Ladies and gentlemen, good morning, and welcome to the Q1 FY25 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 star then zero 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. Thank you, Lizanne. Good morning, everyone. Welcome to the Q1 FY 25 results conference call of Glenmark Pharmaceuticals Limited. Before we start the Q&A, we'll review the performance of the company for the first quarter of FY 25. For Q1 FY 25, Glenmark's consolidated revenue from operations was at INR 32,442 million, as against INR 30,361 million in the corresponding quarter last year, recording a YOY growth of 6.9%. In terms of our overall performance across regions, starting with India. So for India, our formulation business recorded revenue of INR 11,962 million, as against INR 10,693 million in the corresponding quarter last year, recording a growth of 11.9%. India business contributed 36.9% of the consolidated revenue for Q1. In terms of secondary sales, Glenmark India business continued to outperform the industry. As per the IQVIA June 2024 data, Glenmark India formulation business recorded growth of 16.9% in the first quarter and 11.3% as of March-June 2024. In comparison, the IPM grew at 8.7% in the first quarter and 7.5% as of March-June. Glenmark continues to outperform the market in terms of the key therapeutic areas of cardiac, dermatology and respiratory. Our growth is almost double, especially in cardiac and dermatology, compared to the market. Glenmark India business continues to be ranked thirteenth, with a market share of 2.19% as of IPM March-June 2024. The company continues to have 9 brands in the IPM top 300 on the basis of IPM March-June 2024. Glenmark has also improved its market share across key therapeutic areas. In May 2024, Glenmark and BeiGene entered into an agreement for marketing and distribution of tislelizumab and zanubrutinib in India. Under this strategic collaboration, Glenmark will be responsible for locally required development, registration and distribution, providing access to BeiGene's innovative oncology medicines for cancer patients across India. This is Glenmark's second differentiated product in the oncology segment after Akynzeo IV. Glenmark has also successfully launched differentiated products in other key therapeutic areas over the last six months and has seen good market traction for these launches. In terms of our consumer care business in India, primary sales in Q1 was around INR 870 million, with a growth of 11.3%. The company's flagship brand, Candid Powder, delivered revenue growth of 22% for Q1 and recorded its highest monthly market share of 58.8%. La Shield portfolio delivered YOY secondary sales growth of 10.1%, while Scalpe portfolio witnessed a strong uptake for one of its variants, Scalpe Pro. Moving on to North America. The North America business registered revenue of INR 7,808 million for the first quarter of FY 2025, as against INR 7,557 million for the fourth quarter, which translates to a QoQ growth of 3.3%. North America region contributed 24.1% of the consolidated revenue in Q1. In the first quarter of FY 2025, Glenmark received approval for and launched acetaminophen and ibuprofen tablets and brimonidine tartrate and timolol maleate ophthalmic solution. In addition, the company added a couple of pack sizes to existing products. Glenmark filed 1 ANDA in Q1 FY 2025 and plans to file 2 ANDAs in the upcoming quarter. Glenmark has also leveraged its strong development capabilities in respiratory to build a portfolio. We have mentioned this in the past. The company has already filed 2 ANDAs for generic maintenance phase and is awaiting approval for the same. In addition, the company has also filed the ANDA for generic Flovent 44 MCG. This is a pMDI. This was filed in May 2024. Glenmark is also working on the ANDA filing for the other 2 strengths. As of June 30, 2024, Glenmark's marketing portfolio in the U.S. consists of 196 generic products authorized for distribution. The company currently has 50 applications pending at various stages in the approval process, of which 21 are Para IV applications. Moving on to Europe. Glenmark's Europe operations revenue for the first quarter of FY 2025 was INR 6,957 million, as against INR 5,732 million in Q1 FY 2024. This translates into a YOY growth of 21.4%. Contribution from the Europe region to the consolidated revenue was 21.4% for Q1. Glenmark's Europe operations continues to remain strong in terms of overall business performance. All the key markets for Glenmark in the EU region recorded healthy growth in the first quarter. In CEE, markets like Czech and Poland recorded high double-digit growth, aided by strong performance across key segments. The branded respiratory portfolio, including RYALTRIS, continues to do very well in the CEE region. Growth was also aided by new product launches during the quarter. Western European market also performed well. The generic tender business returned to growth during the first quarter. The company continues to focus on sustaining the increasing contribution from branded markets and branded products in Europe. It is awaiting the approval of four additional respiratory products, which were filed in the fourth quarter of FY 2023, and the company is also planning to launch in 11 select markets in FY 2026. Moving on to ROW region, which consists