Cipla Limited (NSE: CIPLA) Q3 2026 Earnings Call dated Jan. 23, 2026
Corporate Participants:
Diksha Maheshwari — Head Investor Relations
Umang Vohra — Managing Director and Global Chief Executive Officer
Achin Gupta — Global Chief Operating Officer
Analysts:
Unidentified Participant
Tushar Manudhane — Analyst
Kunal Dhamesha — Analyst
Neha Manpuria — Analyst
Surya Narayan Patra — Analyst
Abdulkader Puranwala — Analyst
Shashank Krishnakumar — Analyst
Vivek Agarwal — Analyst
Nitin Agarwal — Analyst
Chirag Dagli — Analyst
Sidharth Negandhi — Analyst
Shrikant Akolkar — Analyst
Presentation:
operator
It. Sa. Ladies and gentlemen, good day and welcome to Cipla Limited Q3FY26 earnings conference call. We have with us today from the management, Mr. Umang Vora, MD and Global CEO Mr. Achin Gupta, MD and Global CEO designate Mr. Ashish Adukya, Global CFO Ms. Deeksha Maheshwari, Head Invest Relations. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing start then zero on your touchtone phone. Please note that this conference is being recorded.
I now hand the conference over to Ms. Deeksha Maheshwari, head Investor Relations. Thank you. And over to you, Ms. Maheshwari.
Diksha Maheshwari — Head Investor Relations
Thank you, Ranju. Good afternoon and a very Warm welcome to Cipla’s Q3 FY26 earnings call. I’m Diksha Maheshwari from the Investor Relations team at cipla. Let me draw your attention to the fact that on this call our discussion will include certain forward looking statements which are predictions, projections or other estimates about future events. These estimates reflect management’s current expectations of the future performance of the company. Please note that these estimates involve several risks and uncertainties that could cause our actual results to differ materially from what is expressed or implied. CIPLA does not undertake any obligation to publicly update any forward looking statement whether as a result of new confirmations, future events or otherwise.
I hope you have received the investor presentation that we have posted on our website. I would like to request Roman to take over.
Umang Vohra — Managing Director and Global Chief Executive Officer
Thank you Diksha. Good afternoon to all of you and we appreciate you joining us for our quarter three FY26 earnings call. Over the last five years we’ve delivered strong performance, sensing our market position and significantly enhancing our profitability. Together we built a strong leadership bench and sharpened our execution focus consistently creating value for the company. As I prepare to hand over my responsibilities, it is my privilege to invite Achin to take charge and lead the next phase of our growth and journey. I would now like to invite Achin to give a commentary on the business and subsequent to that Ashish Bhai for his commentary on finance.
Achin Gupta — Global Chief Operating Officer
Thank you very much Umar. And thank you for your steady leadership and for strengthening the foundation on which the company continues to grow. I look forward to carrying the momentum ahead. Turning to this quarter’s performance, we have focused our efforts in growing our base business and we continue to invest for the future. Our diversified portfolio enabled us to deliver revenues of over 7000 crores this quarter. Despite the known drop in generic rev limit sales, our One India business delivered a strong quarter with 10% year on year growth, reinforcing its momentum and commitment to sustainable long term growth.
In our branded prescription business we delivered a double digit growth of 10%. Our key therapies continue to outperform the market with robust growth. Respiratory grew 11% while Anti Diabetes and Cardiac grew 13% each and Urology grew 15%. Dipla Respiratory crossed the threshold of 5000 crores for the first time in IPM as per IQVR map December 25. Respiratory also outperformed the therapy IPM growth by 400 basis points as per IQVIA. Quarter ended December 25. Our overall chronic mix further strengthened to 62.3%. YOY Procore continued its leadership as the number one brand in IPM. We added four new brands to the INR 100 plus role club taking over total to 30 such brands.
Our presence in IPM’s top 300 brands remains strong with 22 brands reinforcing the depth and resilience of our portfolio. CIPLA continues to be the largest pharma company in terms of volume and we own billion plus unit sales in IPL as per IPVR MAT 12-25-During the quarter we entered into a strategic agreement with Pfizer for exclusive marketing and distribution rights of four well established Pfizer brands in India. We also signed a definitive agreement to acquire Inspera Health Sciences, a strategic move that brings together Inspera’s portfolio of pediatric, pharmaceutical and wellness products within Cipla’s robust distribution network.
We further strengthened our diabetes portfolio with the launch of Afreza, India’s first and only inhaled rapid acting insulin, marking a significant milestone in transforming insulin therapy. In addition, through our partnership with Eli Lilly, we launched Europe, a modern once weekly Tirzepatide therapy for obesity and type 2 diabetes, bringing a convenient and advanced treatment option to millions of patients across India. Our trade generics business delivered a healthy growth during the quarter on the back of vigorous execution and distribution, new product launches and technological advancements. Expanding our portfolio remains a key growth driver with eight new launches this quarter which address specific patient needs.
