Dr Reddy's bets on generic semaglutide, biosimilars

ET Intelligence Group: Though Dr Reddy's domestic formulations business continued to grow in the September quarter, it was offset by lower Revlimid sales in North America and weakness in the API business. While the drugmaker reported a sharp sequential improvement in operating performance during the quarter, FY27 is expected to be another year of earnings decline before a potential recovery in FY28. The earnings rebound will hinge on the successful relaunch of generic semaglutide, the ramp-up of the abatacept biosimilar in the US and continued strength in the domestic business.

The biggest near-term trigger is generic semaglutide, which is scheduled for relaunch in November 2026 after temporary supply disruptions linked to API scale-up challenges.

The company has iterated its target of selling six-seven million pens this year. It expects an annual opportunity of 12-15 million pens over the longer term. Initial volumes are expected to be led by Canada and other international markets before larger geographies contribute meaningfully.


The second key catalyst is the US launch of arthritis drug abatacept biosimilar, with a regulatory decision expected in December 2026. While commercialisation is likely to take a few quarters to gain momentum due to time taken to add it to the formulary list, the company anticipates meaningful market-share potential, making it one of the most important growth contributors from FY28 onwards.

The company launched 12 products and filed 10 ANDAs in North America during the first half of FY27, with a healthy pending pipeline of 80 filings, including 27 first-to-file opportunities and three NDAs, which should support steady launch momentum.

Beyond these products, Dr Reddy's is steadily expanding its biosimilars portfolio and specialty business. The US approval of rituximab biosimilar (used to treat blood cancer), launch of cancer drug nivolumab biosimilar in India and new partnerships and innovative therapies underscore its strategy of moving beyond traditional generics.

The domestic formulations business remains a bright spot.

Strong performance in chronic therapies and an expanding specialty portfolio have helped the company outperform the Indian pharmaceutical market.

It also expects a healthy launch pipeline to support growth in the coming years.