Gland Pharma Limited (NSE: GLAND) Q3 2025 Earnings Call dated Feb. 03, 2025
Corporate Participants:
Runjhun Jain
Srinivas Sadu — Executive Chairman
Shyamakant Giri — Chief Executive Officer
Alain Kirchmeyer — Chief Executive Officer at Cenexi Services
Ravi Shekhar Mitra — Chief Financial Officer
Analysts:
Bino Pathiparampil — Analyst
Neha Manpuria — Analyst
Vivek Agarwal — Analyst
Aman Goyal — Analyst
Harsh Bhatia — Analyst
Shyam Srinivasan — Analyst
Ritesh Rathod — Analyst
Roshan Chutkey — Analyst
Jinesh Shah — Analyst
Tushar Manudhane — Analyst
Dheeresh Pathak — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to the Glan Pharma Q3 FY ’25 Earnings Conference Call. 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 call, please signal an operator by pressing star then zero on your touchstone phone. Please note that this conference is being recorded.
I now hand the conference over to Ms Runjan Jain. Thank you, and over to you, ma’am.
Runjhun Jain
Thank you, Reya. Good evening, everyone. We welcome you to the Gland Pharma’s earnings conference call for Q3 FY ’25. Today, we have Mr Sadu, Executive Chairperson; Mr Shyam, Chief Executive Officer; Mr Ravi Mitra, Chief Financial Officer from India’s office; and Mr, CEO of, who is connected virtually from time. We’ll begin the call with business highlights from Mr Salu, followed by Mr Ghiri, who will share his vision about the company. This will be followed up by an overview of Mr Nexi from Mr Allen. And lastly, the Group financial overview by Mr Ravi. Before we proceed, I would like to remind everyone that some of the statements made today will be forward-looking and are based on management’s current estimates. These statements should be considered in light of the risks associated with our businesses. The call is being recorded. The and script will be available on the website shortly.
With that, I’ll hand over the call to Mr for his opening remarks. Over to you, sir.
Srinivas Sadu — Executive Chairman
Thank you, Runjin. Good evening, everyone, and welcome to our Q3 and nine months FY ’25 earnings call. I would like to start by wishing you all a very happy and fulfilling New Year, filled with new opportunities and achievements. Let’s dive into our financials and operational performance. At the consolidated level, our Q3 FY ’25 revenue was INR13,840 million with consolidated EBITDA of INR3,600 million, translating to a margin of 26%, a 100 TPS increase year-on-year. Our base business, excluding Synexy, generated INR10,123 million in revenue for the quarter and 8% decrease year-over-year. This was due to volume degrowth in some of our key products, partly compensated by new launches. We expect to recover these volumes in the coming quarters and remain optimistic about the overall trajectory of our business. The EBITDA margin for our base business was a robust 39% compared to 34% in the same-period last year. The margin improved in the quarter due to changes in the product mix and the measures carried out reducing costs on various fronts. Coming to US sales, we launched 13 new molecules during the quarter, including,,, and. These launches strengthen our product portfolio and position and position us well for continued growth in the US market.
Revenues in the rest of the world markets increased to 21% of our total revenues in Q3 FY ’25. The Indian market generated INR562 million in revenue, contributing 4% to our total revenues. Let’s discuss the progress of our complex product portfolio. To date, we have completed nine filings in a targeted portfolio of 19 product. Six of these complex products have already been launched with three more expected to secure approval in due course. These products target an market opportunity of $7.1 billion, reflecting the significant potential of this segment to drive future growth. In addition, we are very excited to inform you that 15 complex formulations, which are under co-development with Pharmaceuticals or specialty injectable development company have shown promising progress.
These include 7505 B2 and eight ANDS at different stages of development. We expect commercialization to begin from FY ’27. In nine months FY ’25, we filed three RTU infusion back products with 10 more in the pipeline. These products are part of our RTA portfolio with 14 bag products registered. These RTU bags have ITA of about 530 million value in the US and these filings show a commitment towards prioritizing newer technologies in infusion bags. In Q3 FY ’25, our total R&D expenditure was INR437 million, representing 4.3% of our base business revenue. During the quarter, we filed four ANDAs and received approval for eight, including, solution and 5th injectable emulsion.
This brings our cumulative ANDA filings in the US to 366 with 32 approvals and 54 pending. Globally, we now hold an impressive 1,736 product registration demonstrating our ongoing commitment to expanding access to high-quality medicines. On the regulatory front, we are pleased to announce that we have received EIRs from the US-FDA for identical and Parsh facilities in Hyderabad, significant successful closure of the last US-FDA inspections. We remain dedicated to upholding the highest-quality standards across all our operations. Turning to Biologics, we have entered a collaboration agreement with Dr Laboratories. This partnership leverages our state-of-the-art biologics manufacturing facility at Genome Valley in Hyderabad and opens exciting new opportunities in the rapidly-growing biologics CDMO segment. This is expected to generate incremental revenue starting next financial year. We are happy to also inform you that we have signed a CDMO collaboration non-banding term sheet with Shanghai Biotech as well.
