Dr Reddy's Laboratories Reports 86% Drop in Q4 Profit Amid Generic Drug Challenges
Dr Reddy's Q4 PAT crashes 86% on generic Revlimid shock in US market
Business Standard
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Dr Reddy's Laboratories (DRL) reported an 86% year-on-year decline in consolidated net profit to ₹220 crore for Q4 FY26, primarily due to weaker sales of its generic cancer drug Revlimid in the United States. The company's revenue from operations also fell 11% to ₹7,516 crore as it faced increased competition after losing exclusivity.
- 01DRL's Q4 FY26 net profit plummeted 86% to ₹220 crore.
- 02Revenue from operations decreased 11% year-on-year to ₹7,516 crore.
- 03Sales of generic Revlimid in the US were significantly impacted after exclusivity ended.
- 04Revenue from the North American market fell 51% to ₹1,756 crore.
- 05DRL plans to launch generic semaglutide in Canada and India.
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Dr Reddy's Laboratories (DRL) reported an 86% year-on-year decline in consolidated net profit, falling to ₹220 crore in the March quarter of FY26, down from ₹1,593 crore in the same period last year. This sharp decline was largely attributed to weaker sales of its generic version of the cancer drug Revlimid (lenalidomide) in the United States, where the company faced intensified competition after its exclusivity ended on January 31, 2026. Consequently, DRL's revenue from operations fell 11% to ₹7,516 crore from ₹8,506 crore in Q4 FY25. The North American market, which contributed 34% to DRL's overall revenue for FY26, saw a staggering 51% drop in revenue, down to ₹1,756 crore from ₹3,559 crore due to price erosion in lenalidomide. Despite these challenges, DRL's revenue from India grew 20% to ₹1,566 crore, bolstered by new brand launches, while revenue from Europe and emerging markets rose 14% and 29%, respectively. Additionally, DRL announced plans to launch its generic versions of the diabetes drug semaglutide in Canada and India, following recent regulatory approvals.
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The decline in profit and revenue could lead to reduced investments and job security within the company, affecting employees and stakeholders. Consumers may also see changes in the availability of certain medications.
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