Amneal Pharmaceuticals, Inc. Q3 FY2023 Earnings Call

Good morning, and welcome to the Amneal Third Quarter 2023 Earnings Call. I will now turn the call over to Amneal Head of Investor Relations, Anthony DiMeo.

Good morning, and thank you for joining Amneal Pharmaceuticals Third Quarter 2023 Earnings Call. Today, we issued a press release reporting our Q3 results. We announced certain unaudited preliminary results for Q3 on October 23. Our earnings press release and presentation are available at amneal.com. Certain statements made on this call regarding matters that are not historical facts, including, but not limited to management's outlook or predictions are forward-looking statements that are based solely on information that is now available to us. Please see the section entitled Cautionary Statements on Forward-Looking Statements in the earnings presentation and our SEC filings for a discussion of factors that may impact our future performance. We also discuss non-GAAP measures. Information on our use of these measures and reconciliations to US GAAP are in the earnings presentation. On the call today are Chirag and Chintu Patel, Co-Founders and Co-CEOs, Tasos Konidaris, CFO; our commercial leaders, Andy Boyer for Generics, Joe Renda for Specialty, Harsher Singh for Biosciences; and Jason Daly, Chief Legal Officer. I will now hand the call over to Chirag.

Thank you, Tony and good morning everyone. We delivered another very strong quarter with $620 million of revenue, which is up 14%, adjusted EBITDA of $154 million, up 22% and adjusted EPS of $0.19, up 36%. We saw growth in all three of our business segments and reduced net leverage to 4.6 times. Given the strength of our year-to-date performance, we are pleased again to raise our full year 2023 guidance. We are excited about our continued momentum, which underscores the strength of our strategy and solid execution. As we have discussed throughout the year, we believe Amneal is at an inflection point, poised to drive significant top and bottom line in 2024 and beyond. I'll start with a quick overview of our company and then walk through what we saw in each of our businesses during the third quarter. At a high level, Amneal is a world-class global diversified pharmaceutical company, fulfilling our mission to provide access to high-quality and affordable essential medicines. In our affordable medicines business, our generic segment, we have retail, injectables, biosimilars and international. Our strategy continues to focus on expanding our portfolio with impactful complex and high-value products. For the first nine months of 2023, generics revenues were up 7% compared to last year, reflecting a meaningful acceleration from the steady 3% CAGR we delivered from 2019 to 2022. We expect high single-digit top line growth in generics to continue, driven by our diverse portfolio and cadence of over 30 new product launches every year. In injectables, our goal is to be top five in the United States institutional market. There are two key factors that we believe differentiate Amneal and will drive our success. The first is expanding capacity and capabilities and the second is an expanding portfolio. In 2023, we have executed on both. We successfully brought online two new sites, which doubled our manufacturing capacity. Currently, we have 35 commercial injectables with over 25 new launches planned by 2025, as we continue increasing production and expanding our portfolio in a market plagued by shortages, we are well positioned for higher injectables revenues in 2024 and over $300 million by 2025. In biosimilars, our three commercial products continue to see strong uptake. Our largest product ALYMSYS was at 6% market share as of September, which is remarkable in the first three quarters post launch. We expect $60 million in biosimilar sales this year more than double that next year and over $200 million in 2025. In addition, we expanded our partnership with mAbxience who we work with on ALYMSYS to add two formulations of denosumab and an oncology biosimilar to our pipeline. This is part of the next basket of biosimilars for Amneal. By 2024, we look to add two to three more biosimilars to the pipeline. We see biosimilars as the next wave of affordable medicines and are committed to being a leader in this space. Internationally, we are leveraging our US FDA approved portfolio to expand our reach and drive profitable growth. In India, we have our local infrastructure and are expanding our local portfolio. In other geographies, we are working with partners to commercialize our products. For example, we now have two products approved in China. We expect international expansion will add $50 million to $100 million in revenues by 2027 and scale further over time. In our affordable innovations business, our specialty segment, we are focused on neurology and endocrinology therapeutic areas. Our commercial teams continue to drive growth in our key branded products RYTARY for Parkinson's and UNITHROID for hypothyroidism. As you know we received a CRL for IPX-203 seeking additional data in July. I'm pleased to report that we had a successful Type A meeting with the FDA last month and we are working diligently towards the 2024 approval and launch which Chintu will discuss shortly. We expect specialty revenues to be over $500 million by 2027. Finally, in our healthcare segment, we continue to see robust growth across all three channels: distribution, government VA/DoD, and unit dose. We expect AvKARE revenue of $500 million in 2023 and over $600 million by 2025. I'll now pass it to Chintu.

