Dr Reddy’s Q2 profit falls 36%, plans semaglutide relaunch in November
Lower US sales of generic Revlimid dragged down second-quarter earnings, but double-digit growth in base markets and the upcoming relaunch of semaglutide offer near-term relief.
Dr Reddy’s Laboratories reported a 36% year-on-year decline in profit to ₹925 crore for the September quarter, while consolidated revenue fell 1.5% to ₹8,671 crore. The drop was mainly due to reduced sales of blood cancer drug lenalidomide (Revlimid) in North America. However, the company's underlying business, excluding lenalidomide in North America, continued to show double-digit growth.
Ebitda for the quarter was ₹1,783 crore, with a 20.6% margin. North America accounted for 29% of overall revenue, but revenue there fell 23% year-on-year due to the loss of lenalidomide. Emerging markets, comprising 24% of total revenue, grew by 24% year-on-year, driven by new product launches and favorable foreign exchange movements.
The India business grew in double digits, reporting ₹1,851 crore in revenue, up 17% year-on-year. The company's net profit improved significantly on a sequential basis, growing 109% quarter-on-quarter, as the impact of its semaglutide API issue faded. Dr Reddy’s plans to relaunch semaglutide in November after resolving issues with the active pharmaceutical ingredient (API).
The firm secured approval for generic semaglutide in eight emerging markets, including Canada and India, and partnered with Takeda for a dengue vaccine, Gilead Sciences for an HIV prevention drug, and secured US FDA approval for a rituximab biosimilar.
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