Hyderabad-based generic drugmaker Dr. Reddy’s Laboratories’ consolidated net profit slumped 69% year-on-year (YoY) to ₹.435.6 crore in the June quarter amid lower sales of cancer drug lenalidomide and nearly ₹240 crore provision necessitated by recent quality issue around weight loss drug Semaglutide.

Total revenue from operations stood at ₹8,099.8 crore (₹8,572.1 crore), showed its results prepared in accordance with Indian Accounting Standards (Ind AS).

“Our Q1FY27 performance reflected the expected transition beyond lenalidomide revenues, along with an unexpected impact related to semaglutide active pharmaceutical ingredient (API). However, our underlying base business continued to deliver healthy double digit growth across all key geographies,” co-chairman and managing director G V Prasad said.

The focus remains on improving health of the base business through disciplined execution and operational excellence, while building future pipeline of peptides, biosimilars and innovative assets to deliver long-term growth, he said.

An adverse product mix, primarily on account of reduced sales of lenalidomide (generic of Revlimid), price erosion in North America and Europe generics, the semaglutide API related provision impact besides elevated solvent costs and freight costs on account of the Middle East crisis impacted the gross margin, Dr. Reddy’s said.

The underlying base business, excluding lenalidomide, continued to deliver healthy double-digit growth across all geographies, including North America, aided by favourable currency movements.

On the provision, the drugmaker said certain batches of Semaglutide were found to be out of specification due to an issue associated with the API used in the product. “Consequently, based on its best estimate, the company has made a provision of ₹.239.7 crore towards inventory and other associated costs during the quarter ended June 30, 2026,” it said.

Published - July 22, 2026 07:46 pm IST