Glenmark - Will Innovation Pay?

Q4 concall updates

Fy 24 guidance 10% growth with 19% ebidta
With europe at 20% usa at 5% Row and india at 10%.

Europe 4 filings which will boost fy 25 and beyond.respiratory doung well. Entering italy.

Usa more than 10 launches planned for fy24, munroe remediation mostly over. Some batches to be produced in q2 and commercial operations from h2.

India respiratory, cardio and derma doing well competitive pressure on diabetes. Focus reduced on institutional due to lower margins. Remediation on in baddi and goa, likely to be operational by h2. Mr strength at 4800.

Debt increase due to increase in working capital due to larger debtor period in europe and row, forex impact. Fy26 net debt zero target stands. On account of higher cash flows, gls stake sale etc.

Ryaltris doing better than expected expect to move to 45 mn usd in fy 24 from 23 mn sale in fy 23.

Ichnos q4 bump in cost due to one time payoff to people laid off. Going forward ichnos cost to be 60 mn usd pa.1342 poc likely by q3 now. One outlicensind deal from ichnos/glenmark in fy24.


Does Ichnos has any drugs in pipeline or they are burning cash in research?

They have 3 drugs in phase I trials isb 1342, isb 1442 and isb 2001. 1342 results are expected in q3 of the calender yr 2023.1442 results are also expected soon afterwards…

Both 1342 are designated orphan drugs by us fda .

These are mainly for blood cancer, for solid tumors they have 2 drugs in ind enabling studies.

Details on their website pipeline section.

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The problem in this is that the first 3 drugs are for the same disease i.e R/R Multiple Myeloma. Which affects a small population .
Until the company can demonstrate that BEAT/TREAT can be used in other diseases the upside potential will be limited . There are 2 drugs for hematological malignancy & solid tumor namely ISB 2004 & 2301 in discovery stage, let see how they fare.

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Cover story of American Society of Hematology’s Magazine “Blood”-- Preclinical characterization of ISB 1342, a CD38 × CD3 T-cell engager for relapsed/refractory multiple myeloma | Blood | American Society of Hematology

Q1 fy 24 concall highlights

Usa will be doing roughly 100 mn usd per quarter.
Munroe remediation largely done, will wait for fda inspection and then go online. Flovent there is one more competitor who has filed.

India new policy on generics impact will need to be seen. All key therpies like respiratory, derma, cardio doing well except diabetes. Will have 10 to 15% growth ex of divested portfolio.

Europe will keep growing though rate of growth will taper a bit. 4 new filling in respiratory for fy 25 launch. R

Row major markets doing well.

Ryaltris having good market share. Did more than 45 mn usd in revenue. Picking up well in usa and healthy market share in most markets.china,brazil,mexico and few european markets still left to launch.

Ichnos this year shall have data readouts of 1342, 1442 and maybe 2001 as well. One outlicensing deal out of ichnos + glenmark innovative pipeline. Discussions ongoing.

Gls 7 to 8% divestment by august 2024. My take valuations in papers was low considering the capex coming online and the growth prospects of the company.

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Glenmark Pharma Q1 results -

Region wise sales -

India - 1064 cr, up 3 pc (under performed the IPM)
North America - 808 cr, up 22 pc
Europe - 573 cr, up 73 pc
RoW ( basically EMs ) - 551 cr, up 30 pc
APIs - 376 cr, up 16 pc
Others - 27 cr

Total sales - 3401 cr, up 22 pc

Percentage of Branded sales out of the total @ 47 pc
( basically India + RoW formulations )

EBITDA @ 631 vs 431 cr

Margins @ 18.6 vs 15.5 pc YoY

Glenmark’s 9 brands are in top 300 brands in IPM. Glenmark is no - 2 in Respiratory and Derma segments in India

Glenmark Consumer care grew 20 pc. Has popular brands like - Candid Dusting powder and Scalp Anti Dandruff shampoo in its portfolio

Mkt Share of Glenmark’s Speciality Drug - Ryaltris (nasal spray for allergies) in various countries -

Aus-18 pc
SA-15 pc
Poland-8 pc
Italy-10 pc

Glenmark’s subsidiary - Ichnos Sciences has various NCE under discovery and development phase - most of them are Oncology molecules. GPL aims to get into some out-licensing deals yr

Have reduced R&D spends to 8.5 pc of sales. Will bring it down to 7.5 odd pc by next yr

This will boost profitability going forward. GPL’s heavy spends (beyond Industry norm of 5-6 pc of sales) are because of its NCE programs