Our consumer health business continued its upward trajectory with Nicotex, Omnigel and Cipladine consolidating number positions in their respective segments. The business is driving healthy secondary growth and actively exploring opportunities to invest in products and channels to further expand our distribution network. Operating profitability improved reflecting the strength and scalability of our consumer health strategy in North America. We delivered quarterly revenue of $167 million which included a small contribution from Lenalidomide. We faced certain supply challenge in some of our key products and increased competition in new launches. Yet our base business ex Lena delivered a double digit growth yy.
We expect upcoming launches to help cushion the decline in Lena revenues and provide long term growth. CIPLA continues to hold number one position in the overall US Albatrol MDI market this quarter with our market share at 22% as per IQBR data for the week ending December 26, 2025, Landrype remains one of our key strategic assets. Recently however, our partner Thomasin underwent a US FDA inspection at their manufacturing facility which resulted in 9, 483 observations. As part of their remediation efforts, production has been temporarily paused. We currently expect Landreotype resupply to resume in H1FY27. Until this manufacturing restarts, the product will remain in limited supply subject to quality clearance of existing stocks.
While this may cause some short term disruption, we are working closely with Pharmacin and all the relevant stakeholders to explore every viable option to restore normal supply levels as quickly as possible and in parallel we are evaluating alternate sites for this product. A quick update on our US Pipeline by this time our pipeline includes four significant respiratory launches including generic Advair. During the quarter we will be launching generic Victoza and we further expect to launch three more peptide assets in FY27. Notably, three of the four respiratory assets are filed from our US facilities. These strategic introductions will not only strengthen our portfolio but will also serve as key drivers of sustainable longer term growth.
Moving to South Africa in the private market we achieved strong secondary growth of 6.3%, outperforming market of 5.7% as per IQVM max November 25. The business faced weakness in primary revenues this quarter due to in country channel deep talking. However, we expect normalization by next quarter. In EMU, we delivered our fourth successive quarterly revenue above $100 million, recording a 7% YoY growth in USD terms. This was fueled by exceptional execution across both DTM as well as B2B segments. Our continued focus on deep market penetration has provided a strong foundation for sustained growth. Notably, we maintain margin stability while effectively leveraging internal pipeline assets which demonstrates the strength and agility for our operating model.
On regulatory front, we are expecting the reinstation of our indoor facility to take place anytime soon. With that, I would like to invite Ashish to present the financial and operating performance. Thank you, thank you Achinji and thank you Mangji as well. Thanks for your leadership. Now I would like to present the key financial highlights for the quarter. We reported a quarterly revenue of 7074 crore which is flat YoY. The EBITDA margin excluding other income stood at 17.7%. To be precise for the quarter the decline in EBITDA margin was primarily driven by lower generic revlimit revenues.
The reported gross margin after material cost stood at 62.8% again largely driven by decline in Lenalidomide as well as partly because of product mix. Also notably the gross margin or material cost also has your R and D material cost of APIs or RLDs that we purchase sitting out there. The total expenses for the quarter stood at 3,187 crore reflecting a 13% increase over the previous year. This was primarily due to planned investment in R and D manufacturing and talent to support our new launches and build readiness for upcoming products in the pipeline. We remain focused on innovation and future readiness.
R and D investments for the quarter was 494 crore at about 7% of revenue. This was a growth of 37.4% yoyo directed largely towards product filing and key development program. As noted earlier, R and D spend is trending higher this year driven by select opportunities that strengthen the depth and vibrancy of our pipeline. The profit after tax for the quarter stood at 676 crore representing 9.6% of the sales. This includes one time impact of 276 crore from from new labor code which is sitting in the exceptional item rather than above EBITDA. The ETR for the quarter stood at 24.5%.
Our free cash flow, generation and operating efficiency continues to drive healthy net cash position. As of 31st December 2025 debt on our balance sheet includes lease liabilities stood at 489 crore with net cash equivalent balance at 10,229 crore and this is after adjusting for dividend that we paid in the previous quarter and this quarter we paid for Galvus as well. This quarter our EBITDA internal expectation by about 1.52% which will affect the overall guidance for the year and this was primarily a reflection of lower than anticipated Landry performance and the completion of generic revlimid billing cycle with most of the shipment concluding in September quarter and small portion in December quarter.
In parallel we stepped up growth priorities including spends towards the commercialization of our new launches and readiness activities at our US Manufacturing facilities ahead of near term and imminent regulatory approvals. In line with the last quarter’s guidance, we continued to prioritize targeted R and D investments and in select opportunities within our US focused oligonucleotide portfolio where we see potential to secure an attractive and competitive market entry position. Now these are deliberate strategic choices and will lead to FY26 EBITDA margin guidance to land at around 21%. Going back to our key priorities for the market for One India the aim is to focus on execution to sustain the growth momentum and outperform the market in both branded generic and pre generic.
We’ll further strengthen our presence in chronic therapies including diabetes, cardiologists, cardiology, urology and dermatology while maintaining the robust trajectory we have built in respiratory. In North America we concentrate on enhancing commercial execution and accelerating the new product launch introductions that we are expecting in South Africa. Focus will be on improving the private sector mix while being selective in tenders emu. Our top priority is to drive top line growth by deepening penetration in core markets while maintaining a strong margin trajectory. Lastly on FY27 guidance we will further provide that as we finalize our annual operating plan for FY27 in due course.
