New Delhi [India], June 27 : Indian CRDMOs (Contract Research and Development and Manufacturing Organizations) are seeing growing interest from global pharmaceutical companies, according to a recent report by Jefferies.
The report highlighted that Big Pharma companies are increasingly diversifying their manufacturing and research operations geographically, and Indian companies with expertise in small molecule development are well placed to benefit.
It said "Big Pharma is diversifying geographically, benefiting Indian CRDMOs with small molecule expertise".
The report highlighted some major pharma companies (Including Piramal Pharma, Syngene, Laurus Labs, Cohance, Gland Pharma).
The report said that these companies highlighted that many of the ongoing projects are still in the clinical stages, so growth may be uneven. There is also a rising demand for antibody-drug conjugate (ADC)-related CDMO services, and Indian companies are exploring opportunities in that space.
The report also mentioned that GLP-1, a class of diabetes and obesity drugs, could become an important growth driver for generic CMOs from 2026.
Piramal Pharma is targeting 13-15 per cent CAGR in sales over the next 4-5 years in its India consumer health and complex hospital generics businesses.
While the company expects subdued sales from its largest CDMO product in FY26 due to destocking, overall segment revenue is likely to remain flat due to better utilisation at overseas facilities and a recovery expected in FY27.
Syngene's growth in FY26 is expected to be in the mid-single digits, mainly due to destocking of Librela, its largest product. The company expects growth to pick up to low double digits after that. Its new management, led by Peter Bains, is focusing on growth and acquiring US biologics capacities.
However, the overseas unit will have lower margins and may take time to break even.
Laurus is currently handling seven active projects from global pharma clients, which account for 50-60 per cent of its new projects in the past two years.
About 70-80 per cent of the company's CDMO division sales come from commercial molecules. Many of the ongoing projects involve breakthrough therapies that typically have lower failure rates.
The company has invested Rs 4 billion in animal health and Rs 1.5 billion in AgChem, with another Rs 1 billion planned for animal health. It aims to achieve peak sales of 1.5 times the capex from these investments by FY28-29.
Cohance is recovering from the impact of destocking that affected its AgChem and SpecChem business over the past 18 months. The company is planning to launch a new product in the third quarter of FY26 and bring in new customers in the division.
Gland Pharma is expanding its GLP-1 cartridge fill-finish capacity from 40 million to 140 million units by the end of next year. The company's new bulk line will be flexible for use across both GLP-1 and insulin products.
The report outlined that while near-term growth may be uneven due to destocking, most companies expect a strong rebound and long-term momentum.
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