Panacea Biotec plans to raise up to $42M

Delhi-based drug maker Panacea Biotec Ltd is looking to raise up to Rs 250 crore ($42 million) by way of issue of securities as per a company statement. The company’s board is meeting on August 1, 2014, to consider and approve the quarter results besides the fundraising plans.

The firm did not disclose for what purpose it seeks to raise money and through what route. With the opening of the primary market many firms have tapped the QIP route to raise funds over the last two months.

As reported by VCCircle, Panacea Biotec had earlier put its Gurgaon-based hospital—Panacea New Rise—on the block.

The company has been facing financial headwinds and saw its consolidated net revenue decline 12.5 per cent to Rs 475 crore for the year ended March 31, 2014. Its net loss halved to Rs 116.88 crore in the same period. Its finance cost rose almost 50 per cent to Rs 150 crore last year.

It started facing challenges in 2011, when World Health Organisation (WHO) delisted three of its diphtheria-pertussis-tetanus based combination vaccines from its list of pre-qualified vaccines. A year later, Panacea withdrew its oral polio vaccine from WHO list of pre-qualified vaccines stating the facility where the vaccine is manufactured needs further corrective actions.

Panacea has been looking at ways to divest its assets to raise capital. Earlier, it entered into a partnership with Bestech Group to develop a township project over 100-acre plot at Pataudi Road which it owned.

Serum Institute holds 14.58 per cent of the firm.

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