Pronouns

ABakshi121092 , to answer your second question, no, its could not refer to the drug.
The logical referent (the noun to which its refers) is "Bio Pharmaceuticals."

Its is a possessive adjective* (a possessive pronoun followed by a noun, which modifies but does not replace an antecedent noun).
Logically, though preceded by both "drug" and "Bio Pharmaceuticals," its profits could not refer to the drug.
I highlight profits because that word tells you the noun to which its points: Bio Pharmaceuticals.

Drugs do not possess, have, or own profits. Companies do.

To answer your first question a bit indirectly, that which I highlighted is grammatically incorrect, confusing, and ambiguous.

Its contributes to the murkiness. Other elements contribute more.

Stated differently, I could fix this sentence by changing elements other than "its profits."
The phrase is a casualty of poor construction.

Hope that helps.

*If you would like more information, please see GMAT Club Grammar Book: Pronouns - Possessive Adjectives , and, from the Veritas blog linked permanently here, Pronoun Ambiguity on the GMAT