Shares of one of India’s largest global pharmaceutical manufacturers declined by 1.2 percent to Rs 5,428 a share in early trade on Tuesday after the company subsidiary faced an antitrust lawsuit in the US over Revlimid patents.
At 12:20 p.m., Dr Reddy’s Laboratories Ltd shares were trading at Rs 5,471.85 on the National Stock Exchange, down 0.42 percent from the previous close price.
As per the company’s exchange filing, Dr. Reddy’s Laboratories, Inc. (a wholly-owned step-down subsidiary of Dr. Reddy’s Laboratories Limited), along with numerous other pharmaceutical businesses, was listed as a defendant in a lawsuit filed on October 6, 2023, in the United States District Court for the Northern District of California.
The complaint, filed by Mayo Clinic and Lifepoint Corporate Services, asserts claims under federal and state antitrust laws, as well as other state laws, alleging that the defendants improperly restrained competition and maintained a shared monopoly in the sale of brand and generic Revlimid through their respective patent litigation settlements.
The complaint claims that the challenged agreements unjustly delayed generic entry until 2022 and then illegally restricted generic competition until 2026. The action seeks damages and equitable remedy for alleged overpayments.
Dr. Reddy contends that the claims against it are without substance and will firmly fight the case.
Dr. Reddy’s Laboratories Ltd is a leading India-based pharmaceutical company that offers a portfolio of Active Pharmaceutical Ingredients, generics, biosimilars, and differentiated formulations to both domestic and international clients.
The company revenue increased by 29 percent year on year, going from Rs 5,232 crore in Q1FY23 to Rs 6,757 crore in Q1FY24. Net profit climbed by 19 percent within the same period, from Rs 1,179 crore to Rs 1,400 crore.
The Company’s return on equity increased from 11.35 percent in FY22 to 19.35 percent in FY23, while the return on capital employed rose from 15.44 percent to 25.95 percent during the same period.
In the last six months, the stock has delivered a return of 15 percent and 25 percent in a year.
In addition, The Company’s Net profit increased from 9.80 percent in FY22 to 18.12 percent in FY23, while the operating profit rose from 14.32 percent to 24.94 percent during the same period.
As per the shareholding pattern, the company promoters own 26.7 percent stake, while Foreign institutional investors hold 26.99 percent and domestic institutional investors hold 34.53 percent.
Written by Omkar Chitnis
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