LONDON: European drug distributor Alliance UniChem Plc., which is in the process of merging with Boots Group Plc. in a 7 billion-pound deal, said it expects to meet financial goals in the current fiscal although it had encountered difficulties in some markets.
The company said it could not achieve expected growth in Spain and Britain during the second half of the year. However, this was compensated by a strong performance by its retail division. It, however, expected the British market to return to the growth phase in 2006 after the impact of the government-imposed price cuts in January last wanes.
Under the Pharmaceutical Price Regulation Scheme, drug companies have agreed to cut prices on products that are sold to the NHS by 7 per cent.
Alliance UniChem said it continued with its tight cost controls and a strict financial regimen, which it hoped should yield results in 2006.
The company added 101 pharmacies in the 11 months to 30 November, reaching a total of 1,283. Nearly 120 of the stores are operated by associates.
The proposed merger with Boots is expected to create one of Europe’s largest drug and healthcare firms with sales reaching 13 billion pounds and 2,600 stores across the U.K. The Office of Fair Trading is debating whether the deal should be referred to the Competition Commission. It anyway requires the approval of both companies’ shareholders.
Alliance UniChem brings out its financial results on 28 February. The company’s shares were down 1 penny at 789, valuing the business at 2.9 billion pounds.