additions out of BIL amalgamation Tax provided in 2005 (Note : 37) Shortfall in tax provision of earlier years Tax paid (including advance tax) during the year 26. Net Sales Revenue - Tk. 3,327,022,574 This represents net sales and consists of as follows : Local Sales Export Sales - US $ 1,395,584 (in 2004 US$ 1,346,319 ) Sales represent : Tablet & Capsules Pcs Bottles & Tubes Pcs Kg. Basic Chemicals Bottles IV Fluids 26,940,217 16,299,343 43,217,283 2,951,743 89,408,586 (34,977,184) Tk. 54,431,402 26,549,717 - 28,469,983 - 55,019,700 (28,079,483) 26,940,217 3,238,165,045 88,857,529 Tk. 3,327,022,574 2,323,215,567 79,485,395 2,402,700,962 1,559,743,959 25,760,260 - 8,993,424 1,379,534,655 24,936,127 350 - 112 Financial Statements 27. Cost of Goods Sold - Tk. 1,768,522,363 2005 2004 This is made-up as follows : Work-in-Process (Opening) Additions out of BIL amalgamation Raw Material Consumed Packing Material Consumed Laboratory Chemical Consumed Work-in-Process (Closing) TOTAL CONSUMPTION Factory Overhead COST OF PRODUCTION Finished Goods (Opening) Additions out of BIL amalgamation Finished Goods Purchase Finished Goods Available Transfer of Bulk Chemicals to Formulation Raw Material Inventory Finished Goods (Closing) Cost of Physician Sample Item wise quantity and value of Finished Goods Stock are as follows : Notes 28 29 30 31 113,067,980 11,302,636 997,493,949 528,516,245 8,169,985 1,658,550,795 (156,374,814) 1,502,175,981 338,892,462 1,841,068,443 294,831,219 26,412,684 3,200,254 2,165,512,600 - (378,744,903) 1,786,767,697 (18,245,334) Tk. 1,768,522,363 90,349,959 - 787,768,299 332,424,935 5,962,199 1,216,505,392 (113,067,980) 1,103,437,412 260,322,163 1,363,759,575 387,269,598 - - 1,751,029,173 (66,424,989) (294,831,219) 1,389,772,965 (10,843,584) 1,378,929,381 Item Stock as on 01-01-05 Tablet & Capsule Bottle & Tube Basic Chemicals Stock as on 31-12-05 Tablet & Capsule Bottle & Tube Basic Chemicals IV Fluids Unit Quantity Value Pcs Pcs Kg. 299,836,507 4,284,995 2,372 Pcs Pcs Kg. Bottles 302,731,794 6,997,074 2,372 2,580,489 210,437,857 81,926,173 2,467,189 Tk. 294,831,219 235,154,176 111,789,537 2,467,189 29,334,001 Tk. 378,744,903 113 28. Raw Material Consumed - Tk. 997,493,949 This is made-up as follows : Opening Stock Additions out of BIL amalgamation Purchase (including transferred Bulk Chemicals) Closing Stock Item wise quantity and value : Opening Stock Additions out of BIL amalgamation Add : Purchase Less : Closing Stock Consumption Raw material consumed is approximately 78% imported. 29. Packing Material Consumed - Tk. 528,516,245 This is made-up as follows : Opening Stock Additions out of BIL amalgamation Purchase Closing Stock 2005 2004 631,820,233 6,331,275 1,054,507,823 (695,165,382) Tk. 997,493,949 Kg Ltr. Unit Kg Kg Ltr. Unit Kg Ltr. Unit Kg Ltr. Unit TOTAL(Qnty) 1,183,477 3,761 70,456,902 46,053 3,385,414 2,046 125,013,798 1,474,913 3,711 81,104,142 3,140,031 2,096 114,366,558 400,129,288 - 1,019,459,244 (631,820,233) 787,768,299 TOTAL(Value) 616,557,513 3,775,925 11,486,795 631,820,233 6,331,275 1,031,029,459 1,364,484 22,113,880 1,054,507,823 677,434,382 3,838,111 13,892,889 695,165,382 976,483,865 1,302,298 19,707,786 Tk. 997,493,949 212,162,685 19,520,501 525,893,245 (229,060,186) Tk. 528,516,245 118,233,247 - 426,354,373 (212,162,685) 332,424,935 Packing material consumed is approximately 46% imported. Particulars in respect of quantity of each packing material as well as value of each class of packing material are not given as the number of items as well as classes of items are numerous. 114 Financial Statements 30. Laboratory Chemical Consumed - Tk. 8,169,985 This is made-up as follows : Opening Stock Additions out of BIL amalgamation Purchase Closing Stock 2005 2004 465,253 1,193,992 8,656,008 (2,145,268) Tk. 8,169,985 395,921 - 6,031,531 (465,253) 5,962,199 Particulars in respect of quantity of each laboratory chemical as well as value of each class of laboratory chemical are not given as the number of items as well as classes of items are numerous. 