That’s it from my side. Thank you for your attention. Over to moderator for Q and A.
Questions and Answers:
operator
Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on your touch tone telephone. If you wish to remove yourself from the question queue you you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Tushar Manitane with Motilal OSWAL Financial Services Ltd. Please go ahead.
Tushar Manudhane
Thanks for the opportunity sir. So firstly on the Q3 gross profit and gross profit margin, even if the revlimide related impact is there is that further anything in the raw material may be related to landryotide which is dragging the gross profit much lower compared to earlier quarter outside revlimide impact. No?
Umang Vohra
Sure Tushar. So revlimid is a significant impact sitting out there in the gross margin that you see. I think apart from that in case of R and D this quarter was a quarter where we purchased certain RLDs and APIs as well for our R and D expenditure that led to a significant explanation for the difference that you see out there. Other than that there’s a product mix that led to small dilution as well but that is not a significant amount.
Tushar Manudhane
Had any impact on the raw material side while sales would have got impacted but more so on the raw materials as well as in certain inventories related expenses.
Umang Vohra
No, no, no. If you know there was there has been no adjustment in the inventory that we’ve had on account of Landio Tide. It’s whatever we have sold in this quarter of landrealtite a normal material cost against that is what is booked.
Tushar Manudhane
And so extending this like given that there is now disruption so effectively the US sales will then get further lower at least with respect to landreotide reduction in the upcoming quarters. Is that the fair assessment.
Umang Vohra
On account of Landry? Depending on how that situation evolves, the landryotite sales can get further impacted. We are not commenting on the other part of us as of now.
Tushar Manudhane
Okay sir, that’s it from us. I’ll join back to you.
operator
Thank you. Next question comes from the line of Kunal Tammisha with Macquarie. Please go ahead.
Kunal Dhamesha
Hi, thank you for the opportunity. So of the 66 million rough rough decline in the US sales on a sequential basis, how much directionally we can attribute to revlimid versus Landiotite?
Umang Vohra
So a significant portion of that comes from rev limit major portion of that and there is a small portion that comes on account of langotide as well. But important to note is that as against what we had planned in langotide there is a lower than that that we have achieved because of this restructure.
Kunal Dhamesha
Then if I remove just both lenalidomide because there’s still some residual rev limit there and Landio Tide is also there, is it fair to say that we are at a more like a, you know, pre rev limit era where we were doing more like $125, $130 million quarterly run rate for us. Is that a fair understanding? Without lendiotide we should be there.
Umang Vohra
So no. So that your assessment is not entirely correct in arriving at the base because we can’t share the numbers of lenalidomide unfortunately so so difficult for us to explain the entire gap. But directionally if Umang or Achin you want to just comment. I think directionally just to say we have minimal lenalidomide now in that phase and we are looking at very significant launches which are coming up. So I think that the direction of travel of the business will be to grow on the back of the all of the products including some of the launches which have already happened this year.
Kunal Dhamesha
And would you provide more details on the so we know one which is Zandik Advair but beyond that the three respiratory assets if you could provide some color in terms of what is the total addressable market? How is the competitive landscape there?
Umang Vohra
Yeah, so we have mentioned four respiratory assets. One of them is generic adware. There are two other fairly large material opportunities where we believe we have a full generic opportunity which would stay like that for a certain period of time. So we are very excited about those and we are awaiting the approvals which will materially create revenue as well as profitability impact for us. The large means like hundreds of millions or the total addressable market size, how to look at those, One is definitely Symbicode. Right. Of the four, one is edware, one is because. So the remaining two, the large opportunity which you are suggesting where we could be sold one, can you give us the tam? I think for competitive reasons it’s hard to comment on that. But these are fairly large.
Kunal Dhamesha
Thank you. And all the best. Thank you.
operator
Thank you. Next question comes from the line of NEHA M with bank of America. Please go ahead.
Neha Manpuria
Yeah, thanks for taking my question. My first question is on the peptide monetization that we’ve talked about in 27. None of these are from the partner facility that’s been impacted. Right. Would that be a fair assumption or some of this is linked to pharmathon facility getting cleared.
Umang Vohra
No, none of them is coming from pharma 10.
Neha Manpuria
Understood, that’s helpful. And second on the gross margin impact that you said, ashish, from the APIs for R& D, could you quantify how much would that be and should we assume that that was just restricted to this quarter and should normalize from next quarter onwards?
Umang Vohra
Yeah. So without necessarily giving risk, we said that your R and D expenses is about 7% of revenue. So part of that 7% sits as material that you purchase procure as well, which is more both RLD as well as that for certain molecules including oligonucleotides. So what happens is that it is not a quarter regular consistent quarter phenomenon in this quarter we purchased. So therefore it can be lumpy as well. So. So you may not have it coming back in quarter four.
Neha Manpuria
Understood. And how should we think about defending the 21% margin that we have guided to this year into next year when rev limit fully goes away. Initially we have the lender type disruption, but then we also have the launch pipeline. Then if you could just give us some sense on how we should look at margins for 27.
