Dr. Reddy's Prepares Generic Semaglutide Launch in India Targeting $1B GLP-1 Market

Dr. Reddy's Laboratories is preparing to launch generic versions of semaglutide in India, positioning itself as the first generic player in the country's rapidly expanding GLP-1 therapy market. The company obtained permission from India's drug regulator last month to manufacture and sell the generic version of blockbuster diabetes drug Ozempic in India. The generic medication is expected to cost 60% less than Novo Nordisk's weight loss drug Wegovy, according to co-chairman and managing director GV Prasad.

The Indian Subject Expert Committee has already green-lighted the oral pill formulation, with the central regulator's final approval pending. The company is poised to roll out the oral product shortly after its injectable counterpart in FY27. Dr. Reddy's aims to launch its generic semaglutide soon after the patent expiry in India, projected for early 2026.

The timing addresses a massive unmet need, with more than 100 million Indians with diabetes and a rapidly rising obesity burden. Market-size projections exceed $1 billion for GLP-1 therapies in India. The Indian semaglutide market, estimated at $25.8 million in 2024, is projected to surge to $347.5 million by 2035 with a 17.8% CAGR, with oral formulations like Rybelsus driving growth.

India's patent law grants a 5-year data exclusivity for new formulations but does not extend to oral versions of molecules already approved in injectable form. Consequently, Dr. Reddy's can launch the oral pill without infringing existing patents, sidestepping the royalty streams that typically erode margins.

Dr. Reddy's strategy hinges on its integrated manufacturing capabilities, allowing for backward integration in Active Pharmaceutical Ingredients (API) and formulations. By leveraging its in-house API plant, the firm can produce the active ingredient at a fraction of the cost of competitors that rely on Chinese imports, giving it a clear pricing advantage. This backward-integrated API capability provides pricing resilience versus China-sourced competitors.

The company's full-stack approach includes collaborations with international obesity societies, establishing Obesity Centers of Excellence, and developing specific nutritional products in partnership with Nestlé. This comprehensive ecosystem strategy aims to provide end-to-end patient management, addressing adherence and long-term care. The full-stack launch encompasses obesity centers, nutrition products, and digital support, aiming to lock-in patient loyalty.

Beyond India, Dr. Reddy's has filed dossiers in 45 to over 80 international markets, planning direct commercialization in regions like Southeast Asia and Latin America, and leveraging partners elsewhere. International dossiers in 45 markets open multi-region revenue streams from FY27 onward.

GLP-1 (glucagon-like peptide-1) mimetics work by enhancing glucose-dependent insulin secretion, suppressing glucagon, and slowing gastric emptying. The oral formulation uses an absorption enhancer (SNAC) to protect the peptide from degradation in the stomach, achieving bioavailability of roughly 1%. Beyond glycemic control, semaglutide delivers clinically meaningful weight loss (up to 15% of body weight) and has been linked to cardiovascular and renal protection.

Novo Nordisk currently dominates the Indian GLP-1 space with Rybelsus (oral semaglutide) and Ozempic (injectable). However, its premium pricing leaves room for a low-cost generic alternative. When Novo Nordisk introduced Rybelsus in the United States, oral uptake grew to 15% of total GLP-1 sales within two years, spurring a price-competition cycle that shaved 20-30% off average net prices.

Dr. Reddy's has faced regulatory setbacks, including a notice of non-compliance from Canada for its semaglutide submission, potentially delaying its international rollout by at least six months into early 2027. The company's API manufacturing facility in Hyderabad received seven observations from the USFDA in November 2024. The company's Q2 FY25 net profit saw a decline, despite revenue growth, indicating margin pressures.

Dr. Reddy's Laboratories is valued at approximately ₹1,07,092 crore (around $12.8 billion). While Novo Nordisk trades at a P/E ratio of around 13-14, Dr. Reddy's operates at a higher P/E, currently around 18-20. This valuation difference highlights investor expectations for growth from Dr. Reddy's pipeline, including this key GLP-1 asset.