Good morning, everyone. Thank you, Chirag, and thank you to the global Amneal family who work hard every day to help make health possible for so many. We are laser-focused on executing our strategy to be an innovative and diversified global pharmaceutical company capable of driving sustainable growth in the key areas of medicine. The successes of 2023 are clear proof points that we are on the right track. I will touch on how operational excellence, strong supply chain and a highly productive R&D engine profile our strategy. First, we remain focused on driving operational excellence and efficiency as Amneal has one of the best service levels in the industry. As part of our efforts to drive continuous cost efficiencies globally, we are transferring production for about 30 products for cost improvement and also working on many operational excellence programs for long-term savings. In addition, we have strengthened our supply chain by expanding our infrastructure, particularly in injectables. We have doubled our injectables capacity with four facilities and 19 production lines while the injectables market continues to face supply shortages. Importantly, about 30 of our commercial ANDA and pipeline injectable products are on the US FDA shortage list. Amneal is very well positioned to help address drug shortages in the US. At the same time, we remain committed to maintaining our stellar quality track record. Since 2005, the US FDA has conducted nearly 100 successful inspections with no observations or only minor 483s. Overall, our high-quality global operations are at scale to support sustainable long-term growth. Second, innovation is the lifeblood of any growing pharmaceuticals company and that's certainly the case for Amneal. In generics, we are on track for over 40 new launches in 2023 with 33 year-to-date. This is well above our normal cadence of 30 per year. Also, it's more than just the number of new launches. It is the complexity of these products, less competitors, and the increased value of our diversified portfolio. Our pipeline is deep with 166 products pending approval or in development. Accordingly, we expect over 30 new launches next year and for years after that. In addition, while we have shifted towards complex innovations, we have also improved the efficiency of our R&D operations. We are doing more R&D with less spend, which results in a better ROI on projects. Let me share some more details on R&D. Overall, we have 88 ANDAs pending with the FDA, of which 64% are non-oral solid products. Behind that, we have 78 pipeline products, of which 90% are non-oral solids. We have shifted our focus to high-value complex categories with approximately 45% of pending ANDAs and over 60% of our pipeline expected to be first to market, first-to-file or 505(b)(2) products. In injectables, we have launched 10 new products year-to-date including two high-value products in Q3 with potassium phosphate and calcium gluconate bags. Also, we recently received approval for methylprednisolone acetate, which is in shortage. Further, we are advancing a number of complex injectables in our pipeline. In Q3, we filed our first 505(b)(2) ready-to-use bags as planned. We expect to file several long-acting injectables in the near-term as well. As a result, we expect a strong cadence of impactful new injectables to continue in 2024, including the launch of already approved Pemry-DRTU. After injectables, we see inhalation as Amneal’s next key growth area in complex generics. Our pending ANDA for a generic version of Narcan is under priority review and we look to launch in the coming months upon approval. This important over-the-counter product improves access to a critical overdose treatment. In addition, we have two key meter-dose inhaler ANDAs pending for generic versions of QR and Pro. In biosimilars, our first three oncology products are seeing excellent uptake and we have added two additional molecules to the pipeline. We are also evaluating opportunities to be vertically integrated over time. Please see our catalyst slide for the list of recent and upcoming launches. Turning to specialty R&D, we continue to work to advance our 505(b)(2) pipeline. On IPX203 as Chirag highlighted, we had a successful Type A meeting with the FDA last month to align on the path to approval. As agreed with the FDA, we are in the process of completing a small routine QT study in healthy patients. We will complete the study in the coming months and we will resubmit our NDA in early 2024. We are working diligently towards an IPX203 launch in the second half of 2024 pending FDA approval. We continue to see IPX203 as a critical innovation that meaningfully advances the standard of care for Parkinson's patients. In summary, we are driving operational excellence and executing our innovation strategy, which together are fueling our ability to drive sustainable growth. I will now hand it over to Tasos.

