Aurobindo Pharma Limited (NSE:AUROPHARMA) Q4 FY23 Earnings Concall dated May. 28, 2023.
Corporate Participants:
Deepti Thakur — Investor Relations & Corporate Communications
Santhanam Subramanian — Chief Financial Officer
Satakarni Makkapati — Chief Executive Officer, Aurobindo Biosimilars, Vaccines and Peptides.
Yugandhar Puvvala — Chief Executive Officer, Eugia Pharma Specialties Limited
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
Analysts:
Kunal Dhamesha — Macquarie Group — Analyst
Neha Manpuria — Bank of America — Analyst
Prakash Agarwal — Axis Capital — Analyst
Shyam Srinivasan. — Goldman Sachs — Analyst
Tarang — — Analyst
Nitin Agarwal — DAM Capital — Analyst
Binu — — Analyst
Surya — — Analyst
Vishal Manchanda — Systematix Group — Analyst
Punit Pujara — IIFL Securities. — Analyst
Alan Kant — — Analyst
Damayanti Kerai — HSBC — Analyst
Presentation:
Operator
Good morning, and welcome to Aurobindo Pharma Quarter Four FY ’23 Earnings Call. [Operator Instructions] Please note that this conference is being recorded.
I now hand the conference over to the management for opening remarks. Thank you and over to you.
Deepti Thakur — Investor Relations & Corporate Communications
Thank you, Anvith. Good morning and a warm welcome to our fourth quarter FY ’23 earnings call. I am Deepti Thakur from the Investor Relations team. We hope you have received the quarter four FY ’23 financials and the press release that was sent out on Saturday. These are also available on our website.
I would like to introduce my senior management team today on the call with us, represented by Dr. Satakarni Makkapati, CEO of Aurobindo Biosimilars, Vaccines and Peptide Businesses; Mr. Yugandhar Puvvala, CEO of Eugia Pharma Specialties Limited; Mr. Sanjeev Dani, COO & Head, Formulations, Aurobindo Pharma Limited; Mr. Swami Iyer, CEO [Phonetic], Aurobindo Pharma USA; and Mr. S. Subramaniam, CFO.
We will begin the call with summary highlights from the management, followed by an interactive Q&A session. Please note that some of the matters we will discuss today are forward-looking, including and without limitations, statements relating to the implementation of strategic actions and other affirmations on our future business, business development and commercial performance. While these forward-looking statements exemplify our judgment and future expectations concerning the development of our business, a number of risks, uncertainties and other important factors may cause actual development and results to vary materially from our expectations. Aurobindo Pharma undertakes no obligations to publicly revise any forward-looking statements to reflect in future events or circumstances.
With that, I will hand over the call to Mr. S. Subramaniam for the highlights. Over to you, sir.
Santhanam Subramanian — Chief Financial Officer
Thank you, Deepti and good morning and welcome to all of you for joining this earnings call. This year has been really challenging due to various factors, namely, challenging macroenvironment and competitive industry landscape, etc. Despite these issues, we have delivered a good result in this fiscal year.
We will now discuss the results for the fourth quarter of fiscal year FY ’22-’23 declared by the company. For Q4, the company registered a revenue of INR6,473 crores, with an increase of 11.4% year-on-year. The EBITDA before forex and other income grew by 2.8% year-on-year and by 5% quarter-on-quarter to INR1,002.2 crores. EBITDA margin for the quarter was at 15.5% and for the FY ’23 was 15.1%. Net profit increased by 3% quarter-on-quarter to INR505.9 crores. EBITDA margin before R&D is 21.8% for the quarter against 21.4% of the last quarter.
In terms of the business breakdown, formulation business in Q4 FY ’23 witnessed a growth of 11.4% year-on-year to INR5,455 crores and contributed around 84.3% of the total revenue. API business contributed around 15.7% and clocked a revenue of INR1,017 crores for the quarter, registering a growth of 11.4% on a year-on-year basis, led by improved demand for some of the key products.
For the quarter, the revenue from the U.S. formulation increased by 11.6% year-on-year to INR3,045 crores. On a constant-currency basis, U.S. revenue increased by 2% year-on-year basis to $370 million. We have received final approval of 26 ANDAs and launched 10 product during the quarter under review. We have filed 12 ANDAs, including three injectable during the quarter.
Revenue for Aurobindo Pharma, the company — Aurobindo Pharma USA, the company making oral products in USA has increased by 1% quarter-on-quarter. Revenue of U.S. injectable business in U.S. increased by 3% year-on-year and 18% quarter-on-quarter to $71.9 million in Q4 FY ’23. The total Eugia Specialty sales in U.S., including the specialty OSD amounted to $81 million during the quarter — $81 million. During the quarter, the Eugia performance in various financial parameters are better than that of last quarter.
We have a total 171 injectable ANDA filed as on 31st March 2023, out of which 126 have been received in final approval and remaining 45 are under review or have tentative approval. The company, as on 31st March ’23 has 774 ANDAs filed with the USFDA on a cumulative basis, out of which 565 have final approval and 34 having tentative approval, including eight ANDAs which are tentatively approved under PEPFAR and balance 175 ANDAs are under review.
For the quarter, U.S. formulations clocked revenues of INR1,660 crores, an increase of 7.7% year-on-year growth. In constant-currency terms, Europe business clocked a revenue of EUR188 million against EUR183 million of last year for Q4. For the quarter, growth market revenue increased by 18.6% quarter-on-quarter and witnessing a growth of 51.2% year-on-year to INR592 [Phonetic] crores. This includes PLI incentive of INR48 crores against INR8 crores of the last quarter due to improved sales of eligible products during the quarter.
For the quarter, ARV formulation business clocked a revenue of INR159.3 crores, year as a whole. We reached an amount of $119 million again an estimate of $120 million. R&D expenditure is at INR411.7 crores during the quarter, which is 6.3% of the revenue. This is similar to last quarter R&D expenditure of INR415 crores. The average raw material costs remained flat and saw marginal decrease during the quarter and the freight costs also decreased — reduced during the quarter.
Net capex for the quarter is around $105 million, of which capex for existing business is $62 million, including $14 [Phonetic] million for ANDA [Phonetic] purchases, PLI capex of $31 million, and capex for new business for new markets amounts to $12 million. The PLI cumulative capex till March ’23 amounts to $121 million.
The average FX rate was INR82.1936 in Q4 FY ’23 against INR82.10 of Q3 FY ’23. The average finance cost for FY ’23 was at 4%, mainly due to availing multiple currency loans. We have clocked an income of — from investment of INR74 crores for the quarter and cumulatively it is INR148 crores for the year. This is accounted in other income. This needs to be read in conjunction along with the finance charges.
