Domestic-focused pharma firms aim mid-teen growth in 2024 with new product launches, increased demand: Report

Many domestic-focused companies are anticipated to achieve mid-teen growth in 2024, driven by a focus on new product launches, increased volume growth, and growing demand for generics and branded products, indicated a research report from Capital market company BP Equities Private Limited.

The report highlighted recent improvements in the pharmaceutical sector, attributing the positive trend to enhanced performance in the US generics market, robust performance in branded markets, moderation in raw material costs, and market share gains from recently launched products. These factors have significantly contributed to the strong earnings of domestic pharma companies.

The report further emphasised that pharmaceutical companies have strategically increased their presence in chronic therapies, focused on new product launches, and ventured into new therapies to capitalize on market opportunities.

Additionally, Active Pharmaceutical Ingredient (API) companies undergoing capital expenditure (capex) are expected to contribute to top-line growth, with a healthy product mix and softened input costs sustaining 20-30 per cent operating margins in 2024.

"We expect domestic-focused players to report high single-digit growth driven by deferred acute demand, an uptick in the chronic segment, higher MR productivity, new product launches, and the expectation of a healthy flu season," the report stated.

In the context of US-focused pharma companies, the report anticipated robust growth despite challenges. It noted that base drug prices are stabilizing, providing a foundation for revenue increases. The expansion of sales teams is expected to enhance market reach, and the continuous acceleration of gRevlimid, a key blood cancer medication, contributes to consistent and significant revenue growth. The introduction of two new products, gSpiriva for respiratory conditions and gPrezista for HIV treatment, adds diversification and potential revenue streams.

"We expect pharma companies, with a focus on US business, to grow strongly due to the normalization of base business prices, field force expansion, continuous acceleration of gRevlimid, and the introduction of new products (gSpiriva, gPrezista) despite pricing challenges, intense competition, and stricter regulatory compliance requirements," said the report.