Glenmark Pharmaceuticals Limited (GLENMARK) Q1 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to Q1FY27 Earnings Conference Call of Planmark 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 processing star 10-0 on your touch-tone form. Please note that this conference is being recorded. I now hand the conference over to Mr. Utkarsh Gangi, Senior General Manager, Invest Relations of Glenmark Pharmaceuticals. Thank you, and over to you, Mr. Gang.

Thank you, Renju. Good morning, everyone, and welcome to the Q1FI27 Earnings Conference Call of Glenmark Pharmaceuticals, Limited. Before we start the Q&A, let us quickly review the performance of the business in the first quarter. For the first quarter of F527, Glenmark's consolidated revenue from operations was at Rs. 40,185 million as against Rs. 32,644 million in the corresponding quarter last year, recording a YOY growth of 23.1%. Quickly covering our key regions, starting with India, sales from the formulation business in India for the first quarter of FI27 was at Rs. 14,321 million as against Rs. 12,399 million in the corresponding quarter last year, recording a growth of 15.5%. Glenmark continued to significantly outperform the IPM in terms of secondary sales as per IQGIA. Glenmark's senior formulation business recorded a growth of 18.1% in Q1 and 14.3% as per MAT June 2026, compared to IPM growth of 12.2% and 10% respectively. Glenmark continued to sustain strong growth in its core therapy areas like dermatology, respiratory, cardiac, and oncology. Denmark's India business is ranked 13th with a market share of 2.37% as per IQVMAT June 2026. The company has 11 brands in the IBM Top 300. In terms of core therapy areas, Denmark is ranked 2nd in dermatology, 3rd in respiratory, and 4th in the cardiac segment as per IQVMAT June data. Denmark has launched some key products in its... Therapy areas in the last 12 months, which have been driving growth, some of the notable ones are Tevindra, Bukinza and Oncology, which are partnered with B1. In a short period, these two brands have seen a very strong uptake in the market, and the company expects these brands to further gain momentum and meaningfully contribute to the India business growth. On the respiratory side, Glenmark launched NetSmart GFD Smart Tools, Glenmark ASFB Smart Tools, which is the world's first nebulized fixed-toast triple therapy for CRPD. And the enormous strong growth in the chronic respiratory segment has been led by differentiated market, first-in-market launch of this product. In terms of the consumer care business in India, primary sales for GCC in Q1 were Rs. 1,558 million with a worldwide growth of 28%. The company's flagship brand Candid recorded revenue growth upwards of 30% across all its variants, and Lashin's portfolio delivered mid-single-digit growth in Q1. However, Scalp and Bondress recorded very high growth in the first quarter. Other skin brands, such as Aloe Vera and Episoft, also continued a strong growth trajectory during the quarter. North America, the North America business recorded revenue of $10,974 million for the first quarter of FY27, which is translating into a YY growth of 41.1%. Net of the deferred out-licensing income recognition for ISB 2001, the core business YY growth for North America region was 19.8% in the first quarter. During the quarter, Glenmuck launched nine products consisting of a mix of prescription Some of the notable ones are utaline blue injection, sodium phosphate injection, vancomycin injection, transapine injection, progesterone vaginal insert, and calcium gluconate injection. Lenmark is looking forward to several new approvals and launches in the second quarter as well. In the last six months, Lenmark has strengthened its generic respiratory franchise with the first A&D approval of Thank you. Thank you. of last year, including So, we're looking at 110 MCG, which is generic to fluent 110 MCG. This is an aerosol which is generated to A2N. In the injectable site, Lenmark has built a large portfolio of 20-plus commercial injectable products to various partners. Lenmark's injectable manufacturing facility in Monroe received AIL with a BII classification from the U.S. FDA in November 25, and during the quarter, Lenmark relaunched full-wastant injection out of the Monroe facility. The company has currently has 53 applications pending at various stages of need. Denmark's Europe operations revenue for the first quarter of Red 527 was Rs. 7,472 million, as against Rs. 6,678 million, recording a growth of 11.9%. While the overall regional growth was muted during the first quarter, the branded