Umang Vohra
So 27 margin we are not currently guiding guiding towards for a reason that we have not completed our annual operating plan for the year which needs to go to the board and then we can Give that guidance. Next quarter, FY26 is for which we have given guidance of that we should land the year at about 21%. So that is just one quarter left. And we of course have to do better yoy to achieve that, if you do the math. And we don’t have any rev limit now in quarter four, which is what you are all aware of.
Please go ahead.
Neha Manpuria
I’m done. Yes, I’m done with my question. Thank you.
operator
Thank you. Next question comes from the line of Damian tk, right, with hsbc. Please go ahead.
Unidentified Participant
Hi. Thank you for the opportunity. I have two questions. So first, on your expected launch for FY27 in the U.S. so you mentioned four peptides and four respiratory assets. So just want to understand what kind of comfort and visibility you have on these assets. Whether you have got that dates from the FDA on basis of which you are confident that you should be able to launch or these products and also want to understand in any of these, are there any TRL for any roadblock which you are yet to resolve?
Umang Vohra
Yeah. So thank you for that question. The Respiratory assets that we have are progressing well through their assessments and we’ve been preparing for the launch as well in terms of operations related activities that need to happen to prepare for the launch. So we have, we are quite confident about those upcoming launches. Likewise for the peptide assets as well because these are not from the site which is having that issue currently with the partner pharmacin. So we don’t have any reasons to suspect any issues on, on the launch. And Victoza generic Victoza approval is already received so that we will be able to launch soon.
Unidentified Participant
Sure. And for the Respiratory, just to understand, all the peptide assets are from CMO site and Respiratory, as you mentioned, three out of four will come from the US and one may be from the India plant. Is that the status?
Umang Vohra
Yeah. Yeah. So. Yeah, that’s right. So the peptide assets are from partner site and respiratory are from US site as well as India.
Unidentified Participant
Okay. My second question is on your node to the consolidate financials where you mentioned you have paid around 1100 cr for acquiring perpetual rights to manufacture Galvas and combination products. So can you help us understand where these like expenses or costs are sitting in the financial.
Umang Vohra
No. So that. Yeah. So that is sitting in intangibles in your capital advance in your financial statement. The 1100 that we paid.
Unidentified Participant
That’S sitting in balances and intangibles. Right. Nothing on pnl. Okay. Okay, I’ll get back in the Q.
operator
Thank you. Next question comes from the line of Surya Narayan Patra Philip Capital India Private Limited. Please go ahead.
Surya Narayan Patra
Yeah, thanks for the opportunity sir. First question is on, on the landlord whether we have. This is just a clarification first whether we have seen any impact of supply disruption in this quarter because the inspection and all that would have happened in the current quarter but I think the development, what we have seen it is in the fourth quarter.
Umang Vohra
So in case of land rotite the inspection took place in November and, and that’s when you know after that, soon after that they stopped the production. So you know December we didn’t, we had no production out there. Okay so there was some impact in comparison to the previous quarter but as far as our plan the impact is much larger.
Surya Narayan Patra
Okay so then my first question is on the margin side. See now we have, we are guiding kind of a 21% margin for the full year FY26 wherein the fourth quarter obviously we know that it is a relatively weaker quarter for us and hence the impact also would be there alongside the impact of landiotide that would also be visible. But going ahead, going ahead is it, how should one say what are the kind of swinging factors for our margin because obviously the linalidomide would not be there next year and there would be possibly in the first half the landiotide disruption also would be there and the spends on RD side that is likely to continue.
So in that case the overall margin if we see it looks like a below 20%. Am I thinking whether the directionally I’m thinking right or how is it, how should one think if you can just talk about the moving factors for the margin for next year.
Achin Gupta
So Surya, let me just try and give you some color. So you know the Lena is a planned, you know they’ve been sales which was known for quite some time. So that’s happening as we speak. And in preparation for that we’ve been working on the pipeline and as we already mentioned, you know that pipeline is now looking closer. So as we go along, you know and as we start getting those approvals we will be able to obviously share that. So that will be the way to offset all of what has happened. Whatever you know is going off on Lenalidomide.
In addition our other markets continue to grow strongly. So you know India which is a large presence for us continues to grow. EMEU continues to grow, South Africa continues to grow and we will obviously you know be providing some more visibility on how we are looking at R and D and the other expenses to invest in the business. But I Think the broad guidance is that this is Lanyartide is a temporary issue and Lenalidomide was a plan going away for which the pipeline comes into play. That’s how we would look at it. Look more at until the time this land disruption is there more as a temporary aberration than a longer term.
Surya Narayan Patra
Okay. Otherwise our profitability going ahead excluding the impact of the landreotide should be better than the profitability what we would be having prior to the linalidomide scenario.
Umang Vohra
So I think best for us to answer this question will be when we’ve rolled up our annual plan. So we’ll give you much better visibility after that.
