USFDA seeks voluntary action at Dr Reddy's Andhra Pradesh facility

The US health regulator has asked drug major Dr Reddy's Laboratories to initiate voluntary action at its Duvvada facility in Andhra Pradesh.

"With regard to the audit of our Formulations Manufacturing Plant at Duvvada, Visakhapatnam, we would like to inform you that we have been notified by the United States Food and Drug Administration (USFDA), that the inspection classification of the above-referred facility is determined as Voluntary Action Initiated," Dr Reddy's Laboratories on Sunday said in a BSE filing.

Shares of Dr Reddy's Laboratories on Friday closed at Rs 3,307.50 apiece, down 0.55 per cent on the BSE.

Dr Reddy's launches cancer treatment drug Bortezomib in the US market

Dr Reddy's Laboratories Limited on Wednesday announced the launch of Bortezomib for injection in the US market. The drug is indicated for the treatment of adult patients with multiple myeloma or with mantle cell lymphoma who have received at least one prior therapy.

Bortezomib is an active ingredient similar to that of the once blockbuster cancer treatment Velcade of Millennium Pharmaceuticals, a subsidiary of Takeda Pharmaceutical Industries, and Johnson & Johnson.

"We are pleased to bring this product to market for the customers and patients who will benefit from this cost efficient alternative in the market place," said Marc Kikuchi, chief executive officer, North America Generics, at Dr Reddy's. "This is a great addition to our injectable offering in the US market as we continue to augment our portfolio of products in the hospital segment."

Dr Reddy's product was approved by the US Food and Drug Administration (USFDA) via 505(b)(2) new drug application, one of the drug approval pathways that partly depend on the previous studies related to its safety and efficacy.

Pharma industry needs to develop entire value chain: Dr Reddy's G V Prasad

Indian pharmaceutical companies need to rework their chain of work because of the US-China trade war and China exiting polluting sectors like chemicals, said G V Prasad, chairman of Confederation of Indian Industry’s national committee on the industry.

Indian drug companies have been dependent on the drug intermediates produced by Chinese companies owing to cheaper prices, but the situation has now changed with US Government's tough stance on Chinese products, besides the shutting down of low-value and high polluting chemicals and intermediate manufacturing units by China itself.

Prasad, who is co-chairman and managing director of Dr Reddy's Laboratories Limited, said "it is true that the US-China trade war is going to give us a window of opportunity to expand our industry. Also China on its own is exiting the low value-added chemicals manufacturing, so we have no other alternative but to make those raw materials locally. Either way, the backward and forward integration by Indian pharma companies has become a need of the hour."

According to Prasad, the relevance of Indian pharma sector as a provider of affordable alternative to the world remains intact and the US itself had saved $80 billion in healthcare costs on account of the affordable generic medicines produced and sold by Indian companies.

Even China presents itself as a big market opportunity for the Indian generic companies going forward as the Chinese Government has realised the significance of affordability of medicines to its people and started opening the doors for Indian generics in the wake of the high cost cancer therapies in that country, he said at a Health and Pharma Conclave.

Prasad also maintained that the affordability was not an issue in India but lack of a robust health insurance and negligible focus on preventive and primary healthcare were causing the problems in healthcare of people.

He said it was high time Indian pharma industry adopted newer technologies and automation in a big way. Responding to a question, he said the digital marketing technologies would reduce the dependence on medical representatives and save some costs.

Dr Reddy's enters India's nutrition segment with a drink for diabetics

Dr Reddy's Laboratories on Thursday announced its entry into India's nutrition segment with the launch of diabetes nutrition drink 'Celevida'. "It is a first of its kind product under Dr Reddy's nutrition portfolio and clinically proven to help manage blood glucose levels among Indian patients", the company said.

Dr Reddy's 'Celevida' is formulated to have high protein, high fibre and slowly digested carbohydrates, which will support in managing the postprandial blood glucose response and satiety, according to the company.

"We are pleased to mark our foray into the nutrition segment with Celevida, which will address the unmet nutrition needs of the patients in India. Through this nutrition drink, we continue to work towards making a positive impact on people's health and quality of life," M V Ramana, chief executive officer, Branded markets(India and Emerging Markets) of Dr Reddy's said.

Dr Reddy's Q2 net doubles to Rs 1,092 cr on one-off gains, revenues up 26%

Riding on one-off gains, drug major Dr Reddy's Laboratories Limited has reported a 33 per cent jump in profit before tax, at Rs 766.4 crore, while its post-tax profit more than doubled to Rs 1,092.5 crore for the quarter ended September 2019. Th epre- and post-tax profit figures in the corresponding quarter the previous year were Rs 578 crore and Rs 503.8 crore respectively.

The company has reported a 26 per cent rise in revenues, at Rs 4,801 crore for the quarter under review, from Rs 3,797.8 crore in the year-ago period despite a flattish growth in the US business.

The company's top-line growth largely hinged on a Rs 722.9-crore license fee received towards the sale its anti-migraine drug to Upsher-Smith Laboratories and the receipt of Rs 345.7 crore from Celgene Company, pursuant to a settlement agreement during the quarter.

Revenues from global generics in the quarter under review were up seven per cent to Rs 3,281.6 crore from Rs 3053.6 crore a year ago, while those from the pharmaceutical services and active ingredients (PSAI) division rose 18 per cent to Rs 710.7 crore from Rs 602.9 crore in the corresponding previous quarter.

Sales from the proprietary products division rose nearly five fold to Rs 808.6 crore, from Rs 141.3 crore in the year-ago quarter on account of a Rs 722.9 crore license fee that the company has received on the sale of its Sumatriptan injection and nasal spray to Upsher-Smith Laboratories.

