Sun Pharma sees US generics stabilising, pins growth on innovation push

Sun Pharmaceutical Industries expects pressure on its US generics business to ease as compliance improves, while focusing growth efforts on innovation-led therapies

Sun Pharmaceutical Industries is looking to stabilise its US generics business as manufacturing compliance improves and new product launches resume, while sharpening its strategic focus on innovation-led growth, selective acquisitions and major near-term opportunities such as the launch of generic semaglutide in India.

 

Addressing analysts after the company’s December quarter earnings, Sun Pharma’s management said the pressure on the US generics portfolio — which has faced price erosion and competition — is expected to ease once regulatory and manufacturing constraints are resolved. “The generics business will start to recover once we are in manufacturing compliance for a number of our sites in order to launch new products,” Richard Ascroft, chief executive officer, North America, said during the call.

 

The company’s US business saw innovative medicines offset weaker generics sales in the quarter, underlining Sun Pharma’s broader strategic shift towards specialty and novel therapies. In Q3FY26, United States formulations sales stood at $477 million, marginally up by 0.6 per cent, despite the decline in the generics business. US sales accounted for approximately 27.5 per cent of total consolidated sales.

 

Management reiterated that the US remains a key geography for innovation-led growth. “US continues to be an important part of our focus, specifically for innovative medicines,” executive chairman Dilip Shanghvi said, adding that the company is equally focused on expanding its innovative portfolio globally.

 

Sun Pharma is currently ramping up two key specialty launches in the US — UNLOXCYT, an immunotherapy for advanced cutaneous squamous cell carcinoma, and LEQSELVI, a treatment for severe alopecia areata. Early physician feedback and market engagement have been encouraging, according to the company.

 

“Our early interactions have been positive. We have completed initial stocking and had our first orders from distributors,” Ascroft said on UNLOXCYT. He added that discussions with major health systems and cancer centres have progressed well, with formulary conversations moving forward. “The message is resonating in terms of the balance that this product provides in efficacy and safety. It’s something clinicians have been looking for,” he said.

 

On LEQSELVI, Ascroft noted that physicians are reporting early signs of hair regrowth in patients, including some who had failed other JAK inhibitors, broadly mirroring clinical trial outcomes. Sun Pharma is also pursuing lifecycle management opportunities for both assets. “We are in active discussions about lifecycle management for both products,” he said, indicating potential expansion into new indications over time.

 

Beyond the US, the company’s medium-term innovation strategy is supported by a growing clinical pipeline. Sun Pharma recently initiated global Phase II trials of GL0034 in type 2 diabetes and plans to present Phase IIa data for diabetes and non-alcoholic steatohepatitis at scientific conferences over the coming months. “We continue to invest in building a R&D pipeline for both the Global Generics and Innovative Medicines business,” Shanghvi said, noting that innovation remains central to long-term value creation.

 

A key near-term catalyst for the India business is the planned day-one launch of generic semaglutide following patent expiry. Sun Pharma has already secured regulatory approvals for both chronic weight management and type 2 diabetes indications. “We are looking forward to expanding our portfolio with the launch of semaglutide upon the expiry of semaglutide patents in India,” managing director Kirti Ganorkar said.

 

“Sun plans to be in the market on day one of a generic launch,” Ganorkar added, highlighting that the company has ensured sufficient supplies and easy-to-use formats across strengths to meet anticipated demand. He said the entry of generics is expected to improve patient access and expand the overall market for GLP-1 therapies in India.

 

On capital allocation, Sun Pharma reiterated its disciplined stance on mergers and acquisitions, particularly in emerging markets. “We want to remain disciplined about acquisition. Our focus is on finding a way to grow our business organically,” Shanghvi said, adding that acquisitions would be considered only if they strengthen long-term strategic capabilities. He also noted that the company is comfortable using debt for the right opportunity, supported by a strong balance sheet.

 

Together, management commentary points to a company navigating near-term generics challenges while positioning itself for sustained growth driven by innovation, specialty launches and selective expansion — both in India and global markets.