Glenmark Pharmaceuticals : Q1FY 2023-24

"Glenmark Pharmaceuticals Limited Q1 FY'24

Earnings Conference Call"

August 14, 2023

MANAGEMENT: MR. GLENN SALDANHA - CHAIRMAN & MANAGING

DIRECTOR, GLENMARK PHARMACEUTICALS LIMITED.

MR. V. S. MANI - EXECUTIVE DIRECTOR & GLOBAL

CFO, GLENMARK PHARMACEUTICALS LIMITED.

MR. BRENDAN O'GRADY - CHIEF EXECUTIVE

OFFICER, GLOBAL FORMULATIONS BUSINESS.

MR. UTKARSH GANDHI - GENERAL MANAGER,

INVESTOR RELATIONS, GLENMARK

PHARMACEUTICALS LIMITED.

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Glenmark Pharmaceuticals Limited

August 14, 2023

Moderator:Good morning, ladies and gentlemen. Welcome to the Q1 FY'24 Earnings Conference Call of Glenmark Pharmaceuticals Limited.

As a reminder, all participant lines will be in the listen-only mode. And there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing '*' then '0' on your touchtone phone. Please note that this conference is being recorded.

I now hand the conference over to Mr. Utkarsh Gandhi - General Manager, Investor Relations for Glenmark Pharmaceuticals. Thank you, and over to you sir.

Utkarsh Gandhi:Good morning everyone and welcome to the Q1FY'24 Results Conference Call of Glenmark Pharmaceuticals Limited.

Overall Performance Review of 1st Quarter FY'24

Let us review the overall performance of the Company for the first quarter of FY'24. Glenmark's consolidated revenue from operations for the first quarter of FY'24 was at Rs. 34,106 million as against Rs. 27,773 million in the corresponding quarter last year, recording an overall year-on- year growth of 22.5%. We will review each of the businesses of Glenmark Pharmaceuticals Limited, starting off with India. Sales from the formulation business in India for Q1 FY'24 were at Rs. 10,643 million as against Rs. 10,352 million in Q1 of FY'23 which means recording YoY growth of 2.8%. The lower growth was mainly on account of the full impact of divestment of few non-core brands last year as well some impact of the NLEM price revisions.

The India business contribution was at 31.3% in Q1 of FY'24 compared to 37% in Q1 last year. Glenmark's India Business continued to significantly outperform industry growth rates. As per IQVIA Q1 FY'24 data Glenmark's India Formulation Business recorded a growth of 10.7% compared to industry growth rate of 8.1%, furthermore as per the IQVIA MAT June data Glenmark's India Business grew by 13.1% compared to an industry growth of 10.3%. Glenmark's India Business continues to be ranked 14th with the market share of 2.12%. The Company also continues to have nine brands in the IPM Top 300 brands in the country as per IQVIA MAT June data.

In Q1 and MAT June 2023 contribution from the chronic therapeutic segments of Glenmark's was at 47% and 45% respectively. In terms of key therapeutic segments, Glenmark's is rank second in both Respiratory and Dermatology segments. In addition, Glenmark's is ranked 5th in the Cardiac segment and 17th in the Diabetic segment.

During the quarter, Glenmark's India Business also considerably improve that's market share in this key therapeutic areas, as per IQVIA MAT June data the dermatology market share increased to 7.42%. The Glenmark's share in the respiratory market increased to 5.65%, while

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Glenmark Pharmaceuticals Limited

August 14, 2023

Glenamark's share in the Cardiac market increased to 5.23%. Glenmark's share in the diabetes was at 2.21%. These market share gains have been led by higher than industry growth rates for Glenmark across most of the core therapeutic segments.

Glenmark is expecting business growth to remain stable in spite of a recent slowdown in certain acute segments of the industry such as respiratory and anti effective. The Company has launched multiple lines in extensions during the quarter and continues to gain marketshare in some of the key launches across the core therapeutic segments. And the Company continues to have a healthy pipeline of differentiated products which it will launch in the market going forward.

Consumer Care Business

The Consumer Care business in India, primary sales for the Glenmark Consumer Care in Q1 FY'24 worth Rs. 781 million with a growth of 21.3 which was mirrored by a strong double-digit secondary growth of 17%. The company flagship brand Candid Powder delivered revenue growth of 29% in Q1; La Shield portfolio delivered 2% growth in Q1 which was low primarily due to our high base last year and the Scalp portfolio recorded growth of 58% in the first quarter of FY'24.

North America

Moving on to North America, the North America business registered revenue of Rs. 8.085 million which is about USD $98.4 million for the first quarter of FY'24 as against Rs. 6,628 million which is about $86.1 million for Q1 FY'23, which translates into year-on-year growth rate of 22%.

The North America business contribution was at 23.8% compared to 23.9% in Q1 last year. In the first quarter Glenmark launched Clindamycin Hydrochloride capsules which was approved in the previous quarter. Additionally Glenmark file two ANDAs in the first quarter of FY'24. The Company plans to file two to three applications in the forthcoming quarter and a total of 10 to 12 ANDAs in FY'24.

