Thread by @ValueEducator

#ErisLifesciences Q3 FY22 concall highlights 💊💊

Like & Retweet for better reach !

1. Revenues for the quarter stood at ₹332 Cr (7% growth YoY).

2. EBITDA for the quarter was at ₹122 Cr (13.5% growth YoY). EBITDA margin for the quarter was at 37%. PAT for the quarter was ₹101 Cr (12% growth YoY)

3. The Guwahati facility contributed to 80% of the revenues for the quarter. Operating cash flow to EBITDA stood at 73% for the 9 months.

4. The growth has been driven by sustained market leading performance in all the top 5 therapies - Diabetes, Cardiology, VMN, CNS and Women's health which collectively account for 91% of revenues.

5. They have entered into the insulin analogues and GLP1 markets through a joint venture with MJ Biopharm in which Eris holds a 70% equity stake. They are on track to launch human insulin next month.

6. They are creating a new division with 140 medical representatives to kick start the insulin business. The next big product from this joint venture would be Glargine which is presently in phase 3 clinical trials and is expected to launch sometime in calendar year 2023.

7. The MR productivity has increased to ₹5.1 lakhs from ₹4.6 lakhs in Q3 FY21. This has contributed significantly to increasing the EBITDA margin from 36% to 37.3% in the first 9 months of FY22.

8. Of the 10 new launches planned for this financial year, they have launched 4 in the first 9 months. They have several more launches lined up in Q4 including Human Insulin and Drolute, which is their brand of Dydrogesterone in the Women's Health segment.

9. Dydrogesterone is a synthetic progestogen that is used to treat hormonal disorders in women. This is a 500+ crore market which is growing in excess of 40% per annum.

10. When evaluating new acquisitions they have to consider that their standalone gross margins are 84%, so anything below 70-75% gross margin is not feasible for them.

11. The entire oral anti-diabetes therapy is being taken over by the DPP4s and SGLT2s at a very rapid rate. If you exclude these products, there is no growth in the entire oral anti-diabetes market.

12. There is a dip in chronic therapies for 2 reasons - first one is, whenever the acute therapy becomes very heavy, the overall stocking on chronic therapies goes down

and the second reason is patients with chronic diseases stocked up on medicines during the initial COVID outbreak and the demand has not normalized yet.

13. In the diabetes segment, they understand that Glimepiride is no longer a first line of treatment and they have been moving towards the combination drug Glimisave MV which has become the No. 2 drug in its category. It did sales of about ₹80-84 Cr and is growing at 15%.

14. They have launched Dydrogesterone and expect ₹6 Cr run rate this quarter. They are expecting revenues of ₹30 Cr next year and ₹50 Cr in 2 years.

15. The only player who has taken a lead in the online pharmacy space is PharmEasy. Overall organized pharma retail accounts for about 3.5% penetration of the IPM and they receive no discounts.

16. The company is developing a very symbiotic relationship with these players as they are able to provide very insightful pin code level data.