For many, the name Liven Pharmaceuticals will be new. The company came into existence less than a decade ago and has only recently been listed on the stock exchange. Liven was established by a group of sponsors who wanted to create a pharmaceutical company providing health and medication solutions. The company name “Liven” was a play on the word living.
But Liven’s roots can be traced farther back. The company’s origin story goes all the way back to the early 1990s when a company called Merchant’s Glass began manufacturing medical ampoules which are used to package certain medication and medical products.
Liven was going to be the next stage of evolution for the company as it was going to address the patient needs by producing high quality medicines, biologicals and Active Pharmaceutical Ingredients (APIs).
But what started as an ambitious expansion project has had consistent issues along the way. From the outset, Liven suffered through a long period of losses as the low volume and sales meant they were not able to cover their expenses completely. Going from the success of Merchant’s Glass, it was felt that things will workout over time.
Any such turnaround has failed to materialize. In the face of this, the company saw an opportunity to get listed on the stock exchange cheaply which it has done. Now it is looking to raise additional funds using its listing to gain access to public funds.
This could prove to be the final option left for the company which is staring down the barrel. Just what exactly is a right issue, how does it work and what are the plans of the company in terms of utilizing these funds? Profit looks to answer all these questions.
History of the sponsors
The beginnings of Liven Pharmaceutical can be traced back all the way to the early 1990s when Merchant’s glass was established.
The purpose of Merchant’s glass was to manufacture empty ampoules which were being used for medicinal packaging. Initially the company started out producing around 1.1 million ampoules per month which had increased to around 24 million ampoules per month by the end of 2013. The importance of such a company can be seen in the context of the pharmaceutical industry in general.
Around that time, there were smaller competitors which existed in the market namely Friends Glass (Pvt) Limited, MultiGlass, Pharma Glass which were involved in the manufacturing of high quality ampoules and vials. These were being sold to the national and international pharmaceutical companies operating in the country.
There was a gap in the ampoule manufacturing industry which was quickly being filled by the local producers. As the manufacturers started to improve the quality of the product, there was a demand for them by local and international companies. The product that was being produced was being seen as a cheaper alternative to imports which were the norm before.
The rapid increase in the production capacity of Merchant’s shows how well it was able to fill the gap that existed in the market and how it was able to grow its revenues accordingly.
Liven comes into existence
The experience learned from this business was later used to fund the infrastructure and capital of Liven. This step was going to help the sponsors go from producing the packaging to now producing the medicines inside these vials. The knowledge gained in the pharmaceutical supply was going to be applied and vertical integration was being carried out to manufacture medicines as well. From the seed of Merchant’s glass came the next fruit called Liven Pharma.
The core business of Liven was to manufacture pharmaceuticals and allied products which were produced in a variety of dosages. These were in the form of tablets, capsules, injectables and infusions. In order to meet the regulatory standards and requirements, the company complied with the regulations applicable to it and also adhered to cGMP (Current Good Manufacturing Practices). It also gained ISO 9001:2015, ISO 45001:2018 and ISO 14001:2015 in order to comply with quality, workplace and environmental management.
The success of the earlier venture, however, could not be replicated at Liven.
The initial performance of Liven proved to be tumultuous to say the least. The earliest financial data available for the company starts in 2021 which show that the company made net losses of 1.5 crores in 2021 which translated to loss per share of Rs 1.21. The key element hurting the company was its small size and revenues being earned. These losses persisted throughout 2022 and 2023 as loss per shares consolidated at around Rs -1.18 and Rs -1.02 respectively.
Revenues recorded in 2024 were around Rs 24.5 crores which did yield a profit of Rs 1.04 per share, however, 2025 saw revenues fall back to Rs 12.7 crores and loss per share of Rs -8.37.
Getting listed
In late 2024, the management at Liven took the decision to get listed on the stock exchange. The usual route of getting listed is to carry out an Initial Public Offer (IPO) which allows interested investors to invest in the company while the issuer gives out a portion of their shareholding in return. In order to attract investment, the issuer has to release all of its financial data to show well they are performing.
Liven chose a different approach. Rather than releasing its own data, Liven looked to merge itself with a company which was already listed on the stock exchange. Landmark Spinning Industries was chosen which was a defunct company which had closed down its operations a long time ago. Liven chose to buy out the assets and liabilities of Landmark Spinning Industries and then changed the name of Landmark to Liven.
In this process, the memorandum of association, the registered office of the company and other details can be changed once the merger is approved by the courts and approval has been given by the Securities and Exchange Commission of Pakistan.
The purpose of getting listed is to have access to funds of the investing public and create a market where the shares of the company can be traded. Through the reverse merger, the company could not go for an IPO, however, recently it went for a rights issue which is another benefit of getting listed on the exchange.
So what is a rights issue?
Right issue
The purpose of getting listed on the exchange for a company is to allow it to sell some of its shareholding in return for investment which is provided by the market participants. For many companies, this investment is used to give a part of the shareholding to the investors who are interested in the company. But this is not a one time thing only. Just like a company can go to a bank for subsequent and further borrowing, the capital markets can also be used to raise additional funds in the future.
This happens in the form of a rights issue. The shareholders who already own the shares of a company are given an opportunity to invest further in a company. Assuming a company has 100 shares and these are held by 100 different shareholders. When a right issue is carried out, each of the investors gets a chance to invest more in the company. If all the shareholders subscribe to the right issue, then each of them gets the same amount of shares yet again. In this case, a right issue of 100 additional shares is carried out. After the issue, each of the 100 shareholders will now own 2 shares. This will mean that they each hold 1% of the shares of the company yet again.
