Cipla wants new-age medicines to contribute 10% of revenue in five years

Cipla is aiming to derive 10% of its revenue from innovation-led products over the next five years as the drugmaker looks to build new growth engines beyond its core generics business, Chief Executive Officer Achin Gupta told CNBC-TV18.

The move comes as Indian pharmaceutical companies increasingly seek to move up the value chain through differentiated products and innovation while continuing to rely on generic medicines for the bulk of their revenues.

"A lot of our mainstay revenues in the years to come, maybe five years or 10 years, will still stay in generics because that's where we serve the maximum number of patients," Gupta said.

While generics will remain central to the company's business model, Cipla is targeting a larger contribution from innovative products and technologies, building on recent launches in India across respiratory and other therapy segments.

"If you ask me, in five years, we would love to have 10% of our revenues come from innovation," Gupta said.

The company has already introduced products such as breath-actuated respiratory devices and inhaled insulin in India and is now looking to expand its innovation efforts into globally relevant products and markets.

The innovation push comes alongside efforts to strengthen Cipla's manufacturing footprint in the United States, a market that accounts for a significant share of the company's exports. Gupta said the company now operates four manufacturing facilities in the US as part of a broader strategy to diversify production and reduce supply-chain risks.

The expansion also aligns with a growing preference among governments and healthcare systems for local manufacturing of critical medicines and complex drug products.

According to Gupta, some of Cipla's key respiratory products for the US market are expected to be manufactured locally. The company's recently approved generic version of Ventolin

will be produced in the US, while its anticipated generic version of Advair is also expected to be manufactured there.

"This is not just about the localisation push from local administrations, but it also gives us flexibility because we're able to take some of the more complex dosage forms closer to the market," Gupta said.

The company's Goa facility, one of its largest manufacturing sites, currently supplies products across India, the US, Europe, Asia and Latin America. Gupta said nearly half of the production from the facility is destined for the US market, with the remainder catering to other global markets.

Separately, Cipla is working to restore supplies of Lanreotide after its Greek supplier, Pharmathen, received a warning letter from the US Food and Drug Administration.

Gupta said Pharmathen is carrying out remediation measures and will seek a fresh FDA inspection once those efforts are completed. In parallel, Cipla has begun working with an alternative contract manufacturer in the US as part of efforts to reduce dependence on a single supplier.

"With this two-pronged approach, we are confident that we will get the product back on the market," Gupta said.