Glenmark Pharmaceuticals (NSE:GLENMARK) Q2 2026 Earnings Call

0:00 Ladies and gentlemen, good day, and welcome to Q2 FY 'twenty seven Earnings Conference Call of Glenmark Pharmaceuticals Limited. As a reminder, all participant lines will be in the listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Please note that this conference is being recorded. I now hand the conference over to Mr. Utkash Gandhi, Senior General Manager, Investor Relations of Glenmark Pharmaceuticals. Thank you, and over to you, Mr. Gandhi. Thank you, Rinjo. Good morning, everyone, and welcome to the Q2 FY 'twenty seven Earnings Conference Call of Glenmark Pharmaceuticals Limited. Before we begin, I would like to wish everyone a very happy Diwali.

0:48 Let's review the overall business performance before we get on to the Q and A. For Q2 FY 'twenty seven, Glenmark's consolidated revenue from operations was at INR 42,004 and 73,000,000 as against INR thousand 4 and 69,000,000 in the corresponding quarter last year. On a like for like basis, Glenmark's consolidated revenue in Q2 FY 'twenty seven recorded Y o Y growth of close to 20%. For the first half of FY 'twenty seven, Glenmark's consolidated revenue from operations was INR $8,200,658,000,000 as against INR 93,113 million in the corresponding quarter last year. On a like for like basis, Glenmark's consolidated revenue in the first half of FY 'twenty seven recorded a Y o Y growth of around 18%. Covering our market wise performance, starting with India.

1:35 Sales in the Formulation business in India for Q2 FY 'twenty seven was at INR $1,300,274,000,000 as against INR $1,651,000,000 in the corresponding quarter last year. On a like for like basis, the India Formulations business recorded Y o Y growth of close to 14% in the second quarter and close to 15% in the first half of FY 'twenty seven. Glenmark continues to significantly outperform the IPM in terms of secondary sales. As per IQVIA, Glenmark's India Formulation business recorded a growth of 16.7% in the second quarter and 15.7% as per March September twenty twenty six data compared to the IPM growth of 13.8% in Q2 and 12.1% in March September.

2:20 Glenmark continues to sustain strong growth in its core therapeutic areas like dermatology, respiratory, cardiac and oncology. Glenmark's India business is ranked thirteenth with a market share of 2.4% as per IQVIA at September 2026. The company has 11 brands in the IPM top 300. In terms of four therapeutic areas, Glenmark is ranked second in dermatology, third in respiratory and fourth in the cardiac segment as per IQVIA MAT September data. Reflecting on the growing strength of its oncology franchise, Glenmark has also advanced into the top 10 of the oncology market according to the Ipsos MAD June 2026 data. In terms of our key innovative brands across therapy areas, we continue to see strong sales for both TAYLIVRA and RUKINZA, which are our partnered products in oncology, which were launched in Q1 FY 'twenty six.

3:14 In the respiratory segment, we launched NEP Smart GFP and Glenmark's FB Smart Tools in Q3 FY 'twenty six. This is the world's first nebulized fixed dose triple therapy for the treatment of COPD, and they've demonstrated very strong market traction since launch, further enhancing Glenmark's leadership position in respiratory. In terms of our GCC business, primary sales for the Glenmark Consumer Care business in Q2 FY twenty twenty seven were INR1252 million with a Y o Y growth of 46.5%. The CCL brands delivered a strong performance in Q2, driven by sustained momentum across all our key franchises, including Candid, FlashShield, Scalp and some of the newer brands like Wontress and Episoft.

4:03 Moving on to North America. So North America business recorded revenue of INR 12,089 million for Q2 FY 'twenty seven as against INR $4,400,656,000,000 last year. Net of the deferred out licensing income recognition for ISB 2001, the core business Y o Y growth for the North America region was around 31% in Q2 and around 25% in the first half of FY twenty twenty seven. During the quarter, Glenmark launched four products across multiple channels. Notable launches included Sugamedics injection, Futicasone Nasal Spray RX and Interdynamic capsule. In addition to these product launches, Glenmark also launched other pack sizes for existing products. And Glenmark is also looking to begin distribution of several other in licensed products in the third quarter.

