Dr Reddy’s Laboratories (DRL) today said the US would continue to play a central role in the growth strategy of its global generics business in the medium term.
About 63 per cent of the company's new productline in generics pertains to those drugs that would be off-patent by 2013 in the US, GV Prasad, vice chairman and chief executive officer of the Hyderabad-based pharmaceutical major, said at the AGM here.
This means about 106 products are being developed to enter the new space created by the drugs that are going out of the patent regime in the next two-and-a-half years, according to Prasad.
Generics accounted for about 71 per cent of the total Rs 7,469 crore revenues in FY11 while the US sales contributed 36 per cent to the global generics revenues. The company’s market share in the US grew 18 per cent last fiscal.
For the first quarter of the current financial year, the US revenues in global generics business stood at 40 per cent as the company introduced 9 products during the period in addition to 11 last year. During the first quarter of the current fiscal, generics revenues grew 48 per cent in the US followed by 18 per cent in Russia, the company's second biggest contributor to the global generics revenues. Going by the trend, North America is set to play an ever increasing role in the company’s growth in the global generics business.
Chairman K Anji Reddy, addressing the AGM, said while drugs over $100 billion were going off-patent, the governments too were encouraging greater use of generics.
The company’s R&D spend on new drug discovery grew 100 per cent to $70 billion from $30 billion some 10-15 years ago while the output has reduced to almost half of what it used be in the past, paving the way for more business opportunity to Indian companies, including the potential successes in future drug discovery, according to him.
Prasad said the board was working hard to achieve the $3 billion revenue figure by the year 2013. He said they were yet to take a call on the proposal of stock split as was requested by the shareholders. “We have just taken the feedback. Nothing has been decided,” he told the media.