These aims to establish a secondary manufacturing site at brand for some of the key biosimilar products of. These collaborations demonstrate our continued focus and investment in biosimilar CDMO space. Coming to, the business recorded revenue of EUR41 million in Q3 FY ’25, though below our estimates, mainly impacted due to reduced manufacturing activity following the regulatory audit at during the quarter. However, gross margin improved to 77% compared to 75% in Q3 FY ’24. We have on the call for a more detailed update of recent developments and key initiatives at. Finally, I’m delighted to introduce our new CEO, Mr Ghiri. We are confident that his extensive experience will be invaluable as he leads the company towards continued success. You will hear more about his vision and plans for the company in his address shortly. I want to reaffirm our commitment to driving long-term growth through strategic partnerships, innovation and investment in new products and technologies.
Thank you once again. I would now request Mr to take-over.
Shyamakant Giri — Chief Executive Officer
Thank you, Mr Saru. Good evening, everyone. I’m delighted to join you all for today’s earnings call and I’m honored to address you for the first time as the Chief Executive Officer of GLAN. It is both a privilege and a responsibility to step into this role, especially as the company actively pursues strategic initiatives to expand its global presence and strengthen its market position. As I begin my journey and plan, my immediate priority is to understand the company’s current operations and improve profitability, while identifying new opportunities to enhance our growth, strengthen our capabilities and expand globally in areas where we can excel. I have started collaborating with the team to evaluate our direction and strategy from a very first perspective and build a future feed plan. I have identified key priorities, both on the demand and the supply-side as we develop our overall strategy.
On the demand-side, we have four identified priorities one, ROW market growth. We will improve our footprint and launch new products focusing on high-value, high-growth countries instead of having a cluster or a continent approach; two, India domestic growth. We will leverage our portfolio strength in selected therapies and explore inorganic expansion within India. Third, US market expansion; new customer acquisition and value expansion from the current partners will be the crucial for our growth in the US and finally, portfolio assessment, we will continue to seek strategic partnership and pursue potential M&A opportunities to incorporate more high-value injectables and newer modalities into our commercial portfolio. On the supply-side, the four identified priorities are: one, maintaining quality and cost leadership. We will strengthen our operational efficiencies to lead-in both quality and cost; two, engagement with leadership; we will ensure that the course correction measures achieve their desired profitability outcomes and provide both strategic and financial value; Third, intensifying R&D focus.
We will enhance our new product pipeline and accelerate our current projects. And last but not the least, improving management bandwidth. We will hire top talent and more empowered leadership teams. All our strategies will be built on the foundation of our established core values while fostering a culture of innovation, collaboration and excellence. I am grateful to the Board and the Chairman, Mr Saru, for interesting me with this responsibility and I’m excited to work closely with our leadership team. This is truly an exciting time for and I look-forward to collaborating with all of you to chart the next phase of company’s growth journey. I welcome your perspectives and ideas as we empire on this collective endeavor. Thank you again. And now I’d like to hand it over to to provide an update on performance.
Over to you, Alan.
Alain Kirchmeyer — Chief Executive Officer at Cenexi Services
Thank you, Mr Giri, and good evening, everyone. Performance for this quarter was impacted due to certain factors. At our Fontney facility, Q3 FY 2025 production was impacted by an unannounced inspection by the NSM, the French health Authorities. Is committed to working closely with the NSM to address the observations raised. On a positive note, I am pleased to report that our new high-capacity ample line began production last week right on-schedule. This addition will increase our ample manufacturing capacity by-40 million to 50 million units, allowing us to better serve our customers moving forward. In Eruville in France, commercial production of a new inactivated vaccine and an optalmic gel commenced in December as anticipated and will ramp-up gradually in 2025. Additionally, we have begun installing a new prefilled syringe line, which is expected to be operational later in the year. This will significantly boost our capacity to meet the growing demand for this form.
In Brain Lale in Belgium, orders from a new customer unfortunately had to be deferred from Q3 to Q4 FY 2025. As mentioned in our last call, earlier setbacks from the breakdown continued to affect our production levels in Q3, and we expect this to get restored in H1 of FY 2026. Given these developments, we anticipate a weaker performance for the January to March quarter, but I want to emphasize that all major projects remain on-track and aligned with our strategic goals., we remain firmly focused on achieving our medium-term goal of delivering positive EBITDA in-full year 2026. Thank you. This will be driven by our efforts to push revenue beyond the EUR200 million threshold.
Thank you. With that, I want to thank you for your time. And I will now turn the call over to Ravi to discuss financial performance. Ravi, over to you.
Ravi Shekhar Mitra — Chief Financial Officer
Thank you, Alan. Good evening, everyone. We are grateful for your time and presence today. Let’s take a look at our financial performance for the quarter and nine months ended 31st December 2024. I’m very pleased to inform you that our EBITDA and PAT margin improved during the quarter. The EBITDA margin increased to 26% as compared to 23% in QY — Q3 FY ’24 and stood at INR3,600 million for Q3 FY ’25. For the base business ex and, the EBITDA margin did significant improvement for Q3 FY ’25 at 39% versus 34% in the same-period of last year. Improvement of gross margin and better cost management has led to the improvement. We, however, reported a negative INR312 million of EBITDA at, primarily due to the unannounced inspection by ANSL ANSF at in this quarter.