of Russia, CIS, Latin America, Middle East, Africa, and Asia Pacific. For the first quarter of FY 2025, revenue from the ROW region was INR 5,708 million, as against INR 5,528 million for the corresponding quarter last year, recording a YOY growth of 3.2%. The ROW region contributed 17.6% of the consolidated revenues in Q1. Moving on to market regional data. So as for Russia, as per IQVIA data, Glenmark's Russia business recorded growth of 15%-16% in Q1, as well as MAT June 2024. In terms of key therapeutic areas, Glenmark recorded very strong growth in the dermatology segment, especially versus the market. Glenmark continues to be ranked ninth amongst dermatology companies in Russia and continues to be ranked second in the respiratory expectorants market in Russia as per IQVIA MAT June data. Latin America region also witnessed strong growth in Q1, with the respiratory portfolio being the key contributor. Glenmark maintains a strong position amongst the top companies in the covered market of the chronic respiratory segment in Brazil. Glenmark's also launched the first generic for salmeterol fluticasone MDI in the Brazilian market. And secondly, sales growth is also very strong in the other key market in Latin America, which is Mexico. RYALTRIS has also been approved in Mexico and will be launched soon, along with other respiratory products. In Middle East Africa, the company continued to achieve secondary sales growth in key markets such as Kenya, South Africa. Glenmark continues to be ranked third in the overall pharma market in Kenya. RYALTRIS continues to be the leading nasal spray for allergic rhinitis in South Africa, and the product was also launched in other key markets, such as Kenya and Saudi Arabia in the last couple of quarters. The Asia Pacific region for Glenmark recorded slightly subdued growth in terms of secondary sales across key markets, such as Malaysia, Philippines, Sri Lanka. Glenmark received approvals for multiple new products during the quarter in the respiratory and dermatology segments, and RYALTRIS continues to do quite well in Asia region. Moving on to some of our key global brands, starting with RYALTRIS. As of June 2024, marketing applications for RYALTRIS have been submitted in more than 90 countries across the world. Product has been commercialized in 40 markets. It has received approval and will be launched in 10-11 additional markets over the next one year. Glenmark's commercial partners in the US, Hikma recorded better performance on a YOY basis, backed by strong demand and increasing coverage across pharmacy chains and online platforms, as well as other awareness events. Menarini, Glenmark's partners in the EU, has witnessed steady increase in market share across all its licensed markets. Glenmark's partner in Mainland China, Grand Pharma, has received acceptance of the NDA in February 2024. The company expects approval to be received sometime in FY 2026. As per IQVIA, March 2024 data across markets, RYALTRIS has seen robust performance in terms of both value and unit market shares. The product has achieved high double-digit market share in markets like Australia, Czech Republic, South Africa, Italy, Poland. Further, RYALTRIS continues to witness strong uptake in markets where the product was recently launched across Europe as well as ROW regions. Moving on to envafolimab. As mentioned in January 2024, Glenmark announced the signing of a licensing agreement with Jiangsu Alphamab and 3D Medicines for envafolimab for India, Asia Pacific, Middle East, Africa, Russia, CIS, and Latin America. This product has been approved under the brand name Enweida in China. It is the global first subcutaneous injection PDL-1 inhibitor for the treatment of adult patients with previously treated MSI-H or deficient mismatch repair or dMMR advanced solid tumors. More than 30,000 patients have already benefited from this treatment in China. It has been listed as officially included in the list of basic therapies. Glenmark plans to file envafolimab in more than 20 markets in FY 25, and the first market launch is expected in FY 26. Lastly, WINLEVI. In second quarter of FY 24, as we had announced, that we had signed a distribution licensing agreement for WINLEVI, which is clascoterone 1% in 15 European markets, as well as the U.K. and South Africa. The company is currently awaiting approval in these licensed markets and plans to launch WINLEVI in FY 26. In closing, Glenmark Innovation. As we announced before, all our innovation efforts are being channeled through IGI. And as of June 2024, we have 2 biologic assets in phase 1 clinical development and 1 small molecule in 3 clinics, all in oncology. The clinical assets are progressing well. We have an update, an August update for IGI, which includes some more details on the clinical assets. You can go through the same on the IGI website. Some notes to the results before we open the call for Q&A. Forex loss in the first quarter was INR 22 crore, which was recorded in other expenses. Adjusted for this, the EBITDA margin was 18.8%. R&D expenditure in Q1 FY 2025 was around INR 241 crore, of which $13.8 million was spent for IGI. Consolidated total asset addition to the block in the quarter, in the first quarter, was INR 115 crore, of which tangible asset addition is around INR 88 crore and intangible asset