Abbott India: MNC pharma play on increased consumer spending

Finally, a real conference call (Link) from Abbott India (28-Sep-2022):

Notes (fine-tuned as per my understanding):

• Branded generic space industry is a $20 billionàindustry growing at around 10% to 12% à3000 odd organizations. Only, 20% value with the multinationals and the rest with Indian companies. However, 43%, 44% of the market share is held by the top 10 companies. Abbott India Limited is the only multinational amongst the top 10 companies in the Indian pharmaceutical market. Abbott India is also growing faster than the Indian Pharma Market, IPM.

• Approach to becoming category leaders: Category expansion, testing, different SKUs for product gaps.

• Duphastone: Lost share but we have grown and continue to grow. Moved from being the only one to one amongst the 41 brands in a span of two years after being the only ones for 60 years. Broadly two segments to the entire Duphaston market- gynaecologists and IVF. Lost share in gynaecology, but not in IVF.

• Growth strategy:

  • Lifecycle management, expansion of current big brands – top 10 brands are categories and investing further to expand the categories
  • Scale up the number two set of brands- the next 10
  • New Product Launch: Plan to launch 75 products In the next five years compared to 35 Products launched in the last 3 years. Where is that delta coming from? Not as much in lifecycle management, but on LOEs (loss of exclusivity) and other therapy areas. Out of the 75, at least 50% are going to be LOE.
  • Nurture a new category under women health (postmenopausal): Investing heavily to build the post-menopausal problem category with Femoston, a very big and very strong molecule globally. Expect post-menopausal problem category to become huge in the next 3~5 yrs.
  • Ramp up headcount in GI: Abbott is the leader in the gastrointestinal category and would like to retain this leadership.
  • ~70% of our business comes from metros and class one towns. Spreading the business to class two, class three, and extra urban geographies.
  • Ensure product availability across channels.

• Miscellaneous:

  • 33% → In-house manufacturing
  • 58% → total raw materials was imported
  • FY22 top line growth → 14.1%: 7.6% volume and the rest price.
  • Almost 26% of our business by value comes from NLEM products
  • 60-odd brands in the portfolio. Top 10 brands → 70% of the business. Next,10 brands → 20% of the business, and the rest contribute the remaining.

Disc: I own the stock.