The EBITDA for the nine months ended December 2024 stood at INR9,214 million compared to INR9,744 million for the same-period of last year. We have reported EBITDA margin for nine months FY ’25 at 22% at the consolidated level and 34% for the base business. The gross margin for Q3 FY ’25 also showed an improvement to 67% from 61% in Q3 FY ’24 due to change in-product mix. In our base business, the gross margin was at 63% as compared to 56% in the previous year. We are happy to see better margin profile of the new products launched during the year and this quarter. Our net profit for the 3rd-quarter increased by 7% at INR2,047 million compared to Q3 FY ’24 and increased by 25% sequentially from the second-quarter. During this quarter, we achieved a PAT margin of 15%, an improvement from 12% year-on-year.
During the nine months of the current financial year, our PAT was INR5,120 million at 12% margin. Revenue from operations stood at INR13,841 million in Q3 FY ’25. The gap with the corresponding quarter in the previous financial year was primarily due to lower shift volume of certain products for US market, which we expect to complete in the next quarter. At, production was impacted by unannounced inspection by the ANSM, the French health etholic piece. Revenue of our base business exe, while it showed growth of 3% in nine months FY ’25, driven by increased performance in the US market. It decreased by 8% in this quarter compared to same-period of last year to INR10,123 million. Revenue from operation for the nine months FY ’25 stood at INR41,916 million, a year-on-year increase of 2%. Other income for Q3 FY ’25 was INR585 million.
This includes INR525 million from interest on fixed deposits and INR20 million in foreign-exchange gains. For nine months FY ’25, other income totaled to INR1,696 million, INR1,548 million from interest income and INR65 million from foreign-exchange gains. The higher finance cost during the quarter is related to the interest on a GST refund matter. The total R&D expense for the 3rd-quarter were INR437 million compared to INR530 million for the same-period of the previous financial year and stood at 4.3% of the revenue from operations on an ex-NXE basis. The total R&D expense for the nine months was INR1,419 million, which was 5% of our revenue, demonstrating our continued focus in RPD. On a standalone basis, our effective tax-rate was 25% in the 3rd-quarter and 26% for the nine months of the current financial year.
As of December 31 December 2024, on a group level, we had a total of INR27,189 million in cash-and-cash equivalents. After accounting for debt, our net cash position was INR24,122 million. Cash-flow from operations during the nine months was INR5,889 million and working capital stood at INR23,060 million as of December 31, 2024. The average cash conversion cycle improved at 162 days for the nine months ended December 2024 compared to 182 days in the same-period last financial year. The total capex spent during the quarter was INR1,379 million spent at Indian sites and at. At India, we are spending growth capex at expanding a new bank line and increasing the packing capacity. We are also in-process of adding a new cartridge line at Suite9, which will be in addition to one existing cartridge line at Pash Maharam site. At, as Mr Alanil mentioned, we are adding some additional high-speed and new lines to improve the overall capability.
With this, I request the moderator to open the lines for questions. Thank you.
Questions and Answers:
Operator
Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask questions may press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles to ask questions, please press star and 1. The first question is from Neha Manpuria from Bank of America. Please go-ahead. we, we can’t hear you if you are on a headphone, request you to use the handset. Hello, can’t hear you you can’t hear you.
Srinivas Sadu
We can’t hear you.
Operator
Mr Manpuria, I request you to maybe call us back maybe from a different number. Your voice is extremely unclear. We’ll move to the next question. The next question is from Bino from Elara Capital. Please go-ahead.
Bino Pathiparampil
Hi, good. My first question is on the US business. We have seen a Q-o-Q decline in the run-rate and Y-o-Y as well. So you mentioned that there were some volume declines in the quarter. Could you comment on, was it a quarterly phenomenon, some stock adjustment, etc. and what is that going-forward on the quarterly run-rate?
Srinivas Sadu
So we had certain products which was not shipped out some of our main products like and we plan that to ship back-in the next coming quarter. Some of our so demand-side, we don’t have any issues here in terms of the forecast what we have received from our customers. It is just a shipping timing thing which instead of Q3, we will be probably planning for next quarter.
Bino Pathiparampil
So next quarter, we should see a significant Q-o-Q improvement in numbers. Can we assume so?
Srinivas Sadu
Yeah. Yeah. So next quarter this would be compensated by the — some of the products which I mentioned, which would happen next quarter
Bino Pathiparampil
Understood. And this quarter the margin has come in strong. So despite the top-line being low, what has led to that?
Srinivas Sadu
Gross margin do you mean or EBITDA margin?
Bino Pathiparampil
No, I think. Both,
Ravi Shekhar Mitra
Okay. Yeah. So gross margin, I think you grew by a couple of percent and that is largely a factor of the product mix at different sites. And some of the products, as you know are high-margin like vial and products compared to the fuels. And on the EBITDA side also, the cost side, we have kind of controlled and that has slowed down the benefit of EBITDA as well.
Bino Pathiparampil
Okay. I’ll — sorry, if I can ask one more question on. So the earlier guidance was a positive EBITDA in 4Q of this year. So in the opening remarks, I heard that you have changed it to a positive EBITDA in FY ’26. But in FY ’26, if you could let us understand how the trajectory would be. So initial couple of quarters, the losses will continue and then it will pick-up. Is that how we should think about it?
