• The supernormal profits were due to: ‘Day One’ launch of the generic version of Abilify (Aripiprazole) in the US through their marketing partner. 
    • Even as there were 15 filers for this product, only four (Alembic included) could participate in the first wave of the launch, which made all the difference. 
    • Aggressive capital allocation: All the profits from the above were reinvested into the business in mid-term (5+ yrs) projects.
  • Increased R&D personnel to 500 (skyrocketing investments)
    • The number of research projects under various stages of development jumped 4x to 240 in FY16 YoY
    • Invested in a capacity expansion at our bioequivalence unit by 50%, reinforcing product development. 
  • Huge capex: Planned investment (addition) in fixed assets over the next 24-30 months of 1000crs (In actuality, they spend over 3000crs by FY21)
    • Onco (Injectables & oral solids), other injectables & derma
    • Onco API facilities
  • During the year, we established front-end marketing in the US by opening an office in Bridgewater, New Jersey. We recruited a team comprising talented marketing and sales professionals to start our US operations.
    • Will sell under its label & done so for 11 products already.
  • Manufacturing footprint already expanded to 5 manufacturing facilities and 2 R&D centers (Vadodara and Hyderabad)

Important IPM trends:

  • Chronic & sub-chronic growth outshines acute segment (makes up 70% of the branded Indian pharma)
  • In India, the spending on drugs is largely out of pocket, which accounts for around 90% of payments.
  • Around two-thirds of India’s population lives in rural areas but contributes < 20% to IPM sales.
  • USA market: 47 approved ANDAs
  • Indian market: Product basket extended to 170: launched 44 products
    • 1.73% market share: stagnant (at least, not losing share; rank at 19th)
      • Downward revision of the price of Althrocin, a key brand in the antibiotic segment 
      • Regressive policies on price fixation and FDCs