NEW DELHI : Hyderabad-based pharmaceutical company Dr Reddy’s Laboratories Ltd (DRL), will invest outwards ₹700 crore for capacity expansion during the second half of the fiscal, said GV Prasad, co-chairman and managing director of DRL. Mint.
This will be similar to the amount invested during the first half of the fiscal and will take the total capital expenditure (capex) for the year to approx. ₹1,400 crores. He emphasized that the money will be used mostly to expand its production facilities and some new facilities in India.
“Biologics are something we’re expanding a lot, as well as some other portfolios,” Prasad said.
The company had a cost of approx ₹1,100 crore in FY23, making it a 24% increase in FY24 from a year ago. In its Q2FY24 results, it announced that it will look to expand its India business through acquisitions and purchases, licensing and collaborations. “The funding for this will be through separate resources and will not be part of any of the company’s capex plans,” he said, without disclosing the amount allocated.
DRL was, earlier in the year, reported to be in the race to acquire US-based Biogen Biologics, as well as Cipla’s promoter stake. Prasad said at this time he would not comment on any major acquisition-related “rumours”.
The pharmaceutical major in its Q2FY24 results attributed its growth as mainly driven by pricing and new launches, signing an in-licensing agreement for Hengrui’s Pyrotinib, and launching its direct-to-consumer e-commerce website along with five new products during the quarter. It also launched its first digital product, Neivio, for migraine care in India.
The company has developed a portfolio for biosimilars and biologics through development agreements for both, while also expanding its facilities. DRL has received some observations for its facilities from the US Food and Drug Administration (USFDA) and it is responding to them, he said.
The biosimilar market in India is estimated to grow at a compound annual growth rate (CAGR) of 22% to become $12 billion by 2025. This would represent nearly 20% of the total pharmaceutical market in India.
The Company’s brand and generic anticancer drug, Revlimid (lenalidomide) has come under scrutiny recently with a lawsuit filed in a US court over its sale.
“Revlimid is a transaction that we did with the innovator to launch early, and a few others have also launched. So, people feel that we are benefiting from it. So, we are fighting it along with everyone else, but we think we will win, “said Prasad while maintaining DRL’s stand on the situation.
The complaint filed by Mayo Clinic and Lifepoint Corporate Services “asserts claims under Federal and State antitrust laws and other State laws alleging that the defendants improperly restrained competition and maintained a joint monopoly in the sale of brand and generic Revlimid through their respective patent litigation settlements. , ” it said in the exchange file.
In addition to the Laboratories of Dr. Reddy, several other pharmaceutical companies were also named in the complaint.
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Updated: 19 Nov 2023, 23:30 IST
(tagsTo Translate)Dr Reddy