Alain Kirchmeyer
Yeah. We are estimating now 3rd-quarter FY ’26 could be a EBITDA-positive quarter. One is we mentioned about the inspection that happened last quarter. So we lost few weeks because of that. So that’s kind of impacting the next quarter numbers a bit and last quarter numbers are there. So that’s the main reason I think it will move a few quarters, two quarters.
Bino Pathiparampil
Okay, thanks. I’ll come back.
Operator
Participants who wish to ask questions, please press star and one. Next question is from Neha Manpuria from Bank of America. Please go-ahead.
Neha Manpuria
Hi, thanks for taking my question. Am I audible now?
Srinivas Sadu
Yes. Go-ahead.
Neha Manpuria
Okay. Sorry about the previous round. Just following-up on, I understand that there was an inspection, but is there more to the inspection, which is leading us to delay the breakeven to 3rd-quarter? I mean, have the authorities highlighted something to us which needs us to shut-down production for longer. Just wanted to get a sense as to why 10 days of audit is delaying the breakeven by 3/4.
Srinivas Sadu
So one is, of course the last-time we took almost, I think three weeks inspection, the two inspections that happened. So we lost production during that time and there are corrective measures which we need to take. So some observations which we need to work on. So that will take some loss of production time. That’s why we’re estimating now it could be a 3rd-quarter.
Neha Manpuria
Understood. Okay, understood. And my second question is on the ROW business and the Saudi contract. Have we made any progress on that? We were expecting some shipments by the end-of-the quarter or you know in the 4th-quarter, so is that still on-track or any status update on that?
Srinivas Sadu
Yeah. I think that’s one of the reason we actually missed the revenue estimate this quarter. So it got pushed out a bit and it didn’t get dispatched. And also it kind of impacted positively in the margin profile because it’s a low-margin business. But on the revenue side, we lost that — I think it got pushed out by a quarter.
Neha Manpuria
And should that come through in the 4th-quarter or is it more expected on the Southeast tender?
Srinivas Sadu
We actually got the tender, just the allotment to the hospitals that were delayed, so it could be this quarter or the first-quarter of next year.
Neha Manpuria
Sorry, this quarter or I didn’t quite catch that.
Srinivas Sadu
Or the subsequent quarter.
Neha Manpuria
Oh, okay, okay. Got it. And my last question is on the biologics bit. I think you mentioned, one, the Dr supply would start from fiscal ’26 and there was also a second CDMO agreement that you mentioned. I didn’t quite scratch that with whom that was and when should we expect that to start contributing?
Srinivas Sadu
So this is an agreement with the with Shanghai Helius. It’s a Chinese company which has launched biosimilars in different parts of the world including new ones. So we have signed a term sheet as a second site for their pipeline of products so that will take probably 27, maybe two years from now.
Neha Manpuria
Ohh, two years from now
Srinivas Sadu
Transfers. Yeah, once the agreement is firmed up, then you know it will take a tech transfers and you know they take time for that yeah, yeah,
Neha Manpuria
Okay, so this is probably fiscal 28 onwards?
Srinivas Sadu
Yeah, sure 27, 28, I would say, yeah.
Neha Manpuria
Okay, got it. Thank you so much.
Operator
Thank you. To ask questions, please press star and one. Next question is from Vivek Agarwal from Citigroup. Please go-ahead.
Vivek Agarwal
Yeah. Thanks for the opportunity. Just one question from my side. It is good to see that India and ROW, particularly the non-US markets are seeing the kind of attention now that’s been required. So if you can just elaborate basically how we are going to do that or what have you been liking so-far, what new basically we are going to do in these markets. Thank you.
Srinivas Sadu
So India, Vivek, you know, we want to leverage our portfolio strength. We are already having a cost leadership position because of the CDMO activities. And India as a market is also growing. So we are integrating to launch some therapies in India and of course, we are getting various therapies as we speak. We are also evaluating a inorganic route to expand our presence in India. So this is something that we’re doing on the India side. On the ROW side, we are now changing our approach. Earlier, we used to see ROW from a continent land like LatAm or Africa as we have moved that lens to now focus on the top countries, five, six top countries like Saudi, Mexico, South Africa and so on, okay, where we will really want to be aggressive in terms of partnership and filings and all of that. So we have now divided the ROW into three groups, one which is high-value, high pharmaceutical value. And second is of course, medium and so on and so forth. So this approach I think will help us resource these markets well and put a new acceleration plan in-place in our.
Vivek Agarwal
Thank you. Thank you. That’s from my side.
Operator
Thank you. If you like to ask questions, please press star and 1. Next question is from Aman Goyal from Axis Securities. Please go-ahead.
Aman Goyal
Yeah, good evening, sir. Sir, my question is related to the. So in the last quarterly con-call you had said in Q4 the will be breakeven at EBITDA level. So can you throw some light so any estimated time that we will see the breakeven for business.
Srinivas Sadu
So Aman, like we just mentioned that we expect now to EBITDA breakeven at Q3 FY ’26 next year. So this is largely a factor of how we can push the top-line to a $50 million per quarter run-rate and then keep the cost under control. So that can be achieved by new high-speed lines. So one of the additional line is already up and running in, as Alan mentioned in his speech. In addition to that, there are also a couple of activities which is going on at HSC and Belgium side, which will improve the output significantly without having more cost at and other overheads. So this will be happening at Q3 level because Q3 — Q2 is anyway a summer shutdown and we want to also utilize like last year to build-up all those new additional capability we are putting in. So Q3, we estimate that would be a time where we expect the top-line to touch 50 million or more and then have EBITDA breakeven.