The business generated a free cash flow of $61 million during the quarter. As a result of strong cash flow generated during the quarter, the net cash position including investments at the end of March 2023 was at $194 million. The gross debt is $591.7 million. Our endeavor is to bring down the debt going-forward. The high cash was due to some good collections in the month of March ’23 by the U.S. business.
Board composition. During the quarter, we have inducted one new Independent Director in the parent company and one new Independent Director in Apitoria Pharma, the API arm of the company. With this, the total number of Independent Directors in the company is now five out of total 10 Directors. Also, we have appointed CEO for the API arm, Apitoria. We will be appointing one more new Independent Director in Apitoria.
Facility centers. Out of the total eight USFDA regulated API units, six units got — have VAI status, one unit recently got inspected, earlier it wasn’t reinstated and the balance one is under warning letter. We are putting our efforts to get it cleared. All the total 11 USFDA approved FDA — API [Phonetic] units are under VAI status as on date.
Major plants under commissioning. We have three plants, including one Eugia plant under commissioning in U.S. Of this, part of the Raleigh facility was commissioned in March ’23, the balance is expected to get commissioned by FY ’23 end or during FY ’25. The China plant is fully installed and is expected to be commissioned in Q1 FY ’25. We are in the process of manufacturing the exhibit batches. The Lyfius plant which will produce the Pen-G is expected to be commissioned by ’23, however, it is our endeavor to complete ahead of the schedule. We are conducting clinical research studies, Phase-III, for biosimilar product and the biosimilar plant is expected to commission by FY ’23. So far, including the R&D revenue expenditure in biosimilars, we have invested more than INR1,900 crores on biosimilars till date.
Outlook. While our financial performance FY ’23 indicates our resilience to withstand economic adversity on the back of our strong fundamentals, we remain focused on continuing our growth and we are cautiously optimistic on the business growth going-forward. We are committed to deliver good performance in the coming quarters, while adhering to the regulatory and quality standards.
Some of the key focus area for the coming quarters are summarized as below. PLI implementation will be as per our schedule as informed earlier. Post PLI implementation by March ’24, most of the major capex will be done. To improve the capacity utilization across the plant, we may be doing some debottlenecking and the maintenance. We will continue to acquire ANDAs through market authorizations to leverage the existing capacity on our resources. Our differentiated business, biosimilars, is expected to contribute to margin enhancement from FY ’25. New pipeline of approvals will include high-margin, new-generation product candidates [Phonetic] like peptide biosimilars, etc.
Pricing has stabilized in the U.S. and there is price normalcy in the market in U.S. Both the RM cost and logistics costs have reduced during the quarter, overall, resulting in emanating a better business situation for the coming year. Eugia continues to do well and achieved various financial parameters which are better than those of the last quarter. We expect to continue this. We expect to see some good cash generation from FY ’27 onwards after capitalizing all the assets which have been enumerated above.
This is all from our end, and my colleagues will give a better clarity more on it in a Q&A session. We are happy to take your questions now. Thank you.
Questions and Answers:
Operator
Thank you. [Operator Instructions] The first question is from Damayanti Kerai.
Damayanti Kerai — HSBC — Analyst
Hi, good morning, everyone. Thank you for the opportunity. So my first question is on your generic injectable portfolio. For the U.S., we have been seeing sales hovering in somewhere $70 million, $75 million a quarter and similarly branded oncology sales is hovering somewhere around $30 million in last few quarters. So how do you see these injectable sales picking up ahead, given the approval rate is very healthy? And if you can say, like, you will be achieving your guidance provided earlier with this kind of run rate or you see pick-up ahead?
Yugandhar Puvvala — Chief Executive Officer, Eugia Pharma Specialties Limited
Hi, Damayanti. Yeah, in fact, like, I stick to my earlier guidance of double-digit growth. And as you rightly said, we are doing as per our plan, and we will be continuing our journey with a double-digit growth. And on back of healthy approvals, we feel that it is achievable. And that’s on the generic injectable side. In case, Swami, if you want to address on branded injectables?
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
Sure. Yeah, Damayanti, this is Swami Iyer from U.S. So on the branded injectables, Acrotech, these are assets that we acquired from Spectrum and we have a larger plan here to market other products too. We are in the process of getting into — I mean, we have got into business development deals with couple of other companies and this could take some time. But right now, we are looking at maintaining this kind of revenue line at about $25 million, $30 million a quarter.
Damayanti Kerai — HSBC — Analyst
Okay, so you already have some products which you have identified, which will be part of portfolio ahead and then you might see pick-up from current run rate?
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
Yes, but that could take little time, yeah.
Damayanti Kerai — HSBC — Analyst
Okay, and if you can also update on status of Vizag plant, which was, I think, mainly intended for European supplies?
Yugandhar Puvvala — Chief Executive Officer, Eugia Pharma Specialties Limited
Damayanti, like, we started doing the exhibit batches in Vizag plant as per plan and the first trialing is expected to be in September ’23 and it is not only for European markets and emerging markets, and we have identified multiple products even for U.S. pilot, because this plant is big and we have lot of scope for expansion. We wanted to use this as a global plant rather than a specific market plant, but it’s on track and as per the project timelines because it’s almost — all the lines are up and running and we’ve started doing the products.
Damayanti Kerai — HSBC — Analyst
Okay, thank you. And my last question is, if you can comment on your R&D spend ahead? How do you see moving it ahead — in coming quarters?
Santhanam Subramanian — Chief Financial Officer
So Damayanti, the R&D spend for the year was something like — for the quarter was something like 6.3% and the year was around 5.7%. We will be having around something like 6% to 6.5%, anywhere, but more than that — I would say we’ll be incurring around INR400 crore per quarter is very likely, irrespective of how the turnover to going.
Damayanti Kerai — HSBC — Analyst
INR400 crore R&D spend…
Santhanam Subramanian — Chief Financial Officer
Per quarter.
Damayanti Kerai — HSBC — Analyst
Okay. Okay, sir, thank you. I’ll get back in the queue.
Operator
Thank you. The next question is from Kunal Dhamesha.
Kunal Dhamesha — Macquarie Group — Analyst
Hi, good morning. Thank you for taking my question. So first on the Pen-G PLI scheme, would you provide some update as to what would be — how cost-competitive we would be versus, let’s say, the Chinese players? And what kind of scenarios we would have assumed while going for this plant in terms of pricing? Right now, it kind of remains high. But do we expect it to become more competitive once you enter the market?
