New Delhi: India’s leading drug maker Dr Reddy’s Laboratories Ltd said its fourth-quarter profit fell 68%, hurt by competition for generic drugs in the US. Net income dropped to Rs103 crore in the three months ended 31 March from Rs325 crore a year earlier. Sales declined 15% to Rs1,330 crore from Rs1,560 crore, the company said in an emailed statement on Tuesday.
Dr Reddy’s built its business by copying medicines such as Eli Lilly and Co.’s Prozac antidepressant and selling them at a fraction of the price in the US. The company faces increased competition for generic drugs in the world’s biggest pharmaceutical market from bigger rivals including Israel’s Teva Pharmaceutical Industries Ltd and Mylan Inc.
Dr Reddy’s sales in North America, mainly the US, declined to Rs250 crore from Rs560 crore a year earlier. Sales of its copy of GlaxoSmithKline Plc.’s nausea treatment Zofran, marketed exclusively for six months in the US, declined after competition from generic rivals in June.
The company sold Rs270 crore of ondansetron, or generic Zofran, a year earlier, making up 16% of revenue. It didn’t disclose sales of the drug in the fourth quarter.
Dr Reddy’s profit fell 50% to Rs468 crore, or Rs27.73 a share, in the year ended 31 March, from Rs933 crore, or Rs58.56, in the year earlier. Sales for the year declined 23% to Rs5,000 crore.
Dr Reddy’s stock has declined 13% this year.
Dr Reddy’s and Ranbaxy Laboratories Ltd, are trying to counter generic rivals by settling some patent disputes with the makers of the original drugs in return for exclusive marketing rights.