Aman Goyal
So my last question is, sir, then last — in last call, we talked about the GLP1 contract on the CDMO side. So we have three customer — different customers on GLP. Could you throw some light on that the size or revenue to be started in the commercialization, something like that?
Srinivas Sadu
So basically it’s two customers and three products contracts okay to clear. And revenues, you know the better landscape, right, and it depends on which markets and all that. So we can’t really give the numbers to it. That’s probably start seeing some numbers in FY ’26.
Aman Goyal
Okay. Thank you, sir.
Operator
Thank you. All participants who wish to ask a question may press star and one. Next question is from Harsh Bhatia from Bandan Mutual Fund. Please go-ahead.
Harsh Bhatia
Yeah, thank you. Am I audible?
Srinivas Sadu
Yes.
Harsh Bhatia
Yeah. Thank you. Sir, just on this biologics best biosimilar contracts for. I think last quarter you had mentioned that this is a non-exclusive contract and you have a certain capacity for drug substance capacity. So if I’m not wrong, that was Biologics CDMO Biologics, biosimilars contract. But the nature of the contract with the Chinese company is also very similar in terms of the contract commitment of the volumes or the size of the contract or is it materially different.
Srinivas Sadu
I think materially this could be different because there is a — of course, the contract still needs to be signed-up, it’s a term should be signed. But it’s a whole pipeline of biosimilar products, what they have already commercialized and also what is there in the pipeline, which will go up in next few years. And it could be second site. So we’re already looking at expansion of the drug substant site to increase the capacity to 15 KL to meet the demand. So it could be substantially different compared to what we have done in there.
Harsh Bhatia
Yeah. So you already have an 8k capacity and this could in the foreseeable future go to 15 capacity.
Srinivas Sadu
Additional 15. So an additional 15k capacity.
Harsh Bhatia
Yeah. Okay. And where are we in terms of, let’s say for this next customers were looking to get into the US market and RW markets, our plan was to sort of get them to shift their capacity commitments to the Indian manufacturing facilities. So where are we over on that part?
Srinivas Sadu
Pardon Harsh, can you repeat your question, please?
Harsh Bhatia
In terms of the contracts and the customers, your aim was to sort of move their ROW capacity from the sites in Europe to the India sites over a period of time. Where are we on that as of now.
Srinivas Sadu
So we are having currently some business by customers and it’s too early to comment at this point of time. But we are seeing interest from their customers and the work is going on.
Harsh Bhatia
So they must-have already visited your India facilities, right?
Srinivas Sadu
Yeah, yeah, some have.
Harsh Bhatia
Okay. Just one last very quick one. But again, in terms of happening in experience. Again, at a macro-level, China does control a lot of capacity in terms of the raw materials as such. So anything incrementally that you could think could be a second order derivative for the tariffs from that angle.
Shyamakant Giri
I think it’s more to do with the direct imports into US, not to the materials what we buy from China. So I don’t think that there is an impact on that.
Harsh Bhatia
Sir, but do Chinese players, again, just very broadly, is China or Chinese players directly supply of these raw materials into the US market as of now?
Shyamakant Giri
No. So from a positive side, the companies who are actually competing with us directly in China, now they might impacted if this 10% thing gets implemented and on the pharmaceutical products, still it’s not very clear. Then the people who are competing with us in and some of these products from China will be more competitive against them in terms of several products. So that would be an advantage for us in terms of finished products. Probably APS also. But I would say local manufacturing in China in US anyway is not that competitive. But I would say the Chinese players who are directly exporting finished product to China is this 10% tariff comes on to those products, then we’ll be more competitive there for sure.
Harsh Bhatia
And just very lastly, if there are, let’s say, index 200 in terms of the RM component for heparin, how much of that would be China-based consumption and how much would be going outside of China? Very roughly put, if you would have the numbers.
Srinivas Sadu
You mean which is the US?
Harsh Bhatia
No China production getting consumed within China and as compared to going out of China getting exported.
Srinivas Sadu
I’m not sure of that quantity but I think globally they control about 45%, 50% of API production a bit more also, I think 60%.
Harsh Bhatia
Okay, 50% to 60%
Srinivas Sadu
Yeah, but how much is consumed within China and outside countries.
Harsh Bhatia
Okay. Thank you. Thank you.
Operator
Thank you. Next question is from Shyam Srinivasan from Goldman Sachs. Please go-ahead.
Shyam Srinivasan
Yeah, hi, good evening. Thank you for the question. Just the first one on the US. We had 13 launches during the quarter. And despite that we have had like a QoQ even in the base — our base business, excluding in the US, we have seen decline. Can — can you just explain, is it price erosion that seems to be higher than?
Shyamakant Giri
No, I think the major — major drop is in Oxa, which we expect surprise how they didn’t happen. That’s a major loss. And the launches that happened compared to that volume is lower, I would say. From margin profile, the products that we launched in last two, 3/4 is better margin products and that’s why you’re seeing an improvement in margin profile across products.
