Zydus Lifesciences Ltd Q3 FY24 Earnings Conference Call Insights

Key highlights from Zydus Lifesciences Ltd (ZYDUSLIFE) Q3 FY24 Earnings Concall

• India Formulations
  • Double-digit growth led by volume expansion and new launches.
  • Volume growth and new product launches drove growth.
  • Gained market share in key therapies; chronic portfolio grew faster than market.
  • Margin expansion from better product mix and operating leverage.
  • Chronic portfolio grew faster than the market at 12% vs 11% for IPM.
  • Adding 700 medical representatives to expand coverage and reach
• US Formulations
  • Improved profitability from higher volumes and new product launches.
  • Received approval for specialty and differentiated products.
  • Well positioned to sustain growth momentum.
  • Received final approval for 2 key ANDAs – Zituvio and Zituvimet.
• International Formulations
  • International business revenues grew 31% year-on-year.
  • Broad based double-digit growth across regions.
  • Strong demand environment in Europe and EM markets.
  • Mexico business continued to grow in double digits.
• Growth Plans
  • Continue expanding geographical reach, distribution channels, partnerships in India.
  • Launch new products and leverage innovation portfolio.
  • Conduct patient support programs and increase awareness of healthcare needs in India.
  • In US, volume expansion in base portfolio and new launches to continue.
• Innovation Pipeline Progress
  • Completed patient recruitment for Saroglitazar Phase 2b/3 trials for PBC in US.
  • Completed Phase 2 trial of ZY19489 potential antimalarial drug.
  • 2 monoclonal antibodies awaiting approval in India.
  • Completed asset transfer for CUTX-101 for Menkes disease.
• PBC Trial Update
  • Completed patient enrollment for Saroglitazar Phase 2b/3 PBC trial.
  • Expecting primary endpoint data and regulatory submission by Q4 FY2025.
  • 52-week patient follow-up, no interim event-driven data planned.
• India Specialty Business
  • Significant growth seen for all specialty products.
  • Lipaglyn expected to become largest brand for company soon.
  • Large future growth opportunities seen.
• LiqMeds Business Outlook
  • Will start contributing profits immediately as existing business is profitable.
  • Future growth from Zydus’ expansion into UK, other markets with liquid orals portfolio.
• Gross Margin Sustainability
  • Higher gross margins driven by product mix, new product launches in US and international markets.
  • Scaling up of businesses also contributing to margin growth.
  • With Revlimid relaunch gross margins expected to increase further.
  • Believe current elevated margins are sustainable going forward.
• Zituvio and Zituvimet Rollout
  • Early days, will be slow build-up of market share.
  • Developing positioning with payers and customers.
  • One of the important value drivers for FY25.
  • Negotiations with payers ongoing, prescription ramp-up required.
• Consumer Wellness/Injectables Outlook
  • Skincare portfolio growing strongly, food portfolio facing challenges.
  • Rural demand yet to pick up, impacting nutrition brands.
  • Aiming to grow in double digits in FY24.
  • Gross margins improving, new launches and distribution expansion planned.
  • Gained/maintained market share for key brands despite slow market.
  • Ramp up better than previously planned targets in injectables.
  • Seeing good growth opportunities from shortages, complexity.