Surya Narayan Patra
Sure, sir. Okay, just last one question then from my side about your yawpic, the Tirzepatide launch. So what is the kind of progress and whether you have any assessment about the kind of adoption levels in the areas beyond cities where the focus would also be there for you and what scenario that you are anticipating post the commercialization of Semaglutide for Tirzeptide.
Umang Vohra
So we are the full all over India marketing rights for Europe. So we are covering pretty much all of the country with obviously more focus on outside of metros. But this is a very fast growing space so we’re seeing good traction coming through in all of the places. Those which had been expanded to the drug earlier by the partner as well as the cities and new prescribers where we are able to bring the treatment for the first time. So I think there’s a good amount of traction there and it’s a very large medical need across the country.
Patient pool is very vast and widespread across the country which we are looking to serve. Now with respect to semaglutide generic as and when that happens, we believe it will open up a new segment in the market because the molecules are different. Tirclipatide has dual action GLP and GIP which we believe makes it a preferred option. However, from pricing perspective, when genericization of SEMA happens, it might open up options at a different price point to certain segments of the market which effectively will grow the market as opposed to eating into each other.
Surya Narayan Patra
Okay, sure sir. Thank you. Wish you all the best. Thank you.
operator
Thank you. Next question comes from the line of Vino Patti Parampil with Elara Capital. Please go ahead.
Unidentified Participant
Hi, good afternoon. First question on Abraxin. Any update on how it’s doing in the market? No, sorry, you. You said Fingrass, Abrexon, Abrexin, which you have launched.
Umang Vohra
Yeah, no. So I think our launch coincided with other Launches as well. So it’s become a competitive market. So as of now we are inching up our market share. Currently it’s mid single digit. We hope to increase that.
Unidentified Participant
Understood. I was looking at your F22 margins before lenalidomide you were around 21%. How has that fallen to 17 and a half, 18% now without. I mean that too with a little bit revenue.
Umang Vohra
Sure. See I think we explained some of the reasons, right. Like there was R and D which is elevated. We used to be at about I think five, five and a half percent in the past and which has now come to about 7% of sales. So it’s straight away about one and a half, 2%, kind of a dilution from what we used to be. That explains one of the reasons. And then you know, in the last almost about, you know, 12 years we’ve been investing on organic growth and for new launches for de risking. So all that cost has also come into the P and L I think as they start to yield revenue for us, both R and D pipeline as well as all the de risking benefits, et cetera that we are likely to get.
We should normalize back to higher number. And the 17.7, we’ve already mentioned that it’s 1.5%, 2% off from our expectation and for the same similar reasons that we mentioned.
Unidentified Participant
Got it. And this 1100 crore payment to Novartis, is this related to your. The deal that you entered in April 2023?
Umang Vohra
Yeah, that’s right. This is a follow up. So it was earlier just ild, sorry in licensing kind of a deal and now it’s a perpetual license that we’ve got for the trademark and we can also manufacture it in house. I mean was, was it publicly disclosed earlier that such a payment is due under this deal? Yes, yes. When we announced the in licensing then this was disclosed.
Unidentified Participant
Okay. And I’m sorry, I looked up your public statement did I couldn’t find it. Maybe I missed it. Is any such payment in future involved with the current deal with Pfizer or with or the deal for Tis Appetite?
Umang Vohra
So when we shared about the Galvas deal, it was an EPD followed by this perpetual license. So it’s kind of an acquisition with a slight delay. So a couple of years of marketing exclusivity followed by the purchase. The other deals don’t have this kind of provision.
Unidentified Participant
Okay, thank you.
operator
Thank you. Next question comes from the line of Abdul Kadir Puranwala with ICICI Securities. Please go ahead.
Abdulkader Puranwala
Yeah, hi. Thanks for the opportunity. My first question is pertaining to your earlier guidance on US revenues where we saw US revenue stretching around close to a billion dollar by site 27. So. So I mean post lancreotide, are we revising that guidance?
Umang Vohra
Yeah, I think we’ll have to revise. Yeah, the guidance will have to be revised because if we don’t have Landry in a. In one quarter, the the numbers will be lower. Right. So I think that guidance will have to go down because Landiotide if we forecast quarter four not coming in, it will have an impact on the overall guidance for the US business. Now what we had also directionally guided was for the US business to continue at that trajectory supported by new launches. And I think based on what, you know, some of the questions earlier, it’s pretty clear that the launch trajectory of the business is at least at a very, if not almost at the stage of launch, but at a very advanced stage of launch for three products.
So I think that would also add to the overall guidance towards the directional guidance we gave for the business in the U.S.
Abdulkader Puranwala
Okay. Okay, thanks for that. And just around the eight products you mentioned three, you have a rough timeline. How about the balance five? Are these kind of an early FY27 opportunities or late FY27? Any direction?
Umang Vohra
Yeah, no. So effectively I think what is immediate, let’s say from zero to six months we are calling for from zero to six months two big Respiratory launches and one smaller launch right on Respiratory. Let’s say two big Respiratory launches and one advance. That’s what we are calling for in FI in this year. In the next six months. Between the six months to one year there could be another big launch that in Respiratory that we are calling out. Right. That could be another one and that is likely to be around the Symbicode and more towards the end of the year.