addition is INR 27 crore. Net cash for the period ended June thirtieth, 2024, was at INR 359 crore. In terms of working capital at the end of June 2024, inventory was at INR 2,756 crore, receivables was at INR 2,059 crore, and payables was at INR 2,534 crore. We have the management of Glenmark Pharmaceuticals on the call today, Mr. Glenn Saldanha, Chairman and Managing Director, Mr. V.S. Mani, Executive Director and Global Chief Financial Officer, and Mr. Ashish Kothari, Group Vice President and Head of Corporate Strategy. With that, we can open the call for Q&A. Over to you, over to you, Lizanne. Thank you. Ladies and gentlemen, we will now begin with the question and answer session. Anyone wishing to ask a question, may please press star and one on your touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Damayanti Kerai from HSBC. Please go ahead. Hi, good morning, and thank you for the opportunity. My first question is, that you have seen good pickup in India, so that's, I guess, very comforting. But looking at U.S., I guess, still remains bit soft. So what are your expectation on U.S. sales recovery, and how do you see, like, do you have any visibility on FDA regulation for Monroe plant? Sure. So, the U.S. business, you know, continues to remain challenging, but I think the second half of this year, right, once we get our respiratory products approved, right, I think that's when you'll really see the recovery, right? As you know, we have a number of respiratory products which are filed, and we are waiting for approval. So as and when that happens, you'll see a significant recovery for the U.S. business. As regards to the Monroe facility, the FDA has given us a meeting in September. So we are hoping that, you know, it'll there onwards, the facility will restart. Okay. So better, US you should be observing, starting second half. So even if, say, Monroe takes some time, you mentioned you have, a couple of respiratory products. If those come, those should be sufficient to, may contribute meaningfully and then, see better US sales? That's correct. Okay. Then, a question on margins. This quarter, obviously, you have delivered, healthy margins, but moving from, say, close to 18% margin in 1Q, you have given guidance of 19, 19% for the full year. Which will be the key contributors, if you can just, update us on those? So, thanks for the question, Damayanti. So obviously, we had, in this quarter also, adjusted for Forex, we are almost 18.8. We have guided to about 19%. Obviously, the key contributors will be, obviously, India continues to do well. India is a high-margin market. Besides that, our product RYALTRIS continues to do well. Last year, we had guided to almost $80 million of sales this year, and, as earlier we alluded, we have already filed it in a number of markets, and some key filings are also coming up across various geographies. So I think, and also a number of respiratory products that we are hoping to get approved and launched in Europe as well. So I think all in all, all this put together, that gives us the confidence to come very close. Besides, as you see, you can see even our R&D expenses are lower compared to last year as well, so all this should help us to reach close to 19%. Sure. Just a question- Sorry, just to add, so typically our second half is a little better because of the respiratory products getting further uptick, so margin profile also will accordingly be slightly better in H2. Okay. Just a question on your R&D spend for innovation, IGI. So, is this the level, like, you can sustain, or do you have further room to reduce it? I think for this year, you know, we will be around the same level, so around INR 55 million full year. Next year, if you look at our investor presentation, right, we're clearly guiding towards... I mean, I think, you know, if we do a partnership, automatically, you know, these numbers will further reduce substantially in FY 2026. This year, our goal with IGI is to get to POC and, you know, we are seeing some very good data on 2001, which we will present at ASH. And next year, you should see, you know, some partnership activity, right? I mean, that's the roadmap for IGI. Sure. Thank you for your response. I'll get back in the queue. Thank you. The next question is from the line of Prashant Manudhane from Motilal Oswal Financial Services. Please go ahead. Thanks for the opportunity. So just extending on this, USFDA thing, if you could also, highlight what's happening with respect to Goa and Baddi site? So we've completed the remediation for Goa, and you know, we will be you know, liaising with the FDA to come and inspect us, right? I mean, that's kind of where we stand with Goa. Regarding Baddi, for the time being, you know, our focus for the US market from the Baddi site is reduced. So it's not that significant for us. Basically, the four major sites for the US market for Glenmark are Goa, Indore, Aurangabad, and now Monroe, right? These are the four sites which we supply the US market. Also, keep in mind now, US market is 24% of total sales, right, for Glenmark, right? Given the European performance, right, we are thinking that the European business could be as big as, almost as big as the US business by the end of this year. So there's a big shift in the overall revenues for the company, if you, if you look at