Dr. Reddy's Laboratories Ltd.’s US business could see volatility on a quarter-to-quarter basis due to the “fundamental nature” of the generic business model. But the Indian firm underscored the prospects of continued growth in that market, backed by new product introductions, an important one being the upcoming launch of its generic rival to Bristol Myers Squibb Company’s multiple myeloma blockbuster Revlimid (lenalidomide).
Inorganic Growth Strategy
Dr Reddy's appears to be rewiring its India portfolio, with a clear strategy on which segment and brands it wants to focus on or doesn’t want to.
“So likely what we will see in India is we will sell brands that are not in focus and we will actually even buy brands, like we did this quarter with Cidmus in the Novartis deal. So, you're going to see both,” Dr Reddy's CEO Erez Israeli said.
At the investor day event, Dr Reddy’s highlighted that in India its "Horizon-1" strategy, which it defined as "growing the core," includes winning in chosen therapy and disease areas through a differentiated portfolio and an “inorganic play.”
The aim is to be among the top five companies on the Indian market.(Also see "What’s Next At Dr Reddy’s: Biologics CDMO, Cell And Gene Therapy Push" - Scrip, 27 June, 2022.)(Also see "Dr Reddy’s Wants To Break Into Top Five In India" - Scrip, 18 January, 2021.)
Dr Reddy’s had recently acquired Cidmus, a second brand of Novartis’s blockbuster heart failure therapy Entresto (sacubitril/valsartan), in India for $61m. (Also see "Asia Deal Watch: Juniper Licenses Asia-Pacific-Plus Rights To Kolon’s Osteoarthritis Cell Therapy" - Scrip, 18 April, 2022.) The Hyderabad-based company also struck a deal earlier this year to handle the sales and distribution of certain established Novartis medicines in India. (Also see "Novartis-Dr Reddy’s Sales Pact, Job Cuts: Are Foreign Firms Altering India Push?" - Scrip, 14 February, 2022.)
On the other hand, in May, Dr Reddy’s divested four brands to peer Torrent.(Also see "Torrent Acquires Chronic Brands From Dr. Reddy’s, Folds Up US Liquids Business" - Scrip, 27 May, 2022.)
In the case of the US, Israeli said that firm is always on the lookout for “low competition assets,” especially if they are injectables, in order to create a "better portfolio" and with an eye on customers in that market.
"If we do not have the means or we did not develop it in the past, we are getting it from others. That's what we did at the time with Suboxone, that's what we did with icosapent. It's something that we are doing for many years and we will continue to do so
During the first quarter of fiscal year 2023, Dr Reddy’s launched seven new products in the US, including pemetrexed injection, posaconazole tablets and sorafenib, some of which are expected to be ramped up in the coming quarters
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