Then we have peptide launches which the team has called out. I think the peptide launches there will be a smaller one in the zero to six month period. And then hopefully if things work out the way we are thinking, there will also be a larger launch which again could be a, you know, pretty exclusive sort of a scenario for one of the peptide products in the 6 months to 12 months trajectory. So that’s how the launch calendar looks like. Now for whatever is between the zero to six month category, there is a fair amount of belief that this, you know, that this has gone through multiple rounds of review, etc.
And therefore the launches are likely more likely than not to happen sooner.
Abdulkader Puranwala
Got it sir. Thanks for that.
operator
Thank you. Next question comes from the line of Shashank Krishna Kumar with MK Global. Please go ahead.
Shashank Krishnakumar
Hi. Thanks for taking my question. The first one was on the respiratory assets. The four which we are guiding to over the next year and three I think are filed from the us. The fourth one we filed from Goa and not Indore. Is that right? I think we have said that in the past. The partnered assessment is from Go. So that is from Goa.
Umang Vohra
Right. This is not contingent on indoor getting reinspected and cleared. That is correct. That is correct. That’s right.
Shashank Krishnakumar
Got it, Got it. And just the second one on the opening remarks which you had made, the US base X of rev limit grew in double digits. Right. So. And that base when we are referring to that obviously includes Landry. Is that the right understanding?
Umang Vohra
That’s right. Your understanding is correct.
Shashank Krishnakumar
Thank you. That’s it. That’s it from there.
operator
Thank you. Next question comes from the line of Vivek Agarwal the city. Please go ahead.
Vivek Agarwal
Yeah, thank you. The question is related to India business. So what is the share of in licensing portfolio in India RX business and how that has grown.
Umang Vohra
So at the moment it is, you know, less than 10%. And now Galvas was appearing as the in license thing which now you know we will have the benefit of own manufacturing and therefore full supply chain margins. So that will come out of the bucket and your peak will grow. So that’s. That’s the evolution of it.
Vivek Agarwal
Thank you. That’s only from my side.
operator
Thank you. Next question comes from the line of Tushar Manudane with Motilal OSWAL Financial Services Ltd. Please go ahead.
Tushar Manudhane
Thanks for the follow up. So just on Lander died while the first when we had launched at that time Oswald they were set up regulatory issues. If you could clarify it was to do with the same site and now with this US FTA thing. So in the over a period of time have we thought of having any alternate site filing from this for this product? That’s my first question.
Umang Vohra
Yes. So from de risking perspective we’re looking at a second site not in the same market. And those discussions are advanced with the partner because we need the partner to be able to take transfer the product to the new site.
Umang Vohra
So which means effectively if at all when. If you are thinking of launching in first of FYI, relaunching in first of FY27. It has to be subject to the US FDA clearance for this site itself. Yeah. The earlier resumption will come from the existing site for future. The de risking can happen from the second Site as well.
Tushar Manudhane
And sorry if I would be dragging on this, but when there’s a zero to six months, two big respiratory launches, while you might not call out individual market size or product size, if you could just combine the two and just give us an idea in terms of when you say big, how big is the market size and is there, are there any generics already there in these products or not there?
Umang Vohra
No, in the zero to six months. Go ahead, Achin, go ahead.
Tushar Manudhane
I think so. We have guided that two of those opportunities are, I know, quite large and we expect to be the sole generic in those for a substantial period of time. The third one in that same bucket is, is the generic adware which already has competition.
Umang Vohra
Yeah, I get you service. Sorry, but just to reduce the subjectivity, I am just trying to understand when you say big, what would be the market size if not individual product combined? If you could highlight. So like we said that collectively our new launches will make up for the. Revenue drop. I think that should give you some indication of. Relatively less as compared to rev limit. While it would help to make up for the sales, will it be at a relatively similar profitability or lower theftability? Yeah, so see, no, it will be lower profitability than rev limit and it also depends on, by the way, on timing. So when you launch a system collectively, I’m saying this in makeup, it’ll be lower profitability. But important to note is that our Respiratory assets are all in house. Okay. So they will come at a very good gross margin. So you know only when you go outside with partners, when you have to share some profits or pay some milestones, etc. So in this case, all of them are in house.
Tushar Manudhane
Maybe we can give you color. Let’s give you some color in this manner. Right. If you take away rev limit.
Umang Vohra
Right. The next set of products are a certain size for the business. Right. And including land, including Landreotype, I think the two products we’re talking about ballpark as an average, they would come at that size as being leading products for the market outside of rev limit.
Tushar Manudhane
Got it, sir. Thank you.
operator
Thank you. Next question comes from the line of Nitin Agarwal with DAM Capital.
Nitin Agarwal
Please go ahead, sir. On the business, what do you think is the normalized gross margin for the.
Umang Vohra
Business on a more secular basis? So see, I think we’ve been averaging about 65% or so, so range of about 60, 65% depending on the mix. Some quarters will have more acute, so that will be more on the lower side. And when it is respiratory et CETERA then typically it would be higher. And then of course us. It all depends on a small portfolio that you have to, you know, there can be product skills that can be there.