Santhanam Subramanian — Chief Financial Officer
Kunal, I think this question has been raised in the last quarter wherein I clearly said, we’ll be able to give a picture in the month of November. There is no point in guessing a price which is going to happen in the month of April ’24, right, now. But certainly, we believe with our financial metrics etc., we believe we are very cost-competitive and we’ll be able to withstand any other price erosion also. So we will see it only at that time. Let’s not count chickens before it hatches.
Kunal Dhamesha — Macquarie Group — Analyst
Sure, and then on the U.S. price erosion, you said in your opening remarks, it has kind of stabilized, normalcy has returned. But would you be able to quantify what kind of price erosion we saw in the quarter, I mean, on a sequential basis, on a year-on-year basis? That would be helpful.
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
Yeah. Hi, Kunal. On the U.S. price erosion, on — if you have asked for year-on-year basis, first three quarters, we had fair amount of price erosion, and then the fourth quarter was stable and we see that continuity. We are right now doing — I think we are pretty stable, I would say. So if you talk about year-on-year, yes, it was — first three quarters were slightly high and I don’t want to hazard a guess exactly how it is because we had some changes in the fourth quarter and then we had requested some changes. So overall, net-net, I would think we are in a better position today. That’s what I would like to say and today, we are pretty stable.
Kunal Dhamesha — Macquarie Group — Analyst
And let’s say, the trend that you saw in quarter four, would that have continued in April and May as well?
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
Yes.
Kunal Dhamesha — Macquarie Group — Analyst
Sure, perfect. I have more question, I’ll join back the queue.
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
Sure.
Operator
Thank you. The next question is from Neha Manpuria.
Neha Manpuria — Bank of America — Analyst
Yeah, thanks for taking my question. Swami sir, on the U.S. oral solid business, despite the fact that pricing erosion has normalized — stabilized as you mentioned, we’ve seen launches, data shows that Aurobindo is gaining share in a lot of the disruptive products. We haven’t seen the currency rate increase in revenue in oral solid. So could you give us some color there? Do we expect more of this to reflect going forward because it’s pretty much flat, I think it was up 1% quarter-on-quarter?
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
Sure, yeah, yes, Neha. So the fourth quarter was — that’s when we got some of the awards and we have ramped up some of the supply. I think we would see more of this starting this Q1 and I think the impact would be more in the Q2’s timeframe. So the quick — even if we got the awards, to give a quick turnaround, it’ll be little difficult for the kind of product that we got. We did see some surge in terms of sales, but it’s not completely reflected, I would say, based on the award that we received.
Neha Manpuria — Bank of America — Analyst
So do you think the bulk of the benefit of the incremental volumes that we’ve been awarded will be seen in the second quarter, not even in the first quarter?
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
First quarter, we would have some and then it would continue from there. And if you recall in the last two earnings call also we mentioned that we are also launching some of the newer products. So the new products should also contribute to our top line in the next 12 months.
Neha Manpuria — Bank of America — Analyst
Got it, and sir, overall, on the market environment in the U.S., do you think these NBO [Phonetic] opportunities as we call them is more short-term or do you see this being slightly more part of the base business and not necessarily a one-time opportunity? How would you see the environment?
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
So the one-time opportunities are one-time opportunities that I’ll leave apart from the NBOs. NBOs have been pretty decent, and I would not assume that these are short-term. I would assume that these are medium-term. I think the customers are looking for stable supplies and we have been able to provide them that.
Neha Manpuria — Bank of America — Analyst
Got it, got it. Thank you so much. And Subbu sir, on the gross margins, despite the fact that price erosion has stabilized, the ARV sales are lower, injectable sales are higher. We didn’t see gross margin improvement in the quarter and we had the PLI benefit. So was there any factor impacting gross margins?
Santhanam Subramanian — Chief Financial Officer
Yeah, we had certain one-off items which has reflected — reduced top line item because of some clawback tags as in some of the European countries which has really reduced the overall gross margin — sales as well as the gross margin. And this is also one of the reason. From an EBITDA margin perspective also we have taken some one-off items of around INR20 crores. So that also we’ve taken. Overall, if you really see, around INR45 crores to INR50 crores is the one-off items we had taken during the quarter.
Neha Manpuria — Bank of America — Analyst
Sorry sir, I missed the number, INR40 crores to INR45 crores?
Santhanam Subramanian — Chief Financial Officer
INR45 crores to INR50 crores is the one-off items we had taken during the quarter.
Neha Manpuria — Bank of America — Analyst
This is both on the cost and the revenue?
Santhanam Subramanian — Chief Financial Officer
Yeah, both on the cost and on the revenue, maybe in equal proportion — 30-20 type.
Neha Manpuria — Bank of America — Analyst
Okay, got it. Thank you so much, sir.
Operator
Thank you. The next question is from Prakash Agarwal.
Prakash Agarwal — Axis Capital — Analyst
Yeah, hi, good morning. This question on outlook, actually, I mean, last two years, obviously, a lot has happened, growth has come down, gross margins have come down and so have the EBITDA margins. Multiple factors, U.S. pricing pressure, some USFDA issues. So how do you think the next couple of years will shape up? What are the big building blocks? If you can share which segment in your differentiated R&D assets will start coming off first? And how do you see the margin trajectory?
Santhanam Subramanian — Chief Financial Officer
So, I’ll give the broad direction and my colleagues will be able to explain in detail. Swami has already explained that is expected to sales and expected to move in the first quarter followed by second quarter also. If you really — first quarter and second quarter, the sales are going to increase, right. If you go into third quarter, fourth quarter, Mr. Yugandhar has already said in the last meeting itself, that we will be launching Revlimid which is also going to contribute to that. And next year, if you really see, starting April onwards, this is Q3 and Q4 and probably Q4, some biosimilar product maybe get launched. And next year, by April quarter onwards, we can start seeing that Pen-G start delivering, right, that is also there. And plus we are also started seeing the biosimilars more — I mean, it’s full year impact started coming, rather than some one or two quarter — I mean one quarter impact of this year. So I would request Yugandhar and other team — colleagues to explain in detail.
Yugandhar Puvvala — Chief Executive Officer, Eugia Pharma Specialties Limited
I think, Subbu, you covered it, most of things. From generic injectables, which is under the Eugia, we will continue to grow and our endeavor is to grow double-digit and we’re willing to keep Revlimid as one-off and that we will count as, over and above, the base business for the next three years. But the base business with the slew of launches and filings, we expect quarter-on-quarter we should have at least five approvals and five launches. We just wanted to do 20 launches a year going-forward every year and that should provide us that double-digit growth. And we will keep Revlimid as one-off opportunity.
