Have many significant product launches lined up: Dr Reddy's

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Have many significant product launches lined up: Dr Reddy's

Dr Reddy’s also has slew of significant new launches lined-up ahead. It would also be launching a biosimilar product every year beginning with the Indian market. These products are expected to drive company's near-term growth.

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Excerpts from After the Bell on CNBC-TV18 Watch the full show » ALSO READ See latest News about Dr Reddys Labs See previous management interviews See what other Experts & Brokerages are saying about Dr Reddys Labs

Pharma player Dr Reddy's Laboratories posted better-than-expected 88% year-on-year rise in third quarter consolidated net profit at Rs 513 crore.  Net sales for the October-December quarter rose 46% from a year ago to Rs 2,769.19 crore.

Its new launch Olanzapine Zyprexa in the US contributed USD 99 million to the company's bottomline.

The exclusivity period for this product is still left and the company expects to benefit from it in Q4 as well, Sathish Reddy, managing director and chief operating officer, Dr. Reddy Laboratories told CNBC-TV18.

Dr Reddy's also has slew of significant new launches lined-up ahead . It would also be launching a biosimilar product every year beginning with the Indian market. These products are expected to drive company's near-term growth.

The company has restructed its Indian operations to boost growth and aims at being in line with the Indian industry growth in the near-term. "Some of the tactical moves that we have made in the market are to restore the growth back to double digit numbers. Ultimately, the goal is to exceed the market growth rate, he said.

Below is the edited transcript of Reddy's interview with CNBC-TV18. Also watch the accompanying video.

Q: How exactly did Zyprexa generic contribute in terms of numbers? What do you expect in Q4 from it?

A: Olanzapine Zyprexa, which is the brand name, was launched sometime in last week of October. So, we had almost like full benefit of two months for the quarter and that has recorded USD 99 million of sales, as far as Dr. Reddy's is concerned.

The exclusivity period is still left, which is normally for a period of six months, so we will have the benefit in the Q4. We are not in position to disclose what will that number be, but needless to say it has been great number for us so far Olanzapine.

Q: What is the sustainability of the US growth in FY13? What are your key launches at that point in time? Post FY13 how do you expect the US growth to pan out?

A: The first step in the next six months for this calendar year and I am starting from this month itself, there are some significant launches lined up. The products that we will be launching are bound to drive a significant growth for the company, besides the products that are already there in the market in terms of products, which are either limited competition or products which have a big potential to grow.

The second part of it is what happens beyond FY13? We have always been maintaining that we are working on more of limited competition opportunities. We are working on products which have more significant annuities than just exclusivity products, which bump up earnings or sales once in a while. Besides that, we also have limited competition opportunities and more annuities are coming from them. So, Fondaparinux would be an example and there are several such products lined up.

The second part of it is the biosimilars story. We have said that, we should be able to launch one biosimilar every year starting with the Indian market.  We already have four in the market and several are lined up for the launch in the years ahead. These products are also taken to the emerging markets, so all this put together will drive the near-term growth, say somewhere between FY13 to FY15.

Q: What exactly is happening with the Indian business? Is there some amount of restructuring that we are seeing in the domestic business? What is the growth trajectory that we can expect? Is it going to sustain at this plus 10% level? Is it going to exceed to industry growth levels or is it going to go beyond industry growth?

A: It is a bit too early to comment saying that this whole thing is a success in terms of what we have done. I would still wait for the fourth quarter. But leaving that aside, it is not a restructuring as such in terms of what we have done. Some of the tactical moves that we have made in the market are to restore the growth back to double digit numbers. Ultimately, the goal is to exceed the market growth rate.

I would still wait for one more quarter before commenting that all the interventions that we have done are playing out in the way we want it. Even if we see 11% growth, the good thing about that is this is in spite of a weak month of October for the industry. I am not talking about market growth figures, but reported number from our companies.

It has been pretty weak for lot of companies who have only reported single digit growth numbers, but we were able to clock 11%. But just give us one more quarter and this whole turnaround strategy that we have worked out for Indian market, we will be in a better position to comment for that.