Thank you, Chintu. Let me first start with the four pillars of value creation from Amneal. That is diversification, strong financial performance, cash generation; and fourth overall debt reduction. First starting with increased diversification. Chirag and Chintu touched on this throughout the overview of Amneal's strategy and business highlights. Since 2019, the portfolio is remarkably more diversified with new lines of business. In 2019, oral solid generics represented 53% of total revenue. Now in 2023 with new complex generic launches, growth in injectables and specialty and the addition of biosimilars in AvKARE, the portion of oral solid generic revenue is less than half of that at only 26% of the total company revenues. The higher level of diversification was intentional and driven by our desire to deliver consistent financial performance despite the typical ups and downs of any business. As a result, our diversified portfolio is driving sustainable higher levels of growth and profitability, as well as increased future visibility. Let me now move to our second pillar, strong financial performance. As an example, since 2019, our annual revenues have increased by over $800 million or 50% while adjusted EBITDA is up about $200 million or 60%. Consequently, our third quarter strong financial performance is not an isolated event and reflects strong execution across our strategic choices for a number of quarters and years. Let me now go into a bit more detail of our third quarter results. Total net revenue was $620 million, growing 14%. Adjusted EBITDA of $154 million growing 22%, adjusted EPS of $0.19 growing 36%. All three business segments grew revenue substantially this quarter. Q3 Generics net revenue was $391 million, growing 12% driven by our new biosimilars and new complex generics as new launches in 2023 and 2022 added $14 million in Q3 revenue growth. The acceleration in generics growth in 2023 reflects the continued shift towards a diverse complex portfolio and the addition of key new products that have contributed to growth. Next, in Specialty, net revenue was $97 million, growing 9% driven by Unithroid and Rytary. Q3 AvKARE net revenue of $132 million grew 25% reflecting strong execution in new product introductions by the team. Q3 adjusted EBITDA of $154 million reflects strong revenues, durable gross margins and tight expense management. Looking at our Q3 year-to-date results, total company revenue growth is 11%, with generics up 7% and specialty growing at 5% and AvKARE growing at 28%. Combined with stable gross margins and operating expense leverage, year-to-date adjusted EBITDA grew 16% and adjusted EPS grew 11%. Let me now move to our 2023 full year guidance, where given the continued strong performance across the business, we're raising our full year 2023 expectations again this quarter. We now expect net revenue of $2.37 billion to $2.42 billion, which reflects high single-digit revenue growth. Due to higher revenues, we are raising our 2023 adjusted EBITDA guidance to $540 million to $550 million and adjusted EPS range between $0.51 and $0.55. Let me now move on to how strong financial performance is translating into the third pillar of value creation; that is higher cash generation. In 2023, in conjunction with higher profitability and our efforts to drive working capital improvements, our center year-to-date operating cash flow on an underlying basis has grown about 40% to $295 million compared to $213 million for the first nine months of 2022. Going forward, we're focused on converting an increased amount of higher EBITDA to operating cash flow, as a fraction of targeting further working capital improvements and thoughtful CapEx investments. In addition, as you may have noticed on Form 8-K, we filed on October 17, we made important progress on a key legacy item; that is, transitioning from an Up-C Corp structure to a more traditional C-Corp structure. This transition was highly technical in nature but has substantial cash flow benefits to our company as it enhances investor transparency and reduces complexity by having only one class of common stock. This leads me to the fourth pillar of value creation and that is deleveraging. With higher cash generation and many of the historical improvements investments to expand our portfolio and infrastructure already made, we're in a very good position to further reduce debt. From 2019 to now, net leverage has come down from 7.4 times to 4.6 times in the most recent quarter. We're focused on delivering consistent debt reduction over the course of time and we feel confident in our ability to achieve net debt to adjusted EBITDA below 4 times in 2025. I hope this overview of the key pillars of value creation for Amneal. Going forward, we're confident that the increased diversification of our business, strong financial performance, higher cash generation and further deleveraging will create substantial value. Let me now hand it back to Chirag.