portfolio recorded growth across markets. from the branded market-slash-portfolio in Europe in the respiratory and dermatology therapeutic areas. Lenmark's respiratory portfolio also gained momentum across... the product is being launched by So, our partner, my name is Lee. Commercialize across various markets, and additional 2-3 launches are expected in the next 12 weeks. This portfolio will be further augmented with additional products over the next 12 months. Emerging markets for the first quarter of FA27, revenue from the emerging markets region was Rs.7,304 million as against Rs.5 million. Thank you. This quarter on the back of continuous market share game in key therapeutic areas. Denmark's overall respiratory portfolio continues to outperform the covered market across the EM region. Rialtis continues to be the leading nasal spray for allergic rhinitis in most of the markets where the product has been launched. Denmark plans to launch Rialtis in Brazil in the second half of FF27. In the impact region, double-digit secondary sales growth was led by... We have a strong outperformance in key markets such as Malaysia, Vietnam, and Australia. Rialtris was also approved, as mentioned earlier, in China and Thailand in Q4. The company's respective Asian partners, Grand Pharma and Ortona. Moving on to our global innovative portfolio, starting with Rialtris. So I think you mentioned a few of the key highlights of Rialtris as of June. Marketing applications for Rialtris have been submitted in more than 90 countries across the world, and the product has been commercialized now in 57 markets. 10 markets over the next. in some of the recent launches, and Glenmark's partner in... We initiated the U.S. commercialization as well during the quarter, and as per IQDR data across markets, Realty has seen a robust performance in terms of both value and unit market shares, and continues to record the global secondary sales growth of upwards of 40% by over. Ms. Levy, as mentioned, the company launched in Levy in the U.K. in Q1 and saw strong uptake throughout the year. Good morning, everyone. Binlevi has also received approval in Europe in October. In the first quarter, Denmark launched Binlevi in several European markets, including the Nordic Sea countries and Spain. In Portugal, also, Denmark launched the product through a strategic partner. We have submitted the marketing authorization application. Kinayo, which is Enva Folimal, partnered with Jansu, Alfamab, and CD Medicines. Glenmark is five Kinayo marketing authorization applications in 24 countries. As of June, the first commercial launch is expected in FI28. The companies, in parallel, initiated early access or new patient programs across seven markets, including Kenya, Mauritius, Uganda, Philippines, and Tanzania. the supply of Kenaio, and Glenmark has also initiated a global multicenter phase team studying neoadjuvant and adjuvant treatment of patients with this. Thank you. The next generation H2 targeting EDC, unlicensed in due to last year from June 2. Any applications to begin in Q2, FL27. And welcome to the call. He also plans to enroll patients in Australia and South Korea subject to regulatory approvals. I'm partnered with Hanzo. As mentioned earlier, in Q3 last year, Glenmark had unlicensed Omelotinib, which is a third-generation EGFR TKI for the treatment of non-small cell lung cancer. Omelotinib is already approved in the UK in June 2025 for the first-line treatment of adult patients with locally advanced metastatic NSCLC with activated EGFR mutations. Hanzo also received NA approval in the European markets in February 2026. Denmark has submitted MA applications for omelette in 13 countries as of June, 2026, and the first commercial launch is anticipated during the second half of FY27. Moving on to IGI, some of the key updates on our pipeline products, ISB 2001 or ABBV 2001. To date, more than 160 subjects have been dosed in the Trignite Phase I study. 42 of which were in dose escalation and more than 120 patients in dose expansion. Safety and efficacy. ASCO 2025. The clinical trials link is available to use the details. I will read 2301. First-in-class monthly specific. Targeting solid tumors. An idea intends to submit an IND later this year. This is a bispecific immune modulator and ISV2501 tri-specific T cell engager are both in early clinical development. You can view more updates on the IGI pipeline assets on the IGI website. We have Mr. Glenn Saldana, Chairman and Managing Director, and Anirag Mantri, Executive Director and Global CFO. I will now hand it over to Glenn for his opening comments.

