After publishing its Q1 report in February, Egis projected revenue would edge up 0-2% in the 2011/12 business year.

Poroszlai said Egis lowered its target for growth on the CIS market to 5-10% from 10-12% because of a big drop in stocks that may not be replenished by year-end. He added that the Russian drug market was growing at a slower than expected pace.

Egis sees sales in Eastern Europe falling 10-15%, at a faster rate than the 5% drop projected earlier.

Egis is standing by its earlier projection for revenue growth of 0-5% on other markets.

Poroszlai said Russia had become Egis’s biggest market at the end of the Q2, while domestic revenue slipped to just 25% of the total. He added that the proportion could fall under 20% in the coming years.

He said that blind auctions started under a new subsidy system launched in Hungary last year had caused prices to fall and forced Egis to withdraw three product — all earlier winners of an innovation prize — from the domestic market in the first half. He added that the blind auction system was expected to cause Egis’s revenue to fall by HUF 1 billion every half year.

Egis’s net profit climbed 42.2% to HUF 6.45 billion in Q2 from the same period a year earlier, rising on an improved margin and a slight financial gain, the company said in its consolidated IFRS report published late Tuesday.

Revenue rose 6.1% to HUF 33.5 billion. Costs of sales rose at a slower rate, increasing 4.6% to HUF 13.9 billion. Gross profit was up 7.2% at HUF 19.6 billion.

Egis booked a HUF 101 million net financial gain in Q1, compared to a HUF 1.27 billion loss in the base period.