FY26 closed 21% EBITDA matching Q3 cut.

During the quarter, did we kind of book any shelf stock adjustment for Revlimid?

No. I think we had shared this in the last quarter as well. We did not have any SSA adjustments.

On generic Ventolin launch that you are expected to do next month. So just wanted to understand if the Innovator is supposed to launch a green version of Ventolin sometime by third quarter of this financial year. So hypothetically, if the innovator is able to replace all of their Ventolin product with the new version, would that impact Cipla?

Generic to the existing Ventolin. The switching to another variant is -- I think that will be a process, which is not an automatic process under the U.S. law at this point of time. So we do not anticipate any near-term impact of that change as and when the transition starts to happen.

If you could update on the respiratory pipeline, the key assets, Advair, Symbicort, Qvar, Flovent?

So I think as we had guided, we were expecting four approvals this year. Ventolin has already got approved. We are having different goal dates for different products. So during the year, we are expecting Advair, Symbicort and then one other asset to get approved. So this will happen during, I think H1 and 1 is H2 as well.

What is holding back Advair for so long?

I think your question is probably more historic. If you recall, we had OAI at our Indore facility. So we had to tech transfer to the U.S., which caused the delay. But now we are ready with everything. So it's just a matter of receiving the approval. Sorry just to complete went through a pre-approval inspection on our U.S. facility for this particular product.

Do you expect to see any benefit out of the EU FDA for your respiratory portfolio because you source a lot of the basic devices from Europe?

At this point, we are not expecting any meaningful impact of that. I think it's more business as usual at this point in time. (Ashish added: It remains the same. So there is no benefit as such. And in EU, we are already selling Respiratory devices, which are in-house. So there's no significant benefit that we see coming from EU FDA. We get some raw materials from there, especially on the devices side, but there's no any such benefit that we have out there.)

Just wanted to understand the specific initiatives around AI, which you mentioned. If you could share any specific initiatives that you've taken and anything -- any other pilot initiatives that you see scaling up in future?

Yes. So AI is a broad-based implementation that we are targeting, which will focus across multiple functions. And the difference between what used to happen in the past versus now is we are focusing on end-to-end processes versus small limited use cases. So this will be -- we have implementations across quality, regulatory, corporate functions and a lot of the R&D-related use cases as well. So the idea is to use it in a way that helps obviously faster and better decision-making, but also ultimately gives us productivity benefits.

On the biosimilars front, I just wanted to understand in terms of your strategy for biosimilars, are you looking at in-licensing? Or are you looking at your own development? And what sort of a pipeline and time line are you looking at for that, both from a U.S. and EU perspective? And is that sort of accelerated given the new FDA draft guidelines?

Yes. So we have predominantly an in-house strategy where we have 2 assets currently under development for developed markets. One of them is already under clinical trial under an IND of U.S. We will be adding 1 to 2 assets each year, which will then, therefore, start resulting into a pipeline of 6 to 8 in-house assets over the next 5 to 8 years. On top of that, we are considering a limited amount of in-licensing where there are near-term opportunities that are not within our in-house portfolio.

So that means in the second half, we will see a run rate of almost like $100 million incremental revenue versus the quarterly run rate in the first half?

Yes.

On Ventolin — with another variant of Albuterol getting approved, do you find any changes to the market dynamic in terms of pricing, competition or scope in Albuterol, whether it will lead to incremental business or not since it is a variant of Albuterol only and prescription would be based on Albuterol HFA?

No. These are different products because they get substituted to the different innovator products. So it's a different NDC, different market. And we have CGT on the generic Ventolin. So we will actually be exclusive for a 6-month period. And we expect a significant uptick. There is no cannibalization that will happen on the other variant, which is a generic to another variant of same molecule. So we're more likely to take the share from the existing Ventolin suppliers rather than going from the other franchise.

Just on the R&D — connecting R&D spend overall almost INR 2,000 crores and very few ANDAs being filed. So is it that the R&D spend for ANDA is significantly higher maybe for FY '26, '25 compared to the earlier philosophy of R&D spend for ANDA?