Prakash Agarwal — Axis Capital — Analyst
So you are saying base business, U.S., you’re expecting double-digit growth?
Yugandhar Puvvala — Chief Executive Officer, Eugia Pharma Specialties Limited
That’s right.
Prakash Agarwal — Axis Capital — Analyst
In fiscal ’24 and ’25, on the large base.
Yugandhar Puvvala — Chief Executive Officer, Eugia Pharma Specialties Limited
That’s right. That is for the Eugia business, which is a generic injectable business, yeah.
Prakash Agarwal — Axis Capital — Analyst
For the U.S. generic business, I was asking.
Yugandhar Puvvala — Chief Executive Officer, Eugia Pharma Specialties Limited
That’s right. That is for the injectables and specialty products.
Santhanam Subramanian — Chief Financial Officer
Which is $81 million for this quarter, which I explained in the script.
Prakash Agarwal — Axis Capital — Analyst
Yeah, yeah. No, I just — little color on the U.S. generic business, ex injectable will also help, sir.
Yugandhar Puvvala — Chief Executive Officer, Eugia Pharma Specialties Limited
Swami, would you like to take it?
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
Yeah. So Prakash, we’ve talked about new products coming being commercialized during the current fiscal. All that I can say is that we would have steady growth. We anticipate about 40 ANDAs to be commercialized during the year. That’s a fairly conservative number and that would add decent amount of dollars to the top line. And I think we would consistently — at least for the next few quarters, we would see this kind of product being commercialized from — after the — based on the approvals that we expect to receive.
Prakash Agarwal — Axis Capital — Analyst
For approvals, we are still getting a lot, sir, I’m just trying to understand little quantitative idea also that with this high base, can we expect high single-digit or at least mid single-digit growth on the U.S. generic base business or given the erosion and the state the U.S. generic market is, that will be difficult or with the R&D pipeline, we can manage?
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
So all that I can say is, prices have stabilized. We are able to ramp our volume. There is a good demand. So on overall basis, I think we should see a pretty decent demand. I don’t want to put a number to it, but I think it will be fairly decent. It would be probably in the higher single digits. That’s something we expect. And then, we don’t — we are very optimistic on it.
Prakash Agarwal — Axis Capital — Analyst
Okay, thank you. And Subbu sir, for you on the margins, if you could give some qualitative…
Santhanam Subramanian — Chief Financial Officer
No, I think before that, if I request Satakarni to talk about his launches, etc., because that is also going to make an impact on the overall margin profile improving in the coming years. Satakarni?
Satakarni Makkapati — Chief Executive Officer, Aurobindo Biosimilars, Vaccines and Peptides.
Yeah, hi, Prakash. So continuing our journey to build on a differentiated portfolio, one of the key elements to us to achieve margin enhancement in future and also sustainable growth is bringing in biosimilars into the regulated market. So we are fairly confident that towards the end of this year, we will have at least one product in the market. Next year we see at least two to three products in the European market with our first filing happening in the U.S. market. So I really see the inflection point for biosimilars to start from ’25-’26. The amount of effort that had gone into conducting these clinical trials for biosimilars, we have a robust portfolio of biosimilars. As we talk now, we have two product filings which were already made with European Medicines Agency. We had three product filings made with the MHRA in the U.K. and we have two product filings with Health Canada. I expect the regulatory procedures and the procedural nuances to conclude anytime between Q2 of this year to the Q2 of the next year. That will bring in a series of launches in regulated markets.
Now staying on the same subject and continuing my guidance for the last three quarters in the earnings calls to now, I’m happy to state that we have completed the treatment phase of trial in 690 metastatic breast cancer subjects of a trastuzumab biosimilar, biosimilar Herceptin, where our test product was tested for efficacy, safety and immunogenicity versus the innovator’s Herceptin. After the completion of treatment phase and after the initial read of the raw data, we are confident that the study, which is a three-year long study, has achieved similar object to response rate to that of the innovator’s product in women with positive — HER2 positive metastatic breast cancer. We are confident that the filing process in emerging markets will begin in June-July. The first filing will happen in India. We will file with the European Medicines Agency by September and we will file with the USFDA by quarter four.
We are prioritizing the filing of this very important life-saving biologic biosimilar in India with an aspiration to launch it in our country this year. We believe that more women will benefit from this life-saving oncology therapy on the back of such extensive clinical data in 690 patients, usually not heard of in submissions that are done domestically. We believe this will give the oncologists and the patients an access to a good and reliable cancer therapy option for treating our women, mothers and sisters. So this is my update on trastuzumab.
Likewise, as the discussion is on differentiated portfolio, as the filing process for our oncology biosimilar across markets is slated to begin, we are showing signs of advancing our differentiated portfolio to various autoimmune diseases. Autoimmune diseases is a huge market in the U.S. I am pleased to state that a full fledged global Phase-III clinical trial of a biosimilar to Xolair, we are announcing the name of the biosimilar for the first time. The Phase-III clinical trial of biosimilar to Xolair, which is omalizumab, has begun, as our trials sites are being readied now and our subjects recruitment is ongoing. The patent expires in U.S. in November 2025. We have followed the due process of submitting the clinical trial plan and application for our biosimilar candidate And we hope that this Phase-III clinical trial, which is a comparative study on the efficacy, pharmacokinetics, pharmacodynamics, safety and immunogenicity, which is being conducted in 600 subjects with chronic spontaneous urticaria.
The reason why I bring this up is to tie in this discussion with what Swami is saying. The Acrotech Biopharma, which is our brand business in the U.S., is investing in dermatology. Now if you look at our biosimilars and how we are positioning them in immunology and autoimmune diseases, this adds to our commercial front-end and the businesses that we are establishing and nurturing in the U.S. with a long-term view to increase margins and to sustain our margins in this business. We believe that this biosimilar presents a sizable opportunity in a potential market of $4 billion with very limited biosimilars competition. It is our intent to file this product in 2025, just in time, maybe two quarters ahead of the formulation patent that expires in U.S. in 2025.
Further, to stay on the differentiated portfolio, we are strengthening our immunology pipeline competitiveness in the autoimmune therapy segment by kicking off a Phase-I three-arm PK/PD safety study of another biosimilar aimed at treating osteoporosis. This is also immunology biosimilar, this will also fit very well into the portfolio in both our U.S. and European commercial front-end teams. A Phase-III clinical trial application for this product is being submitted, as we talk, this week with the European Medicines Agency and we are gearing up to initiate a Phase-III trial by Q3 of this year.