31. Factory Overhead - Tk. 338,892,462 This consists of as follows : Salary & Allowances (including welfare expenses, retiral benefit and contract labour) Repairs & Maintenance Insurance Premium Municipal Tax & Land Revenue Advertisement & Subscription Traveling & Conveyance Entertainment Research and Development Printing & Stationary Telephone & Postage Toll Charge/ (income) - Net Electricity, Gas & Water Other Expenses Depreciation 134,469,797 101,417,546 39,456,949 6,498,801 620,390 175,410 1,310,215 507,828 16,710,265 3,171,742 1,738,720 3,917,000 16,901,507 5,938,553 107,475,285 338,892,462 Tk. 27,632,150 4,320,384 410,228 172,297 1,311,389 198,437 15,092,887 2,871,120 1,455,375 (3,647,292) 9,406,726 7,691,541 91,989,375 260,322,163 (a) Salary and allowances include Company's Contribution to provident fund of Tk. 2,169,838 (in 2004 Tk. 1,809,995). (b) In 2005, all the 603 factory employees received annual salary and allowances of Tk. 36,000 and above. (c) The value of imported stores and spares consumed is Tk. 5,136,590 (in 2004 Tk. 4,035,791) which is 42% (46% in 2004) of total stores and spares consumed as included in repairs & maintenance. (d) Other expenses does not include any item exceeding 1% of total revenue. 115 32. Administrative Expenses - Tk. 119,006,535 This consists of as follows : Salary & Allowances (including welfare expenses and retiral benefit) Rent Expenses Repairs & Maintenance Donation & Subscription Traveling & Conveyance Entertainment Printing & Stationary Auditors' Remuneration Telephone & Postage Electricity, Gas & Water Legal & Consultancy Fee AGM and Company Secretarial Expenses Other Expenses Depreciation 2005 2004 60,096,658 5,062,150 8,141,534 1,522,742 7,074,211 1,805,972 1,099,500 300,000 3,273,840 3,552,365 3,350,442 13,759,040 1,678,042 8,290,039 Tk. 119,006,535 43,191,044 4,241,545 6,359,844 842,035 4,884,470 1,148,491 767,733 200,000 2,781,576 3,122,254 1,439,358 9,941,472 1,511,700 6,266,812 86,698,334 (a) Salary and allowances include provident fund contribution of Tk. 1,222,163 (in 2004 Tk. 919,146). (b) In 2005, all the 88 employees of head office (excluding employees relating to selling and distribution) received annual salary and allowances of Tk. 36,000 and above. (c) Auditors' remuneration represents audit fee for auditing the accounts for the year 2005. 33. Selling and Distribution Expenses - Tk. 715,141,958 This consists of as follows : Salary & Allowances (including welfare expenses and retiral benefit) Rent Expenses Repairs & Maintenance Traveling & Conveyance Entertainment Printing & Stationary Telephone & Postage Electricity, Gas & Water Market Research & New Products Training & Conference Sample Expenses Promotional Expenses Literature/News Letter Export Expenses Distribution Commission Depreciation Other Expenses 229,720,919 14,174,590 12,531,386 112,894,909 1,769,800 9,179,084 8,177,292 3,012,474 31,002,585 18,679,751 34,687,667 67,568,237 43,429,760 7,922,655 99,483,680 11,893,102 9,014,067 Tk. 715,141,958 131,438,824 12,026,348 11,281,416 56,870,392 1,499,916 6,018,420 7,794,438 2,748,366 12,807,376 7,956,113 14,232,342 28,383,518 24,718,107 4,850,415 47,212,748 3,134,163 7,782,497 380,755,399 (a) Salary and allowances include provident fund contribution of Tk. 5,357,062 (in 2004 Tk. 4,218,457). 116 Financial Statements (b) In 2005, all the 1,266 employees relates to selling and distribution received annual salary and allowances of Tk. 36,000 and above. (c) Distribution commission represents 3% of sales other than export sales which has been paid to the I & I Services Ltd., the local distributor of the company and a related party. 34. Other Income - Tk. 7,232,609 This is arrived at as follows : Interest Income Cash Dividend received on investment in shares of Padma Textile Mills Ltd. Exchange gain on retention quota (F.C.) accounts Liability against Customs Debenture Written off (Loss)/Profit on sale of Fixed Assets 2005 2004 2,873,370 1,520,269 1,169,216 1,758,387 (88,633) Tk. 7,232,609 - 2,895,750 399,385 - 555,871 3,851,006 35. Finance Cost - Tk. 221,949,324 This is made-up as follows : Interest on Cash Credit and others Interest on loan from PF and WPP & Welfare Fund 202,541,434 19,407,890 Tk. 221,949,324 175,918,104 14,660,311 190,578,415 36. Contribution To Workers' Profit Participation / Welfare Funds - Tk. 24,268,333 This represents 5% of net profit before