Shyam Srinivasan
And, I’m looking at just the US market. I’m assuming Saudi Arabia would come in ROW, right? Sorry, I’m getting confused. Let’s say US market Q-o-Q decline.
Shyamakant Giri
Even US supply in, I think there’s a decline of I would give you give you a percentage also about 12% down in terms of quantity variance for and, the other product — two products. And that’s the reason — primary reason why we lost that decrease in the volume.
Shyam Srinivasan
Understood. And so we should expect Q4 that there’ll be a recovery there or we’ll start shipping an OXA and the other product again in Q4, right?
Shyamakant Giri
At least US in Oxa, it should —
Shyam Srinivasan
Yeah. I’m only focusing on the US market.
Shyamakant Giri
Correct. From price variance perspective, from quarter-on-quarter, it’s about, I think 2% — 1% to 2% lower.
Shyam Srinivasan
Understood, understood. And in terms of pricing or any of the other on the base business excluding NX and other, has there been an erosion?
Shyamakant Giri
No, no, there’s not much price erosion.
Shyam Srinivasan
Understood. My second question just on the 39% core margins. If you could help us what was the profit share and the milestones in that number.
Ravi Shekhar Mitra
So for this quarter profit share is 11.7% and milestone is 10.2%.
Shyam Srinivasan
So about 20%, I’m just adding those two numbers is coming from these two, right? Right, Ravi?
Ravi Shekhar Mitra
Yeah. So profit — yeah, correct. Profit share if you translate as part of the product only, right? It’s margin of the product.
Shyam Srinivasan
So I’m not questioning the numbers. It’s just that — no, I’m just trying to look at this number you expect 11% for us typically, right?
Ravi Shekhar Mitra
Yeah, typically about 20% together.
Shyam Srinivasan
Yeah. So some quarter it may be high, some quarter low. So if you say nine-month basis, it’s again 10.1% and 8.8%.
Ravi Shekhar Mitra
Okay.
Shyam Srinivasan
So overall, yeah, so
Ravi Shekhar Mitra
Some guidance also, but together it’s over 19%.
Shyam Srinivasan
19%. Okay. So — and we should assume that Q4 also get at least these kind of milestones and similar kind of profit share.
Srinivas Sadu
So basically it’s a simple math. The low-margin products if you have shipped like in-kind of a product.
Shyam Srinivasan
It’s down. It comes —
Srinivas Sadu
To INR100 crores. It’s like 5% to 7% margin. So that then the margin will get diluted about 36%.
Shyam Srinivasan
Understood. Understood. Okay. Thank you. Thank you, sir, sir. Thank you. Yeah.
Operator
Thank you. To ask a question, please press star and one. Next question is from Ritesh Rathod from Nippon India Mutual Fund. Please go-ahead.
Ritesh Rathod
Yeah, hi hope I’m audible.
Srinivas Sadu
Yes go-ahead.
Ritesh Rathod
How many Chinese players are active or in US injectable market or put it other way around, how many of the front-end companies source their raw-material — source their Finnish products from Chinese manufacturing plant? If you can give some color this is in context with the tariff thing which we spoke earlier.
Srinivas Sadu
Probably one or two injectables who are selling directly front-end, but people sourcing finished products from China would be maybe four to five.
Ritesh Rathod
And when we see our top-10 or top-25 products, such kind of Chinese sourcing or Chinese competitors would there be would there be a decent — would they have a decent volume market-share like — and with this tariff, things can swing in coming quarters. Is that a probable — is that a probable scenario?
Srinivas Sadu
At least some products especially happen in where the front-end player is backward integrated 100% into Heparin. And there the margin is low. Those kind of products, you know it will help the balance.
Ritesh Rathod
And in past, we spoke about particularly in new launches, we saw excessive competition from Chinese players spoiling the market. So you think in your pipeline products such kind of competition would now be much lower than what earlier you have seen for the new launches.
Srinivas Sadu
It all depends on the products, because some products the margin profile is high, then probably it’s lesser impact, but wherever there is a the margin is lower than that took an impact. I think there they’ll stay away from launching, I would say.
Ritesh Rathod
Okay. Yeah, that’s it from my side. Yeah.
Operator
Thank you. Before we take the next question, a reminder to participants that you may press star and one to ask questions. Next question is from Roshan from ICICI Prudential Mutual Fund. Please go-ahead.
Roshan Chutkey
Thanks for taking my question. I just wanted to understand going-forward, if volumes were to go higher, right, one, because of like Chinese competition abating a bit because of tariff and two, particularly in this quarter, I guess, you have some slippage coming from the previous quarter so should one think that volume growth would be very-high or margins will take a knock? How should one think about this
Ravi Shekhar Mitra
Yeah, if volume goes up then overall margin will as a percentage will come down. But in absolute terms, of course, it will grow. I guess.
Shyamakant Giri
Yeah, Roshan, there is one more data point that I would like to bring into here. So this year, if you see our new launches in the US, we have launched 27 molecule and 39 SKUs, you know, of which 30 SKUs are first-time launches in the US and the gross margins there is upwards of 65% or so. So if you see, what we’re doing also is trending our new launches, which are primarily complex generics, RTUs and all of that and being very aggressive to push that agenda, push that sales in the US so that we still hold-on to our gross margin in-spite of one-offs are going out. And we have seen the — we have seen this year, for example, in-quarter three, 5% of our revenue total was primarily coming from new launches that we did in the US at a higher gross margin. So while goes up, but we also have a plan here to improve or maintain and improve our gross margin by having a good portfolio and aggressively launching new players in the US market.
