Dr Reddy's has received the Indian drug regulator’s nod to study the safety and efficacy of the weight loss drug Semaglutide.

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Semaglutide is the same active ingredient present in the blockbuster diabetes and weight loss drug, Ozempic and Wegovy by Novo Nordisk.

Dr Reddy’s has been given the nod to conduct a bioequivalence study to establish the safety and efficacy of the drug on the Indian population. If the bioequivalence studies meet expectations, it can launch the drug in a year.

Novo Nordisk which has become the most valuable company in Europe raised its guidance for the third time this year and expects sales to rise as much as 40% this year due to money generated from this blockbuster drug.

Ozempic is expected to make $12.5 billion in sales in 2023, a growth of 23% while Wegovy, the drug approved for weight loss netted $1 billion in sales in just one quarter seeing its sales rise 363% in just the first half of 2023.

Currently, Novo Nordisk has launched Oral Semaglutide in India at the price of Rs 10,000 per month.

Dr Reddy's has been in the limelight of late. The company recently reported that the United States Food and Drug Administration (USFDA) has issued nine observations for its biologics manufacturing facility located in Bachupally, Hyderabad.

DRL’s wholly-owned subsidiary, Dr Reddy's Laboratories Inc., has also found itself among several pharmaceutical companies named as defendants in a recently filed lawsuit.

“The complaint, filed by Mayo Clinic and Lifepoint Corporate Services, asserts claims under federal and state antitrust laws and other state laws alleging that the defendants improperly restrained competition and maintained a shared monopoly in the sale of brand and generic Revlimid through their respective settlements of patent litigation," according to a stock exchange filing.

Following the lawsuit, analysts have turned cautious about the stock. “At this juncture, I would rather prefer to exit these stocks because, at current market prices, the risk-reward is not very favourable,” Vishal Manchanda, Pharma Analyst at Systematix Group told CNBC-TV18.

(Edited by : Shweta Mungre)

First Published:Oct 19, 2023 5:20 PM IST