Dr Reddy’s braces for Q4 challenges in US Market

Pharma major Dr Reddy’s Laboratories is preparing for challenges in the US market which are expected in the fourth quarter of the current fiscal. 

“One of our key products in the US will face increased competition beginning February 2026 with an anticipated decline in sales and profits,’‘ K Satish Reddy, Chairman, Dr Reddy’s Laboratories, and GV Prasad, its Co-Chairman and Managing Director, said in this message to investors in the annual report for 2024-25.

However, the Hyderabad-based company was preparing to face it through a combination of organic and inorganic strategies, they said.

“In FY26, we will continue to grow and strengthen our core businesses, enhance value through portfolio management and strategic differentiation, scale our presence in consumer healthcare, innovative therapies and biosimilars, introduce new revenue streams via acquisitions and strategic partnerships, boost efficiency across the value chain and streamline structural costs to minimise the impact,’‘ Reddy and Prasad said.

As part of its preparation for future and key growth moves, the drug-maker took a dual track approach this year by strengthen its core — API, generics, branded generics, biosimilars and OTC and by building new value pools by investing in future growth areas including consumer healthcare, biosimilars and novel molecules such as NCEs, NBEs and CAR-T, according to its captains.

“We expanded through acquisition and partnerships across key markets. Acquisition: Nicotinell and other leading Nicotine Replacement Therapy (NRT) brands, expanding our footprint in Europe and beyond. This consumer healthcare category with a high entry barrier will drive steady returns,’‘ they said, adding that the company also entered into a nutrition venture with Nestle in India, received US rights for Cyclophosphamide from Ingenus and launched Galvus (anti-diabetes) in Russia.

Expand innovation

To expand innovation and to be future-ready, Dr Reddy’s in-licenced Vonoprazan (GI drug from Takeda) and launched Toripalimab (immuno-oncology) and Elobixibat (chronic constipation treatment) in India. It expanded its with Sanofi (Beyfortus for Respiratory Syncytial Virus (RSV) and partnered with Gilead Sciences to bring HIV drug Lenacapavir to low- and lower-middle-income nations.

In addition, it opened a cutting-edge biologics CDMO facility in Genome Valley while its subsidiary Aurigene got US FDA approval for two promising oncology assets — AUR 110 for solid tumours and AUR112 for lymphoid malignancies. It also secured Rituximab approval in Europe and filed Denosumab in the US and Europe.

“The above initiatives are in line with our strategy to address issues of availability and accessibility of affordable innovation through in-house and collaborative efforts,’‘ the top leadership said.

FY25 has been a pivotal year for Dr Reddy’s. We delivered double-digit top line growth with every market contributing — the US, Europe, Emerging Markets, India and PSAI. Our EBITDA margin stood at 28.3 per cent and its ROCE reached about 28 per cent for the full fiscal.

Published on July 2, 2025