July 9 (Reuters) – Indian drugmaker Dr Reddy’s Laboratories said on Thursday it will delay supplies of its generic diabetes drug due to an issue with the active pharmaceutical ingredient, erasing $678 million from its market capitalisation.
Dr Reddy’s, in a statement to exchanges, said that certain batches of semaglutide, the key ingredient in blockbuster diabetes and obesity drugs, were found to be “out of specification”.
The company said it would probe the root cause and ensure product quality, adding that it had sufficient production capacity to meet demand. Dr Reddy’s did not specify until when the supply disruption would last.
“There is no impact on patient safety or on the product’s existing global regulatory filings,” the company said.
Shares of the firm closed 5.9% lower at 1,269.50 rupees, in their steepest decline in more than three years. The pharma index settled 0.9% higher and India’s benchmark Nifty 50 ended 0.3% up.
More than half a dozen Indian drugmakers have launched lower-cost copies of Novo Nordisk’s Ozempic and Wegovy, vying for a share of the fast-growing global obesity treatment market.
Dr Reddy’s sells semaglutide under the brand name Obeda. Peers Zydus Lifesciences and Sun Pharma have also launched their semaglutide brands, intensifying competition in India, which has the second-biggest diabetic population globally.
Local drugmakers have launched their products at prices up to 70% lower than Novo Nordisk’s Ozempic.
($1 = 95.3775 Indian rupees)
(Reporting by Kashish Tandon in Bengaluru; Editing by Sherry Jacob-Phillips and Mrigank Dhaniwala)
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