But what if you feel that you do not want to invest in the company any more? In that case, you are allowed the opportunity to sell your right share in the stock market. Someone else might want to invest more than their older shareholding and they will be willing to buy additional rights in the market. Assuming that 50 of the shareholders feel that any additional investment will not be able to yield any benefits to the company. They can wish to sell their 50 shares in the market when the right becomes tradeable.
There might be other shareholders who feel that they want to invest more so they can buy these rights on the stock exchange and then invest the additional funds that the company requires. The individuals who are selling the shares are aware that now their shareholding will fall after the rights are issued and they will have a lower percentage of shares than before.
Once all the rights have been traded, the shareholders who have the right shares have to provide the subscription amount to the company in order to get the shares. If they fail to provide it, they can see their rights become worthless.
By design, the right shares are giving the first opportunity to older shareholders to invest more in the company. Once they have decided what to do, new investors are given an opportunity to buy the right shares from the market and make their investment as well.
For Liven, it is an understood fact that the previous sponsors are looking to invest further in the company and they want some of the burden to be shared by the other shareholders who have invested as well. At June end of 2025, the owners held more than 85% of the shares which means they will be putting up most of the investment for the new rights issue as well. This is a way for further injection of capital and resources into the company from the capital markets rather than going to banks in order to get more borrowings on the balance sheet of the company.
The case of Liven
In the case of Liven, a right share was announced in order to raise Rs 200 million by issuing 20 million additional shares. The proportion of shares was going to be 21.496 right shares for every 100 shares held. The subscription price to invest in the company was going to be Rs 10 per share. The shareholders who held a single share were going to get 0.21496 for each share that they held in the company. Now they had a choice to do two things. Either they could invest Rs 10 per share in the company and provide these funds to the company or they could sell these rights to other investors.
But there is one last thing that needs to be addressed here. When the rights were announced, the share price of Liven was trading at Rs 63. How can the investors pay only Rs 10 and then get a share which was worth much more? This is where the price of the trading rights comes into focus. The rights that the shareholders were going to get would start trading at a price around Rs 53 which would justify the subscription price being set at Rs 10. For investors willing to sell, they can get a good price for their share while the buyer will be expected to pay this price in order to buy the shares.
The company stated that the funds raised from the right issue were going to be utilized for the company’s day to day working capital needs, carry out new investment in sustaining the business, provide some strength to its financial position and to enhance its profitability. Most of the funds were being used to establish a new dry powder injectable division, purchase of vehicles and to process the registration and licensing of the drugs with the Drug Regulatory Authority of Pakistan (DRAP).
In addition to this development, Liven also announced that it had been able to carry out its first successful export shipment to the Arab region which shows that it is capable enough to export any additional products which might not have any demand on a local level. This also shows how the company is looking to shift its focus from local markets to international markets by strengthening itself financially. The funds raised would be used to supplement this region as well.
There are also internal plans that are being discussed at the company to look to expand into API manufacturing. Currently, most of these APIs are imported. Liven is thinking of trying to make these ingredients themselves by carrying out backward integration. This will allow it to reduce its dependency on external suppliers and control its costs while ensuring supply stability for itself.
The revenue drivers of Liven can be seen as being strong as they provide a wide variety of dosages which cater to different therapeutic needs. Having a wide range of products and an ability to tap into new markets is something that Liven has been trying to do in the past which will contribute to better revenues. In addition to that, the exit of many International brands has meant that now more than 70% of the pharmaceutical needs of the country are being met by local manufacturers.
Another factor going in favour of the company is that the demand for medicines is income and price inelastic and demand is usually stable or growing which means that the revenues can increase over a period of time. The recent change in pricing policy applicable on non essential medicines has also meant that pharmaceutical companies have an autonomy over their prices that they did not enjoy before.
In terms of the cost drivers, the biggest challenge to Liven is the fact that most of the APIs that are used in manufacturing are imported which means that any shock in the supply chain or any depreciation of the currency directly impacts the costs of production. Another cost that is being faced by the company is the increase in regulatory, licensing and compliance fees that have to be incurred as the product portfolio of the company is extensive and covers different forms of dosages. In order to maintain the quality and comply with the standards set, the cost that has to be borne is much higher.
Breaking down the financial data
As the company was listed recently, there is a dearth of relevant financial information which can be used. The focus will be put on the most recent annual statements which provide a snapshot of 2024 and 2025. The revenues for 2024 were registered at Rs 24 crores which fell to Rs 13 crores in 2025. The dip in the revenues was seen as the volume of sales for Liven fell during this period. While sales fell, the cost of sales increased leading to gross profit falling from 25% to 13%. The primary issue here was that as sales were falling, the costs associated with production were causing gross profits to fall.
The biggest reason for the slump in performance and profitability from 2024 to 2025 was taht administrative expenses, selling and distribution and other expenses increased from Rs 2 crores to Rs 51 crores. These expenses included increase in salaries and benefits, fee and subscription and listing expenses which made up most of the administrative expense increase. In terms of other expenses increasing, bad debts and allowances of expected credit losses had to be recorded due to accounting treatments. Many of these entries were mandated by the reverse merger and were not under the control of the company itself.
The impact of this was that profit after taxes fell from Rs 4 crores in 2024 to losses of Rs 58 crores in 2025. The start of a new financial year will see a much clearer picture of the company in terms of how the new year starts off, however, based on its historical performance, it can be expected that signs of improvement will start to show when the new product line comes online.
The financial performance of Liven has been seeing losses since its inception and there are efforts being made to allow the company to turn profitable. The sponsors of the company have shown a commitment to running the business using their skills and experience in the industry. All these efforts have failed to bear fruit till now. The listing has provided an additional avenue for the company to raise finances which it has utilized now.
The results of this investment will take time to show their impact in the future. For now, it seems like the sponsors have played the only move available to them. Will it prove to be their last card to play? Only time will tell.