Likewise, third immunology biosimilar, again, a strong focus of the entire company on differentiated portfolio has already begun a Phase-III clinical trial, where we completed around 40% of the recruitment already. We plan to file this product in the next fiscal year in India and emerging markets to start with.
So to answer your question, overall as a company and as biosimilars, we’re nurturing our R&D so that we can sustain our business in the future, especially with an eye on the regulated markets, Europe and U.S., Prakash. I hope this answers.
Prakash Agarwal — Axis Capital — Analyst
This is very elaborate, thank you so much and some color on the margins will also help.
Satakarni Makkapati — Chief Executive Officer, Aurobindo Biosimilars, Vaccines and Peptides.
It will be too early to…
Prakash Agarwal — Axis Capital — Analyst
The overall company level, sir.
Satakarni Makkapati — Chief Executive Officer, Aurobindo Biosimilars, Vaccines and Peptides.
Then Subbu would answer that. Subbu?
Santhanam Subramanian — Chief Financial Officer
See, overall company level, Prakash, if you’re really seeing last quarter, we ended with around 15.5%. Certainly, we will not be limping, but certainly we will grow in an incremental fashion. Probably, I don’t think a step-jump approach will happen this year. Right? So incrementally, probably we may be mid — between — I mean, we monetized 20, but could be midpoint in this year, is what my feeling.
Prakash Agarwal — Axis Capital — Analyst
Okay, thank you very much and all the best.
Operator
Thank you. The next question is from Shyam Srinivasan.
Shyam Srinivasan. — Goldman Sachs — Analyst
Yeah, good morning and thank you for taking my question. Just the first one on the Eugia. What is the full year number now for the revenue? I think $81 million per quarter, also has some global part, which is non-U.S., I assume, and that is for the quarter. So what’s the full year number? And did I miss it in terms of the guidance that we’re talking about double-digit growth? So the $650 million, $700 million, would that come with the generic Revlimid on top? Is that how — sorry, if you can help us reconcile with the past on how we were thinking about this business?
Yugandhar Puvvala — Chief Executive Officer, Eugia Pharma Specialties Limited
Even though, like, we don’t give specific numbers on Eugia, but I’ll just give you a broad guidance in terms of we closed around INR3,300 crores of top line. This is roughly around $411 million this year. This is a flat growth compared to FY ’22, but we didn’t decline. And in fact, in a challenging environment, we could able to grow at single-digit and going-forward, I’m guiding based on the current pipeline, what we have, that we will continue on this INR3,300 crores of base, we will continue our journey of double-digit growth. On top of it, Revlimid will get added. That’s how it is, Shyam.
Shyam Srinivasan. — Goldman Sachs — Analyst
Got it, Mr. Yugandhar. So just help us understand, on the base business, you’re talking about launches, like you said 20 launches, I think, in your previous comment.
Yugandhar Puvvala — Chief Executive Officer, Eugia Pharma Specialties Limited
That’s right.
Shyam Srinivasan. — Goldman Sachs — Analyst
So I just want to understand how is the — I think you’ve got a lot of questions on the oral solid side of things and price erosion, but what is happening on generic injectables, anything that you can comment? What explains the flattish growth? Right? I’m still assuming OSD is a very small percentage of your overall thing and largely injectables. So just help us understand pricing environment on the generic injectables side.
Yugandhar Puvvala — Chief Executive Officer, Eugia Pharma Specialties Limited
Like, first two quarters of FY ’23 were really challenging and I think the first time when the market opened up post-COVID in the Q1, Q2 of last financial year, which is FY ’23, we had almost a double-digit price decline, which was unseen and unheard in an injectable and specialty business. But from quarter three onwards, things have stabilized and right now, the competitive environment is I think — let me put it this way that we are in a good footing with respect to the competitive environment is concerned. And last two quarters, the pricing has been almost — decline has been almost negligible. And that is what we feel that going-forward and also one more thing which is helping us is in terms of — unfortunately, the drug shortages in U.S. are at the highest level in its history and all these things, and on top of it, a slew of launches will help us grow the business. And as guided earlier, our gross margins in Eugia should be between 60 to 70 and EBITDA levels will be around 25 to 35. It’s a broad range, one quarter we might be here, one quarter, we might be there, depending on how launches will shape up.
Shyam Srinivasan. — Goldman Sachs — Analyst
Got it, sir, and just a follow-up on Revlimid. Is there anything that you’ve disclosed in terms of the timeline for the launch, how large it is — will likely be for you in terms of — because it’s a crowded space, is there still elbow room for everyone six, seven, eight players now, right? So just want to understand your thoughts on generic Revlimid.
Yugandhar Puvvala — Chief Executive Officer, Eugia Pharma Specialties Limited
In generic Revlimid, we already secured the final approval. As per the settlement, we’ll be launching in October but as we cannot disclose the percentage of settlement, so I will leave it there. It won’t be a significant part of my revenue, it will be like pretty good bottom line for my business. And as it is, as you know that like, this is going to be limited shares for multiple players, so we expect the pricing to be stable. And it doesn’t matter before Jan 2026, whoever, a number of launches might happen and but, like, only thing is, we don’t expect — because each player will be restricted by the percentage of, like, share what we said. And we expect the pricing to be stable up to Jan 2026.
Shyam Srinivasan. — Goldman Sachs — Analyst
Got it, sir. Last question is on growth markets. I think we have seen a good bump-up there, 18%, 19% quarter-on-quarter growth. So what is driving some of this growth? Is it sustainable? I think 9% now is domestic formulations in India. So some qualitative color on that business? Thank you.
Santhanam Subramanian — Chief Financial Officer
I already said in the opening remarks itself, Shyam. This quarter, we have got a good PLI incentive for around INR48 crores against last quarter INR8 crores. Basically the incentive is depending upon the eligible product which have been approved by the Ministry and this quarter the sales of the eligible products have picked up a lot. And because of that, we got this INR48 crores, which has helped to take it. But still we are in line with the overall number of around — whatever be the number agreed with the Ministry and it is a number which has been reckoned — achieved.
Shyam Srinivasan. — Goldman Sachs — Analyst
Subbu sir, so you classify the PLI income as domestic — sorry, I was…
Santhanam Subramanian — Chief Financial Officer
Yeah, because it is only for the Indian subsidiaries. They don’t give it — achieved by the Indian subsidiaries, they don’t give it for the U.S. or any other foreign countries — sales achieved in other foreign country, only for domestic.
Shyam Srinivasan. — Goldman Sachs — Analyst
Got it, sir. And last follow-up, sir, if I may quickly. When you’re talking about mid-teens margin, are we talking exit quarter or full year fiscal ’24? Thank you.
