ZYDUSLIFE - Zydus Lifesciences Limited Share Price

Q1: There has been a significant increase of about 32% in other operating expenses. Could you elaborate on the key drivers here?

A1: The increase in other operating expenses this quarter mainly stems from our recent acquisitions of Amplitude and Comfort Click. Amplitude's impact was for two months, while Comfort Click's was for one month. Additionally, M&A activities brought project-specific expenses not seen in previous quarters. Going forward, we expect the normalized run-rate for these expenses to range between Rs. 1,500 to Rs. 1,550 crores.

Q2: Could you elaborate on the rationale behind the proposed fundraising initiative? Is the company evaluating any large acquisition opportunity?

A2: The primary goal of the fundraising initiative is to deleverage our balance sheet by reducing current debt. This strategic move will enhance our financial flexibility and readiness for growth. The board approved a QIP resolution to tap capital markets as needed. We're exploring opportunities in the US specialty business and potential acquisitions in Europe and innovative assets.

Q3: Can you elaborate on Saroglitazar's market opportunity, especially in light of Gilead's acquisition of Livdelzi for $4.5 billion?

A3: Currently, there are two approved drugs for PBC; we would potentially be a third entrant. This presents a significant opportunity, as the usage of PBC medications is increasing. We anticipate a strong launch about 14 to 15 months from now, addressing a considerable unmet need, which positions us competitively due to our solid clinical evidence.

Q4: On Revlimid, what are your expectations for the coming quarters?

A4: For Revlimid, we don't expect substantial numbers in the next two quarters as sales have significantly declined from earlier in the year. Most of its sales occurred in Quarter 4 and Quarter 1, and we anticipate lower quantities for the next two quarters, with genericization looming in Quarter 4.

Q5: What is your assessment of the US revenues for FY27? Can the revenues organically grow over FY26?

A5: We're optimistic about maintaining our current pace in US revenues, despite uncertainties surrounding Revlimid and Myrbetriq. While subject to upcoming court decisions, we believe that our pipeline and new product launches will help sustain growth in FY27.

Q6: Can you provide updates on your vaccine segments in terms of progress and growth aspirations?

A6: We've been active in vaccines, especially with our trivalent flu vaccine and rabies. We're ensuring robust participation in tenders, expecting to expand globally over the next two years. By FY27-28, we anticipate our vaccines to significantly contribute to our portfolio, targeting global tender participation for TCV and MR.

Q7: How do you view pricing regulations in Europe affecting your MedTech business?

A7: Similar to generics, medical devices in Europe face pricing negotiations every three to four years, leading to typical 3-4% price reductions. While regulations are a factor, we see this as manageable and expect significant cost-saving opportunities through our acquisition of Amplitude.

Q8: What is the expected investment needed for the Saroglitazar launch in the US?

A8: The investment will scale as we finalize our NDA submission and receive feedback from the FDA. We estimate needing a sales force of about 60 to 80 personnel to support our launch strategy, ramping up once we get clear timelines from the FDA review process.