4:51 Glenmark has strengthened its respiratory franchise with the launch of flotetasone propionate inhalation aerosol, the forty four mcg, which is a generic to Flovent. Glenmark was granted a CGT designation and received one hundred eighty days exclusivity upon commercialization. As mentioned before, Glenmark has also received approvals for fluticasone nasal spray, both Rx and OTC formulations. We have also filed additional ANDAs for differentiated respiratory products, including critical bone FLOVENT-one hundred ten, generic to FLOVENT-one hundred ten as well as for generic to eparatropium inhalation MDI. Glenmark has also initiated the ongoing commercialization of Ryaltris and is now leading brand strategy in market access across The United States.

5:45 Glenmark has also built a large portfolio of commercial injectable products through various partners. Our injectable facility received DIR from the U. S. FDA with a VII classification. And subsequently, we relaunched the fulvestrant injection out of the Monro facility in Q1, FY 'twenty seven. We are working on launching additional products from the Monro site in the upcoming quarters. During the second quarter, our Goa plant also received EIR from the U. S. FDA with the VII classification. A quick litigation update. As previously disclosed, there were multiple antitrust and consumer protection lawsuits, including class actions that consolidated in the Eastern District Of Pennsylvania against the company's subsidiary, Glenmark Pharmaceuticals Inc, in connection with allegations of price fixing market allocation and related anticompetitive conduct. The plaintiff included classes of direct purchasers and payers and indirect purchasers of generic drugs.

6:43 The three complaints filed by Humana were included in the consolidated litigation with a view to resolve this dispute and avoid uncertainty. Glenmark USA has agreed to enter into a settlement with Humana for a total amount of USD 15 USD 15,300,000, including interest payable in two installments. The settlement makes clear that Glenmark USA denies each and every one of the allegations made against it, and the settlement does not constitute any concession or admission of liability, wrongdoing or illegality on the part of Glenmark USA. The full amount of the payments of the settlement agreement has been provided in the company's financials. Moving on to Europe. Glenmark Europe operations revenue for Q2 FY 'twenty seven was INR 7,920 million as against INR 7,460 million, recording a growth of 6.2%.

7:35 Europe delivered a mixed performance during the quarter. We saw strong momentum across several Western European markets, being partly offset by softer demand in parts of the CEE. The region continues to strengthen its strategic portfolio through successful launches and commercialization of key brands, particularly Raltress and Middlebury, which gained further market acceptance across multiple markets. Strong execution in respiratory and dermatology specialty portfolios. Market access initiatives have helped sustain the business momentum. So we are continuing to remain focused on accelerating growth in the European region through our differentiated strategy around respiratory dermatology portfolios.

8:21 And we expect branded respiratory and branded dermatology to keep contributing higher in Europe as we move forward. Moving on to Emerging markets. For Q2 FY 'twenty seven, revenue from the Emerging Markets region was INR 8,769 million as against 6,585 million for the corresponding quarter last year, recording a Y o Y growth of 33.2%. EM delivered impressive performance in the second quarter, driven by robust secondary sales growth, continued market outperformance, portfolio expansion and strong execution across regions. Our Russia region recorded a healthy growth led by dermatology portfolio and product launches and continued market share gains amongst the dermatology companies in Russia. Glenmark ranked sixth as per the IQ data, Matt, September 2026.

9:09 LATAM delivered a strong Q2 as well, with growth driven mainly through the larger markets like Brazil, Mexico and Colombia, supported by continued portfolio expansion in the respiratory segment. Ryaltris was launched in Brazil during the second quarter of FY twenty twenty seven and has received encouraging initial feedback from physicians as well as the market. The MEAG business also remained resilient amidst the geopolitical and supply chain uncertainty with key countries outperforming several covered markets. And Ryaltris, again, continues to be a successful product in the region. The APAC region was one of our fastest growing regions in the quarter, delivering strong secondary sales growth driven by respiratory and dermatology brands. Moving on to our global innovative portfolio, starting with Ryaltris.

9:58 As of September 2026, marketing applications for Raltus have been submitted to more than 90 countries across the world. The product is now commercialized in 58 markets. And further, we are expecting Ryalties to be launched in additional 10 markets over the next few quarters. Ryalties was launched in Brazil during the second quarter, as mentioned before. We also have initiated the end to end commercialization of Ryalties in The U. S, and we've seen some initial success there as well. Our partners in Europe and emerging markets continue to drive a steady increase in market share across all the licensed markets. Winlevy, which is partnered with Cosmo. As mentioned earlier, the company has launched Winlevy in The U. K. In the first quarter of twenty twenty six. Since launch, the product has achieved formulary status covering 40% of The U. K. Market, and we've seen some initial strong feedback on the product. And Glenmark's partner, Cosmo, also received the MA last year. And in the first quarter, we have launched Winlevy in several other European markets, including The Nordics, CEE and Spain. Winlevy is also under regulatory review in South Africa, where Glenmark has submitted the application earlier.