tax after charging the contribution as per provisions of the Companies Profit (Workers' Participation) Act, 1968 and is payable to workers as defined in the said Act. 37. Income Tax (Income)/Expenses - Tk. (3,895,094) This consists of as follows : (a) Current Tax (b) Deferred Tax Income Note 6 (j) & 20 Current Tax consists of as Follows : Tax for the year under review Short provision of Tax relating to earlier years 46,169,026 (50,064,120) (3,895,094) 43,217,283 2,951,743 46,169,026 Tk. 28,469,983 (4,184,733) 24,285,250 28,469,983 - 28,469,983 117 38. Earnings Per Share (EPS) : 2005 2004 (a) Earnings attributable to the Ordinary Shareholders (Net profit after Tax) (b) Weighted average number of Ordinary Shares outstanding during the year Tk. 489,261,764 76,878,446 329,375,780 69,970,312 Earning Per Share (EPS) Tk. 6.36 4.71 The definition of numerator (Earnings) and denominator (Weighted average number of shares) is stated in Note-6 (p). 39. Tax-Holiday Reserve - Tk. 117,823,763 This represents 40% of net profit of the Tax-Holiday units. 40. Related Party Transactions : The Company carried out a number of transactions with related parties in the normal course of business and on arms length basis. The nature of transactions and their total value is shown below : Name of Related Parties Nature of Transactions (a) I & I Services Ltd. (b) I & I Services Ltd. (c) Padma Textile Mills Ltd. (a) Local Distribution (b) Distribution Commission (c) Dividend Income Value of Transaction in 2005 Balance at year end 3,777,772,309 99,483,680 1,520,269 683,362,096 - - 118 Financial Statements 41. Particulars of Disposal of Property, Plant and Equipment The following assets were disposed off : During The Year Ended 31-12-05 : PARTICULARS OF ASSETS COST DEP.UPTO 31-12-04 W.D.V. AS ON 31-12-04 SALES PRICE PROFIT/ (LOSS) NAME OF PARTIES MODE OF DIS- POSAL Motor Cycle RX-100 C.C. Hero Motor Cycle 100 C.C. Motor Cycle Motor Cycle Toyota Corolla TX Toyota Corolla Station Wagon Toyota EL 30 Tarses Photocopy Machine Photocopy Machine Machinery Furniture Furniture Furniture Furniture Furniture Office Equipment Office Equipment Furniture Furniture Total: 44,570 55,035 13,333 22,528 485,414 365,416 360,414 140,000 140,000 16,045 43,893 12,187 20,109 433,293 326,180 321,715 77,881 77,881 28,525 11,142 1,145 2,419 52,121 39,236 38,699 62,119 62,119 47,044,952 44,285,999 2,758,954 202,528 90,000 383,579 144,342 10,974 19,914 8,594 14,172 2,479 Tk. 50,009,421 46,076,360 3,933,061 43,982 10,000 61,620 75,658 9,676 120,086 126,406 9,828 3,921 246,510 100,000 445,199 220,000 20,650 140,000 135,000 24,000 6,400 41,700 33,000 17,100 5,100 210,000 170,500 125,300 15,000 15,000 2,530,000 202,528 90,000 350,000 25,000 8,000 2,250 2,250 1,000 700 3,844,428 Anwar Motor Bike & Engg. 13,175 21,858 Mr. Gulam Rosul 15,955 2,681 Anwar Motor Bike & Engg. Anwar Motor Bike & Engg. 157,879 Mr. Faisal Khair Chow. 131,264 Mr. Sabbir Hossain Khan 86,601 (47,119) (47,119) (228,954) Jamal Automobile Ramjan Ali Auto Center Ramjan Ali Auto Center Hasan Enterprise - Mr. Mohd. Akhter Hussain - Mr. Md. Nurul Islam (33,579) (119,342) (2,974) (17,664) (6,344) (13,172) (1,779) (88,633) Dr. M.A. Malek Chowdhury Faisal Tyre Store Faisal Tyre Store Faisal Tyre Store Faisal Tyre Store Faisal Tyre Store Faisal Tyre Store Tender Tender Tender Tender Tender Tender Tender Tender Tender Tender Negotiation Negotiation Negotiation Tender Tender Tender Tender Tender Tender 42. Payment/Perquisites to Directors and Officers : (a) The aggregate amounts paid to/ provided for the officers of the company as defined in the Securities and Exchange Rules 1987 are disclosed below : 2005 2004 Managerial Remuneration 20,240,480 1,668,706 Gratuity 1,779,048 Company's Contribution to Provident Fund 2,995,580 Bonus Perquisites : Housing Transport Medical Telephone Electricity, Gas & Water Total 6,881,638 5,977,451 2,165,891 2,501,781 1,746,468 Tk. 45,957,043 18,581,349 1,229,911 1,211,458 2,301,273 5,789,341 4,447,985 1,540,149 1,770,752 1,252,839 38,125,057 (b) No compensation was allowed by the company to the Directors of the company. 119 (c) No amount of money was expended by the company for compensating any member of the board for special services rendered. (d) No board meeting attendance fee was paid to the directors of the company. 