Glenmark's marketing portfolio consists of 183 generic products which are authorized for distribution in the U.S. market and the Company has 50 applications pending at various stages of the approval process.

Europe

Europe business, Glenmark's Europe operations for Q1 FY'24 were at Rs. 5,732 million as against Rs. 3,300 million in Q1 last year recording a year-on-year growth of 73.7%. The Europe business contributed 16.9% of the total revenues in the first quarter of FY'24. The strong growth

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Glenmark Pharmaceuticals Limited

August 14, 2023

in the region was driven by an uptick in the base business as well as new product launches during the first quarter.

The Western European business recorded high double-digit growth for Q1 with markets like the UK and Spain growing significantly. Amongst the key markets the UK recorded strong growth on the back of key launches particularly in the generics business and key markets in Central and Eastern Europe such as Czech and Poland also recorded strong secondary sales growth.

Glenmark's Respiratory portfolio in Europe has also been a key factor for the strong performance in Q1. The Company has seen a strong uptake across all four Respiratory brands that it has launched particularly brands like Ryaltris and Soprobec, Ryaltris continues to exhibit strong growth across markets in which both Glenmark and partner Menarini have launched the product. And Salmex and Esthemax also continue to sustain its market share across the CEE markets both in terms of value and volume.

In addition the Company mentioned in the last earnings call that it has filed four additional respiratory products for the EU markets. And which would be launched over the next two to three years. And Glenmark has also entered the Italian market and will be expanding across the country in the forthcoming quarters.

ROW

ROW region which consists of Asia, Middle East, Africa, Russia, CIS and Latin America, for the first quarter of FY'24 revenue from the ROW region was Rs. 5.512 million as against Rs. 4,226 million for Q1 last year, recording a year-on-year growth of 30.4%. For Q1 FY'24 the ROW business contribution was at 16.2% compared to 15.2% last year.

The Company witnessed healthy growth in the base business across all sub details of the ROW market, starting off with Russia, as per IQVIA, June and MAT June data Glenmark's Russia business recorded growth of 34% and 17% respectively in value. This has been driven by all key brands including Ryaltris, Ascoril and Montlezir.

Amongst the Dermatology companies, Glenmark ranks 10th as per MAT June 2023 data and amongst the company's presence in the expectorant market in Russia, Glenmark continues to maintain its strong second rank as per the MAT June data. In June, Glenmark also launched Ascoril LS which is a combination to further consolidate it's leadership position in the expectorants market.

The Asian region recorded 14% secondary sales growth which is driven by markets like Philippines and Vietnam. Dermatology and Respiratory are the key therapeutic areas in which Glenmark is present in Asia and contribute significantly to the overall sales. In addition, Ryaltris was launched by Glenmark in the Malaysian market in Q1 FY'24 we have seen good demand so

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Glenmark Pharmaceuticals Limited

August 14, 2023

far post launch. And Ryaltris continues to hold (18%+) value market share in Australia across the top allergic Rhinitis products. The product has also received strong response in South Korea post launch in Q3 of last year by partner Yuhan Corporation.

Middle East Africa region recorded (20%+) growth in sales during the first quarter, Glenmark continues be ranked third in the overall Kenya market. Further the Company continued to achieve strong secondary sales growth in South Africa, UAE. Ryaltris again was a key product, it was launched in Saudi Arabia in Q1 and is expected to drive the further growth in the Respiratory segment, as a product will get launched across other NEA market in FY'24.

Latin America region witnessed strong growth in Q1, Respiratory portfolio was the key contributor for Glenmark in the Latin American markets. The Brazil business for Glenmark achieved 25% plus growth in its covered market Company maintains its rank amongst the top companies in the covered market for chronic respiratory segment in Brazil as per IQVIA MAT June data.

And secondary sales growth also remain strong in Glenmark's other key market which is Mexico. Glenmark's business in Mexico grew by 25%, then 15%, 25% in value and 15% in units as per IQVIA MAT June data.

Key Highlights for Ryaltris

We will cover some key highlights for Ryaltris as of the end of Q1 FY'24 marketing applications for Ryaltris have been submitted in more than 70 countries across the world. The product has been commercialized in 29 markets including major markets like the USA, Canada, markets in Europe like the UK, Australia, Russia, South Africa, South Korea and Saudi Arabia.

Menarini Glenmark's partners in the EU intends to launch the product in additional European markets in FY'24 and consolidate its position in the market where the product has already been launched. In addition, the markets in which Glenmark is selling, we continue to do well in Ryaltris in Europe.

Hikma Glenmark commercial partner in the U.S. continues to see strong prescription, new prescription and repeat prescription growth as the allergy season progresses through the country.

Grand Pharmaceuticals is Glenmark's partner in Mainland China, they aim to complete the ongoing Phase III study in the country and submit the marketing authorization application in the second half of FY'24. And we have mentioned some key market shares for Ryaltris, value market shares across a few markets where Glenmark and their partners have already launched Ryaltris. So, Australia, we have (+18%) market share, South Africa 15%, Czech Republic 25%, Poland 8% and Italy 10%.

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