11:11 Moving on to our oncology portfolio, starting with Kinahio, which is envafolimab partnered with Janssen Alphamab. Glenmark has filed Kinahio marketing authorization applications in 24 countries as of September 2020 We received our first regulatory approval in The Dominican Republic in September, and we have also initiated early access on inpatient programs in nine other markets. And Glenmark has also initiated a multi center Phase III study in adjuvant patients in NSCLC. Trastuzumab, resettucam, which is partnered with Engui Pharma, Glenmark advanced regulatory submissions for trastuzumab, ezetecan next generation HER2 targeting ADC.

12:00 As of September 2026, MA applications for trastuzumab, ezetecan have been submitted in two markets with additional filings to follow in subsequent quarters. As mentioned before, in June 2026, we had initiated a Phase III clinical trial in sacrum resistant ovarian cancer in India. We also received approval for initiating enrollment in other markets. Omolitinib, which is partnered with Hanzo. In Q3, Glenmark had entered into an exclusive license collaboration and distribution agreement with Hanzo for Omolitinib, which is a third generation EGFR tyrosine kinase inhibitor for the treatment of NSCLC. Glenmark has submitted MA applications for omlertinib in 13 markets as of September 2026 with the first commercial launch anticipated during the second half of FY twenty twenty seven.

12:49 Moving on to IGI. IGI is multi specific antibody pipeline in oncology consists of four assets, ISB two thousand and one or AGBV two thousand and one. To date, more than 170 subjects have been dosed in the TYGNITE Phase I study, 42 in dose escalation and more than 130 in dose expansion. Safety efficacy data from all subjects continues to be promising and consistent with the data previously presented at ASCO twenty twenty five. Updated Phase I clinical data from the Trignite study of ISB two thousand and one, ABBV-two thousand and one will be were accepted for oral presentation at the ASH Conference at the upcoming ASH twenty twenty six Conference in the session, multiple myeloma pharmacologic therapies, MAHRSON immunotherapy.

13:37 ISB two thousand three hundred and one is a first in class multispecific immune cell activator, which is targeting solid tumors and IGI intends to submit an IND by the end of this year. And ISB 2,300 2 and 2,501 are the other differentiated assets, both in early preclinical development. In terms of our immunology portfolio, ISB eight eighty or LAD191, which is the anti IL-one wrap, Almirall reported we partnered this asset with Almirall, and they reported in their H1 twenty twenty six financial results presentation that the ongoing Phase II study in HS is expected to read out in 2027.

14:22 In addition, Phase I data for LAD-one hundred ninety one were also presented at the European Society for Dermatology Research twenty twenty six meeting under the title Anti IL-one RAP Treatment shifts HS towards nonlesional state, providing further scientific support for the program's mechanism of action in ILB-830X8 STAR310, subsequent to BioCryst's acquisition of Astria and BioCryst's confirmation that STAR310 falls out of the company's strategic focus, BioCryst will return full licensing rights to IGA effective November 4. IGA is currently evaluating strategic pathways for Star three ten going forward, including potential partnerships. Some additional notes on the results. R and D expenses for the quarter were 344.9 crores, of which IGA R and D was around INR 187 crores.

15:14 Total CapEx during the second quarter was about INR 262.1 crores, of which tangible CapEx addition was around INR 170 crores and intangible was around INR 92 crores. From the Glenmark piece, we have Glen Saldana, Chairman and Managing Director Anurag Manfli, Executive Director and Global CFO and Purbhi Shah, General Manager, Investor Relations. I'll now hand it over to Glen for his opening comments. Thank you, Utkash. Good morning, everyone, and thank you for joining us today. Before we begin, on behalf of the Glenmark team, I'd like to extend our warmest wishes to all of you on the occasion of Diwali. Q2 was another strong quarter for Glenmark reflecting the continued momentum across our business and the disciplined execution of our strategy.

