Page 170 - CW E-Magazine (1-10-2024)

Special Report Special Report

Pharma watch: Moving up the value chain – a look generic products (injectables, patches,
inhalants, nasal, ophthalmic) over the
at 1QFY25 and past trends past fi ve to six years, which offsets the
price erosion in existing molecules.
ndia Ratings and Research (Ind-Ra) from the generic Revlimid, stable price ing pharmaceutical companies, which
expects its rated pharma companies to erosion and increased traction in niche reported yet another strong quarter in Price and new launches driving domestic
Imaintain their momentum on growth products. The strong growth in the 1QFY25 in terms of sales growth and formulation business growth while volume
and profi tability in the regulated markets US business, if sustained, could lead operating profi tability, led by complex remain weak
(US), driven by new launches, ongoing to maintaining of EBITDA margins. generic products launches, ongoing The domestic formulations business
drug shortages and growth opportunities While, the domestic formulation busi- drug shortages in the US and healthy of Ind-Ra’s coverage universe delive-
in the domestic formulation business. ness coverage universe reposted low growth in US and India businesses. red healthy revenue growth at 10.5%
Normalisation of drug prices in the US double-digit growth against high single Overall, the top line grew 10.6% yoy yoy in 1QFY25 as against 10.6% yoy
and a softening in raw material prices digit growth in FY24, led by growth in in 1QFY25 (1QFY24: up 15.8% yoy; in 4QFY24 and 6.5% yoy in 1QFY24,
will help companies to keep revenue acute/chronic segments. 4QFY24: up 9.6% yoy). on account of growth in key thera-
growth of 9% yoy (year-on-year)and pies such as cardiac, gastro-intestinal, EBITDA margins at all-time high market and a softening of raw mate-
EBITDA margin of about 22% during Increase in USFDA inspections in The US business of companies, anti-infective and anti-diabetic. While In 1QFY25, the EBITDA margin of rial prices. EBITDA grew 21% yoy to
FY25. FY25 which are rated by Ind-Ra, continued Indian Pharma Market (IPM) re- the companies in Ind-Ra’s coverage uni- Rs. 163-bn during the quarter.
The agency also expects an increase to report strong growth of 11.6% yoy ported revenue growth at 7.7% yoy in verse remained strong and all-time high
Ind-Ra highlights that sustainability in the United States Food and Drug while domestic formulations grew 1QFY25 as against 4% yoy in 1QFY24 at 25.3% (up 220 basis point yoy and Over the past few years, most
of the US business remains key to sup- Administration (USFDA) inspections 10.5% yoy. The EBITDA margin of (source: AIOCD-AWACS). In terms of 230 basis point qoq) as against 23.1% Indian players are pursuing meaningful
port the low margins in other markets. in FY25; however, these are unlikely the rated companies remained robust growth drivers, price (6.1% yoy) and in 4QFY24 and 23.2% in 1QFY24, led cost-saving initiatives including port-
to cause signifi cant disruptions. Ind-Ra at 25.3% (rose 220 basis points yoy) in new launches (2.6% yoy) drove the by a better product mix, healthy growth folio optimisation, fi eld force rationali-
However, the sector outlook for affi rmed the ratings of 53% of the enti- 1QFY25 (1QFY24: 23.2%; 4QFY24: overall IPM performance in 1QFY25, in the domestic formulation business, sation and divesting non-core assets to
Indian pharmaceutical companies ties in its universe in the eight months 23.1%), led by the lower raw mate- while volume growth remained weak at strong growth in the US generic busi- improve their effi ciency and profi tabi-
remains neutral for FY25, led by an ended 9 September 2024 and took rat- rial prices and sales contribution from negative 1.0% yoy. Ind-Ra expects IPM ness led by product-specifi c opportuni- lity. Ind-Ra expects cost optimisation
expected volume recovery in the domestic ing downgrade/Negative Outlook/Rat- niche launches, and moderation in pric- revenue growth to be at 8-9% yoy for ties with lower price erosion in exist- will continue to be the focus area for
formulations business, stability in price ing Watch with Negative Implications ing pressure in the US market. FY25 as against 6.5% yoy in FY24. ing product portfolio in the US generic Indian pharma companies.
erosion in the US, lower input cost and actions on 14% of the entities, where
overall cost optimisation efforts. the margins came under pressure while Strong growth in US generic business
rating upgrade/Positive Outlook actions continues Chemical Weekly Buyers’ Guide
low double-digit growth in domestic on 27% of the entities where overall The US generic business of com- www.cwbg.in
formulations credit profi le improved. panies covered by Ind-Ra has con- www.cwbg.in
In 1QFY25, Ind-Ra has seen strong tinued to report a strong performance
growth in its coverage universe of US Top-line grew 10.6% yoy in 1QFY25 since 3QFY24 (average growth at Pocket-Friendly Pay-as-you-use Subscription Plans
business, led by a higher contribution Ind-Ra rated a sample of 18 lead- 15.5% over the past seven quarters). In Opt for a scheme that suits your needs and make best use of India’s most authentic directory
1QFY25, the US business grew 11.6% for sourcing chemicals and related products.
yoy to $2.7-bn as against 26.6% yoy in Subscription plans
1QFY24 and 13.5% yoy in 4QFY24, Plan Hours of usage INR* USD*
on account of a stable single-digit price Plan 25 25 1,500 25
erosion, shortages of drugs, and niche Plan 50 50 2,500 50 Web-Based
launches (including generic Revlimid, Plan 100 100 4,500 75 Directory
Mirabegron etc.). The agency highlights Plan 150 150 6,000 100 on Indian
that the US business contribution to the *Plus GST @ 18% applicable Chemical Industry
coverage companies stood at around For more information or for a FREE trial contact: and Trade
35% over the past fi ve years.
Mr. Kiran Iyer Mr. Abhishek Vora
kiran@chemicalweekly.com abhi@chemicalweekly.com
Ind-Ra highlights that the strong Chemicals & Search & download
pipeline of Indian companies will help Chemical Weekly Database Pvt. Ltd. related products / data on 8,500+
Manufacturers /
Equipment &
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in the US market. The companies have Behind Everard Nagar, Sion (E), Mumbai - 400 022. Consultants Merchant Exporters
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170 Chemical Weekly October 1, 2024 Chemical Weekly October 1, 2024 171

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