Yes. Actually, we have gone up products, including some First-to-Files, which are on Oligonucleotide side as well. So we've gone into more respiratory, more peptide and more Oligo, which is resulting in higher spend per filing. (Ashish added: And some of these also involve litigation cost as well. So that also leads to higher R&D spend, which has got everything in that R&D spend that you see, both API cost, your R&D that you buy, litigation, et cetera, et cetera. And of course, some of these Oligonucleotide, et cetera, we go outside to CRO, CMOs as well.)

The Albuterol market share has sort of reduced quarter-over-quarter — moved from 22% back to 19.5%. Anything to read through?

No. I think it's hardly a reduction that you see out there of 0.4% or so that we've seen. So I think 19% to 20% or rather 19.5% to 20% is something that you should pencil in -- we are ranked out there. And if the supply was -- if you could supply more, then we could -- there's a potential to increase the share as well.

On the R&D part — is this Indore regulatory issue also one of the reasons for delay in filing because of the regulatory issue at Indore site or the Indore site classification has got nothing to do with the filing of the assets? I was referring to prospective filing, where R&D spend is incurred but because of classification at Indore, the acceptance of filing by U.S. FDA, is there that kind of delay also happening?

No. So now we have derisked out of Indore. So our assets are filed from U.S. And one of the assets we are doing from Goa because Goa is here. Same likewise for potential filings also, we are focusing more on Goa and U.S. sites. And Indore, I think we will accelerate as and when -- as soon as it clears.

On Ventolin — will the pickup be gradual or can we have a sizable business in 2-3 quarters timeline? And capacity won't be the constraint?

Yes. So you will see towards second half a ramp-up happening in generic Ventolin. Though we will launch it within the quarter 1 and quarter 1, yes, but the ramp-up will happen in half 2. No. We have U.S. facility for it. Not a problem at all on the devices side.

On your U.S. exit guidance of $1 billion in FY '27 — what kind of visibility you have on these products that gives you confidence you can receive approval this year? And for some of the bigger assets, what kind of risk mitigation strategies have you already implemented?

No, see I think it's -- in terms of confidence in each of these assets, we are seeing some developments happening. Like for example, in Advair, now you've had a PAI that has happened. Okay. Ventolin where we were expecting around the same time we've got the approval. In certain other assets also, there is an ongoing discussion readiness that is there. Of course, we can't anticipate when the approval will come through. But some of them, we are aware of the goal date, et cetera. Well for quarter 3, quarter 4 ramp-up to happen to $1 billion kind of a run rate. And that's what we have envisaged in our business plan. And from facility point of view, all these facilities are also derisked.

When you say facilities issues are derisked, so most of these filings are filed from 2 sites, say from India and from U.S.?

No, that won't be the case. Right now, these are filed from U.S. or from Goa, you will have 1 or 2 assets filed. But -- and these are respiratories that I'm talking about. The peptide is with a partner site outside. So we don't anticipate -- that we don't anticipate any risk in the facility. Goa has recently got inspected as well. There are 2 observations we are waiting -- we have responded to those observations. We are waiting for the classification.

On India business — you ended at 9% growth for the segment. So when we look ahead, say '27, '28, do you think you can outpace IPM growth in next 1-2 years or it might take slightly longer because market growth has also improved?

Yes. So we are confident that we'll be able to deliver a strong double-digit growth as well as a market beating growth in FY '27, '28. And we've been seeing that consistent trend over the last couple of quarters.

When you're saying that you will be at a $1 billion exit run rate, does it include Lanreotide or it doesn't include any contribution from Lanreotide?

At the moment, we've left that out of this guidance. So that will be an upside to plan if we can successfully get back in the market before that.

What kind of a tail are we looking at in these plus $100 million opportunities? Can they continue for a couple of years, '28 and '29 or in '28 onwards we can see some bit of erosion starting to happen?

