Cinacalcet, a generic version of branded drug Sensipar, had a huge contribution to our revenues in the first quarter of this fiscal, says Kedar Upadhye, joint president & global CFO, Cipla Ltd. In an interview with Swati Khandelwal, Upadhye said, "We have changed distribution pattern for the trade generic business, which had an impact of almost Rs 150-200 crore on our revenues."
There has been a lot of growth in American business. Which drugs played an important role in this growth?
Cipla has launched several limited component products in the last three-four quarters. In the fourth quarter of the last fiscal, we launched Cinacalcet, a generic version of Sensipar and it benefited us a lot. We also launched other products like Budesonide, Isoproterenol and Diclofenac Gel. The portfolio profile of our new products which were launched in the last four-five quarters has been very healthy. Apart from Cinacalcet, many other products have contributed to our revenue.
There is a 12% drop in business in the domestic market. What led to this fall?
We changed the distribution pattern of the trade generic business after noticing that our buying behaviour was getting concentrated. This had an impact of almost Rs 150-200 crore, but it is good and will make our business sustainable. Maximum of our dispatches were deferred to July, so ideally one would have billed it in the first quarter, but its dispatch and billing were deferred to July. We term it as sales cut off, which was unusually high in this quarter. So, these are the two factors that led to this decline, but our prescription generation numbers, secondary sales and therapy-by-therapy growth market strategy have been quite healthy, and we continue to be positive. The change in distribution pattern in the trade generic business shows that we are committed to this market.
Is there any increase in the company's expenditure on R&D as compared to the past?
We are increasing our R&D spend on two-three products, including generic Advair, whose clinical trial is very well on track. We have also been able to enrol the targeted number of patients. Apart from this, we have three-four additional products like inhaled itraconazole, which is being co-developed with our Pulmatrix in the US. So, there are three-four development programmes where we are focused and will continue to invest aggressively.
There has been a decline in earnings from the API (active pharmaceutical ingredient) segment. What is the reason behind this decline?
Our revenue depends on the buying pattern of our customers and this is something that leads to certain quarter-to-quarter fluctuations. But our API business margin profile is very healthy.
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