Thank you, Utkash. Good morning, everyone, and thank you for joining us today on the Q1 earnings call. We've begun FY27 on a very strong note, delivering consolidated YOY revenues of 23%. Even if you exclude the deferred income from 2001, the base business YOY growth is north of 18%. This performance was broad-based across all our key markets. India business sustained its continued outperformance in the co-therapies as well as strong momentum in oncology through Tevembra and Brukhenza launches. As guided earlier, our North America business reported a strong recovery on the back of respiratory launches, and we expect this growth to sustain over the next few quarters. Our emerging markets business also recorded a very strong performance in the first quarter while Europe was... As we are transforming our presence there through expansions in the branded respiratory and dermatology segments. Our branded portfolio continues to do well across the markets. Rialtis is growing upwards of 40% in terms of secondary sales in Q1, and we've also expanded the launch of WinLevy to other EU markets. We continue to work on our partnered Innovative Oncology portfolio and are expecting to launch Amlotinib towards the end of FY27, followed by Class 2 Reza and Envo Fultimab. Innovation remains central to our long-term growth at Denmark. ISB 2001, ABB 2001 continue to show promising safety and efficacy with more than 160 patients' goals to date, and we are excited about the progress of IGI's pipeline assets, including 2301 and 2302. Overall, we remain focused on disciplined execution, strengthening our base business, scaling up our specialty portfolio across markets, and continuing to progress the IGI pipeline. forward over the course of the year. With this, I will hand it over to Anurad Mantri for his opening comments.

Thank you, Glenn. Good morning, everyone, and thank you for joining us today. We have started the FI27 with a broad-based growth across all our regions. The improved mix has also helped maintaining our growth margin in spite of the increased cost due to the ongoing geopolitical situation. As highlighted during our investor day, we are reinvesting in our base business as well as innovative business expansion. This coupled with the increase in cost of shipment and overall logistics has impacted our overall operating margins to some extent. While depending on the geopolitical situation and the development, some of the cost increases will continue to impact the business. But we are working on minimizing the impact on our profitability through superior product and geographical mix. Our working capital initiatives help generate incremental income through interest rate arbitrage. The associated interest income is clubbed under the other income in the P&L, and the increase is apparent in this water. While gross interest costs have gone up, this is mainly on account of higher lease expenses, bank commitment charges, and various other interest arbitrage things, which is the income is booked in the other income, but the interest cost comes in this side. As a result of various measures implemented, our overall earning profile and visibility has improved considerably, and we remain committed to maintaining a gross debt zero position in our balance sheet. Overall, we have delivered a strong quarterly performance and are on threat to achieve our guidance as a part of landmark 3.0's earning. Thank you.

So, with that, Renju, we can open the floor up for Q&A.

Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on your touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. 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 comes from the line of Samayan TKI with HSBC. Please follow us.

Hi, good morning, everyone. Thank you for the opportunity. My first question is on your R&D spend. So, can you call out the spend for the quarter? And since you have planned to move ISV 23012 clinical trials later this year, after that, what kind of incremental R&D you anticipate? That's my first question. Thank you.

So, R&D spend for this quarter was around 289 crore, and which is going forward as we guided earlier in that R&D spend is going to continue to be around 7 to 8 percent overall. This quarter was a bit lower, but it's actually, it cannot be exactly the phasing out of the R&D spend, and it will continue as per our guidance.

Also, as we guided, IGI, the spend will be around $70 million. This includes the investment in 2301 Phase 1 and all the investments in the clinical trials that we anticipate over the next two to three years. It's all included in that $70 million that we will continue to burn in IGI.

Sure. So you have a comfortable funding position to take care of this spend, which is required for moving assets to next year. Thanks for that. My second question is on Europe. Can you talk a bit more like what has changed? Because I think this is the second quarter when we are seeing the trend.

