Positive Prospects for Indian Pharma in the US, but Domestic Market Casts a Shadow

Positive Prospects for Indian Pharma in the US, but Domestic Market Casts a Shadow

28 Aug, 2023

 

Positive Prospects for Indian Pharma in the US, but Domestic Market Casts a Shadow

 

The Indian pharmaceutical industry has faced ups and downs in recent years, especially with the drop from its pandemic-driven peak last year, intensifying pricing pressures in its main market. However, Q1 FY24 tells a tale of two stories. The US market saw improved pricing pressure compared to last year, resulting in better revenue and profitability. Factors like drug shortages and competitor struggles have eased the erosion of US prices.

The introduction of the generic cancer drug gRevlimid has helped alleviate concerns. Dr. Reddy's alone garnered $125 million in sales from this in Q1. Other firms like Cipla, Zydus, and Sun Pharmaceuticals also reported substantial gRevlimid sales. This support is expected to bolster the US base business, reducing pricing pressure for two years. Furthermore, rigorous US FDA inspections and accelerated new launches are set to improve the US outlook for Indian pharma in FY24.

Exclusive launches of drugs such as gSuprep and gTrokendi benefited companies like Lupin and Zydus Life. Upcoming drugs like Darunavir and gSpiriva also hold the potential to boost North American sales.

On the domestic front, a delayed monsoon weakened sales of acute therapies like gastroenteritis in Q1. This trend impacted key players such as Dr. Reddy’s, JB Chemicals, and Alkem. Although Alkem noted no sales change in July, clarity is expected in August.

However, Sun Pharma shines domestically, with robust performance driven by increased sales volume and new product introductions. Having launched 105 new products in FY23, up from 77 the previous year, Sun Pharma's India business demonstrates a growth rate of 11% CAGR over FY20-23. Projections suggest around 10% CAGR growth in Sun Pharma's India business from FY23-26.

 

 


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