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Annual Review 2016

Letter to the shareholders

Mr. Donev 

Dear friends,

A quite dynamic year is over. We started it with good forecasts for our main export markets, especially Russia and the Ukraine. The reality was that only after the first few months of the year the unstable situation in Russia had a negative impact on the overall expectations of the population and the purchasing power on the market fell a result of which was a 6% decline in the sales revenues for the export markets by year-end. The price erosion on the domestic market was a cause of 2% decrease of sales in value and a 7% increase in packages.

In the past few months we see some signs for economic and political stabilization in Russia, which give us certain security for the results of 2017. We are optimistic for the trend of recovery of the sales in the Ukraine. After the restructuring of our export activities our local teams work systematically for the increase of the results on a number of markets like Poland, Belarus, Latvia, etc. We are very proud with the successful registrations of new products which we are yet to develop. An excellent example is Tuspan® – the coughing syrup, which will be available on a number of European markets even this year in case of successful and timely procedures.

This year started with a long-awaited news concerning our project of registration of our product Tabex® in the USA. In case a restructuring takes place between Achieve and Oncogenex (our remaining shares in the capital of Extab will be transformed in shares in Achieve in case of such restructuring) there will be two advantages for us: first, the new joint team of the two companies will have a much bigger chance of a successful registration of Tabex and second, “Sopharma” AD will become a shareholder in a public company traded on NASDAQ.”, says Ognian Donev, PhD, Executive Director and Chairman of the Board of Directors, “Sopharma” AD.

It is a tradition to make wishes for the New Year and let me wish all of our partners a healthy and successful 2017!

Ognian Donev,PhD,
Chairman of the Board of Directors and Executive Director of Sopharma AD

Key Financial Results

BGN '000
BGN '000
Sales revenues 877,085 874,984 0.24%
Deprecation and amortization (EBITDA) 73,656 62,766 17.35%
Operating profit 44,951 36,440 23.6%
Net profit 54,902 22,600 142.93%

BGN '000 
BGN '000 
Non-current asset 416,599 401,484 3.8%
Current asset 422,622 434,143 2.0%
Equity 491,223 457,640 7.34%
Non-current liabilities 53,842 62,492 -13.84%
Current liabilities 314,156 315,495 -0.43%

EBITDA/sales revenue 8.4% 7.2%
Operating profit/Sales revenue 5.1% 4.2%
net profit/Sales revenue 6.3% 2.6%
borrowed capital/Equity 0.75 0.83
Net debt/EBITDA, annualized 2.82x 3.57x

Significant Events

21 January

Sopharma AD deposited with the Finacnial Supervision Commission an agreement for termination of the Contract for transformation through merger between Sopharma AD and Momina Krepost AD.

5 March

The Company bought 1 000 own shares representing 0.00076% of the share capital of the Company.

8 May

Sopharma AD notifies that it took the decision to establish the "Sopharma Ukraine OOD" company with headquarters in Kiev, Ukraine and with share capital of 1,000,000 / one million / UAH.

16 June

The General Meeting of Shareholders of Sopharma AD was held.

4 July

For the first six months of this year, revenues from sales decreased by 10% compared to the same period of 2015, including 3% decrease of domestic sales and a 15% decrease of export sales.

20 September

Information about Annual Meeting with Investors.

7 October

SOPHARMA AD informs that as a result of its intention to express interest in acquiring a commercial company operating on the territory of the Republic of Moldova, as a first step Sopharma AD filed a request for approval of concentration with the competent authorities in the Republic of Moldova.

4 November

The Board of Directors of Sopharma AD decided to purchase up to 100% of the capital of “Veta Pharma” AD for a price not exceeding 2.12 BGN per share.

18 November

Sopharma AD (the “Company”) announces that on 18 November 2016 the Company received a notification for the acquisition of 505 364 shares, representing 0.37% of its capital, by ZUPF Allianz Bulgaria. After the transaction the share of ZUPF Allianz Bulgaria in the capital of Sopharma AD reached 5.17%.

15 December

Sopharma AD hereby notifies that on 14 December 2016 Sopharma AD filed with the Financial Supervision Commission a tender offering for the shares of all other shareholders in Unipharm AD.


New Development and Products


New Products

with marketing authorizations for the period January - December 2016. Marketing authorizations for six new products have been issued.

Desloratidin film tablets

Ibandron film tablets

Amlodipin tablets

Vederal drops

Deavit drops

Tuspan syrup


Expected in 2017

Three to five new products are expected to be introduced by the end of the 2017.



Over 15 production processes and technologies are in the processes of transfer, validation and optimization. Pharmaceutical development is carried out of over 10 new products for the Company.





Foreign markets
Efforts are focused on retaining and increasing the share of the company on the main markets (Russia, Ukraine and Poland) as well as establishing and extending presence in other countries (USA, Central and Est Europe and the Caucasian region).
New products
Consistently launch new pharmaceutical products on all the markets in which the Company sells its products in order to expand its product portfolio.
Organic growth
Grow organically in selected new markets to become a strong regional player with stable, geographically diversified revenues
Optimization of production capacity
Optimization of production capacity and construction of new ones
Intra Group Integration
Further consolidate and integrate the Group to optimize its cost structure, control entirely the production chain and benefit from potential synergies