Mumbai: Drug maker Dr Reddy’s Laboratories Ltd is launching Prilosec, a product used to treat stomach ulcers and heartburn, in the US market. Vice-chairman and chief executive officer G.V. Prasad also said in an interview that the company is counting on its alliance with GlaxoSmithKline Plc, or GSK, to power sales in a few years. Edited excerpts:
Your FY10 guidance stands at 10% revenue growth in rupee terms. Are you sticking with that or do you think you can better that the way things are moving?
Looking at the overall picture this quarter has been very good, but I do not think we are going to talk about guidance in this session. We will talk about the guidance after the quarterly results in January.
Making progress: Dr Reddy’s vice-chairman and CEO G.V. Prasad.
What kind of revenue upside do you expect from the Prilosec opportunity?
This is going to be a significant product. I am not able to put a number at this time but it’s going to be a special opportunity with limited competition. Hence the prices should be good and it should be a decent product for Dr Reddy’s. Moreover, this is not a product which is limited by 180-day kind of a horizon. It is more of a limited competition product and we expect this to continue for maybe more than a year, closer to two years perhaps.
Any risk right now of underperforming on the guidance set out because there are some concerns about the performance of Betapharm and whether that will continue to drag going into FY10?
The emerging markets have done well and India has done quite well. Russia has done quite well this quarter... The US has certainly slowed a bit; we had a couple of issues there, one was the expiry of the 180-day exclusivity and that somewhat slowed sales there. On top of that we had a voluntary recall in this quarter, which did affect sales momentum in this quarter. So while the US and Germany were also a little weak because of the pricing situation as well as the tender situation there, other markets are doing well. The US should also bounce back as we launch Omeprazole OTC (over the counter) and several other products, which are waiting to launch. However, while Germany remains a difficult market for us, every other region is doing well.
Could you detail how you see the GSK deal scaling up?
The GSK alliance is for the branded generic market. We have just started registering products. So you should not expect a big uptick in sales in the near future. The sales will become significant only maybe a couple of years from now.
We made a lot of progress. We have filed a number of products in various markets but the sales will start next year. But I do not think they are going to be very meaningful next year. I think the third-fourth year is when they will become a sizeable portion of our sales.