Sun Pharmaceutical, India's largest drug maker, reported a 36% year-on-year drop in its consolidated net profit for the second quarter ending September, settling at ₹1,989 crore. This significant decline was attributed primarily to the financial impact of exceptional items, specifically costs associated with US antitrust litigation and the expenses related to its proposed acquisition of Organon.
Despite the bottom-line pressure, the company’s top-line performance remained positive. Sun Pharma recorded an 11.8% year-on-year increase in consolidated revenue, reaching ₹16,100 crore for the quarter. This growth was largely driven by a strong performance in domestic formulations and emerging markets, which continue to be key contributors to the pharmaceutical giant's portfolio.
Managing director Kirti Ganorkar highlighted that the company's overall performance was anchored by strong momentum in India, emerging markets, and other international territories. The India formulations segment emerged as a primary growth engine, with sales rising 17.3% to reach ₹5,552 crore. This domestic business accounted for 34.5% of the company's total consolidated sales during the quarter. Similarly, formulation sales in emerging markets grew by 7.6% to $350 million, while other international markets saw a more modest growth of 3.1%, totaling $241 million.
However, the company faced a downturn in its US business, where formulation sales declined by 8.2% to $455 million. The US market currently accounts for approximately 27% of Sun Pharma’s consolidated revenue and remains a critical component of its strategy for both generics and innovative medicines. Addressing the long-term outlook for the competitive GLP-1 market, executive chairman Dilip Shanghvi noted that while product development cycles typically span three to four years, the company remains optimistic about the market's significant potential, even if it captures only a small percentage of the total patient base.
The company also announced operational milestones during the quarter, including US regulatory approval for Ilumya to treat adults suffering from active psoriatic arthritis, further expanding the drug’s therapeutic applications. Additionally, Sun Pharma’s Unloxcyt received a preferred recommendation from the National Comprehensive Cancer Network for treating advanced cutaneous squamous cell carcinoma. Expanding beyond its established dermatological focus, the firm strengthened its cardiovascular portfolio through the licensing of lerodalcibep, a PCSK9 inhibitor, for markets outside the United States and China, with pre-launch preparations now underway in the European Union.
Research and development expenditure for the quarter stood at ₹778 crore, representing 4.8% of quarterly sales, reflecting the company's continued investment in its innovative medicines and generics pipelines. Integration planning for the acquisition of Organon is also proceeding as scheduled, with regulatory approvals successfully secured in most regions and remaining jurisdictions moving forward according to plan.
Looking at the broader half-year performance for FY27, Sun Pharma reported an 11% increase in consolidated revenue to ₹31,284 crore, with an adjusted net profit of ₹6,252 crore, marking a 2.2% rise compared to the previous year. Earnings before interest, taxes, depreciation, and amortisation (Ebitda) for the first half grew by 3.8% to ₹9,162 crore, maintaining a margin of 29.1%. While the immediate quarterly profit was tempered by legal and acquisition-related expenses, the management indicated that the core business segments continue to show resilience and sustained growth momentum across various international and domestic markets.
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