By Kaustubh Kulkarni
MUMBAI, May 8 (Reuters) - India's top drugmakers, among the
world's biggest producers of cheap generic medicines, are
looking beyond their own shores to generate revenue, seeking to
profit from big-selling drugs going off-patent this year in the
lucrative U.S. market.
Global demand for generic drugs from Indian companies such
as Ranbaxy Laboratories, Dr. Reddy's Laboratories
, Cipla and Sun Pharmaceutical Industries
is booming as developed nations battle rising
Ranbaxy, India's largest drugmaker by sales, reported a
quarterly net profit of $23.3 million on Wednesday roughly in
line with expectations, and said it had filed for three new
generic products in the United States.
Despite a Supreme Court ruling last month which seemingly
opened the way for generic drugmakers to sell their cheaper
copies of patented drugs at home, the likes of Ranbaxy still see
the U.S. market as being more lucrative.
"Ranbaxy's domestic business generates only 25 percent of
sales and the path ahead looks tough as growth has slowed down
due to pricing pressures and intense competition," said Deepak
Malik, a pharmaceuticals analyst at Emkay Global in Mumbai.
"Hence, the company has to look at global markets to make
Ranbaxy could not be reached to talk about their results and
India's leading drugmakers have been put off their home
market, analysts say, due to a new government policy to cap
prices, which cuts into their margins.
The initiative was instigated to make drugs that are deemed
essential more accessible to the country's mostly poor 1.2
Indian companies account for one third of new generic drug
filings in the United States. They however face intense
competition as well as rising lawsuits from innovators and a
stricter U.S. regulatory environment.
Ranbaxy generates more than 50 percent of its sales in North
The company, controlled by Japan's Daiichi Sankyo Co
, is awaiting the U.S. drug regulator's final nod for
its generic versions of Novartis AG's hypertension
drug Diovan and Roche Holding AG's Valcyte, a medicine
used to prevent infection with the herpes virus.
The race to get approval reaps big rewards - the winner
enjoys a 180-day marketing exclusivity for the drug.
Ranbaxy has sufficient capacity to meet rising demand in the
United States after it received a U.S. FDA approval for a
manufacturing plant in India last year.
Innovator companies are expected to lose nearly $15 billion
in revenue in United States alone in 2013, industry reports say,
as drugs go off patent.
Other big ticket drugs nearing patent expiry in the United
States include Eli Lilly and Co's anti-depressant
Cymbalta and human insulin analogue Humalog and Roche's cancer
Valued at $3.6 billion, Ranbaxy shares were down 2.1 percent
at 0912 GMT. The stock is down over 9 percent this year,
compared to a 2.3 percent rise in the Mumbai market.