Lupin's growth in US to stay muted next year

Speaking from the sidelines of the India Pharmaceutical Forum 2017, Lupin's Managing Director Nilesh Gupta shared his outlook on Indian industry and API inspections. Below is the transcript of Nilesh Gupta's interview to CNBC-TV18's Ekta Batra.Q: Let us start with the IPA, you are the head of the IPA, can you just tell us the broad takeaways because there was a lot of focus on compliance for the past two days? A: A lot of takeaways, I got a lot of points. Some of the things that I have personally taken away is how do we take this to the next level. One key part is how do we bring in grass root level training. Another big one was, how do we roll it out to other companies, how do we bring in measures of outcomes of our activities. So, lots of good stuff to take away.Q: What is your sense in terms of the industry, the Indian industry when it comes to compliance? There are some patches when it comes to some recent API inspections which haven't gone off well but there are some inspections which in fact have been successful. So, your sense in terms of whether we are better than what we were before or again it is a mixed picture?A: It unfortunately is a mixed picture. I think we are moving forward. I think there are six companies that we have in the IPA quality forum but IPA in overall I think we are moving in the right direction.There are still smaller companies that have challenges, intermediate makers, APIs, small formulation companies as well and at one level quality system is the heart of the company. You can't influence everybody but we are going to try to reach out to as many people as possible. However there is going to be more pain before we get to a much better place.Q: Is there more focus recently on API manufacturers because that seems to be a trend which is now emerging at least from a USFDA perspective going down inti the supply chain?A: No. I think that has remained, it is pretty much the same. I think it always starts from more formulation focused, it does move into API, it moves into intermediates as well. However there is still plenty of focus on the formulations side.Q: The latest news on Lupin is that Glumetza is going to see or is seeing more competition along with Fortamet as well where we have Aurobindo which has filled for ANDA, your sense? Those two are really the bastions of your US market right now?A: Those are big products. Like we have said in the past those are kind of going to continue to be big products as well. There is more competition on Glumetza, the authorized generic (AG) launched early February.However we still see both of these products where you will probably see one or two competitors coming in each year and there are going to remain nice opportunities as well.We have a whole bunch of new products launching. We have already talked earlier about more than 25 products that we will launch in next financial year. There are some nice ones that we hope to launch at the end of this quarter as well.I think growth next year in the US will be muted. However we are going to work hard to make sure that we can fill the gap that these products would face.Q: Growth will be muted in the US because of pricing pressure or because of a high base, how much do you expect in terms of pricing pressure?A: These are basically exclusive or semi exclusive products. I don't think it is fair to generalise them into the pricing pressure bucket. To me the pricing pressure remains at 6-8 percent kind of number and that is where I see it being in next year as well. These products will have more competition and that is the gap that I am talking about plugging.Q: What if Trump does announce border tax?A: We will see. I have said before we have to be vigilant but there is only that much of planning that you can do at the start for something like that.Q: Negotiation with Medicare directly?A: We have to see how these things actually rollout. To me there are basically only four big customers in the US. If Medicare negotiates directly there will be a fifth customer as well. I think this will also promote use of more generic products. So, there are pluses and minuses of something like that, we have to see how it rolls out. I think all of this is going to be a little while rolling out.