Drugmaker Lupin is transferring its over-the-counter (OTC) consumer healthcare business to a wholly owned subsidiary in a deal valued between ₹550 crore and ₹650 crore. The company announced this move while reporting its third-quarter (Q3) financial performance.
Strong Q3 Performance
Lupin reported a profit after tax of ₹858 crore for Q3, marking a 38.8% increase compared to the previous year.
The company’s sales reached ₹5,618 crore, a 10.6% rise from ₹5,079 crore in the same period last year.
Nilesh Gupta, Managing Director of Lupin, said, “Our third-quarter results highlight our continued strength, with both revenue and EBITDA showing sustained growth.” He added, “US revenues have been pivotal, driven by scaling up new products. This growth is further supported by a strong nine-month performance from India and EMEA regions.”
Rationale Behind OTC Business Transfer
Lupin is transferring the OTC business on a slump sale basis to a newly incorporated subsidiary. The company will finalize the transaction value based on working capital adjustments and other financial considerations until completion.
An official from Lupin stated, “Separating the OTC business as an independent entity positions the company to thrive in the rapidly growing OTC market. This move also allows Lupin to sharpen its focus on core strengths in prescription drugs.”
In FY24, the OTC consumer healthcare business generated revenue of ₹148 crore, representing approximately 1% of Lupin’s standalone turnover of ₹14,666 crore.
Timeline for Business Transfer
Lupin expects to finalize the Business Transfer Agreement (BTA) with the new subsidiary by April 30, 2025, or as mutually agreed. The entire transaction is expected to be completed by June 30, 2025.
Growth in US Market
Lupin’s North American sales for Q3 reached ₹2,121 crore, reflecting a 12.3% increase and accounting for 38% of its global sales. The company recorded Q3 FY2025 sales of $235 million, compared to $212 million in the same period last year.
As reported by thehindubusinessline.com, during the quarter, Lupin secured six abbreviated new drug approvals (ANDA) in the US and launched two new products. The company now has 163 generic products in the US market.