the overall picture. Understood, sir. So, further this, the gross margin, even on a quarter-on-quarter basis, where our India and Europe sales has been higher, still the gross margin is sort of lower, if I think about it on a quarter-on-quarter basis. Whereas even the raw material cost has been relatively, subdued or soft, at least as far as the industry-wide phenomenon is, goes. So if you could explain that. Yeah, yeah, sure. So, sure. So, I mean, compared to quarter-to-quarter, it was almost 67% in the last quarter. I also I also guided at that time, it can always be ±1%, depending on product mix, yield, et cetera. On an overall basis, we would like to guide that will always be close to 65%-67%, give and take a percentage here or there. That's how we look at it. Understood, sir. And if you could also call out how much has been the retail sales overall for the quarter? It's closer to INR 20 million in this quarter. How big this potential can be for China market? So I think, look, I address for a full year, right? We anticipate close to $80 million of sales, right? We are pretty much on track to achieving that, right. I think China, some of the new markets, we are still not guiding towards, but the launch is still a year or two away. So we have 3-4 markets which are still to be launched, you know, starting next year, which is mainly China, Brazil, and a couple of other major markets, right, which will start contributing. Understood. And just lastly on Winlevi, like, the launch is still in FY 2026, so anything, any major milestone to be achieved before we go ahead with the launch, given that it's taking almost 3-4 quarters? I mean, it's just we're waiting for the approval from the European agencies. Then we have price approval to be taken, that takes its own time. So it's all the pre-launch activities that we are working on. There's nothing beyond that to look at. And in some markets, we could launch end of this year, but conservatively, we are saying FY 2026. Understood. That's it. Thank you. Thank you. A reminder to the participants, anyone wishing to ask a question, may please press star and one. The next question is from the line of Kunal Randeria from Axis Capital. Please go ahead. Hi. Good morning. So first, in the India business, you launched liraglutide in January. I just want to understand how that launch been progressing. So I think the liraglutide is a great opportunity. We are still challenged with some supply issues as and when we have sought that it should be a good product to have in the portfolio. Currently, the initial uptake is very good for the product. Can I know what's the market size, and the generic market size? So Kunal, the whole GLP-1 market is. It is about, I think, INR 1,000 crore as per IQVIA. But I mean, that's not a good reference point because it's still very much under-penetrated. Also, I mean, keep in mind, liraglutide is a daily injection, whereas Sema and some of the others are weekly injections and beyond. So it's a great product to have in the portfolio. It will do well. However, you know, with semaglutide and some of the other GLP-1s, eventually, you know, the focus will shift to the other GLP-1s over time. Sure. Sure. Sure. So then, if I understand correctly, genetic could increase the volume, but then it will be offset by some of the existing, you know, patients moving to Sema and all. So there's not really much scope from a revenue perspective to increase the market size? No, there is scope, and, that, that's something you will see in the second half of this year, as we will continue to gain market share on liraglutide in the second half, right? But I think keep in mind that, semaglutide goes off patent in 2026, so there will be some shift which will happen, between lira, Sema, and some of the other, antidiabetic treatments, right, post 2026. ... Yeah, got you. Okay, second again on India. So while 12% growth is quite strong, ICYI shows somewhere around 15%-16% in the last few months. So just want to understand, you know, what led to the discrepancy? It's hard to—I mean, look, our India growth is strong. The takeaway message is that we are outperforming the market, you know, consistently, and that will sustain, I think, going forward. So we are seeing strong growth in all our therapeutic segments that we operate in. And except for acute respiratory and diabetes, these are the two segments where there was a, you know, slight struggle in Q1, which we think will change over the course of the year. India growth, all in all, is strong, right? But I think overall, you should peg us at, you know, 10%-15%, right? 