Santhanam Subramanian — Chief Financial Officer
You’re asking Yugandhar?
Shyam Srinivasan. — Goldman Sachs — Analyst
No, no I’m asking you, sir. When you talk about between 15.5% and 20%, you talked about the margins being that, are we looking at it on a quarterly exit basis, are we looking at full year fiscal ’24 EBITDA margins? Thank you.
Santhanam Subramanian — Chief Financial Officer
I think I have taken it only quarterly basis because we do not know at this stage, as Yugandhar clearly pointed out, the Revlimid will happen only in the quarter Q3 which will have a significant addition to the bottom line. At this stage, I’m not talking about the — I am saying, moving on, excluding the Revlimid, etc., we should be in midpoint between current and 20%, that’s what I feel at this stage. We will revisit next quarter. In each quarter, we will revisit.
Operator
Thank you. The next question is from Tarang.
Tarang — — Analyst
Hi, good morning. I have three questions. So one, Subbu sir, you — in your opening commentary, you suggested that the free cash generation for the business would perhaps begin from FY ’27. I was just curious in terms of…
Santhanam Subramanian — Chief Financial Officer
I said FY ’25, not FY ’27. Okay?
Tarang — — Analyst
Oh, my bad.
Santhanam Subramanian — Chief Financial Officer
Yeah, yeah, because the Pen-G plant will be completed by March ’24. By that time, we would have incurred most of the capex and there is no big project which we are thinking of, as on date, of this size or magnitude to incur in the couple of years, right? And the Pen-G should give good cash generation, right? So because of various factors, I feel there is — would be a good cash generation starting next year onwards.
Tarang — — Analyst
I understand, sir. I misheard it for FY ’27, apologies. Dr. Satakarni, on biosimilars and peptides, one, if you could give us a sense on the status of regulatory inspections, and second, some sense on what’s happening on peptides?
Satakarni Makkapati — Chief Executive Officer, Aurobindo Biosimilars, Vaccines and Peptides.
So — Tarang, hi. On the regulatory inspections, I gave you guidance in the last earnings call that we are — the two filings that we had EMA, we are expecting a regulatory inspection, which had happened and we are waiting for a formal report of the pre-commercial audit or inspection from EMA. We believe this will become part of the Day-80 clock-stop procedure in response from EMA. So we are expecting that. With the delay in the audit, let me also give you a guidance because we have submitted this file last year, we have — we are close to exhausting the time on the procedural clock-stop that EMA or CHMP allows us. We have a clock-stop until June 20th. So once we receive the draft observations of 180 GMP inspection from the agency, we will have to work with CHMP on the way forward and how can we provide any additional data if they require within the timeframe allowed by the clock stop for the procedure. Now this is the guidance on EMA inspection.
Now with Health Canada, I told you last time that we are expecting a Health Canada inspection. The review process of our products have begun. So we were expecting an on-site evaluation as communicated by Health Canada. But because of the of paucity of the auditors, the auditors have pushed the dates back. We are expecting now the Health Canada audit inspection to coincide with the review procedure, which is around November. So that’s my expectation, but again, I’m preempting. I need to talk with Health Canada over a period of next two, three months, engage with them as the review procedure unfolds, to see when I can have the inspection from Health Canada.
With MHRA, unfortunately, with all the three filings that we had, for example, with one of our monoclonal antibody filing, we have concluded a 150, which is at the point of approval and we still did not get any inspection date from MHRA. We are following it up with them.
So this is about the update on the inspections. What was your second question, Tarang?
Tarang — — Analyst
Status on peptides.
Satakarni Makkapati — Chief Executive Officer, Aurobindo Biosimilars, Vaccines and Peptides.
On the peptides, as I told you, we are now focusing on two majority segments in peptides API development, which is essentially oncology peptides and anti-diabetology peptides. So last October, if I did not give this guidance earlier, we have filed a Drug Master File for Liraglutide, which is now active, the DMF. We are hoping to file a DMF for another GLP-1 analogue by the end of this year also. So I am reasonably pleased with how the peptides business is shaping up. It is also contributing to, say, Eugia’s injectables. I think we have two ANDAs approved this year, Yugandhar may correct it — may give you the right picture. So we are — I am convinced about how we are working on peptides and the focus that we have on diabetology and oncology segments in peptides side.
Tarang — — Analyst
That’s helpful. Thank you. The third question to Swami sir. Sir, just wanted to get a sense, today, about 774 ANDAs filed, I mean, in your view, what will be Aurobindo’s coverage for the generic market in the U.S.? Just to get a sense, because my sense is, by volumes, you’re probably the largest dispenser. So I just wanted to get a sense on how big the uncovered market is for you. And how should we see this number moving forward over the next two, three years?
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
So see, if you talk about the approvals, if you talk about the potential, yes, there is fair amount of uncovered market and today we have covered the market to the extent we can, and we are launching new product. So the priorities change depending on the profitability of the product and then how quickly we can do this product. I think there is lot of scope for coverage. That’s all I would like to say at this point. Even today, we have a number of approvals that we are in the process of launching. Month after month, we have launches. So it would be — at this point, I can only tell you that we have a fair amount of market that we have not covered yet.
Tarang — — Analyst
Would it be more than 50%, the covered market?
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
I wouldn’t hazard a guess, but on the overall term, we are the largest. I would not put such a high percentage. All that I can tell you is, we have uncovered market, today, we a large player. Obviously, being a large player, you cannot compound a growth with huge percentage, but I think we have a fair amount of market to be covered.
Tarang — — Analyst
Okay, that’s helpful. Thank you. All the best.
Santhanam Subramanian — Chief Financial Officer
I would request everyone to ask only one question because quite a lot of people are waiting and restrict to one question, please.
Operator
Thank you. Thank you, sir. The next question is from Nitin Agarwal.
Nitin Agarwal — DAM Capital — Analyst
Hi. Thanks for taking my question. Sir, on the — if you can provide any more color on our plans and outlook for the Chinese business, given the fact that you said the plant should be in place by next year sometime?
Santhanam Subramanian — Chief Financial Officer
Yeah, we will be doing — initially we’ll be — I think, as we said, we have more or less installed the plant and we have been doing the exhibit batches. We have filed around five products from the China plant and we’ll be starting with the European dispatches, because it takes quite a lot of time to get the approval — regulatory approval from the Chinese regulators. So we’ll be starting with the European manufacturing starting first quarter FY ’25, that is April next year, followed with probably by third quarter or fourth quarter for the Chinese market. So this is our plan for the Chinese plant — China plant.