Nitin Agarwal
And on the, on the fixed cost. Per se, we’ve had obviously some pickup. In the business, fixed cost overhead which have happened.
Umang Vohra
Obviously there’s been a rev limit cushion. Over the years which has been there. Now with rev limit not being there.
Nitin Agarwal
Is there an opportunity for us to. Take out some of, you know, to. Prove some of the operating overhead costs?
Umang Vohra
No, absolutely. I think we constantly look at opportunities to reduce cost and optimize it. So there are opportunities. We’ve run a program as well this year, part of, you know, that program. Some benefit may come towards the end of this year, but more full year benefits will start kicking in in the next year. So there are definitely constant continuous improvement programs that we run on the cost side. And you know, please, again, you know, for the sake of repetition, the R and D cost that you see out there of 7% of revenue sits in material cost, other cost and people cost.
So all the three line items will have those sitting. So if you see increase in those line items, that’s also because of rd, not so much in people because we’ve not really, you know, invested big time in people on the R and D side. But on material and other expenses increase, you can see it’s on account of R and D. And R and D also has litigation costs that you do for the products in the US or any other country. So those costs are also baked in.
Nitin Agarwal
Thank you so much.
Umang Vohra
And Archin, best of luck for your term going forward.
Achin Gupta
Thank you.
operator
Thank you. Next question comes from the line of Chirag Dagi with DSP Asset Managers. Please go ahead.
Chirag Dagli
Yeah, so thank you for the opportunity. Ashish, on your comment of the increase in R and D, some bit of that being, you know, led by the R and D, R and D purchases that you’ve done, the absolute Quantum seems like 150 odd crores. Is this in the ballpark or is this way off in terms of if you were to estimate, because you’re not calling it out separately, but that 150 crore kind of an increase versus the run rate that you’ve been having.
Is this broadly right?
Achin Gupta
So, yeah, so see that’s the guidance chiral that we’ve given in the last quarter as well where we said that our R and D expenses and estimate has gone up by about 50 basis points. So your 50 basis points would translate to somewhere around 150 crores. So from that sense, yes, your number is.
Chirag Dagli
And that sits in the RM cost is what I’m trying to understand. As well as other expenses also. Yes, and some bit of capital expense. But that will be very small. Like if you’re buying lab equipment. But that’s a small number. That won’t be a.
Achin Gupta
The incremental versus the average run rate that we’ve been having largely sits in the RM cost. Line item and other expenses.
Chirag Dagli
Understood, Understood. Fair point. The other bit is in terms of the quarter on quarter dip in the US business, roughly about $65 million. You said largely. This is Lenali domain. Should we extrapolate this to an annualized number to get the sense of what our annual Lenalidomide sales would be in the base or would it be lower? Higher. Just how should we think about that there?
Umang Vohra
Unfortunately we can’t guide yet because of the agreement surviving. Is the run rate going to be materially different in the coming quarters on the us. So I think the future guidance on us let Landryotite stabilize. I think there’ll be good opportunity for us to give you that guidance.
Chirag Dagli
Understood. Thank you for that color. And just in terms of clarification, Umang, you said you know the two assets.
Umang Vohra
The big respiratory products that you’re expecting. In the next six months in terms of the opportunity size, it could be. Did I get this right? That the size could be as big as Landreotype potential or what were you trying to indicate in terms of. Yes, yes. What I was trying to say is that it’s quite likely that one, if not both could be one of the largest products for the company. That’s what I was trying to say. So if you take out Lenalidomide. Right. And if you take the, you know, the next top two or three products of the company that we sell, including Landreonite, this is ballpark in that top two or top three product type of a profile for revenue.
Chirag Dagli
Understood. Thank you so much. Thank you for that.
operator
Thank you. Next question comes from the line of Siddharth Nikanti with Chanakya Wealth Creation. Please go ahead.
Sidharth Negandhi
Hi. Thanks for the opportunity. I just wanted to understand if you are, you are seeing greater traction in trade generics or branded generics within the India business. If you could give some color on that and in context of, you know, the, the schedule and implementation, how are you seeing the actual implementation on ground and do you expect either the branded or the trade generics business to gain share because of that? That’s question one. Question two was in line with the Peptide launches that you mentioned in the developed markets in the us if you could give some color in terms of launches in the emerging markets for some of these peptides where we are seeing loss of exclusivity.
So these are my two questions.
Umang Vohra
So I’ll start with the trade generic and branded generic question first. We see opportunities on both sides and I think slightly different drivers for each. One has an element of scientific doctor promotion. The other is more channel led. But given the breadth of the market, we see equal opportunities on both sides and our growth rates have also been similar in this year. As far as Schedule M is concerned, that’s a good initiative from the government side to raise the quality bar on all the manufacturing that is happening in the country. It is more of an impact for smaller players who will need to ramp up to meet those quality standards.