So, if you look at our European business, right, we, the last four years, you know, we've been among the fastest growing, our European business has contributed significantly to the company, right, over the last four years. And if you remember our guidance, we said Europe will come to, you know, high single digit this year, right? The other thing about Europe that we are doing, You know, is we are working aggressively to move, you know, to focus more on our branded products in Europe, which is mainly the products in the respiratory and we have several respiratory and derm launches, right? Which will drive the growth of Europe. So I think, you know, this year we'll finish probably at high single digit for our European business. However, I think as these branded launches start gaining scale, right, we will get back to double digit growth from next year. Right? For our European business. But, again, just to remind you, we were, you know, it's been the fastest going geography for four years continuously. So, very strong business for us.

Sure. And if you can just, you know, say some quantitative number, what percentage of European segment sale is contributed by Bandit products right now? And where do you want to take it safely just down the line?

So today it is small, relatively, right? Around 30% of total revenues, right? But we see that number, you know, if you take a five-year view, right, that should go to about 60, 60 odd percent, right, over the next five years. That's the kind of focus we are bringing to the branded products across Europe.

Okay, that's helpful. And my last question is on your injectable pickup in US segment. So you mentioned 20 plus products, including the partner project. So when we look at the contribution coming from the injectables, is that meaningful in the current numbers or you think it will build up over the time?

It will still take time. I mean, most of these are commodity injectables, right? We have some good launches and some good products, but it will still take some time to contribute to the overall revenue profile of the U.S. business, right? The U.S. business, if I look at the U.S. business this year, the primary drivers are the respiratory launches, so Frutical Zone 44. And then floticozone nasal spray OTC, which we have launched. And in the second half of this year, we have at least two or three more respiratory launches, so I think which will help drive the performance of the U.S. business this year. All in all, we should have a good year in the U.S. this year. Next year, I think some of the Monroe, you know, differentiated injectables will start contributing next year. For the U.S. business, in addition to all the respirator work that we're doing.

Okay, that's critical. Thank you, Glenn.

Files, you know, which are in H2, right, which will also help the U.S. this year.

Thank you. A reminder to all the participants that you might have a star and one to ask a question. Next question comes from the line of Harshit Durk with Diamond Asia. Please go ahead.

Hi, Jim. Good morning, and thanks for the opportunity. Sir, maybe on this cost part, how should we understand the RM cost impact, the increase in API cost because of this ongoing world situation and supply disruption? How it can impact gross margins and how sustainable this impact will be? How should we understand the gross margin outlook, sir?

So, as I mentioned in my opening remarks, basically the geopolitical situation is impacting our gross margin, which is across the API cost as well as the logistic cost. So, we are seeing the cost pressure across. We are trying to mitigate it through the better product mix and the better geographical mix. So, that we are trying to mitigate. And that's the reason you can see that the margin was impacted, but not to the extent of the impact we are seeing across the API packing material as well as the logistic cost. Going forward, it all depends on how the situation evolves in the geopolitical situation. If it subsides, but I think in the future quarter also, at least two quarters, we see the pressure coming up because of this, and we'll try our best to mitigate through the product and geographical mix.

I think the way to think of the business, right, is given the new launches and the respiratory launches in the U.S., right, given our strength in our India business, right, the growth in All that we are hoping will clearly offset any pressures that we are seeing on account of the elevated cost due to the war. So overall margins are pretty comfortable. I think on a full year basis, what we guided to the 21-22% will clearly be there, right, on the overall margin of the company.

Okay. Thank you, sir.

Thank you. Next question comes in the line of Kunal Runderia with Access Capital. Please go ahead.

Yeah, hi. Good morning. So, first question is about the India business, quite a strong performance, and it's also mirroring the secondary data that we see in IQ. So, Glenn, maybe, you know, while the secondary data has always been very strong, I think this time around we see that convergence. So, is there any change, you know, that has happened? And going forward, would that be a good indicator on how we should model the domestic business?

