US Drug Shortage, Stable pricing set to boost Indian Pharma Revenues

US Drug Shortage, Stable pricing set to boost Indian Pharma Revenues

Octanex Labs Pvt. Ltd. Octanex Labs Pvt. Ltd.

Octanex Labs Pvt. Ltd.

Contract Research, Custom Synthesis and Manufacturing

发布日期: 2023年7月24日
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During the first quarter of the financial year, India's pharmaceutical companies are expected to experience a boost in revenue due to an acute drug shortage in the US, stable pricing, and new product launches. Analysts predict a top-line growth of approximately 14-15 percent, with EBITDA growth of 24-30 percent for Q1 of FY24.

However, hospitals may face lower occupancy rates, and diagnostics companies could be impacted by delayed monsoons. Despite these challenges, several pharmaceutical firms are poised to perform well. Companies like Natco Pharma, Dr Reddy’s Laboratories (DRL), Sun Pharmaceutical Industries, and Zydus Lifesciences are likely to drive sales growth with their generic Revlimid contribution, particularly in the treatment of multiple myeloma and cancer.

Aurobindo Pharma is expected to benefit from volume recovery and input cost advantages. While the weak monsoon season may affect acute therapy sales in the domestic market, analysts expect double-digit growth in exports and improved gross margins due to a decline in bulk drug costs.

Pharmaceutical companies may face some impact from price controls, potentially softening the market growth in India. However, Torrent Pharmaceuticals and Cipla are expected to lead with 10 percent and 9 percent year-on-year (YoY) growth in the domestic market, respectively.

In the hospital sector, increased occupancy and average revenue per occupied bed (ARPOB) are anticipated to drive a 3 percent revenue growth, with a 19 percent sequential increase in profit after tax.

As for diagnostics companies, Vijaya is expected to outperform with 16 percent non-Covid growth YoY, mainly volume-led, while Dr Lal Pathlabs reported 11 percent growth. With non-Covid tests performing well, diagnostics companies are projected to experience revenue and margin growth, supported by better pricing and network expansion.

Overall, the pharmaceutical industry shows promising growth prospects, with various factors contributing to its success in the first quarter of the financial year. Despite challenges, companies are expected to adapt and thrive, supporting the healthcare needs of the global market.

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