10 to somewhere thereabout, right, for the full—on a full year basis. Sure. Sure. And just one for Mani Sir. The depreciation and the tax were quite low in the quarter. So, if you can just run us through what happened and what the expectations are for the rest of the year and next year, too? So, just to give you our guidance broadly, the depreciation and tax, as well as interest, all these should be pretty consistent throughout the year, that we see in Q1. And as far as depreciation goes, as you know, last year we did have some of the, you know, write-downs, et cetera. So all that helped us to bring down the depreciation. Plus, obviously, you can see in the Q1 also, there has not been too much addition to the block. So I think we'll see how the year progresses, but broadly, this is where it should be. As far as the tax goes, even last quarter, last year, I kind of indicated and guided that we be in 25%-27%. That's where we'll be, yeah. So what is driving lower tax? I I mean, US would still be making losses, right? Perhaps Ichnos losses have come down, but what's driving this? Yeah, but some of the other, you know, like, rentals, et cetera, are doing well. Some of them are based out of Europe, et cetera. So some of those places, the tax rates are a little lower. So that helps us a lot, yeah. All right. Thanks. Thank you. Before we take the next question, we would like to remind participants that you may press star and one to ask a question. The next question is from the line of Nithin Agarwal from Dam Capital. Please go ahead. Hi, thanks for taking my question. Glenn, so on Ichnos, you know, what should we look forward to in Ichnos over the next 12-18 months? Any milestones and by when do you should expect them to play out? So Nithin, I, you know, as I mentioned, right, 2001 is doing really well for us, and we will do a presentation at the ASH conference, right, in December, right? At that conference, we will put out our clinical data, which should generate quite a lot of excitement in the community. So that's the near-term thing, and then after that, of course, the goal is to to do a partnership sometime next year, around 2001. When is the readout for the other molecules expected, Glenn? So currently, there are two which are in active clinical trial, right? It's 2001 and 1442. 1442 is taking a little longer to get to POC, but 2001 is ahead right now. So that'll be the first followed by 1442. These are the two in clinical development. 1342, you know, we are not doing any more clinical work, but we are actively looking for partnerships around 1342. Are there any other assets which are in pre-clinical assets that you're looking to build out or sort of to grow through as we go along? Near term is, it's just these three that we're talking about, Nithin. Okay. And secondly, Glen, on, on the US now, obviously, you talked about the fact that it's become like a less than half quarter of the business now. Again, strategically, how do you look at US now? What kind of investment in the generic part are you looking to make, and where do you see opportunities, if any, in the US business yourselves? I mean, clearly on the U.S. business, you know, the near term, the next 2, 3 years will be driven by our respiratory launches, and the injectables coming out of Monroe. These are the two drivers, right, that we have for the U.S. business. Following that, we have some sole FTFs, you know, like Gabapentin Enacarbil, beta calciform. So these are some of them. We have a unique position on Axitinib. So I think these 2, 3. There are some very select products, but I think post H2 of this year, the U.S. business should start showing some good traction, right, in the second half of this year and beyond, right? Mainly coming out of some of these, these unique launches, right, that we have for the U.S. business. Glen, what are the timelines of some of these launches that you mentioned? So H2 is broadly what I can give you, Nithin. I can't be more specific than that. Okay. Lastly, Manisha, on the cash flows, you know, what is your outlook for the working capital now for the year? Where do we see it ending the year at? So Nithin, as we kind of given during the fourth call, we had guided that we will be closer to 22-25 days. So as of now, I'd say we are at about 62 days. So I believe that that could become updated, because as you can see, the business is also growing. ...and we may have some little more increase in the working capital side, especially on the receivable side, yeah. All in all, we should 70-75 days is what we should work through over, you know, on a sustained sort of. Yeah, 75 days is the idea. Okay. Thank you, sir. Thank you. A reminder to the participants, anyone wishing to ask a question, may please press star and one. Participants, if you wish to ask a question, you may please press star and one. If there are no further questions, I now hand the conference over to Mr. Utkarsh Gandhi for his closing comments. Take the call. Okay, thanks. Thanks, Lizanne. So before we end the call, we'd just like to state that the discussion materials provided during today's call, including information, statements and analysis, made describing company's or its affiliates, objectives, projections and estimates are forward-looking statements. These are based on current expectations, forecasts and assumptions that are subject to risk and uncertainties, which could cause the actual outcomes to differ. No representation or warranty, either expressed or implied, is provided in relation to these discussions, and it should not be treated by the recipient as a substitute for the exercise of their own judgment. The company also does not undertake any obligation to update or revise any forward-looking statements. With that, we can close today's call. Thanks a lot for your participation. Thank you, members of the management team. Ladies and gentlemen, on behalf of Glenmark Pharmaceuticals Limited, that concludes this conference call. We thank you for joining us, and you may now disconnect your lines. Thank you. Thank you.