As we've always said, our domestic business is really a fantastic business, right, in terms of the quality of the brands, the quality of the franchise across the board, right, and even if you look at the domestic business today, I mean, most of the segments we operate, cardiovascular, we are growing, you know, 15 odd percent, you know, dermatology continues to do well for us. Respiratory, particularly chronic resp, you know, over 25 plus percent growth. So all these coupled with Tevembra and Rukenza, you know, we did over 100 crores of sales in the first 12 months of launch, right, which is remarkable. So India is a very strong franchise for us. And I think if you have to model it going forward, you can easily assume that we will have between 12 to 15 percent growth on a consistent basis from here on for the entire India business.

But, you know, your top three brands still are like Telma or its extensions. So, you have a very high concentration risk in some ways. So, do you see any risk towards growth prospects?

On the contrary, I think having strong brands is a positive. That's the view we have, right? So having brands like Telma, Ascoral, Alex, you know, Candid, and some of the newer products, right, our OTC franchise, Candid Powder, now with this Tilembra, Brukenza, I mean, there's so many, so many different, you know, the strength of the portfolio is extremely strong, right, across the board. So, we don't see any risk to the performance in our India business.

Sure, sure. And then you've also invested quite a bit of innovative products, so organically as well as enlightening things. So, barring R&D, other than R&D, any kind of OPEX or like marketing costs, you know, that you will have to do to market these products in Europe or emerging markets, additional costs beyond what you already do?

So we're already doing that, right? I mean, if you see, you know, we are investing in building out or strengthening our oncology commercial capabilities, particularly in emerging markets, right? And that has, you know, that's why we're making some investments this year, and that's why our margins we are guiding to is 21 to 22%, right? Because these investments... are more for preparation of the launch of Amrotinib, followed by Trastureza, followed by Enverfolimab, and these three brands can give us almost 5-600 million over a 5-6 year time frame, right? And then, of course, we'll use the same infrastructure to launch ISP 2001 when available. So that will give us a very strong oncology franchise. Particularly in India and all of emerging markets. So I think we're continuing to make these investments, which is all built into the margins that we'd like to.

And one more, if I can squeeze in, ISP 2301, it's in, I think, should we expect a deal this year, or would it be after phase 1A similar to what you saw in ISP 2001?

So, on 2301 is a super exciting asset, right? I mean, we've, you know, it's a Penta specific, which globally, you know, puts us at the world stage in terms of innovation, right? No one has ever bought, you know, tried to target both NK cells as well as activate T cells, right, along with these tumor antigens. So, it's a very, very novel concept overall. And, uh, From a deal perspective, clearly we will wait till at least we get some data, clinical data in humans and get some POC before we even start looking at potential partnering.

I have a few more questions. Thanks a lot to lend me all the time.

Thank you. Next question comes from the line of Tushar Manoj Dahi with Bhutilal Ossal, Financial Services Limited. Please go ahead.

Thanks for the opportunity, sir. So, two questions. One on 110 MCG, the product being filed, where do we stand in terms of approvals or any additional queries? That's first.

Well, yeah, I mean, we are... As we said, in H2, right, second half, right, we should see some of these respiratory products getting approved. You know, we anticipate at least two or three of these getting approved, right, between 110, fruticazone, nasal spray, RX, ipratopium, all this, right, in the second half of this year, you should see. My hope is at least two of these three come through.

Got it. And the one which is already launched, have we had the, in a way, full quarter benefit in terms of business, or we are still to see the real meaningful impact?

I wouldn't say full quarter. I would say half the quarter we saw some benefit, but I think this Q2 will see the full quarter benefit out of Fruity 44.

Got it. And so, secondly, on ISB 813 with BioCrest, is there any rethink from their side that is as far as the agreement is concerned? And then subsequent extension to that, that since the product is now about to complete phase 2, and is there any scope for having an agreement with alternate companies or more number of companies on this aspect?

You know, we moved a backup compound, right, called Star 310. So it's actually in phase one, right? It's just completed phase one, right? So that's the stage at which we're at. In terms of biopress, we have no visibility to what they're doing in terms of further development yet, right? Because they just acquired Astrea some time ago. So we're still trying to figure out what the next steps are on that.

Got it, sir. That's it from your side. Thanks.

