Cadila Healthcare aims to double US business to $1 billion in 3 years

Pharma major to launch 100 new products; Moraiya facility slated to come out of US FDA woes

Ahmedabad-based pharmaceutical major Cadila Healthcare Ltd (also known as Zydus Cadila), which draws 40 per cent of its revenues from the US market, aims to double its US base business, which currently stands at $553 million, over the next three years by launching approximately 100 products. 

It has 197 abbreviated new drug approvals (ANDAs) pending approval in the US market. 

A senior official of the company said on grounds of anonymity that Zydus was bullish on its US business and projected that its share in the company's overall revenues would rise as well. "We have a good pipeline for the US market, and now, with the Moraiya facility coming out of US FDA (US Food and Drug Administration) woes, we expect a steady stream of launches in the US market in the coming quarters. The share of US business in our revenues is around 40 per cent now, this may rise as the base business grows," he said. As such, the company is aiming to double the base business, analysts said.

At present, Cadila Healthcare is the ninth-ranking pharma player in the US generics market (based on prescriptions) with a market share of 3.1 per cent. The company's latest investor presentation claimed that it ranked among the top three in eight of the top 10 products marketed in the US. It has already commercialised 90 products, including generic oral solids and injectables. 

Deepak Malik, analyst with broking firm Edelweiss, felt that Zydus' US growth rate would be around 26 per cent between FY17-FY19. "This will accelerate top line and bottom line growth to 18 per cent and 32 per cent, respectively," the brokerage firm said.

Sarabjit Kaur Nangra, vice-president (research – pharma), Angel Broking, said that while the domestic market (which now contributes to around 35 per cent of the company's revenues) is likely to clock a 13-14 per cent growth rate, the US market is likely to grow at 20-25 per cent. 

Moraiya's clearance is likely to play a key role in boosting the pharma major's US business. The facility contributes around 60 per cent of Zydus' US sales. It was served a US FDA warning letter in December 2015 and received FDA clearance this June. 

The company would be betting on mesalamine-based filings. Zydus has three mesalamine-based filings — generic Asacol, generic Delzicol, and generic Lialda. Of these, it has already bagged the approval for generic Lialda (which has sales of $1.14 billion in the US) and a launch is expected next quarter. 

The company source said that while Zydus enjoys the 180-day exclusivity for generic Lialda, as such there was no other player at the moment who has even a tentative product approval. 

Apart from mesalamines, some of the other key Caila products include an anti-hyperstensive drug, called Toprol XL ($400 million market size), and a gastrointestinal drug, Prevacid ODT ($250 million). 

Besides, Zydus is also targeting the relatively limited competition transdermal market which has a size of around $6 billion. The top three products in this market account for 60 per cent of the market and Mylan, Dr Reddy's Lab, and Sandoz are the other major players. Zydus had acquired a transdermal manufacturing facility in the US a few years back and it also has three transdermal approvals. Around six filings are pending approval at the moment. 

Cadila Healthcare's key launches for the US market

Market size	FY18	FY19	FY20
Less than $ 100 mn	Zegerid Zegerid OTC

Astelin Spray

 

Rotigotine patch

Silenor

$100 mn- 500 mn

Toprol XL

Clonidine patch

Estradiol patch

Solodyn

Prevacid ODT

Aloxi

Daliresp

Delzicol

Quedexy XR

$500 mn- 1 bn

Pristiq

Strattera

Exelon patch

Lialda

Namenda XR More than $1 billion Niaspan Lidocaine patch  

Cadila Healthcare US snapshot

Particulars	FY15	FY16	FY17
US sales	$555 mn	$614 mn	$553 mn
ANDA filings	36	30	50

 

Cadila Healthcare investor presentation (June 2017) pointers:

• No 9 player in US (based on prescriptions)

• Market Share of 3.1%

• Among Top 3 in 8 out of 10 products marketed in US

• Ninety products commercialised

• Recently received US FDA approval for generic Lialda 

• ANDAs pending approval stood at 197

• Of these, over 75 Para-IV filings

• Acquired Sentynl Therapeutics Inc, a US-based speciality pharma co in pain management segment in FY17

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