Nitin Agarwal — DAM Capital — Analyst
And, sir, on the products that you’re looking to file from this facility, are these injectables, these are inhalers or what is the…
Santhanam Subramanian — Chief Financial Officer
As of now, we’re doing only the OSDs.
Nitin Agarwal — DAM Capital — Analyst
Okay, sir. Okay. Thank you, sir.
Operator
Thank you. The next question is from Binu [Phonetic].
Binu — — Analyst
Hi, good morning and good evening. Just a clarification on the capex. On PLI, so far you have spent about $120 million. How much of that would be for the Pen-G project?
Santhanam Subramanian — Chief Financial Officer
Entirely for the Pen-G plant.
Binu — — Analyst
It’s entirely Pen-G plant.
Santhanam Subramanian — Chief Financial Officer
Yeah, yeah.
Binu — — Analyst
And how much more will be done in this year for Pen-G?
Santhanam Subramanian — Chief Financial Officer
I think this means FY ’24, if I’m right, correct?
Binu — — Analyst
Correct, correct, correct.
Santhanam Subramanian — Chief Financial Officer
So we need to — as I said, most of the capex would be done by FY ’24, that means Pen-G project, as on date, it is estimated around 250 to 260, 5% plus or minus contingencies. Right? So that much of amount will be spent by end of the year. That means another 130 million would be spent this year — 130 million to 140 million will be spent this year.
Binu — — Analyst
Understood. Okay. And any significant capex planned in biosimilars for this year?
Santhanam Subramanian — Chief Financial Officer
No. See already the plan for biosimilars is in place already. As we informed to the exchanges sometime back in October, we want to put one unit which we have already informed, but the timing-wise, Satakarni will decide when to start that plant. But that may not be a very big plant like a INR2,000 crore, must be around INR300 crores, INR400 crores, probably, that is.
Binu — — Analyst
Understood. And all put together, what would be the total capex for FY ’24?
Santhanam Subramanian — Chief Financial Officer
See as I said, the maintenance capex will be very less, in terms, it will be around $125 million — $120 million to $130 million, the existing plants’ capex. Any new products, new market, etc., which is going to give a return in terms of the new turnover, new profits, everything, that will be depending upon what we close it by end of the year. That could be anywhere — maybe — I mean, I’m just guessing anywhere between [Indecipherable], like that. We will see it. I think it’s too early because our objective is to complete the existing projects. Right?
Binu — — Analyst
Perfect, perfect. Sounds good. Thank you. Thanks a lot.
Operator
Thank you. The next question is from Surya [Phonetic].
Surya — — Analyst
Yeah, thanks for the opportunity, sir. My specific question about this thing is that, it’s about the Eugia side. So after doing all these integrations and all, what all — means, what kind of benefit of integration that we have started witnessing? And how is that going to help you incrementally going ahead? That is one. And just, if you can also clarify a bit on the Pen-G. See, having seen the kind of a changed pricing dynamic in price as well as demand dynamic in recent past, how has that changed your potential as well as outlook for the project? And starting from which month or which quarter or which period that you are expecting contribution from the Pen-G project?
Santhanam Subramanian — Chief Financial Officer
So as I said, it is expected from Q1 — I mean FY ’25, that is April ’24 onwards, we need to start generating the revenue from that project. How fast the ramp-up can take place, etc., we’ll be able to tell only in November or maybe in February quarter, right? It is in the process of installation. The installation is likely to complete only by October-November. And then after that, we will do some pilot batches and other thing. We’ll ensure the product is coming out successfully, right? So that is the thing. In terms of the demand forecast, etc., we don’t need to guess for your product, which is going to be launched down the line, one year, right now itself. Maybe we’ll address this maybe at a later date, okay?
Surya — — Analyst
Okay, sure, sir. Regards the integration benefits of this Eugia, putting all the assets — relevant assets into that and the integration advantage what is it that you are trying to see going ahead, if you can talk about events.
Santhanam Subramanian — Chief Financial Officer
As we said in the stock exchange notification itself, the purpose of it is to bring focused management to improve the performance, which Satakarni — which Yugandhar has been explaining very nicely, what is his plan, double-digit growth and other things. Those are all the thing and also to have a control on the quality standards. So that is the thing. Probably, Yugandhar, you may like to add more?
Surya — — Analyst
Basically, sir, I just wanted to have a sense about the contribution at the margin level or the profitability level, because many of the asset would be also seeing a developmental cost and all that which is currently and may not be commensurated by incremental revenue, that is one. And even the two injectable facility, what we have been building up, one in U.S. and one in India, so when are they likely to contribute incrementally? So say, in this segment, how should it really be contributing to the overall profit or margin improvement of the company?
Santhanam Subramanian — Chief Financial Officer
See, I think, Surya, the answer has already been given by Yugandhar very clearly. He said very clearly, he will grow the business — base business, existing business by double-digit. And he also said Revlimid will be over in addition to that. He said there is a significant profit will — addition in the profit will come from Revlimid, he said that. Plus, he also said that, what are all the new projects on Vizag plant, etc., when he is going to launch. I think all the questions which are being asked have been answered already very — in an informal way, Yugandhar has given all answers, what is the EBITDA margin, etc., band also he has given. Right?
Surya — — Analyst
Okay. So then, sir, specifically, if you can just indicate, let’s say, what is the kind of cash burn that we are seeing because of the kind of initial activities –developmental activities, one. And when, incrementally, this U.S. plant is likely to see the revenue, because that is currently possibly in the filing stage. Right?
Santhanam Subramanian — Chief Financial Officer
Yeah, that Yugandhar can answer it.
Yugandhar Puvvala — Chief Executive Officer, Eugia Pharma Specialties Limited
Yeah, it is in the filing stage, we are already did first filing. So we have plans to do around five, six filings from that plant during this fiscal. And in case if FDA triggers the audit, it’ll get commercialized in FY ’25. In case if the FDA delays the audit, we don’t know, but we — our anticipation at this point is that in FY ’25, this plant should get commercialized.
Surya — — Analyst
Okay. And the India plant is FY ’26 opportunity, sir, injectables?
Yugandhar Puvvala — Chief Executive Officer, Eugia Pharma Specialties Limited
It also will be FY ’25, not FY 26, the Vizag — see I have four commercial plants under Eugia and two new plants. One plant is in Vizag and one plant is in U.S. These are the two non-commercial plants. We expect both these two new plants to be delivering some revenue starting from FY ’25.
Surya — — Analyst
Okay, yeah, sure, sir.
Santhanam Subramanian — Chief Financial Officer
Yeah, next — yeah.