Thank you. A reminder to all the participants that you may press star and 1 to ask a question. Next question comes from the line of Krish Mehta with Inam Holdings. Please go ahead.

Hi, thank you for taking my question. I have two questions. The first is if you could provide the current working capital and net cash position for the quarter. And the second question I had is on, you know, Glenn, you spoke about 12 to 15% growth in India. If you could just give some color on how this growth would be split in terms of volume versus value and new product launches.

Okay, so first question on, I'll take the first question and then we'll take the second question. So on the working capital as well as the debt position, what we guided for the year is that we will have around 115 days of tight working capital days which we will continue to maintain. We are well below that and we are on track because quarter on quarter there could be some ablition, but I think currently we are much below the 115 days, but still we maintain our guidance of the full year basis on the 115 days of networking capital. On that position, as we clearly said that we will continue to maintain gross debt zero in our energy. The cash position accordingly varies because of the various freight-related expenses and some of the pressure which we are seeing. But given that, all these are mitigated, and we will continue to maintain our gross debt zero position.

And on the second part, right, with regards to the India growth, right, see, So, India, if you see the main growth drivers for us, right, as we've discussed, Jovembra, Bukenza, 100 crores already in the first year, continues to do very well for us. Chronic respiratory, GFP launch, you know, the brand is trending closer to about, in the first year itself, about 70, 80 crores of annual revenue and still growing very, very rapidly. On the cardiovascular, you know, Telma continues to gain market share, the entire franchise, right, across Telma and all its variants. On dermatology, right, it's pretty much a broad-based growth, all mostly, this is all volume growth, right? On the value side, I mean, we don't see too much of value growth in our business purely because... You know, the competitive intensity is pretty high, right? So, we think the bulk of the growth is still volume growth, right? Maybe closer, between volume growth will be about 6-7%, new products will be another 3%, and then value will be another 3-4%, somewhere thereabouts, right? That's the typical breakup that we are seeing in the India business, right? But, and to answer your question, we still... I have a lot of runway in terms of new launches. For example, Amlotenib, we will launch in India, which is a big product, we think, in the non-small cell lung cancer space, very large indication. We will launch Tastuzumab-Rezitacan in India, right, in the oncology space, and that will put us among the leaders in the oncology space in India, right, which, you know, with the launch of Tevembra, Brukenza, and these other two launches, right, that will take us to being among the leaders in the next five years. In India, right? So, way before we launch ISB 2001, right? So, that's on oncology. We talked about cardiovascular. We talked about dermatology, right? And in the respiratory, you know, chronic rest, we still have many more exciting launches as we go forward. The last point on India is regarding the semaglutide is not a big area of focus for us, but it will help. Turn around our diabetes franchise, which until last year was declining, right? And now we've been able to turn it around. SEMA currently is tracking at about 20-25% of annualized sales as we speak. The brand is still growing. So I think overall that will help turn around our diabetes franchise. So these are all the segments that we operate in, right, in India. I think, pretty broad-based growth across all the segments that we operated.

That's very helpful. Thanks a lot for that.

Thank you. Next question comes from the line of Sukrit D. Patil with ISAT FinTrade Private Limited. Please go ahead.

Good morning, Mr. Dean. I have two questions. The first question from Mr. Dillen is, I just want to understand a forward guidance beyond the regular outlook. What are the top two to three execution priorities you're focusing on in the next few quarters? And alongside that, what do you see as the biggest risk in client adoption, regulatory shifts, or compliance pressures? And how are you preparing to manage them while strengthening Glenmark's position in generic and specialty pharma? That's my first question. I'll ask my second question after this. Thank you.

So, um... The priorities are clearly to prepare for some of these U.S. launches, right, that we're anticipating, particularly in the respiratory side, in the next, in the second half. That's on one side. The other side is preparing for the launch of Amlotinib, right, which is a big product for us in India and all emerging markets, right, which will drive the growth in, you know, starting second half of this year, right, followed by Trustureza and some of the other launches, right. So that's probably the key priorities where we are focused on, you know, driving the business, right? India continues to do well, and Europe and the other franchises continue to do well. And we have all the building blocks in place, right, to continue to sustain the growth that we are anticipating for India, right? Also, I think field force expansions, we continue to do field force expansions, both in India as well as in emerging markets to prepare for those launches. So that's another thing we are heavily focused on, right? You know, from now till the end of the year. So that's your second question. I couldn't, I mean, the second half of the question I couldn't get clearly. Can you repeat that?

