Last year marked Dr. Reddy’s 40th anniversary. What were the defining moments in the company’s history?
Dr. Reddy’s was incorporated in 1984 and started business in 1985. Initially, it focused on producing active pharmaceutical ingredients (APIs). At that time, there were three companies in the group: Dr. Reddy’s, Cheminor Drugs, and Globe Organics. I joined the board in 1986 and became a full-time executive in 1990, leading Cheminor Drugs, which later merged with Globe Organics.
We started as an API company and later expanded into generic formulations. When I joined, the company was a $20–30 million business; today, it generates around $3.4 billion in revenue. Some key milestones include listing on the New York Stock Exchange, launching our first finished product in the U.S., and expanding into Russia, Europe, Brazil, China, and other key markets. Currently, our largest business segments are generics, branded generics, and APIs, with emerging areas like biologics and consumer health growing steadily.
Dr. Reddy’s has played a major role in India’s reputation as the “pharmacy of the world.” How do you see the company’s contribution to global access to medicines?
From the start, Dr. Reddy’s was founded on the principles of affordability and access. While we aim to bring innovative products to market, our biggest impact has been in generics. Our entry into the U.S. market was pivotal—we were one of the first Indian companies to challenge patents there, securing exclusivities that helped us build our business.
India’s pharmaceutical industry has grown significantly, becoming the largest global producer by volume, though the value remains lower due to the nature of generics. This industry-wide growth cemented India's reputation as the "pharmacy of the world." However, while we lead in generics and APIs, true innovation remains a work in progress. Some companies, including ours, are making strides in novel drug development, but there is still a long way to go.
Dr. Reddy’s was also the first Indian company to initiate new drug discovery in the 1990s. What can you tell us about your latest developments, particularly in oncology?
Indeed, our journey in drug discovery began in the early 1990s under Dr. Reddy’s vision. We initially focused on metabolic disorders like diabetes, as well as oncology. While we achieved early success with licensing deals with companies like Novo Nordisk and Novartis, many of those drugs did not reach the market due to evolving standards of care and clinical trial challenges. As a result, we shifted toward incremental innovation and specialty products, securing six novel product approvals in the U.S. before refocusing our strategy in 2015.
Now, we are prioritizing oncology through our subsidiary, Aurigene Oncology Limited. We are developing immune-oncology therapies and have a drug in Phase 3 clinical trials in India, with results expected soon. Beyond novel drug development, we also have a strong presence in oncology generics and biosimilars. Additionally, our CAR-T therapy, which we licensed in, is being developed specifically for India, given the complex logistics involved in its administration. Altogether, we are positioning ourselves as a significant player in the global oncology space.
You also have a biosimilars business and recently announced a collaboration with Alvotech…
Yes, we licensed a biosimilar from Alvotech, and we will jointly market it. However, our biosimilar portfolio extends beyond oncology into areas like immunology and autoimmune diseases, including treatments for rheumatoid arthritis.
Alongside this collaboration, we are also developing our own biosimilars for global markets. This diversification into immunology, oncology, and other therapeutic areas reflects our long-term strategy of expanding our presence in the biosimilars space.
Last year, Dr. Reddy’s made its biggest acquisition ever by acquiring Nicotinell. What are the implications of this move for the company?
We made a conscious decision to invest in consumer health as a growth area. Large pharmaceutical companies are moving away from direct consumer health to focus on prescription drugs, as consumer health typically yields lower margins for innovative companies. However, for a generic company like us, consumer health can be margin-accretive and strategically beneficial.
The acquisition of nicotine replacement brands from Haleon (formerly part of GSK Consumer Healthcare) was a synergistic move, as we already had a presence in most of the markets where these products were sold. Beyond nicotine therapy, we are expanding our consumer health portfolio in India and Russia, where we already have a strong foothold. Given the global shift towards wellness and preventive healthcare post-COVID, we see consumer health as a long-term growth driver and are actively seeking further acquisition opportunities in our core markets.
India's life sciences industry is growing rapidly. What are your projections for its future?
The Indian pharmaceutical market has been growing at close to double digits for many years. It is attractive because it is a branded generics market, meaning margins remain stable, and product lifecycles are longer compared to commodity generics, which tend to collapse with increased competition. Additionally, the market remains underpenetrated, with a heavy concentration in urban areas while rural markets still offer significant growth potential.
Another major opportunity is the introduction of a patent regime, allowing Indian companies to license innovative drugs and bring them to a market of 1.4 billion people. Companies like ours, with strong global collaborations and brand equity, are well-positioned to work with innovators and expand access to these treatments, not just in India but also in other emerging markets.
Do you believe India could eventually drive global innovation in life sciences?
I hope so, but currently, only a handful of companies are engaged in true drug discovery. The innovation ecosystem in India is still underdeveloped—funding for R&D is limited, and government support is only now beginning to materialize. That said, if the right infrastructure and policies are put in place, India could emerge as a significant contributor to global innovation.
China’s progress in life sciences over the past decade is remarkable, and India has the potential to follow a similar trajectory. If the right efforts are made in fostering research, development, and investment, I believe India could reach a comparable level of global impact in the next ten years.
Dr. Reddy’s CEO, Erez Israeli, has expressed optimism about the U.S. administration’s relationship with India in life sciences. Do you share that view?
I am cautiously optimistic. The last U.S. administration was beneficial for India, strengthening relations in various sectors, including pharmaceuticals. I hope some of those policies and sentiments will carry over into this administration as well. However, there have been discussions about tariffs, and it is unclear whether those are genuine policy intentions or merely a negotiating stance.
Even if tariffs are introduced, they are unlikely to significantly impact Indian pharmaceutical companies. The real competition in generics is not between Indian and American manufacturers; it is between Indian companies themselves and Chinese competitors. If duties are imposed across the board, it will create a level playing field rather than drastically altering market dynamics.
Dr. Reddy’s emphasizes sustainability, which is not often discussed in the pharma sector. What sets your approach apart?
Sustainability has always been integral to our operations. In the early days, environmental management in Indian pharmaceutical manufacturing was poor, and we recognized the need to invest in proper waste treatment and sustainability practices. Since 2001, we have published sustainability reports, initially focused on environmental impact but later expanding to include governance and social impact (ESG). By 2020, we had achieved most of the environmental commitments we set in 2010, and we have since raised our ambitions further.
Our key environmental goals include becoming carbon neutral by 2030, achieving 100% renewable energy use, and maintaining water positivity—goals we are actively working towards. On the social front, we aim to serve 1.5 billion patients by 2030 and have already expanded into underserved areas like Africa through partnerships, including one with the Gates Foundation. Additionally, we are committed to gender diversity and inclusivity, aiming to triple female leadership and significantly increase opportunities for people with disabilities.
Where do you see Dr. Reddy’s at its 45th anniversary? What will drive future growth?
In the near term, GLP-1s represent a significant opportunity. However, our long-term goal is to be at the forefront of innovation, bringing new treatments to market. In oncology, our vision is ambitious—we aim to find a cure for at least one type of cancer in the next few years. This is our moonshot project, and we are dedicating significant resources toward it.
Beyond oncology, we see growth coming from our expansion into biosimilars, novel drug development, and consumer health. With a strong foundation in generics and an increasing focus on innovation, we aim to solidify our position as a leader not just in affordability and access but also in medical breakthroughs that can change the standard of care globally.