Thank you, Tasos. In summary, Amneal has never been in a better position to drive substantial sustainable long-term growth and we believe the best days are ahead for our company. Let's now open it up for Q&A.

Thank you. We will now take our last question from Balaji Prasad from Barclays. Balaji, your line is now open. Please go ahead.

Operator, we can go to the next participant and put Balaji back in queue. Thank you.

Okay. No problem. We will now take our next question from David.

I wanted to ask about AvKARE and its role in the organization moving forward. Do you believe it might become a non-core business over time? How do you view it strategically? Additionally, regarding injectables and the launches you mentioned, are these primarily shortage products or a combination of shortage and complex products? I'm trying to get a better understanding of the product mix for injectables and what the margin structure for injectables will look like compared to your overall corporate margin structure. Thank you.

Hey, David, how are you? Good morning. On AvKARE, we are one of the few remaining US manufacturers, and most of our business comes from TAA compliant products. This is a strategic area for us. As you can see, our product offerings are expanding with VARD, and we also have a niche in unit dose. We have a partner who is an expert in this field managing the business. While it may be challenging to define what is core versus non-core, this is very strategic for us, and we are open to exploring options in the future. It is a strong and highly profitable business, and we are fully committed to it. Now, I will hand it over to my brother, who will pass it to Harsher.

Hi, David. Good morning. Regarding Injectables, we have a large portfolio and have invested over the past two years to enhance our research and development capabilities and infrastructure. We offer a wide range of dosage forms, including PFS, large bags, auto injectors, liposomal peptides, and microspheres. These categories are complex, and some involve high volumes. We now have the capacity to engage in both value and volume strategies in the injectable space moving forward, with our current capacity at approximately $20 million to $25 million, while our PFS product range has increased to about $70 million. This marks a significant shift. In response to shortages, we currently have around 30 products awaiting approvals that are already approved. Products experiencing shortages fluctuate, but Amneal is very committed to addressing these issues. Whenever we have a product ready, we work to help alleviate shortages. Regarding your question about launches, it’s a mix; some are first-to-market while others are complex products like MPA multidose. This blend will characterize our future offerings, and we are aiming to launch 20 new injectable products in 2024. We have a robust pipeline that we expect to grow to about 80 products by 2025. Harsher, do you have anything to add?

David, I want to clarify your comment. Shortages and complex products are not mutually exclusive. In fact, the most significant shortages often occur in complex products. Over the past six months, we have launched a good representation of our portfolio, including premixed bags of electrolytes, which face long-term structural issues in the market that we aim to address, alongside single product opportunities where we excel, like corticosteroids and methylprednisolone. You can expect us to continue on this path.

And David on the margin.

If I may just – yes, final one.

It's okay. Your last point goes to impact the margin. So injectables in general and the areas we play are just they're going to be accretive to the overall gross margin of the company. So this is one of the reasons why we think about the future we feel confident about enhancing and increasing our financials not only top line profitability and adjusted EBITDA and cash growth.

Okay. Got it. That was my last question. Thank you.

Thanks, David.

Thank you, David. We will now take our next question from Leszek Sulewski from Truist.