43. Production Capacity, Actual Production in 2005 : Production Capacity Actual Production Excess/(Shortfall) Unit 2005 2004 2005 2004 2005 2004 Solid Section Tablet & Capsule 1,336 (in million pcs) 1,336 1,789 1,542 453 206 Liquid Section IV Fluid (Addition Bottle & Tube (in million pcs) 26 26 29 24 through BIL amalgamation) Bottle 14 - 15 - 3 1 (2) - 44. Capital Expenditure Commitment The company has capital expenditure amounting US $ 3,458,930 contracted but not incurred or provided for at 31 December 2005. 45. Finance Lease Commitment At 31December 2005, the company had annual commitment under finance leases as set out below : Leases expire within 1 year Leases expire within 2-5 years (inclusive) Leases expire after five years 72,544,698 79,066,900 - Tk. 151,611,598 46. Claim not Acknowledged as Debt There was no claim against the company not acknowledged as debt as on 31.12.2005. 47. Un-availed Credit Facilities The company has no credit facilities available to the company under any contract, other than trade credit available in the ordinery course of business and not availed of as on 31.12.2005. 48. Payments Made in Foreign Currency : Import of Machinery Import of Raw & Packing Material and Spares Foreign Currency (Equivalent US$) Taka 3,285,590 14,795,389 212,117,678 955,190,284 No other expense including royalty, technical expert and professional advisory fee, interest, etc. was incurred or paid in foreign currencies except as stated above. 120 Financial Statements 49. Dividend Paid to the Non-resident Shareholders in 2005 : (a) Dividend for 2004 was declared on 02-06-2005 and therefore, dividend for 2004 was paid in 2005. (b) Dividend of Tk. 264,655 relating to the year 2004 was paid to 6 non-resident shareholders against 529,309 shares held by them. (c) No dividend was remitted in foreign currency but paid in local currency to their local custodian banks. 50. Foreign Exchange Earned : (a) Export Sales of US$ 1,395,584 (in 2004 US$ 1,346,319). (b) No other income including royalty, technical assistance and professional advisory fee, interest and dividend was earned or received in foreign currency. 51. Commission/Brokerage to selling agent : No commission was incurred or paid to any sales agent nor any brokerage or discount other than conventional trade discount was incurred or paid against sales. 52. Post Closing Events : Following events have occurred since the Balance Sheet date: (a) The company paid an amount of US$ 800,000 equivalent to Tk. 56,285,000 against obligation to Shamil Bank under lease. (b) The directors recommended 15% cash dividend. The dividend proposal is subject to shareholders' approval at the forthcoming annual general meeting. (c) Company's short term borrowing to Shandard Chartered Bank has been fully settled after payment of last outstanding balance of Tk. 18,301,262. (d) Except the fact stated above, no circumstances have arisen since the balance sheet date which would require adjustment to, or disclosure in, the financial statements or notes thereto. Salman F Rahman Vice Chairman O. K. Chowdhury Director Ali Nawaz Chief Finance Officer Dhaka 30 April, 2006 Corporate Headquarter 17 Dhanmondi R/A, Road No. 2 Dhaka 1205, Bangladesh Phone : +880-2-8611891 (5 lines) Fax : +880-2-8613470 Email : beximchq@bol-online.com Website : www.beximco.net Operational Headquarter 19 Dhanmondi R/A, Road No. 7 Dhaka 1205, Bangladesh Phone : +880-2-8619151 (5 lines), +880-2-8619091 (5 lines) Fax : +880-2-8613888 Email : info@bpl.net Website : www.beximcopharma.com Factory 126 Kathaldia, Tongi, Gazipur Legal Advisor Huq and Company 47/1 Purana Paltan, Dhaka-1000 Auditors M. J. Abedin & Co. Chartered Accountants National Plaza (6th Floor), 1/G Free School Street Sonargaon Road, Dhaka-1205 Bankers Janata Bank Local office 1 Dilkusha C/A, Dhaka-1000 Citibank N.A. Chamber Building 122-124 Motijheel C/A, Dhaka-1000 Concept, Text and Design : Marketing Department, Beximco Pharma Printed by : Mavis International, Dhaka BEXIMCO PHARMA We are building a healthier tomorrow www.beximcopharma.com 

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