Dr. Reddy’s Q3FY24 Results: Pharma major Dr. Reddy’s Laboratories on Tuesday reported its consolidated financial results for the quarter and nine months ended December 31, 2023.
According to the company’s statement, its third quarter profit for the financial year 2023-24 at Rs 1380.90 crore, up 11 per cent in comparison to Rs 1243.90 crore during the corresponding quarter of previous year.
Dr. Reddy’s posted revenue from operations at Rs 7236.80 crore, up 6.6 per cent as against Rs 6789.80 crore during the third quarter of FY23. According to the company, the revenue growth was primarily driven by market share gains for the company’s existing products in North America and continuation of the growth journey in Europe.
Moreover, the total income reported by the pharmaceutical firm during the quarter in review was at Rs 7453.00 crore. The total expenses incurred by the company during Q3FY24 stood at Rs 5626.60 crore.
On plans for the chronic disease segment, M. V. Ramana, CEO, Branded Markets (India & Emerging Markets), Dr. Reddy’s Laboratories told Financial Express.com that they are working on three levels for the growth of the business.
“…one is how do we continue to grow our existing brands? The second one is how would we bring in the current standard of care apps so that we are able to also benefit the patients in India the third element is how do we licensed and innovative assets that today can address unmet need? These are three ways in which we’re trying to grow within the chronic space. Obviously, there is a fourth element which is business development in terms of an acquisition opportunity that can supplement our chronic space and a therapeutic gap. We will look at it but the first three are the primary drivers to increase our presence in the chronic segment,” Ramana said.
The Global Generics (GG) business reported Q3FY24 revenue at Rs. 63.1 billion, YoY growth of 7% and QoQ growth of 3%. YoY growth was primarily driven by increase in volumes of our base business, new product launches, partially offset
by price erosion in certain markets.
According to the company, sequential growth was driven by increase in volumes of our base business, offset partially due to price erosion in certain markets.
On plans to explore new disease areas, Ramana said that they are looking at both acquisition and in-licensing deals of innovative assets.
“We are also focused on the therapeutic area and which we already have a strong-hold because it is important that if you’re bringing in a new concept to the market, you need to have the share of mind of the key opinion leaders who are able to understand why this product is needed in India. This products are already witnessing growth. We will continue to focus on those therapeutic areas because we feel that a lot of innovation is actually happening in these spaces, for example, oncology, because this was an unmet need. So that’s where we will focus in the upcoming financial year,” Ramana informed.
In the India market, Q3FY24 revenue at Rs. 11.8 billion, YoY growth of 5 percent and QoQ decline of 1 percent. YoY growth was largely attributable to revenues from new products launches while QoQ decline was largely on lower volumes in base business.
On the plans for the India market in the upcoming financial year, Ramana informed that they have a “clear path” to maintain continued growth of the market.
“…while we had a very focused approach in terms of growth of growing a certain number of brands, which we feel have got the tailwind and there’s a clear path on how we will continue to go better than the market. The three additional growth levels that we are working on, are getting access to and working on innovation. The second is to see how we would scale consumer health which has two components: OTC and nutrition and the third is digital. And even within digital we have three initiatives. One is a direct-to-consumer platform. The second was digital therapeutics, our first venture being Nerivio, and very soon we’re going to launch a condition management platform for IBS. We feel that new innovations have brought enough strength to help us continue to grow and reach our aspirations, he told Financial Express.com.
During the press briefing Parag Agarwal, Chief Financial Officer, DR Reddy’s Laboratories Ltd. also informed that they are investing in building innovative and differentiated products in several markets led by India focusing on quality and compliance and strengthening capabilities remains the license to operate.
Meanwhile, ahead of the Interim Budget 2024-24, Satish Reddy, Chairman, Dr. Reddy’s Laboratories Limited, said that the Indian pharma sector aims to grow to USD 120-130 bn by 2030 and USD 350-400 bn by 2047.
“One of the key drivers for this growth would be the expansion of the industry’s presence in the innovation space which continues to account for 2/3rd of the global pharmaceutical opportunity. The pharmaceutical industry is a knowledge-driven sector. On an average, the global clinical trials process alone takes over 11 years with high risk of failure. Hence, continuous investment in R&D is critical,” Reddy said in a statement shared over e-mail.
Furthermore, reforms are needed in regulatory system especially with respect to timelines that make it challenging besides the need for a conducive eco-system that enables industry academic collaboration and infusion of venture capital funding into this space, he informed.
“While the recent announcement of Promotion of Research & Innovation Program Scheme of INR 5,000 Cr fund by Government of India has been a major move to incentivize funding for innovation and encourage collaboration among pharmaceutical companies, government research institutions, and start-ups, there is more required that ensures continuous funding for R&D and innovation. The main expectation from this year’s Budget will be the provision that enables novel ways of funding for the pharma industry. Additionally, ease of doing business is crucial on all aspects,” Reddy emphasised.
