Parabolic Drugs Limited– IPO Note - ANS Pvt. Ltd.

According to the Ministry of Commerce, Report of the Task Force, December 2008, currently,the Indian pharmaceutical industry is one of the world’s largest and most developed, rankingfourth in volume terms and 13th in value terms. In the API segment, India ranks third in theworld producing about 500 different APIs. India has emerged as the country with the largestnumber of USFDA approved plants outside US. According to the Department of Industrial Policy& Promotion, the drugs and pharmaceuticals sector has attracted foreign direct investment(“FDI”) worth USD 121.8 million during the period April-October, 2009. The cumulative FDIinflows in this sector from April 2000 to October 2009 have been USD 1.58 billion.The Indian pharmaceutical industry is expected to grow at a CAGR of 14.2% to around USD 50billion in 2015- 16. Exports are expected to grow at a CAGR of 16.2% while the domestic marketis expected to grow by 12.5%.API manufacturers in India supply APIs to domestic formulation companies, which cater todomestic and/or export markets, and also export APIs directly to regulate and/or semiregulated/unregulated markets abroad.CONTRACT RESEARCH AND MANUFACTURING SERVICES INDUSTRYThe R&D and manufacturing outsourcing market (CRAMS) has two major segments – contract(custom) manufacturing services and contract research (drug discovery and development)services. Drug discovery and development outsourcing, also known as contract research, spanstarget identification and lead optimization to Clinical Trial IIa. Contract manufacturing, spansfrom clinical trial phase IIb to the off-patent stage and includes manufacturing of intermediates,APIs and formulations. Custom Synthesis (“CS”) forms an important business sub-segment ofCRAMS. CS entails synthesis of compounds, as per customer specification/requirements. Thus,it involves supplying initial material, reference compounds, derivatives of lead compounds andintermediates, especially for molecules in the development stage or drugs under patent.