So see, these are not like the 6-month exclusivity kind of opportunities. So even if competition enters, they will taper off slowly, right? So they are more like the way to look at it is what you saw in our Albuterol or what you saw in our Lanreotide prior to supply disruption issues. These are more steady opportunities. So where we have to manage some level of price erosion, but not a cliff kind of scenario, right? So these are steady opportunities.

Is there any M&A component or in-licensing component that I might have missed, which is also leading to this double-digit growth in 4Q?

Yes, we had in-licensing of some Pfizer products. We had a small acquisition of a business called Inzpera. Yes. So base will still be double digit.

Over the next 2, 3 years, how should we think about your capital deployment, both organically or inorganically?

Yes. So look, I think we are preparing for a solid growth over the next 5 years and beyond. And for that, I think the number 1 deployment is going to be on R&D side. So we have plans to accelerate R&D pipeline. So Respiratory assets, we have some under approval, more which we are filing. Complex products, which we outlined was peptides, other differentiated products. But also we're going to step up on biosimilar side, where we would want to do roughly 6 to 8 internally. And if we find a couple of good opportunities, we can supplement through inorganic as well, so that will consume some capital. Then we have capex, which we have increased steadily over the last 3 years.

Anything in India or emerging markets, more in branded generic space you think Cipla would be looking at or this would be largely organically built?

So India, we've actually put a slide in the investor deck on the partnerships we've done. Acquisition, a large acquisition in India is a little difficult for us because we are a number 2, number 3 player. We're actually number 1 by volume. So whenever we start looking at some of these, there is a significant overlap that we have to account for. So emerging markets Europe remains a very good opportunity for us. We're looking at that.

On India business — we grew double digit in trade generic and consumer healthcare. So is it fair that the branded generic business has actually been pretty muted for the entire year? What gives us confidence we'll be able to beat India growth in the next year?

Yes. So I think we mentioned that all the 3 segments of the business have done really well in -- especially Q3 and Q4. Q1, we had a muted quarter on the branded Rx business. But that is behind us now, right? There were reasons related to seasonality, et cetera, but we've not seen those similar reasons as we started this particular financial year. So -- with the products we have and the strategies that are there, we are quite confident, and we've seen that trend now over at least 2 quarters.

Given that we've had a fairly low base on seasonality, ideally even a normal season should give you that tailwind for India growth this year, right?

Yes. So that's why we're saying we are confident about the double-digit growth because the seasonal patterns don't happen too many years in a row, right? So I think the base was low for last year on some of these acute things, but also the chronic portion, particularly diabetes, cardiology has grown significantly. So we have also diversified beyond that seasonality dependent portfolio.

On the margin guidance of 18.5% to 20% — given that a lot of the U.S. growth will be second half weighted, is it fair to assume that in the second half our margins could be north of 20% range and therefore the average that you've given?

Yes. So that's exactly what I had mentioned initially that in 18.5% to 20% that we're guiding, it will be more in the favor of H2 where you will have better than average and first 2 quarters where we don't have the benefit of new launches, we will see a lower margin than the average that we're giving. So yes, that's the trend that you will see.

On EBITDA margin guidance — given the outlook you provided for U.S. business, $1 billion plus run rate and India double-digit growth in FY '27, this 18.5% to 20% appears a bit conservative. Have you baked in significant impact of input cost increase or impact of geopolitical situation?

See, I think we have made a lot of investment in the last 1 or 2 years, both on people as well as on R&D. And both these costs is going to sustain. People costs will continue to be high because we've made manufacturing facilities and to add the field force etcetera. I think more or less that investment phase is coming to an end. But of course, that people cost is now sitting with us and revenue of that will start coming in, like Achin had said later with the new launches coming in. R&D also, while it is discretionary and in hand, but still will continue to be at about 6% to 7%, but more biased towards 7% because we are increasing the number of programs, etcetera. So therefore, I think 18.5% to 20% is a fair margin to assume. We are taking in more moderate kind of war risk and we are hoping that it's temporary and not really going to sustain.