Good morning. Thank you for taking my questions. Just first on the Rytary front the script growth has been good. I call the sales page was a bit light. So just perhaps maybe walk us through some of the pricing dynamics in 3Q. Was there any discounting in the GTN front? And then secondarily on the IPX 203, can you provide a little bit more details around the feedback from the FDA regarding your Type A meeting and the study design that you expect for that? And then also how are you thinking about the commercial launch in the second half?

Great. Thank you, Les. I'm going to have our Chief Commercial Officer, Joe Renda answer the Rytary question and then we'll move to my brother for IPX two or three more details please?

Yes. Regarding Rytary, our contracting strategy remains unchanged. We are still fortunate to have the best coverage among prescription products in the Parkinson's market, with approximately 70 percent commercial coverage and about 60 percent Part D coverage. The growth we've experienced has primarily occurred in the latter part of the year. For example, in Q3 and Q4, our new prescription growth is around 20 to 22 percent, significantly higher than the same period last year. We are observing growth in both new prescriptions and total prescriptions for Rytary. We are very pleased with the trends as we conclude this year, and overall, it appears our growth will surpass what we have seen in previous years with Rytary.

And last just on your point about the quarterly gross to net yes we had about $5 million $6 million of over unfavorable kind of timing gross to net adjustment related to Medicare rebates. So that's why probably the quarterly net revenue growth is a little less of the kind of volume growth. But that's behind us and it was more of a one-time event.

We had a very successful Type A meeting regarding IPX203 to clarify our path with the FDA. The main topic of discussion was the safety data for carbidopa, which we successfully addressed with one year of safety information. The FDA is on board with our data and presentations. There’s only one outstanding question since carbidopa is an older molecule, requiring us to conduct a QT study. We will begin a small routine QT study with 30 healthy patients very soon, and we aim to complete this study and submit our file in the first half of 2024, with plans to launch the product in the second half of 2024. We are fully prepared for both the commercial and manufacturing aspects, and the product is ready to be introduced. We are genuinely excited about IPX203 and the benefits it offers to patients.

Yes, the value is significantly broader than that of Rytary. We are targeting a patient population of 1 million, with 90,000 new patients each year. This represents a large market, and we aim to shift the prescribing habits from immediate-release formulations to IPX203, which offers a superior formulation. It provides a longer-lasting efficacy each day, substantially improving patients' daily lives. We have extensive data to support this and have not yet marketed to a wider audience. We are prepared for our marketing strategy and have learned valuable lessons from the Rytary launch. There is considerable support for this product as clinicians have observed its positive results. An extremely exciting launch is on the horizon, not only in the United States but also in Europe, where IR is currently the only offering. This is very much needed for Parkinson's patients in that region. Globally, we are committed to our mission of providing life-changing medications with affordable access to the entire population. We are thrilled about this and are preparing our filing response as we move forward.

Got it. Thank you for that color. One —

Go ahead, Les. Do you have a follow-up?

Sorry, I muted his line. Let me put his line back up. Sorry, Leszek, your line is now open. Please continue.

Can you hear me?

We can Les. Go ahead.

Yes. We can hear you now.

Okay. That seems to be a lot of feedback on line. My follow-up question was regarding your recent refinancing agreement. So can you just perhaps walk us through some of the key aspects and changes in the covenants and things of that nature? Thank you.

