Dr. Reddy's Laboratories Ltd.
(
RDY
) recently announced that it has launched its generic version of
Merck & Co., Inc.
's (
MRK
) Clarinex Reditabs (desloratadine 2.5 mg and 5 mg) in the
US.
Clarinex Reditabs is indicated for the treatment of seasonal
allergic rhinitis, perennial allergic rhinitis and chronic
idiopathic urticaria. According to IMS Health, Clarinex Reditabs
generated US revenues of approximately $5.3 million for the 12
months ending Nov 2012.
Earlier this month, Dr. Reddy's also launched its generic
version of Merck's Propecia (finasteride) 1 mg. Propecia is
approved for the treatment of male pattern hair loss. According
to IMS Health, Propecia generated US revenues of approximately
$136 million for the 12 months ending Oct 31, 2012.
We are pleased with Dr. Reddy's geographic reach and product
depth. Dr. Reddy's also has a robust generic product pipeline. At
the end of the second quarter of 2013, Dr. Reddy's had 63 ANDAs
pending approval with the FDA, of which 33 are Para IV filings
and 7 are first-to-file. Dr. Reddy's Global Generics segment
revenues jumped 25% to $380 million in the second quarter of
2013. Generics revenue soared in North America (up 47%), driven
by limited competition.
However, the company's performance in Europe due to the
continued economic weakness in the region remains a concern.
During the period 2017-2018, most of the large branded drugs
are due to lose patent exclusivity and so we have little
visibility on the growth prospects of generic companies like Dr.
Reddy's beyond that timeframe.
In view of these challenges, we see limited upside from
current levels at Dr. Reddy's. The stock carries a Zacks Rank #3
(Hold).
Other generic players in the market are
Mylan Inc.
(
MYL
) and
Pernix
Therapeutics Holdings, Inc.
(
PTX
), which currently hold a Zacks Rank #2 (Buy).
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DOCTOR REDDYS (RDY): Free Stock Analysis
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