Operator
Thank you. The next question is from Vishal Manchanda.
Vishal Manchanda — Systematix Group — Analyst
Hello, am I audible? This is Vishal Manchanda.
Santhanam Subramanian — Chief Financial Officer
Yeah.
Vishal Manchanda — Systematix Group — Analyst
Hi, so my question is, have you witnessed any failure-to-supply penalties during the year?
Santhanam Subramanian — Chief Financial Officer
Swami?
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
Failure to supply is normally commercial practice that the suppliers generally get into failure to supply. And you know there are several types, one is the service-level penalty, other one is actual failure to supply. So all this comes under the broad gamut of failure to supply. We do that — have as a practice and we do incur that.
Vishal Manchanda — Systematix Group — Analyst
So can you kind of share whether it was higher Y-o-Y or it was not — the trend is broadly similar on a Y-o-Y basis?
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
You see, it’s too early to say how exactly it has panned out because, first and foremost, for the last year, there are many customers who did not — who gave some kind of leeway, because it was post-COVID and there were other issues. So it’s not comparable. That’s number one. Number two, if there is a failure to supply, it doesn’t mean that you’re actually going to pay that kind of money because you are going to contest it. He would give you a failure to supply that you don’t supply to him at all, which you supplied two years back or — so these are all questions, it gets normally settled after a point of time. But yes, there could be failure to supply and this is a normal commercial practice. Our idea is to try and control it to the extent we can.
Vishal Manchanda — Systematix Group — Analyst
So you provide for it in your numbers?
Swami Iyer — Chief Financial Officer, Aurobindo Pharma USA
Yes, absolutely.
Vishal Manchanda — Systematix Group — Analyst
Got it.
Santhanam Subramanian — Chief Financial Officer
Next, please?
Vishal Manchanda — Systematix Group — Analyst
Just one more.
Santhanam Subramanian — Chief Financial Officer
There are another three people waiting, Mr. Vishal, if you don’t mind.
Vishal Manchanda — Systematix Group — Analyst
Thank you.
Operator
Thank you. The next question is from Punit Pujara.
Punit Pujara — IIFL Securities. — Analyst
Yeah, hi, thanks for taking my question. So my questions are for Dr. Satakarni. Now, I understand you are developing a global biosimilars portfolio. But my questions are just for the U.S. part of it. First question is, do you think it makes sense to incur additional cost for, say, interchangeability, not for the currently filed products, but the products that you will file later on? That’s first. And second, what are your thoughts around the regulatory framework around the interchangeability converging with what we have in the European market? These are my questions.
Satakarni Makkapati — Chief Executive Officer, Aurobindo Biosimilars, Vaccines and Peptides.
Punit, it’s a good question. It actually requires a huge discussion because the regulators, the policymakers and the industry is engaged in a major debate across the regulated markets, but I’ll try and give my perspective and Aurobindo’s perspective on interchangeability. One, I think, going by what is happening in other regulated markets, if you see what I have predicted before, interchangeability as scientific norm doesn’t make any sense for biosimilars. Okay? So it has been my policy that I would not invest in any interchangeability clinical trials for the time being because I believe as Europe and MHRA has shown the way, going-forward, maybe towards the end of this decade, interchangeability as a concept for clinical — additional clinical trial will be nullified even at the USFDA. Now this is my personal opinion. I’m of the opinion on which CuraTeQ designs its clinical trials.
What is interchangeability’s relevance in biosimilars? There is a good debate, there is a bad debate around it. The good debate is that in chronic segment, when I say chronic segment, where a patient — users has to use a drug for a longer period of time, say for example, in diabetes, you are using an insulin. So the patient should be armed with an interchangeable data so that he can confidently switch from one product to another product. Now, by definition, we don’t agree it as scientists, because, by definition, biosimilar is, in all means, similar to an innovator biologic. Now again after proving residual uncertainty — after proving that there is no residual uncertainty and proving totality of evidence through a stage-wise development, that is doing pre-clinical trials, unlike biosimilarity, Phase-I PK/PD and Phase-III safety, efficacy and immunogenicity trials, why is there an additional need to push for interchangeability is the question that industry is asking?
Now this has been widely accepted already and you are seeing signs of it in countries like Canada, Europe, etc. I think U.S. will also follow suit. So [Indecipherable] at Aurobindo and CuraTeQ, I don’t do any interchangeability trials for my biosimilars. I don’t think it will significantly impact me in the market. Maybe in the first two, three years because I have to always create a new customer base, I will not be able to switch the old customers into my product, but towards the end of this decade, I believe, interchangeability as a definition, interchangeability as a concept, will die down from a requirement of doing an additional clinical trial. I hope that answers.
Punit Pujara — IIFL Securities. — Analyst
So, that’s really helpful. Thanks. I’ll join back the queue.
Satakarni Makkapati — Chief Executive Officer, Aurobindo Biosimilars, Vaccines and Peptides.
Thank you.
Operator
Thank you. The next question is from Alan Kant [Phonetic].
Alan Kant — — Analyst
Yeah, hi, thank you for the opportunity. Sir, just one question, a couple of quarters back, you had spoken about the possibility of some kind of buyback or higher dividend. So just wanted to check, are we still thinking on those lines? Any update on that, pleas?
Santhanam Subramanian — Chief Financial Officer
So it is a good question. It is being — we are discussing that but the timing-wise, it has not been decided because we are embarking on this Pen-G project at accelerated pace, and also we were looking at the possibility of moving the cash which is available in various parts of the country — various parts of the globe, especially in euro [Phonetic], we are sitting on around $200 million cash, but the exchange rates are not very conducive to bring it at this stage. So we are working on all these things so that we’ll be able to ensure that we are optimizing the entire thing. Probably we may do it at some point of time. When? God only will know.
Alan Kant — — Analyst
Got it, sir. Thank you.
Satakarni Makkapati — Chief Executive Officer, Aurobindo Biosimilars, Vaccines and Peptides.
Give me a second. This is Satakarni, I would go back to Punit and leave a punchline. Punit, by definition, we at Aurobindo CuraTeQ believe all biosimilars should be interchangeable. I will leave with that thought. Thank you.
Operator
As there are no further questions from the participants, I now hand the conference over to the management for the closing comments.
Deepti Thakur — Investor Relations & Corporate Communications
Thank you all for joining us on the call today. If you have any of your questions unanswered, please feel free to keep in touch with the Investor Relations team. The transcript of this call will be uploaded on our website www.aurobindo.com in due course. Thank you and have a great day.
Operator
[Operator Closing Remarks]