Company to remain focussed on 03 Pharma therapies - Derma, Respiratory, Oncology. Going to launch a number of new products in these areas

Continue to file 10-15 products in US/ yr. But the complexity of the products has gone up significantly. Not filing plain vanilla products anymore

Disc: hold tracking positions in both GPL and GLS. Biased. Not SEBI registered

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Glenmark Pharma latest updates-

Selling 75 pc stake in GLS (Glenmark Life Sciences) that was involved in making APIs and had a small CDMO business - to Nirma Group

To get sale proceeds (post Tax) of about 5000 cr. Has a debt of 4600 cr on Books

GPL to be debt free by yr end

GLS used to pay hefty dividends to its parent so as to reduce its Debt burden. That obligation is now gone

GLS’s CDMO ambitions were at risk as its parent (GPL) was involved in NCE research. Innovators were uncomfortable handing over CDMO projects to GLS because of that

GLS used to trade at significant discount to peers because of these reasons

I think, its a win-win for both GPL and GLS

Disc : bought a tracking position in both

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Glenmark q2 concall update

India q2 was marginally up due to slowdown in derma and respiratory. Picking up in q3.

Usa gone below 100 mn usd again, 3 respiratory lajnches thru in licensing.

Europe doing exceptionally well and momentum to continue.

Row doing well and expected to continue

Margin impact due to gls divestment to be mitigated by reigning of R&D, capex,operational leverage and reduction of intrest cost

Munroe starting engg batches,followed by validation batches and then commercial launch.

Astria payment has come in q3.

Update from ichnos site

Isb 1342 trial stopped and will be outlicensed.

Ichnos targeting ipo in 12 months time.

Glenmark Pharma -

H1 and Q2 FY 24 highlights -

Adjusted financials ( adjusted for Glenmark Life’s slump sale ) -

Consolidated Sales @ 3207 cr, up 6.3 pc ( growth drivers - Europe, RoW business which were up 58, 19 pc YoY )

EBITDA - 505 cr ( adjusted for a forex life of 43 cr ), Margins @ 16 pc

R&D expenses @ 305 cr ( almost 10 pc of sales - a very promising indicator, out of this - aprox 195 cr spent towards NCE discovery program at Ichnos ( GPL’s subsidiary )

Geography wise sales breakup -

India - 1121 vs 1091 cr, up 3 pc ( however, the consumer care business was up 15 pc. Slowdown in acute therapies and divestment of some brands to Eris Life affected overall growth. Scalp and Candid continue to do really well ). Glenmark Pharma has a strong Respiratory and Derma portfolios in India
( ranked no-2 in both ). Company ranks no-5 in Cardiac market. IPM overall rank @ 14. Company has 9 brands in top 300 brands.

North America - 740 vs 753 cr, down 2 pc ( sales expected to pick up in Q3 as some important launches like - gTaytulla are lined up ). Currently, the company has a product portfolio of 165 generics in US

Europe - 599 vs 378 cr, up 58 pc ( key brands like - RYALTRIS - nasal spray , Salmex - anti asthma inhaler - continue to do well )

RoW - 732 vs 615 cr, up 19 pc ( GPL - ranks no 8 in Derma, No-2 in expectorants (cough medicines ) in Russia. Launched RIYALTRIS in Malaysia, Saudi Arabia - receiving great response. Also witnesses strong growth in Brazil, Mexico


Currently being marketed in over 70 countries. Enjoys double digit mkt share in a lot of countries like - Czech, Poland, Australia, RSA, Italy

Glenmark’s commercial parter for RIYALTRIS is US is Hikma ( British major ). Seeing strong demand in US

Brand has completed phase-3 trials in China. NDA application to be submitted by Dec 23

Other comments -

Intend to strike at least one out licensing deal wrt the Ichnos portfolio

Intend to further enhance cash generation to reach debt free status

Entered into an agreement with Nirma Pvt Ltd to sell 75 stake in GLS ( will continue to retain 7.5 pc stake ) for a total consideration of Rs 5600 cr. Company currently has a gross debt of around 4700 cr and a net debt of around 3300 cr

GLS sale likely to be reflected in the Q3 numbers

GPL expects operating leverage to kick in across LatAm and Europe by next FY leading to expansion in EBITDA margins. Also expecting reduced intensity of R&D going forward

India business expected to pick up from Q3 onwards. In Oct, India business grew 20 pc YoY

In Q3, three injectable products are lined up for launch in US. US business should pick up pace in Q3