16:05 We delivered strong growth across key markets while continuing to strengthen our portfolio and advance our innovative programs. Our India business continued its strong performance across our core therapies. We continue to strengthen our presence across our four therapeutic segments through a differentiated branded portfolio and superior execution led approach. In North America, we continue to build on the momentum through our respiratory launches. We remain excited about the continued opportunities both in respiratory and injectables as well as the initial pickup of Ryaltris. Emerging Markets delivered another healthy quarter supported by the strength of our branded franchise and strong market execution.

16:56 We witnessed very strong secondary sales growth across our key emerging markets. In Europe, we remain focused on expanding our branded and respiratory and dermatology business, while steadily improving the overall quality and profitability of the overall business. Innovation remains a clear pillar for Glenmark's long term strategy. During the quarter, we continue to make progress across our innovation and specialty portfolio. We believe our innovative platform at IGI is truly world class and we are excited about the progression of our partnership with AbbVie as well as the next assets in the IJI pipeline starting with ISB 2301. We believe Glenmark is well positioned for the next phase of growth and we are excited about the opportunity ahead.

17:47 Our priorities remain clear, accelerating growth in our core business, scaling up our specialty and branded portfolios and advancing our innovative pipeline. With this, I'll hand the floor over to Anurag for his opening comments. Thank you, Glen, and good morning, everyone. Wish you all a very happy Diwali and a prosperous New Year ahead. As Glen mentioned, we delivered a strong performance in Q2, supported by our execution across all our businesses and continued focus on operational discipline. This is despite the cost pressure across the value chain due to the various geopolitical volatility. Excluding the various one offs from the last year as well as looking at the core business P and L, excluding IGA, we delivered a 20% Y o Y growth in revenue, along with 21% EBITDA margin in Q2.

18:42 The company recognized an exceptional item during the period for which the related amount has been fully provided for in the financial statement. Adjusting the exceptional item, our adjusted debt stood at $4.85 crores with net margin of 11.4% for the quarter. As of September, our net working capital days were in the range of one hundred and ten to one hundred and fifteen days, in line with our guidance of FY 'twenty seven. The company continues to maintain a net cash position of $4.24 CR as on September 2026. The increase in gross debt reflects the funding of certain strategic field force expansion in various markets and the multiple legal settlement payment, which were front loaded in the H1.

19:30 And accordingly, to meet this strategic expansion, we kept the cash in the various geographies to meet our strategic growth targets. As the operating leverage kicks in in as to FY 'twenty seven, we expect gross debt to be zero by end of FY 'twenty seven. The company remains focused on the prudent capital allocation. And accordingly, we are focusing on our strategic growth target and maintaining our healthy balance sheet ratios. Overall, we are pleased with the progress, and we have made in the first half of the year and confident of second strong second half based on the operating leverage. With that, we would be happy to take our questions.

20:16 Renu, we can open the floor up for Q and A. Thank you. We will now begin the question and answer session. The first question comes from the line of Demianthi Kehrai with HSBC. Please go ahead. Hi. Good morning, everyone. My first question is on your provisions for litigation charges in The U. S. So after what you booked in first half of this fiscal, what kind of visibility you have? Like how much more we can incur in coming quarters, if you have any thoughts around that?

21:13 So I think most of our big cases have been settled, right. And now going forward, we anticipate there will be some possible small amounts which will go out as we go forward. So the bulk of it is behind us in terms of settlements, legal settlements. Okay. So major ones are done, but some smaller markets might continue in coming quarters as well. Quarters and years maybe. Quarters to years. Okay. My second question is on your U. S. Buildup. So two points I want to understand. First, what kind of headroom you see for Slopen franchise in terms of market share gain, etcetera?

22:02 And then second, if you can update us on filing and launches from the Monroe facility? Sure. If you look at our respiratory franchise, right, so Flovent forty four was the first product, first major product that we rolled out and the product is doing as what we anticipated. So it's doing quite well. We are the sole generic on the market and to the best of our knowledge we will continue that way for a while. The second product we got was substantial product was Fluticasone Nasal Spray, right, which we are currently in the process of commercializing. So some of that impact you should see in Q3 and beyond in terms of the sales of Fluticasone nasal spray.

22:54 We also have two other product launches probably towards the end of this year. One is Flovent one hundred and ten and ipratropium, right. So these are the two launches towards the end of this fiscal year. And then next year, we are hoping we should have we are anticipating one or two more filings this year, which should come up for launch next year. So I think the respiratory franchise is very solid. Also in this quarter, we also have axitinib getting launched, right, which we think is an exclusive product. So I think that will also be a key driver to the performance in Q3 and beyond. So this is broadly The U. S.

