Cipla plans expansion, aims to launch at least one product in US every year

In India, the company is by far the leader in the respiratory drugs segment, having a turnover of over Rs 18.93 billion

Cipla, a prominent name in the respiratory segment in India, is expecting its next leg of growth from the international market. Having launched products in the segment in the international market, it added $70-100 million in revenues last financial year. Cipla now aims to launch at least one product in the US (in the segment) every year from next year. 

In India, Cipla already enjoys a 67-68 per cent share of the respiratory drugs market, and the company says there is potential for a 14-15 per cent growth as the market is under-penetrated. The overall respiratory market is expected to clock 12-13 per cent growth. 

Cipla Chief Executive Officer (CEO) Umang Vohra said the firm was planning to work closely with diagnostic centres to boost the detection rates of respiratory illnesses. 

“There are an estimated 90 million patients with respiratory illnesses in India of whom only 30 million are diagnosed. Less than 10 million actually get proper treatment,” he said. The burden of respiratory illnesses is as big as diabetes in India. 

As for the international market, Vohra said the company was already doing well in some countries where it had presence.  In South Africa, Cipla grew at twice the rate of the overall respiratory market. 

It launched its breath-actuated inhaler Synchrobreathe in South Africa last year. “In the emerging markets, we are clocking 10-12 per cent growth,” Vohra said. These are the lesser regulated markets such as Australia and Sri Lanka, among others.

Edelweiss Securities, in its recent report, said, “Europe posted healthy growth in brands such as Dymista and Seroflo. The company launched Fluticasone Propionate Salmeterol (FPSM) in eight European countries.” 

Respiratory franchise in the UK includes FPSM and ipratropium bromide (used for treatment for chronic obstructive pulmonary disease and asthma). Cipla launched FPSM in Australia and has also started clinical trials on the same in China. 

“In two to four years, we will see good traction from the Chinese market. It is essentially a branded market and the size is huge. While it takes patience to enter the market, it does offer great potential,” Vohra said. 

“Cipla is focusing on strengthening its presence in Australia and Colombia through the respiratory portfolio and through a combination of in-house pipeline products and partnerships in China, Brazil and Indonesia,” Edelweiss noted. 

Vohra said so far as the US market was concerned, the firm had already started trials for generic Advair, the blockbuster asthma drug from GlaxoSmithKline. “Generic Advair may take around two and a half to three years to launch. Next year, we expect to launch generic Albuterol. In FY20-21 we are looking at launching a steroid-based product,” the CEO added. 

Most of the respiratory products that Cipla has lined up for the international markets have a market size of around $2 billion or so, and the competition is expected from three to four players. It sees $100 million revenue from each of the key products (generic Albuterol, FPSM, and generic Advair) depending on how many other players get approval. 

In India, the company is by far the leader in the segment, having a turnover of over Rs 18.93 billion (as per AIOCD AWACS). It has clocked an 11.9 per cent compound annual growth rate over five years on a high base. 

Lupin and Cadila Healthcare, growing rapidly in the segment, have much smaller revenues from the segment — in the range of Rs 5.6 billion and Rs 5.5 billion, respectively.

“We expect the India base to touch around half-a-billion dollars (around Rs 36 billion) in the next five years,” Vohra said, adding the US, India, South Africa and China would be the largest markets for Cipla in the next five years. 

Respiratory illnesses have a certain stigma associated with it in India. In fact, only 30 per cent patients take inhalers in India, compared to 70 per cent globally. 

Most patients here depend on oral medicines. To address this, Cipla launched its “Berok Zindagi” campaign to dispel the myths around asthma and other respiratory illnesses.