Aim to hit and maintain EBITDA margins in the 18-19 pc range wef H2 FY 24

Continue to see price erosion in mid single digits in US business

Company is buoyant on the branded and OTC India business going forward. Company remains on a very strong footing in Respiratory, Derma and Cardiac space. Diabetic portfolio is also doing well. Should be able to grow the topline at 12-14 pc for next 3 odd years

Company’s Muroe facility in US should go live by next year. This should also aid margins going forward

Europe business’s margins have reached corporate avg with scope for further improvement. LatAm should reach there in next 1-2 yrs. RoW is already there

My Take ( biased ) - company can report a revenue of aprox 14000 cr and EBITDA of aprox 2500 cr next year. PAT may come in the range of 1300 - 1400 cr. That may lead to significant value unlocking for the company’s stock

Disc: holding, biased, may add more, not SEBI registered


Q3 concall updates

India restructuring has led to reduction in stock points and decrease in working capital requirements.

India run rate to be 1000 cr and increase of 10% next year

Usa new injectable launches to help from q4, munroe fda inspection requested, any time soon expected. Commercial production by q1. 2 injectable to filed from munroe

Europe has achieved a decent base leading to synergies and better margins. Growth strong

Ryaltris fy 25 sales around 80 mn usd.
Jiangsu tieup for envalofimab will be next ryaltris
Flovent and 1 more pmdi filing in progress

With gls sale company to be net debt positive by march. FCF to increase with better margin profile pdts and operational leverage in fy 25 onwards.

Ichnos readouts likely in fy 25, assets will be monetised the outlicensing way.

IGI will lead to R & D cost reduction by 30 to 40 mn usd


Ichnos presented data on isb 2001 in american association of cancer research with findings in phase 1 on patients. Claiming superior tumour killing potency over existing drugs.

Details on ichnos glenmark website


Hi Ranvir, can you please share your views on how you came up with the 14000cr figure for next year, because if I’m not wrong GLS will not be part of the consolidated rev next yr which is currently at an annual rev of approx 2300. I’m just trying to figure out if that is even possible. Thanks!


I don’t remember the exact calculation

What I broadly remember is I extrapolated ( an optimistic scenario ) management commentary of strong growth in FY 25 ( 15 pc type or something, will have to revisit the concall ) and subtracted the GLS sales

But … I am not able to recollect clearly. Anyways, don’t go by that. One can still assume a 8-10 pc topline growth over FY 24 and almost NIL interest payments due to the sale proceeds ( post Tax ) received from the stake sale in GLS

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Investors day in coming week.
More on FY26 and long term vision in Investors Day

Gross Margin : 32%
This Qtr had benefit of India being a little higher But Ryaltris is expected to double. So there is no one off in GM +ve for Gross margins expectations.

Ryaltris China will be a big launch in starting FY26
There are a host of markets where they don’t have Ryaltris. Capex for Ryaltris additional line + Generic Flovent.

Receivables explanation :
Better cash flows in Q3

R&D might not be going up in coming years wrt absolute number. 1000 Odd crore (FY25 7.5%)

Impairments in brief coz i saw folks asking a lot of queries around the impairments in the concall

  • The Board of Directors of Glenmark Pharmaceuticals Inc., USA in their meeting held on 23May, 2024 decided to impaired the block of OSD & Nebulizer within the manufacturing facility
    located in Monroe.

  • Exceptional Item also includes de-prioritisation of certain intangibles of Glenmark Speciality SA aggregating to Rs 11,000.77 Mn ($133 million) and the consequent effect under the Accounting Standard IND AS 30 Impairment of intangible assets.

  • impairment of certain block at Monroe facility, (From Concall)

Old things which might help understanding the monroe impairments etc

  • the formulations manufacturing unit in Monroe, North Carolina, received a warning letter in June 2023.

  • GPL settled its drug pricing case with the US Department of Justice in August 2023 (USD30 million).

  • GPL also settled generic Zetia lawsuits for USD87.5 million in FY23. Price control in India, USFDA inspection as well as other lawsuits in the US will remain monitorable.


Just to add apart from generic flovent and ryaltris, the next 2 drugs will be envafolimab and winlevi. One more pmdi like flovent to be filed in fy 25 and launched in fy 26.

GPL is the only filer in flovent and market size of all doszge is 1.6 bn usd. Gpl as of now has filed for only 1 dosage, balance under process.


Glenmark will sell remaining 7.84% stake in Glenmark Life Science (GLS) by doing an OFS.
This would amount to a pre-tax consideration of around 800 crores at 5% discount to CMP of GLS.