Yes, just want to understand what risks you see in adoption or competition from the peer, and just want to understand your plan of growth and how you prepare to handle the challenges that could slow down the growth.

So, look, I mean, the growth that we are seeing, right, is a culmination of all the hard work that we've done in the past, right? So, I think all the, what we are working on right now is all which will drive our future growth, right? Basically over the, you know, particularly next year, right, as these launches start happening, as the products start. I think that should help strengthen the growth for FI28 particularly. But all the growth that you're seeing now and which we hope to sustain is all the work that's already been put into in terms of launches and products already there. So, from a risk perspective, we think the risk this year is relatively low, right? It's all a matter of how well we execute from year to the end of this year, and that's where the... The primary focus is right now.

So, as we mentioned at the beginning that most of our Growth is toward the branded and unique products. So, as to answer your question on the regulatory part, which reduces the risk, because we are moving towards more innovative and branded portfolios. So, to that extent, going forward, it will start de-risking some of the regulatory risks related to the geopolitical situations.

Thank you. My second question to Mr. Mantri is, again, along the similar lines, from a financial point of view, what key risks or challenges do you anticipate in the coming quarters, and what specific measures are being taken to manage margins, cash flow, and balance sheet stress, especially in areas like raw material cost, volatility, receivables, or any regulatory compliance? Just want to understand your plan of action on this. Thank you.

So, we have taken a multiple initiative to improve our working capital efficiency. As you rightly mentioned, in this situation, the key is to how to, because the environmental prices are actually not completely in your control because it's related to the geopolitical situation and so is the freight and other things. So, what we are trying to mitigate is improving the working capital optimization efficiencies toward that, reducing our debtors, improving the payment terms with the vendors, and in this process, we are actually optimizing the various supply chain financing, threat-based MSMA financing, global factoring, and packing credit, and all these type of instruments, so that we can actually, at the moment we improve the working capital efficiency, Free up the cash for the growth and for the future growth. So that's how we are looking at it.

Thank you, and best wishes.

Thank you. Next question comes from the line of Part Sudha with Trineta Asset Management, please go ahead.

Yes, Mr. Arigat. Yes. So, first of all, good morning, and thank you for the opportunity. So, my question is on VR3.

Now, it has become Glenmark's first successful global specialty brand.

Internally, which product in your current portfolio do you believe has the highest potential to become the next global brand of similar scale?

I think post-Ryaltris is the first big one, right? Followed, I think Amlutinib has tremendous potential, right? The one we are starting to launch, you know, second half of this year in non-small cell lung cancer. So the one we licensed from, and so that should be a big product. Likewise, Trastureza, which we licensed from Hengriwi, that can be a big product for us. So all these will help build a very nice... You know, innovative, respiratory, innovative franchise, right, across all our markets. And then, of course, the big one will be ISB 2001, right, as and when it launches. So I think over the next five to ten years, you should see significant launches happening on the innovation side.

Got it. And my second question is like, Millery has now been launched in several European countries, markets. So could you discuss physician adoption and whether the dermatology could become a meaningful growth driver in Europe?

You're referring to WinLevy, correct?

Yes, sir.

WinLevy, you know, is a niche product, right? It's for acne, and we think it'll be a nice product to have with the dermatologist. It's differentiated, and the adoption has just started, right? We just started commercializing it in many of our markets, so it'll take us some time. To build on WinLevy, right? But along with WinLevy, we have a couple of other branded Derm products, which we are also promoting, right? And we are planning to promote, right? Which will help drive the entire Derm franchise in Europe.

Thank you so much, and that's all from my head, and best of luck.

Thank you.

