Dear Shareholders,
It gives me immense pleasure to present to you the 41st Annual
Report of ZIM Laboratories Limited (ZIM) for the Fiscal Year 2025. I hope this message
finds you and your families in good health and high spirits.
Business Overview
FY25 marked a year of focussed strategic execution and measured
business expansion, underpinned by our continued commitment to innovation, quality, and
sustainable growth.
Our Pharmaceutical business remained the primary revenue contributor,
accounting for 75% of Total Operating Income, reflecting the strength of our core strategy
and disciplined execution. The Nutraceutical segment contributed 25%, aligning with
ZIM's strategic focus on balanced and diversified
growth through innovative and differentiated products. Exports
continued to be the mainstay of our business, contributing 83% to Total Operating Income,
reinforcing both the relevance of our product offerings and our expanding global reach.
We made significant progress in our Innovative Products portfolio: New
Innovative Products (NIP) and Oral Thin Films (OTF) - in line with our vision to build a
differentiated, value- driven pipeline. The combined contribution from NIP and OTF
increased notably during the year, reaching 16.5% of Total Operating Income, up from 10.1%
in FY24. NIP sales contributed 11.5%, while OTF sales contributed 4.9%. This growth was
further supported by increased revenue from dossier licensing and co-development fees,
amounting to
Rs98 Mn. During the year, ZIM entered into several licensing agreements
with partners across the EU and other markets, underscoring the commercial potential of
our innovation-led product pipeline.
In our domestic business, which contributed 17% of Total Operating
Income, we continued supplying high-margin Pharmaceutical and Nutraceutical products,
particularly to government institutions. The penetration of innovative offerings,
including NIP and OTF, into government schemes and select private market contracts
reaffirms their value and the opportunity to scale further in India.
Business Development and Marketing
Throughout FY25, we sustained steady momentum in dossier filings across
key geographies. In the EU, 5 NIP filings covering 4 molecules were completed, bringing
the cumulative EU NIP filings to 7 to date. Additionally, 6 OTF filings for 2 molecules
were completed in the EU. Filings also progressed across Pharmerging and RoW markets for
Finished Formulations, NIP, and OTF products. Notably, through our Australian subsidiary
ZIMTAS Pty. Ltd., 1 NIP and 1 OTF product were filed, further strengthening our regulated
market presence.
During the year, we received 2 Marketing Authorisations in the NIP
category for Dimethyl Fumarate and Azithromycin Suspension. Our EU partner also secured
approval for Buprenorphine Sublingual Films (OTF), underscoring the regulatory progress
and scientific strength of our differentiated portfolio.
To support product registration and commercialisation, we adopted a
structured regional business development strategy, on-boarding experienced Business
Development leaders across our five key regions. Through our EU and Australian
subsidiaries, as well as a newly established Scientific Office in the UAE, we established
a local presence to facilitate the registration and launch of high-value NIP and OTF
products. A landmark contract was signed with partners in the GCC region to expand our
Oral Thin Films business.
Product, Plant and Technology Upgradation
We continue to invest in R&D to enhance product differentiation and
advance drug delivery platforms. In FY25, consolidated R&D investment stood at 8.8% of
Operating Income, consistent with prior years.
Our pipeline now includes 12 NIP products, of which 8 have been fully
developed. The remaining 4 are expected to be completed in FY26 and filed in the EU and
other regulated markets. This pipeline represents a cornerstone of our future growth
strategy.
FY25 also marked significant investment in production capacity
expansion, aligning with our strategic goal of completing the CapEx cycle required to
scale operations. We now have substantial capacity for manufacturing our key NIP and OTF
products, along with a specialised Liquid-in-Pellet Technology based Nutraceutical Suite
to support high-value OTC supplements and formulations. Several audits and accreditations
were successfully completed during the year, including the EU-GMP audit of our facilities.
While FY25 was a year of progress, it was not without challenges. We
encountered headwinds from geopolitical instability, currency depreciation, and payment
uncertainties in some of our traditionally stable legacy markets - particularly impacting
our Pre-Formulation Intermediates (PFI) and Nutraceutical exports. In line with our
prudent risk management approach, we refrained from accepting new orders in these regions
without clear payment visibility. Despite these setbacks, our diversified business model
and the growing share of high-value innovative products helped offset the impact and
sustain momentum.
Looking Ahead
As we look ahead to FY26, we anticipate strong growth across developed,
RoW, and Pharmerging markets, driven by our regional BD teams and increased product
registrations. The execution of ongoing agreements remains a top priority, and we are
confident that our continued efforts will lead to sustained value creation.
On behalf of the Board, I thank our shareholders for their continued
trust and support. I extend my heartfelt appreciation to all ‘ZIMians' for their
unwavering commitment, and to our customers, partners, regulatory agencies, and
stakeholders for their collaboration and confidence.
Together, we look forward to scaling new heights as we continue our
journey of innovation and growth.
| Warm regards, |
| Anwar S. Daud |
| Chairman and Managing Director |