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Last Updated : Oct 13, 2020 03:46 PM IST | Source: Moneycontrol.com

Covid medicines help Cipla, Glenmark post strong sales growth in a subdued pharma market

The recovery was led by easing of lockdown restrictions and resumption of non-Covid related treatments.

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The long-standing Covid-19 pandemic may have spread much gloom across industries, but there are some that have reason to cheer. Among  the pharma big-names, CiplaGlenmark and Ajanta Pharma have emerged as outliers, posting double-digit growth rates in Q2FY21.

Covid drugs such as Remdesivir, Favipiravir and Azithromycin, among others, helped both Cipla and Glenmark post strong growth in sales during the quarter.

Cipla's sales rose 11.5 percent year-on-year (YoY), driven by respiratory brands Duolin, Montair Lc, Asthalin and Aerocort, which grew at healthy double digits, while Azithromycin brand Azee, which is widely prescribed for Covid-19, recorded a 42 percent rise. Respiratory and anti-infectives form about 56 percent of Cipla's sales.

Glenmark's  sales rose 32 percent, led by Covid antiviral drug Fabiflu.

"Fabiflu continues to be the third largest contributor to overall sales. Also, other brands such as Telma, Candid, and Candid B supported growth," said Motilal Oswal in its report.

Ajanta Pharma's sales grew 12.1 due to strong demand  for the company's cardiac brands.

Others in the industry, however,  did not fare well. Sales of market leader Sun Pharma, according to data from market research firm AIOCD, showed a decline of 3.3 percent, while Dr Reddy's dropped 0.3 percent and Lupin remained flat.

Slow recovery

The Indian pharmaceutical market (IPM) grew at 1 percent year-on-year (YoY) in Q2FY21, making a partial recovery from the slump witnessed in the first quarter, according to data released by AIOCD.  The recovery was led by easing of lockdown restrictions and resumption of non-Covid related treatments.

In Q1FY21, IPM contracted nearly 6 percent due to preemptive buying in March and lockdowns that hit delivery of healthcare services.

The market recovery has been more prominent in September, when IPM grew 4.5 percent YoY.

The volumes fell 6.5 percent, while price growth remained almost muted at 4.6 percent. While drugs for treating chronic diseases such as cardiovascular and diabetes managed to beat the slump, sales of anti-infectives, respiratory, pain management and gastrointestinal medications remained under pressure.

"Next half will continue to subdued, the recovery has come due to whatever little anti-Covid medications which are very high value, but their absolute units are very low," said Ameesh Masurekar, Director, AIOCD Pharmasofttech AWACS Pvt Ltd.

"Because of the semi lockdown conditions, precautions, work from home still going on, the routine infections are still much lower than last year level, because of that anti-infective sales, associated co-therapies such as gastro, pain and analgesics also get impacted," he added.

Masurekar expects IPM growth to be in the range of 3-5 percent in the

second half.

The anti-infective, gastro and pain segments together constitute about one-third of the Indian pharmaceutical market, which is around Rs 1.43 lakh crores.

The anti-infective segment -- around 13-14 percent of the market  -- saw sales declining by 6.3 percent in Q2FY21. Pain segment declined 6.8 percent and gastrointestinal managed to grow at 0.3 percent.

Sales of vitamins have picked up, reporting a growth of  9 percent during the second quarter.

For the year ended September 30, the domestic pharma market grew at 3.5 percent. India pharma traditionally grew at 10 percent and above, with the exception of a slowdown during the rollout of Goods and Services Tax (GST).
First Published on Oct 13, 2020 03:46 pm