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MOSL: HEALTHCARE-Volumes continue impacting overall growth

HEALTHCARE: Volumes continue impacting overall growth

 

• Indian pharmaceutical market (IPM) growth stood at 7.6% YoY in Jan'20, lower than 8.8% YoY in Dec'19 and 10.8% YoY in Jan'19.
• Growth was led by prices (+5.2% YoY) and new launches (+2.7% YoY), but dragged by volumes (-0.3% YoY; 12-month average: 1.8%).
• For the quarter ended Jan'20, overall growth came in at 10.3% YoY, led by price (+5.4% YoY) and new launches (+2.7% YoY). Volume growth for the quarter was relatively low at 2.2% YoY due to dismal momentum in Dec/Jan. Notably, both NLEM and non-NLEM products grew by 10% and 10.4% YoY, respectively.
• On a MAT basis, industry growth came in at 9.6% YoY, with price growth at 5.3%, new product growth at 2.5% and volume growth at a mere 1.8% YoY. 

Price - key growth driver; volumes muted

• In value terms, secondary sales increased by 7.5% YoY for NLEM (~10% of IPM) and by 7.6% YoY for non-NLEM (~86% of IPM) in Jan'20.
• Price growth for non-NLEM products was 5.5% YoY in Jan'20. Growth in NLEM products was driven by volumes (+3.5% YoY) and prices (+3.6% YoY).

 Dr. Reddy, JB Chemicals, Torrent emerge as outperformers

• In Jan'20, Dr. Reddy's (+20.4% YoY), JB Chemicals (+18%) and Torrent (+15.8%) delivered highest growth.
• Reddy's performance was driven by strong double-digit growth in its top therapies, especially in Derma/ Respiratory (+23.2%/+23.6 YoY). JB Chemicals witnessed good traction in volumes (+10.5%) and price (+9.1%). Torrent gained from strong growth in Anti-diabetic therapy (+20.2% YoY).
• Sun Pharma's sales grew at 10.3% in Jan'20 from 8% in Dec'19, mainly due to a better performance of Anti-infective/ Gastro-intestinal (+17%/11.7% YoY).
• Secondary sales were muted for GSK Pharma, Alembic and Biocon.
• On a MAT basis, JB Chemicals/Torrent reported highest price growth of 9.1%/8.2% YoY. AstraZeneca saw highest growth in new launches (+5.4% YoY).