INSUBCONTINENT EXCLUSIVE:
Indian pharma companies have been toying with different strategies to build their US business as the traditional low-cost model of selling
generic drugs is no longer as lucrative as it used to be
Some of the leading pharma companies invested in specialty business in a bid to create a long-term growth driver
However, some of them are reviewing their decision given the impact on profitability.
Specialty drugs are typically used to treat complex or
rare conditions and chronic ailments
They are complex-to-manufacture, often involving high-end research and high upfront investment towards product development and marketing
The company is witnessing a gradual traction in its revenues from this segment
accounted for about 24 per cent of total R-D spend for the quarter.
Lupin too is investing heavily in specialty segment through notable
spending on R-D and promotion
It got a new talent to head this business segment that has an inhalation product, complex injectables and select biosimilars
quarter-after-quarter, we see improvements and are working towards it
At the end of the day, if we don't see that our promotion efforts have the right response, obviously, we will start optimizing the P-L
But at this point in time, we are seeing promotion responsiveness from the reps as well as the other promotion efforts that we are
The company has hinted of prioritising the speeding-up of clinical trials of its biosimilar assets meant for US filings over specialty
three that the company has
In FY21, the company has guided to spend not more than 1 per cent of its revenues and less than 5 per cent of its EBITDA on its US specialty
that: 'if the tramadol strategy doesn't work out well, then obviously we will try and see if there's another product we could go after
But that is not going to be at the expense of our P-L
We are very clear about the amount we can spend
So we're exploring multiple partnering options right now with various partners in terms of what we can do with this business.
Aurobindo
Pharma is investing in its specialty portfolio but it is at an early stage with products under development and filing scheduled to begin
Revenue generation is to largely start from FY21-22.
While the Street considers Sun Pharma to be best placed to become a specialty player in
the US, any significant contribution from the portfolio is unlikely to be made in the near term
High costs, with their impact on profitability, also dent the impact of any specialty drug launch on the overall revenues
The decision of expanding into the specialty business in the US is a long term strategic call that companies need to take based on their
There is a limited visibility also on the kind of capex required for Indian companies to make a mark in the US specialty market and whether
What works for one player, may not work for another one
Sun being the largest player in the industry can afford to go full throttle on its specialty business strategy
have at a time when they have not been able to create much value for their shareholders
Current investment in specialty business is not providing hopes of business turnaround to the investors