From CIPLA perspective, we do not have much or any impact because we are already at or better than the standards that are asked for in terms of EM launches on peptides. You know that Lira glutide we had already launched and then we have some other products in the pipeline. It would be difficult to call out individual assets because the Quantum would not be as large as it is in the us but we are looking at having same level of complexity and differentiation on our EM portfolio as we have in the U.S. portfolio. And sometimes there are assets which are more differentiated, which are registered in branded markets which are not available as opportunities for the generic market in the us.
So we are focusing on building out these EM front ends as well as EU and South Africa front ends.
operator
Thank you. Mr. Negandi, please rejoin the group for more questions. Next question comes from the line of Srikant Akolkar with Nuama. Please go by.
Shrikant Akolkar
Thank you so much for taking my approach. My question, I have two questions. Firstly, since we have launched, can you say that we still will be able to launch Semaviside in March, in the month of March.
Umang Vohra
So at the moment we are focusing on Tirzepatite. That’s a fairly large opportunity with our Europe partnership with Eli Lilly. As you see from IQVR data, last month the molecule was clocking upwards of 130 crores a month. So our efforts are primarily focused on that, on sema. We will wait and watch as to how the market evolves and then you know, if we see an opportunity at a lower price point to cover some of the market, we can take that call but not, not immediately.
Shrikant Akolkar
Understood and just follow up on that because we have an agreement with Alai. Does that agreement stop us from.
Umang Vohra
So we cannot share the specifics of that. But as I said, you know, we can, we can see how the market shapes up and if we see an opportunity to play in that market, we can take that call over time.
Shrikant Akolkar
Okay, second question. Just to check up whether we have in the development.
Umang Vohra
Can you please repeat the question?
Shrikant Akolkar
Yes, I was asking if we have Genjix Kiriva in the development at the moment or maybe in future.
Umang Vohra
Well, it depends on which market. Okay, I think I got this question. The question is on Spiriva, right?
Shrikant Akolkar
Yes, sir.
Umang Vohra
Yeah, yeah. So that depends on which market you’re talking about. I think for some part of the world we have it and for some part of the world, you know, we, we can’t disclose because it’s competitive.
Shrikant Akolkar
Okay, understood. Thank you so much and thank you. Among the last 10 years and all the best to achieve as well. Thank you.
Umang Vohra
Thank you.
operator
Thank you. Thank you. Next question comes from the line of Kunal Tamesha with Macquarie. Please go ahead.
Kunal Dhamesha
I thank you for the follow up. Just one question on the 275cro exceptional item this quarter. Ashish, do we see any prospective impact which could happen in the future quarter as well that you know of this 275some amount continues to remain.
Umang Vohra
So in our assessment. We have the data with us. We’ve based on the new code as per guidance and FAQ given till now, we’ve taken the impact. So we don’t anticipate any material adjustment to this amount. Except of course your approvals now because of the new code will start to be. It will be higher than the approvals every year that you are making. But for the past, whatever the accruals has to be made is all sitting there in the 275. No material adjustments we see after this. But there could be some lingering or residual or the structural increase in employee cost because of this. Right. Because we now have to provide for graduation. Yeah. So your accrual every year now will be, will need to be slightly higher unless you change the structure of salary.
Kunal Dhamesha
Sure. Yeah. Okay. Okay. And you know, on R and D side this year has been higher, but given we would have, you know, timelines about the projects that we are currently doing. So do we expect that R and D can cool off let’s say in FY27?
Umang Vohra
I think the normal range which we have been operating in is around 5 to 6% of RT spend gets lumpy at times depending on certain programs where the RLD and EPI costs might get lumpy. But I think we’ll try and keep it more around that 6%. But quarter on quarter depending on the timing of project. You know, some of it goes up and down during the year.
Kunal Dhamesha
Sure. Thank you. And all the best.
operator
Thank you. Next question comes from the line of Siddharth ni Gandhi with Chanakya wealth creation. Please go ahead.
Sidharth Negandhi
Hi. Thanks for the follow up. Just on the schedule and what I wanted to understand is on, given the challenges that the smaller guys will have on implementation, are you envisaging your trade generics or branded generics business? Seeing any short term blip or benefits from this? That’s the question I actually had.
Umang Vohra
I think it is more towards benefiting the patient in terms of quality and preventing unnecessary adverse events. Given the number of manufacturers which exist in India, we don’t see much material difference on our business on either of trade generics or branded generics because of this schedule implementation.
Sidharth Negandhi
Got it. Thanks.
operator
Thank you. Ladies and gentlemen, due to time constraints we have reached the end of question and answer session. I would now like to hand the conference over to Deeksha Maheshwari for closing comments.
Umang Vohra
Thanks everyone for joining the call. If any daily questions are left, we’re happy to address that. Just that one comment that was asked on Galvis, that 1100 that sits in the capital commitment in our balance sheet in note 38 that clarifies the amount that is sitting there for Galva’s capital commitment that we have made. It was not there in the initial press release. I checked that. Thank you.
Achin Gupta
Thank you.
operator
Thank you. Thank you everyone for joining in. And if you have any further questions, please write it to investor.relationsupply.com. Thank you on behalf of Cipla Limited. That concludes this conference. Thank you for joining us. You may now disconnect your lines.