23:42 Trajectory. And then of course in injectables in Monro, we've now launched fulvestrant already that's commercial and we are waiting for some of the iron complexes right to start getting approved as we go forward. So next year you should see our hope is at least three, four products commercial from Monro, one or two of them could be quite substantial. Sir, and when you are doing manufacturing of some licensed product as well as from Monro, right? No, not from Monro. So Monro, we only do our own products, but what we do is we do a lot of in licensing of various injectable products. So we have multiple partnerships, right, between various Indian companies and some Chinese companies, right, which has helped us get some excellent good portfolio. For example, Sugarmedex, which we recently launched or in the past we have Phytonadoin, we have a number of products from that franchise, right, which has helped us build a sizable institution business, right. That coupled with the Mondo launches in injectables, right.

24:53 Our thinking is in the next two, three years we should have a substantial injectable portfolio, right, between Mondro and the in licensed products as well as some of the in house respiratory product launches that we are doing, right, should be key drivers to our overall business in The U. S. Sure. That's helpful. And my last question is now India and U. S. Are two of your largest businesses strongly back in the growth trajectory. So how should we look at the EBITDA margin trajectory from current level? So I think just one point. So India and U. S. Are big, but I also think emerging markets will be very, very substantial for us, right, in the next five years. So I just want you to keep track of that too, right, because of all the because Riotis as a product continues to do exceedingly well and of course with the launch next year should be a substantial year for our oncology franchise, right, with the launch of amlotinib, Clasturisa, right, starting next year onwards, right, you should see substantial uptake in some of these products. And the oncology, some of these should start contributing next year, so FY 'twenty eight onwards. So I think the build out is pretty should be pretty substantial, right, from year on every year with the oncology products, with Ryaltris continuing to grow at 30%, 40%, right,

26:24 across the world, right, that should be a key driver for us over the next three, four years. So I think emerging markets should also be a substantial play. But in terms of margins, I'll ask Anurag to comment. So as the shift happened towards more branded innovative portfolio and India and emerging market along with the higher margin launches in North America. The margin trajectory and you will see in H2 itself, it's continued to improve because we have invested in feedforward expansion and strategic expansion in emerging market in oncology area in H1. So therefore, the expenses were front loaded, and these will start yielding results from H2 onwards. So we'll continue to see upward margin trajectory.

27:12 And what we guided earlier is that in terms of a percentage improvement on a year on year basis, that's what we are targeting on the margin front. Sure. Thank you, Glenmark. Thank you, Anurag. I'll get back in the queue. Sure. Next question comes from the line of Kunal Randhiriya with Axis Capital. Go ahead. Hi. Good morning, and thank you for the opportunity. Glen, first question on ISB 2001. In the press release, day before yesterday, you mentioned that you will be presenting at ASH this year. In your presentation, there are there's a mention of two trials.

27:57 There's one Phase III combination also. So Trident, I understand, it's your you probably have updated data on that. But can you just highlight what this Phase III combination is? Sure. So as you know, the ISB 2,001 is being run by AbbVie now, right, our partner's AbbVie. So they are running they have full control of the development and while we play an active, we collaborate very closely with them. They are running the trials. What are the Phase III trial, if you look at clinicaltrial.gov, right, AbbVie has started a Phase onetwo trial where they've combined ISB-two thousand and one along with, I think, CELMoDs, right, mezigdomide and evratomide, right?

28:50 And so they're running that trial as we speak. And it's on clinicaltrial.gov, so you can actually access it from there. The Trignite, of course, you're very familiar with the one hundred seventy patients that we've dosed is coming out of the Trignite study and I think a lot of we're pretty excited about the presentation that will go out at ASH. So you should wait till ASH to see what we're going to present there. Sure, sure. Got that. Second question is on emerging markets, great quarter this time around. And I think in the years ahead, you do have portfolio rollout of envapolumab, trastuzumab and others. So I'm just wondering what kind of growth one could expect and what would be the contribution of some of these new innovative products that we can maybe see in the next two to three years?

