Dr Reddy’s net profit beats estimates despite 14% dip, set for India semaglutide launch

Hyderabad-based Dr Reddy’s Laboratories has reported third-quarter revenue so far, beating street forecasts: ₹8,726.8 crore and profit after tax (PAT) ₹1,210 crore, as steady growth and favorable exchange rate in India helped offset the loss in Revlimid sales in the US.

A. Bloomberg The survey, conducted with the participation of 24 and 22 brokerage firms, showed that the consolidated income of the pharmaceutical manufacturer ₹8,338 crore and profit after tax ₹1,089 crore respectively.

The firm’s revenue increased approximately 4.4% year-on-year, but declined marginally by 0.9% sequentially; Its after-tax profit fell 14% year-on-year and 16% quarter-on-quarter as product-specific headwinds continued.

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Earnings Before Interest, Taxes, Depreciation and Amortization (EBIT) decreased by 11% compared to the same period of the previous year ₹2,049 crore, margins fell to 23.5% from 27.5% in the previous year.

“Our growth in the 26th quarter was supported by continued momentum in our branded businesses with the help of favorable forex, thereby offsetting the impact of lower Lenalidomide sales. We continue to focus on disciplined execution of our strategic priorities such as core business growth, pipeline advancement, operational efficiency and selection of inorganic opportunities to create long-term value for our stakeholders,” co-chairman and managing director GV Prasad said in a statement.

Dr Reddy’s revenue in North America fell 12% year-on-year and 9% sequentially. ₹2,964 crore, mainly due to increased price erosion and declining sales of Lenalidomide (Revlimid).

Dr Reddy’s was one of the Indian generic drug manufacturers that struck a deal with Celgene, the inventor of blood cancer drug Revlimid (Lenalidomide). Limited quantities of the drug from 2022 until its patent expires this month.

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The company’s revenue from Europe increased by 20% year-on-year ₹1,448 crore, thanks to continued traction in the nicotine replacement therapy (NRT) business, new product launches and positive forex.

Dr Reddy acquires Haleon’s global consumer portfolio Health brands in the NRT category outside the US in 2024.

India business saw strong double-digit growth, with revenue up 19% YoY ₹1,603 crore.

The company is preparing to launch semaglutide in India in March as its patent has expired, the company’s management told reporters at a press conference. The company has already received regulatory approval to launch the drug in India.

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“In terms of the Indian market, we will be launching the product and we also have a few partners from whom we will source the product,” said Ramana MV, CEO, branded markets. “We have capacity both within our CMO (contract manufacturing organization) and our own manufacturing facilities,” he said. The drugmaker is also awaiting regulatory approval in Canada, where the patent expires this month, and could receive it any time between now and mid-May, management said. plans to launch Semaglutide is available in approximately 80 countries, with patents scheduled to expire this year.

The firm’s core U.S. business, excluding Revlimid, is growing in double digits, company management told reporters. “We have a very good product line of important products. Semaglutide and the biosimilar Abatacept. “In addition, we are also working on inorganic opportunities,” CEO Erez Israel said, adding that the company plans to launch Abatacept in the United States in 2027.