Dr Reddy's said price erosion and lower volumes, besides the impact of voluntary recall of ranitidine and temporary disruption in supplies due to logistics issues have resulted in a flattish growth in formulations revenues (Rs 1,426.5 crore) in the US, despite the launch of eight products during the quarter.

The overall growth in the global generics business was led by India and Emerging Markets, which grew by 9 per cent and 10 per cent, tp Rs 751.1 crore and Rs 827.6 crore, respectively, during the quarter under review.

The company's gross profit margin was up 250 basis points at 57.5 per cent, from 55 per cent a year ago. However, adjusted for one-offs, normalised gross profit margin stood at 51.5 per cent, according to the company.

Dr Reddy's gets 4 observations from USFDA for Srikakulam plant

Drug major Dr Reddy's on Saturday said it has received four observations from the US health regulator USFDA for its facility at Srikakulam in Andhra Pradesh.

The audit of the company's API Srikakulam Plant (SEZ) by the United States Food and Drug Administration (USFDA) was completed on Friday, the Hyderabad-based pharma major said in a regulatory filing.

Dr Reddy's further said that it would address the four concerns within the stipulated timeline.

"The audit of our API Srikakulam Plant (SEZ), Andhra Pradesh, by the USFDA, has been completed on October 25, 2019. We have been issued a Form 483 with four observations," said Dr Reddy's.

It further said: "We will address them comprehensively within the stipulated timeline."

As per the US health regulator, "an FDA Form 483 is issued to firm management at the conclusion of an inspection when an investigator(s) has observed any conditions that in their judgment may constitute violations of the Food Drug and Cosmetic (FD&C) Act and related Acts."

The FDA Form 483 notifies the company's management of objectionable conditions.

Dr Reddy's Q1 net profit up 45% at Rs 663 cr on rise in generics business

Drug major Dr Reddy's Laboratories Limited has reported a 45.31 per cent jump in consolidated net profit at Rs 662.8 crore for the quarter ended June, 2019 as compared to Rs 456.1 crore in the same quarter previous year.

The revenues of the company grew by 3 per cent to Rs 3,843.5 crore for the quarter under review, from Rs 3720.7 crore in the corresponding previous quarter

A combination of factors, including an 8 per cent growth in global generics business and the other operating income drove the growth in net profit of Dr Reddy's during the first quarter ended June, 2019 even though the gross profit margin of the company declined by 400 basis points to 51.7 per cent as compared to the year ago period.

"This quarter, we grew in most of our key markets and hope to continue this momentum with a sharper focus on performance. We will continue our journey of operational excellence, cost leadership and innovation across our businesses," Dr Reddy's co-chairman and CEO G V Prasad said.

The company was able to maintain a flat growth in SGA (selling, general and administrative expenses) expenses at Rs 1,206 crore even as the manufacturing costs saw a 13 per cent increase at Rs 1,857.6 crore during this quarter as compared to Rs 1647.9 crore in the corresponding quarter previous year.

The global generics segment, which accounted for 85.81 per cent of the revenues for the period, grew 8 per cent, mainly driven by the double digit growth in Europe(19 per cent), India(15 per cent) and the emerging markets(10 per cent). However North America, which is the single largest market for the company, saw only a 3 per cent growth in global generics revenues, up 9 per cent sequentially, at Rs 1,632.2 crore as compared with Rs 1,590.3 crore in the year ago period.

Dr Reddy's said the revenue growth in the US market was driven by contribution from new products and increase in volumes, partly offset by price erosion coupled with adverse foreign exchange movement. It launched five new products and re-launched Isotretinoin during the quarter.

India revenues touched Rs 696 crore on the back of 15 per cent revenue growth driven by volume traction and improved realisations in base business and new product launches, according to the company. Europe business saw a 19 per cent growth at Rs 240 crore on a relatively smaller revenue base.

Revenues from PSAI (pharmaceutical services and active ingredients) and proprietary products division declined 16 per cent and 61 per cent to Rs 450 crore and Rs 28 crore respectively during the three month period.

The company has received other operating income of Rs 375.9 crore, which include Rs 350 crore received from Celgene pursuant to an agreement entered towards settlement of possible claims.

When it comes to the gross profit margin of the company, the year on year performance was impacted by price erosion due to increased competitive intensity in some of the company's key molecules in the US and Europe, and lower sales from PSAI business, according to the company. Sequentially excluding the impact of one-time out licensing income of Rs 180 crore realised from the sale of derma brands, the gross margins have witnessed improvement of 150 basis points on a sequential basis, it said.

Dr Reddy's to sell rights of 2 neurology drugs to Upsher-Smith for $110 mn

Dr Reddy's Laboratories Friday said it has entered into a definitive agreement with Upsher-Smith Laboratories to sell the US and select territory rights of its neurology branded products -- Tosymra and Zembrace -- for over $110 million (approx Rs 765 crore).

"Under the agreement, Dr Reddy's will receive $70 million as upfront consideration, $40.5 million in near-term milestones and additional financial considerations including, existing contractual obligation and inventory," the company said in a regulatory filing.

Subsequently, Dr Reddy's said it will receive sales-based royalties on a quarterly basis.

Both the products are commercialised through Dr Reddy's wholly-owned subsidiary, Promius Pharma.

The company said Tosymra and Zembrace were designed and developed with the goal of addressing unmet needs of large but discrete segments of patients suffering from episodic migraine who need options other than their current therapies.

Dr Reddy's Laboratories Co-Chairman and CEO GV Prasad said, "This is a testament to our strong research and development capabilities, and delivering solutions to unmet needs of patients. In a short time, we created a well-recognised migraine specialty business in the US and we look forward to our partnership with Upsher-Smith".

The closing of the transaction is subject to various customary closing conditions, the company said.

Shares of Dr Reddy's were trading 1.44 per cent lower at Rs 2,549 apiece on the BSE.