Yes. Thanks, Les. So we're pleased to report that after as you know refinancing our term loan B, which was due May of 2025 was one of our key priorities of this year. And I think we're very pleased with the outcome so far. So after just a lot of very positive support from our existing lenders and a number of new lenders we successfully priced and allocated about $2.3 billion, which is about 90% of our Term Loan B. And with that, the key thing was we extended the maturity by three years to May of 2028. So essentially a couple of hundred million dollars are due in May of 2025 and $2.3 billion have been pushed out to May 2028. It's essentially 4.5 years from now which gives us a substantial amount of additional runway for the company to continue the diversification path that we began a few years ago, increasing our cash generation that I spoke of and reducing both absolute debt and net debt to adjusted EBITDA. As we expected, the pricing was pretty much in line with our expectations. So you may have seen on Bloomberg, made it was software plus 550 basis points. That's a couple hundred to 200 basis points over the existing loans. So that was within our expectations. So that leads to about $50 million of increase in interest expense, which the unwinding of BPC I spoke about will more than offset that increase. So from an overall cash perspective that increase in interest expense, which we fully expect will be more than offset by our change in corporate structure, which will save us about $60 million plus year-over-year. In terms of covenants and so forth, there isn't anything or none of the big material changes that I can fully recall. And the final thing I would mention is as we need to keep in mind that our interest expense growth is limited, partially because $3 billion of our debt is fixed. So we have a swap in place, and we were able to amend that swap to kind of reduce our interest expense associated with this refinancing. So, a great outcome from our perspective. I'm going to thank both our existing lenders and our term loan for being supportive and working with us over the last few months, because as we know the capital markets held be pretty choppy.

Great. Thank you.

Thank you, Les. We will now take our next question from Nathan Rich from Goldman Sachs. Your line is now open. Please go ahead.

Hi. Good morning. This is Sarah on for Nate. Thank you so much for taking our question. I first wanted to start on the new corporate structure and the cash flow implications. Can you just talk about the peak expected restructuring savings and also the time line to realize these synergies?

Sure. Good morning, Sarah. It took us a couple of years to fully adapt to the legacy structure and find the best approach for all our shareholders. We expect to implement the change tonight, so we will have the new corporate structure in place, and the savings will be immediate. We anticipate annual savings of about $60 million in cash. Historically, significant amounts of cash were exiting the company related to financing, but now those savings will be realized and will benefit the company right away with the tax distribution payments starting tonight. It's a great outcome. Unlike some companies that incur substantial costs to change their structure, we were able to unwind ours at no cost, and we are very pleased with the result.

That's really helpful. Thank you. And then, I just wanted to dive into the strong AvKARE growth and the segment's operating margin improvement. So can you talk about what drove the significant margin uplift in the quarter? And then also, I know GLP-1s have been a big area of focus. Is this also contributing to the strength in this segment?

Let me address this. We acquired 65% of AvKARE on January 30, 2020. Since then, despite challenges like COVID, that business has shown remarkable resilience and growth. First, we aimed to leverage MBL's product pipeline to enhance AvKARE's growth, which has been successful. There has been significant product flow between ML and AvKARE, creating substantial value for patients and customers. The growth is driven by several factors. Firstly, there's overall demand in the marketplace as the population ages, which provides a natural advantage. Secondly, following COVID, there is greater product availability from both Amneal and third-party providers that AvKARE collaborates with, allowing for new product introductions. Additionally, AvKARE has capitalized on market certainties related to injectables and complex products, allowing for strategic pricing this year. This explains the increase in gross margin performance compared to prior years. Overall, these factors have contributed to AvKARE's strong growth, and while we may not see a consistent 25% to 30% annual top-line growth, we definitely anticipate robust double-digit growth in the coming years.

Yes. So, Sara, I just want to clarify that AvKARE is a niche government distribution business for VA/DoD where you have to invest in product development, product partnership way in advance. So, it's a value-added distribution, not just simple distribution. We do not distribute GLP-1s or anything. So, the growth is from value-added generics products from Amneal as well as other suppliers that AvKARE is set to do government contracting for long-term national contracts as well as FSS schedules and their unit dose business with the hospitals is growing as well.

That’s really helpful. Thank you.

Thank you. We will now take our next question from Balaji Prasad from Barclays. Balaji, your line is now open, please go ahead.