Roshan Chutkey
Understood. How — with respect to the CMXC business, spoke you mentioned RFCs are coming thick and fast. Can you just talk a little bit about that?
Srinivas Sadu
Alan, can you take that? The question of RFP is we have a pipeline of RFPs which are addressing. So the question is around that.
Alain Kirchmeyer
Yeah, so we have a constant flow of opportunities that we are looking at. And what is especially encouraging in the last quarter is that we finalized the validation batches for two products that will move-in Q1 into a commercial production.
Roshan Chutkey
Understood. Thank you so much. All the very best.
Srinivas Sadu
Thank you.
Operator
Thank you. If you like to ask questions, please press star and one. Next question is from Jinesh Shah from RSP and Ventures. Please go-ahead.
Jinesh Shah
Hello. So thanks for the opportunity. So my first question was when we talked about that we have margin improvements in this quarter due to the product mix in core business. So I think you did mention. I just want to reconfirm that. Is it because of the new product launches that we do, we have a better margin in that and because of that our product — because of that our overall the EBITDA margins of the core business and then should up in this quarter. Is that the correct understanding?
Srinivas Sadu
Yes, that is definitely correct. And also the product mix it spoke about. So both of that is responsible for this higher-margin.
Jinesh Shah
Okay. So like if I have to like predict for the future, then we do expect that whatever we had in past like 30% to 34% of EBITDA margins, we do expect a better margins in the future, right?
Shyamakant Giri
Yeah. Yeah.
Jinesh Shah
Okay. So — and okay. So my second question is, can you — as you — as we had an unannounced inspection and in one of the quantity of site. So can we talk about the observations of that inspection?
Shyamakant Giri
Yes. So we do got some observations in that inspection and we want to finalize the and submit to them. So we let you know once the CARPA submission happens and outcome of that?
Jinesh Shah
Okay, okay, fair enough. And my last question would be like is there any like one-off in the finance cost in this quarter like we have a significant jump-in this quarter. So is that
Srinivas Sadu
Yeah, it is — as of now it is one-off, see about INR18 crores is on account of pressed on a GST refund matter.
Jinesh Shah
Okay, okay, understood. So that’s it from my side. Thanks a lot.
Srinivas Sadu
Yeah. Thanks.
Operator
Thank you. To ask questions, please press star and 1 one. Next question is from Tushar from Motilal Oswal Financial Services. Please go-ahead.
Tushar Manudhane
Thanks for the opportunity. Sir, just on this at least as far as Inoxa Hiperin products are concerned, if you could share what is our market-share for US market in specific
Srinivas Sadu
I think the loss about 6%. I think we sell about INR16 million to 18 million. That’s about 6, 7% it’s around 20%, 20 25%.
Tushar Manudhane
6% and 25% right?
Srinivas Sadu
Yeah, yeah
Tushar Manudhane
And how much would be the market-share of the Chinese competitors?
Srinivas Sadu
They’ll have higher I will say but he not say I gotta see how much? He much he not say I can’t tell but still I think 30, 35 should be there I can come back to you, Tushar. I can take it offline.
Tushar Manudhane
Sure, sir. Just lastly on this, is there any way to — I mean, practically the ultimately the source of raw-material is still in the fix waterhouse, which are abundant in China. So eventually one will have to depend on Chinese raw-material supply that can be hard as far as supply of alternate formulation is concerned. Is that right?
Srinivas Sadu
Yes, sir, the basic cost is still China, otherwise if you go to US source it’s more expensive. But within US, within China we have several sources for that we could be more competitive in terms of pricing. We get some volume discussion, all that. So it’s a continuous work what we do in terms of processing of that crude to happen and in, if you can say both molecules. But still we have to depend on for the API.
Tushar Manudhane
Thanks.
Operator
Thanks to ask questions please press star and 1, the next question is from Harsh from Mutual Fund. Please go-ahead.
Harsh Bhatia
Yeah, thank you for the follow-up. Sir, just in terms of again part. You have spoken a bit about these capacity of expansions as well as certain capabilities across and PFS and in active vaccine as such. So any of this or anything other than this relates to any point towards the manufacturing capacities of directly or indirectly to that extent, I mean hope it would be too early to comment on that.
Srinivas Sadu
And can you repeat that? It’s not very clear question.
Shyamakant Giri
So can we use finance this capacity for, that’s what you’re saying?
Harsh Bhatia
No, the capacity is for customers who are looking for GLP-1 manufacturing capabilities to that extent because your — yeah.
Srinivas Sadu
Yeah. So it’s part of the plant. I mean, part of the capex plan we’re evaluating because there’s a big opportunity out there for that CDMO for that also. So it’s under evaluation to install capacity for that. While the — even the syringe line what we are installing now this year that also has a capability to fill cartridges. So it has a capability, but the plan is future capex, we are evaluating whether you want to invest into additional capex on the bulk cartridges, which is more economical compared to sterile cartridges, which can be done on the current syringe line? Yeah, but opportunity is there, yes.
