Chennai: Indian pharma companies in the US generic business reported robust growth in the first quarter of FY25. The growth has been strong in the past few quarters. In 1QFY25, the US generic business of companies covered by India Ratings grew 11.6 per cent yoy to $2.7 billion. In Q1FY24, the business had grown 26.6 per cent and 13.5 per cent in 4QFY24. The US generic businesses have reported a strong performance since 3QFY24 at an average growth of 15.5 per cent over the past seven quarters. This has been on account of stable single-digit price erosion, shortages of drugs, and niche launches, including generic Revlimid and Mirabegron. The US business contribution to the coverage companies stood at around 35 per cent over the past five years. The strong pipeline of Indian companies will help maintain their sales growth momentum in the US market. The companies have increased focus on developing complex generic products, including injectables, patches, inhalants, nasal and ophthalmic over the past five to six years, which offsets the price erosion in existing molecules. The domestic formulations business of the companies also delivered healthy revenue growth at 10.5 per cent in 1QFY25 as against 10.6 per cent in 4QFY24 and 6.5 per cent in 1QFY24, on account of growth in key therapies such as cardiac, gastro-intestinal, anti-infective and anti-diabetic. Meanwhile, Indian Pharma Market reported revenue growth at 7.7 per cent in 1QFY25 as against 4 per cent in 1QFY24. In 1QFY25, the EBITDA margin of the companies remained strong and all-time high at 25.3 per cent as against 23.1 per cent in 4QFY24 and 23.2 per cent in 1QFY24, led by a better product mix, healthy growth in the domestic formulation business, strong growth in the US generic business led by product-specific opportunities with lower price erosion in existing product portfolio in the US generic market and a softening of raw material prices.
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