Thank you. Good morning everyone, and I apologize for missing previous opportunities. I appreciate it. I have a couple of questions. Firstly, it's impressive to see the company's developments over the past few years, particularly in the last two quarters where the transformation has been substantial. As I look ahead to the next one or two years, I would like to understand the factors affecting cash flow outflows for 2024 and 2025, so we can analyze cash flow trends for the upcoming years. Also, you have certainly changed the conventional generic model by targeting markets in India and China. I would like to know how significant these markets can be, given that they are markedly different. India appears to be on a strong growth trajectory, while China seems to be stagnating. How would you approach these markets differently? Thank you.

Good morning, Balaji. I'll address the first question. We believe that in the coming years we will see growth in revenue, EBITDA, and cash flow. This year, our cash to EBITDA ratio improved significantly compared to previous years, exceeding 50% due to our intentional efforts on working capital improvements. We expect this trend to continue, so as EBITDA rises, operating cash will also increase. Regarding capital expenditures, we are operating at scale, typically spending between $50 million and $60 million, which may fluctuate slightly but is not expected to change significantly. We anticipate an increase in interest expenses, estimated at around $50 million year-over-year. However, we will also save over $60 million in cash distributions related to the APC unwound, resulting in a net positive impact of approximately $10 million to $15 million. As for legacy issues, we have been focused on resolving them. In 2019, we, along with the industry, faced significant liabilities with unclear details. A couple of years ago, we settled the Opana ER case, which resulted in a payment of over $130 million last year and an $86 million payment this year, with only one remaining payment of $50 million due in January 2024. This means we will face a $30 million reduction in liabilities related to Opana ER from 2023 to 2024, which is favorable. Once Opana is resolved, we will shift our focus to opioid-related liabilities. Our team has estimated a potential liability of about $22 million, although this could vary. Such liabilities typically settle over a long time, so we don’t expect them to significantly impact any single fiscal year. Overall, when considering all these elements, we expect to retain more cash in the company over the next few years compared to previous years.

Thank you, Tasos. And the International Balaji, we have two strategies we have. One is using Amneal's own portfolio which is very huge on injectables and the retail side as well as in the future it could be biosimilars. We are partnering in Europe. We have Orion, a 100 years old Finland Company as our partner. So we're working through their sales channel to sell Amneal's products. In the Middle East, we just signed up multiple partnerships. So we'll be selling Ennis products in the Middle East and US FDA approved sites approved products obviously have a more premium than the other products. We have finalized our term sheets in Southeast Asia as well and are going now to South America Canada. So we'll cover pretty much the entire world some parts of Africa as well. And basically it would be incremental revenue of Amneal's products, which are sold in the United States. So that's the first strategy which we expect to go to $50 million to $100 million plus it will keep growing because we have more and more products that we are launching. And again, complex products in international markets are very good. We are not taking every product out there. It has to obviously make certain margins for us. And the second strategy is India strategy. That is a stand-alone strategy. We have direct marketing. We have spent quite a bit of time understanding the market and we have launched our sales forces in hospitals several products including diagnostics in hospitals. And now we have just expanded ophthalmology, the eye care products portfolio in India and we will be entering oncology and CNS as well. So, pretty broad strategy because we believe India is growing at 14% to 15% every year from a market and it has even more room to grow. So, we want to be part of that growth journey, and we have the science. We have the company's reputation and setup in India. So, we believe India can become a substantial market. It's very small today like $10 million but it can go pretty long way in India. So, that's the international strategy we have.

Just Balaji to add one thing in India. We are looking at beyond our current portfolio especially in rare diseases and some other unmet areas in India because there is a huge unmet needs on many, many products. So, we are looking at certain branded aspects of product development and launching India specifics and that looks pretty exciting in that space, because there is a lot more awareness affordability and people are talking about health and prevention than the previous time. And the India market is shaping up very differently than what we have seen before. So we want to be there and we want to be a value-added something that is unique and new.

Thank you all.

Thank you, Balaji. We have no further questions registered today. So with that, I will hand over to Chirag Patel for final remarks.

Well, thank you very much everybody and have a nice day.

This concludes today's call. Thank you all for your participation. You may now disconnect your lines.