Thank you. Next question comes from the line of Sain Mukherjee with Nomla. Please go ahead.

Yeah, hi. Good morning. Just one question I had on all the litigations in the U.S. around some settlement on antitrust litigation recently. So if you can just update us on, you know, what are the pending litigations and how much we have provided for and what would be the cash flow implications, and is there anything that we need to provide for additionally this year, next year? Thank you. We'll update us on, you know, the situations around various city gates.

I think, Shayan, most of the litigations we've already provided, right, I mean, all the, you know, all the information was around the settlement that we did with the state AGs, right, which we already took, I think, in Q4, okay, in terms of a provision, right, so that's done, right, so we've... On the MDL side, right, the MDL we provided for state agencies, we provided the DPPs, we settled, right, these two groups we settled. We have the EPPs to go, and we have the...

There won't be any, so most of the provisions are made, and incrementally, this will not be very significant, right, going forward.

So, it may not be a very significant background, but the smaller two litigation, what Glenn mentioned, has been, I think, as and then, we provide more on a conservative basis. The cash flow will obviously go in at least two years out of it, but as a P&L perspective, we have provided all the litigations as of known today.

Understood. And I don't know whether I might have missed it. Can you just share the net cash position as of June?

As we mentioned that we will continue to maintain our gross debt zero position as well as the net working capital deals of 115 days. We are well below under those 100 working capital controls. And we continue to maintain that position going forward. We are taking a lot of initiatives to mitigate the cost pressures and improving the working capital, especially in the current geopolitical situation in terms of our procurement side as well as on the sales side. And overall, we are continuing to maintain our growth at zero position.

Yeah, but I was just looking at the cash number, cash, and investment that you share, right, every quarter. I know Roswell has been zero for a while, but the cash position, we can share.

So, cash, see, I'll give you the cash number, but I think it's not going to be much of the help towards your model. I think you should, my request is that you build a model based on the balance sheet perspective dates, which are the gross date zero. We currently have a close to, as we're operating cash-wise, we continue to maintain our 800 to 900 cash on these.

Okay. And so one last question on India. What is the MR strength that we have? And, you know, given all these oncology and, you know, launches that are happening, is there some investment that you need to do? If you can give some color on that.

So, India, MRs, I think we are about 5,600, somewhere thereabouts, right? But every year, we add about 300, 400 MRs. I mean, that's pretty consistent in terms of our growth, right, across all the therapeutic areas that we operate in. Oncology in India doesn't need a big... We already were in oncology. We already had a sales force in oncology in India, so there's no expansion required for the India oncology.

I see. Okay. Okay. Thanks a lot. Thank you.

Thank you. Next question comes from the line of Devanj with Anubudhi. Please go ahead.

Hi. I just wanted to ask a question regarding how much of the AbbVie deal cash flow has been gotten in so far. I understand that there was a $700 million upfront payment and the other $1.2 billion which was attached to the milestones. So have any of those milestone payments been activated?

So, as of now, we just got the 700 up front. We've not got any further milestones yet.

So, the deferred income that you say coming from the IGI deal has a part of that 700 million. Is that right?

That's correct.

That's correct. Perfect.

Thank you so much. Thank you.

Ladies and gentlemen, as there are no further questions, we have reached the end of question and answer session. I now hand the conference over to Mr. Utkarsh Gandhi for closing comments.

Thanks. Thanks, Indu. A quick reminder to everyone that the information, statements, and analysis discussed during this call, describing the company or its subtilies objectives, projections, and estimates of forward-looking statements. These are based on current expectations, forecasts, and assumptions, and are subject to risks and uncertainties, which could cause actual outcomes to materially differ. No representation of warranty, either expressed or implied, is provided in relation to the conversation and the documents provided, and the committee undertakes no obligation to revise any of the power-looking statements because of new information, future events, or otherwise. With that, we can close the Q1 F527 call for Glenmark. Thank you, everyone, for joining us today. Thank you.

On behalf of Glenmark Pharmaceuticals Limited, thank you for joining us. You may now disconnect your lines.