Harsh Bhatia
Could you just sort of help us understand what would be the cartridge capacity, let’s say, at this next year level if possible the bulk cartridge capacity.
Srinivas Sadu
I think if you utilize the complete 100% of the syring line what we’re just installing for cartridges, it can produce about 40 million 40 million to 50 million cartridges.
Harsh Bhatia
40 million to 50 million cartridges. Okay, okay. Yeah. And what would the order book look like? I think so in the first-quarter of this financial year, it was somewhere around EUR20 million, if I’m not wrong. What would the order book look like right now for the next year?,
Shyamakant Giri
We couldn’t understand what is — regarding 4th-quarter you mentioned.
Harsh Bhatia
Yeah, for the 3rd-quarter, what would the order book look like the order book for 3rd-quarter for the next year order book?
Srinivas Sadu
Alan, what’s the order book for the 4th-quarter?
Alain Kirchmeyer
I cannot — I cannot answer this question of my mind, but we — it must be — it must be above EUR60 million because we have a backlog that has been carried down from 2024.
Srinivas Sadu
Yeah. So the order book is about 60 million now. Yeah.
Harsh Bhatia
Okay. Thank you. Thank you. Thank you.
Alain Kirchmeyer
Keeping in mind we have usually a Three-Month confirmed order horizon with our customers.
Operator
Thank you. The next question is from Vivek Agarwal from Citigroup. Please go-ahead.
Vivek Agarwal
Yeah, thanks for the follow-up. So this is related to capex as well as investments. So over the next three years, how much the company is going to spend on biosimilar plus GLP1 put together?
Srinivas Sadu
Even the capex?
Vivek Agarwal
Yes.
Shyamakant Giri
So we are at biosimilar, we are currently evaluating for the 15 kL capacity we estimate should be around $80 million to $100 million but currently it’s a process of calculating a project evaluation.
Srinivas Sadu
GLP-1 we have already invested into it. The land will be installed this year, next two quarters. So there is no additional investment into GLP-1 in terms of finished product, but we are looking at now, now that the current manufacturing side also kind of maxed out in terms of capacity, we are looking at a greenfield project for the next phase of growth.
Vivek Agarwal
And just a basic question, I’m just trying to understand, right? In terms of fill finance as well as cartridges are concerned on GLP1, right? So let’s say, if you want to put a capacity of 100 million cartridges, right? So how long it can take and what kind of investments that may require?
Srinivas Sadu
Around I think INR200 crores.
Vivek Agarwal
And how long it can require — basically how long you can complete the project that you start
Srinivas Sadu
18 months, 18 months,
Vivek Agarwal
18 months. Thanks. Thanks. That’s from my side.
Operator
Thank you. The next question is from from White. Please go-ahead.
Dheeresh Pathak
Yeah, thank you. I’m sorry if you only answered this, but the — do you have a capacity and capability for pen assembly your current manufacturing setup? Pen or auto-injector?
Srinivas Sadu
Yeah, we do, we do. Yeah. We have already filed product from the site.
Dheeresh Pathak
The pen side, pen assembly side.
Srinivas Sadu
About 40 million.
Dheeresh Pathak
Do you also make auto injectors?
Srinivas Sadu
Yeah
Dheeresh Pathak
What is that capacity sir?
Srinivas Sadu
No it’s a similar common line. So auto-injector see basically it’s assembly. You would do our infringes and then you assembly the auto-injector.
Dheeresh Pathak
Okay. Okay. And are you expanding this capacity or this is the capacity as of now? Is there a plan to expand this capacity?
Srinivas Sadu
Yeah. So one more line we are adding this year. So it will add another 100 million-plus.
Dheeresh Pathak
Another 100 million. How much are you spending on that
Ravi Shekhar Mitra
Capex program? Yes. So we already spent it actually most of it. This will come in the Suite 9 the additional one.
Dheeresh Pathak
When does it get commissioned?
Srinivas Sadu
28.
Dheeresh Pathak
If you can tell me like calendar ’28 smaller first-half second
Srinivas Sadu
Smaller volumes will come from FY ’26, where the patents are expiring from ROW market and also Canadian market and — but the majority will come from FY end of FY ’27.
Dheeresh Pathak
End of FY ’27. Sorry, how much have you spent on this 100 million line?
Srinivas Sadu
So we can’t specifically tell this because it’s part of the main site. It’s part of the — it’s one of the suits of what we have. But if I had specific for the line, we can give a number. Offline we can take it.
Dheeresh Pathak
All right.
Srinivas Sadu
It’s kind of what you. It’s not a dedicated side. We don’t need a dedicated site for this.
Dheeresh Pathak
Okay, understood. Thank you, sir.
Operator
Thank you very much. Due to time constraints, we’ll take that as the last question. I would now like to hand the conference over to Ms Jain for closing comments.
Runjhun Jain
Thank you everyone for joining us today. We appreciate your participation in the questions during the call. If you have any follow-up questions, please feel free-to reach to us. Looking-forward to interact with you in the next. Thank you.
Operator
Thank you very much. On behalf of Gland Pharma Limited, that concludes this conference. Thank you for joining us. Ladies and gentlemen, you may now disconnect your lines.