Dr Reddy's investment plan involves expansion in biologics and other divisions, pushing the total yearly capital expenditure to around INR 1,400 Cr.
Global Pharmaceutical player, Dr Reddy’s Laboratories, has planned to invest INR 700 Cr in the capacity expansion of biosimilars and Active Pharmaceutical Ingredients (API). This investment is part of the company’s focus on future investments and AI.
This strategic investment is in addition to the INR 700 Cr that the company had already planned to invest for capacity expansion during the second half of this financial year.
Moreover, the expansion involves the biologics division of Dr Reddy’s Laboratories as well as other portfolios. This will take the total capital expenditure for the year to about INR 1,400 Cr.
Sharing insights on future investments and AI, GV Prasad, co-chairman & MD, Dr Reddy’s Laboratories, said, ‘’We have seen how AI has reduced the amount of experimentation we need to do, bring more precision to our work, and give us ideas that normal human beings wouldn’t have thought about.’’
He further emphasised how they are using machine learning to understand scaleups, as reported by Moneycontrol.
Founded in 1984, Dr Reddy's is a global pharmaceutical company that offers a portfolio of products and services, including active pharmaceutical ingredients (APIs), generics, branded generics, biosimilars, and over-the-counter (OTC) products.
For Q2 of FY24, the company announced that it would be looking to expand its India business through acquisitions and buyouts, licensing, and collaborations. In this regard, the funding will be done through separate means and will not be part of any of the capex plans of Dr Reddy’s.
The company has been developing a portfolio for biosimilars and biologics through development deals as well as expanding its facilities. The firm had a capex of about INR 1,100 Cr in FY23, making it a 24% increase in FY24 from the year before.
In September, last year, Dr Reddy's Laboratories Limited joined the race to acquire the biosimilar products portfolio of Biogen Inc, a US-based company in a deal valued at up to $1 billion.
Reportedly, Intas Pharmaceuticals Limited, another Indian firm, is also in contention in this acquisition. Additionally, Samsung Bioepis Co Ltd is also being considered as a potential buyer for the portfolio.
As of the latest reports, the acquisition of Biogen’s biosimilar portfolio is still under negotiation. If successful, this move aligns with Dr Reddy's goal to expand its API and Biosimilar business.
Going forward, Dr Reddy’s Laboratories aspires to triple its reach and touch over 1.5 billion patients by 2030. Further, they are also focusing on digital transformation in the customer and patient journey, primarily in creating a differentiated value proposition.
In December, Dr Reddy’s signed a pact with Coya Therapeutics for investigational therapy of Amyotrophic Lateral Sclerosis (ALS). As per the terms, Coya granted Dr Reddy’s an exclusive licence to commercialise COYA 302, a proprietary co-pack kit containing a combination of low dose IL-2 and CTLA-4 Ig (abatacept) in the United States, Canada, the European Union and the United Kingdom for ALS.
Days back, Dr Reddy's Laboratories acquired a nearly 6.5% stake in the Israeli development-stage biotech player Edity for a cash consideration of $2 million.
Reportedly, the Hyderabad-based pharma picked up 10,14,442 preferred A-1 shares, equivalent to 6.46% of Israel-based Edity's share capital on a fully diluted basis, for $1.9715 per share, by way of conversion of SAFE (simple agreement for future equity).
In another development, this month, Dr Reddy's Laboratories acquired US-based MenoLabs. The acquisition deal is a part of Dr Reddy's strategy to expand its presence in the rapidly growing women's nutritional and wellness market in the US.
The acquisition not only marks a strategic expansion for Dr Reddy's but also positions the company as a key player in women's health and wellness, aligning with the growing trend of consumers actively seeking nutritional and wellness solutions.
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