29:51 So I think so in terms of growth trajectory, right, EMs you should see a minimum 15%, 20% growth consistently for the next few years, right, coming out of EMs. Oncology alone, right, should start contributing next year, right. With some of these oncology products, my guess is, you should see next year $30,000,000.40000000 dollars coming out of the oncology franchise and that will continue to grow significantly. Of course, the margin profile also on these oncology drugs are much higher than the regular margin profile. So that should help from FY 2028 in terms of the overall margin profile. So EMs with the oncology launches alongside with Ryalta's continuing to do well, right, Consistently, you should my guess is you should see a 15%, 20% growth consistently from year on.

30:48 Sure. And can you share how much has Ryaltris done maybe in this quarter? And what do you think it could be again two, three years down the line? And which markets will drive the growth from year on? So if you look at Riotr as a product, right, we are currently if you look at the overall market, Kunal, right, it's about $3,500,000,000 right, in terms of entire steroidal nasal spray market. So we are addressing a pretty substantial market, right. If you put the mono steroidals like fluticasone nasal spray, Flonase and Nasonex and all these products, right, and the combination products. So and Ryaltus, we think is a best in class product, right, in terms of efficacy and safety profile and it's demonstrated consistently.

31:41 Many of our markets, we are already at above 20% market share, right, in almost 10 or 15 markets, have more than 20% market share. And I mean if we're able to broad base that, right, this can be a substantial product for the company as we go forward. Today, as of this year, we'll be at about $130,000,000 $140,000,000 of sales, our sales, right? And that's growing at about 30%, 40% right now, closer to 40% growth. So I think it's substantial rollout for us, right? And you can see multiyear growth coming out of Riotis as we go forward. In H1 itself, Kunal, the Riotis growth on a year on year basis was more than 40%.

32:28 Okay. Got it. And which markets are driving these? So I think it's very broad based, Gunal. So virtually every market we are having we are seeing that kind of uptake, right? And I also think, I mean, some of the newer markets we're just in the process of launching, for example, Brazil, which is a large market. China partners are just rolling it out in China. U. S, I think this is the first year and I think U. S, our goal is to continue to drive Ryelter's sales as we go forward. So I think the next four, five years we should see substantial uptake from The U. S. Market with regards to Ryelter's.

33:14 So this year is about $15,000,000 $20,000,000 of sales, but that will grow pretty rapidly and as we go forward. So I think these are some of the markets which are contributing, but I think the growth is broad based. Today almost all our markets we're growing at 30%, 40% consistently. Got it. Thanks a lot, Glenmark. All the best. Sure. Thank you. Next question comes from the line of Nitin Agarwal with TAM Capital. Please go ahead. Thanks, Glen, and congratulations to you for a good set of numbers. Glen, on the respiratory launches that we've done so far in H1, what is the market share sort of performance in both the products that we've launched so far?

34:04 So Flowent forty four, as per IQVIA, it's around 22% and growing, right, as we go forward. So I think we will continue to gain share on Flovent forty four. That's our view, right? Fluticasone nasal spray, we've just launched, Nitin. So it's too early to talk about market share. I mean, we had just started we got the approval, I think, in September, and we're just now rolling it out as we speak. And Glen, when you look through The U. S. Now, I guess, obviously, you've got things lined up for the second half of year, as you mentioned, as well as a couple of launches for next year. But I mean, what's a three to five year picture of The U. S? I mean, have we made enough investments? Are we making investments in The U. S? What kind of specific therapies or categories will drive The U.

34:54 S. For us? I mean, is there enough fuel to really take us meaningfully from where we are today? So I think so. I think the drivers will come out of both every year, we can launch a couple of respiratory products, right? These are very large products. So that's a big driver for us. The other thing is the injectables, right? I think Monro, you should see the next three, four, five years to give you substantial growth coming out of the Monro injectable products that we are commercializing. So on the generic side, it's both these platforms and of course, Ryalties, as I said, should give us a substantial growth, right, over the next four to five years, right, in The U. S. Market itself, right. And we'll be putting resources to drive that as we go forward.

35:46 So you mentioned iron sucrose complexes for next year in The U. S. And from a respiratory perspective, beyond the fluticasone sort of franchise, how many filings are we looking to do over the next couple of years? So we have fluticasone franchise, then we have ipratropium, which we are expecting to get approved. And then after that, we have at least a couple of filings every year. And these are all mostly MDI, DPI's and those kind of products. Okay. And secondly, you mentioned about the emergency oncology is, I think, the specialty product we need to scale up from next year onwards. If I got it right, you mentioned a 30,000,040 million dollars number for next year. I mean, how are you seeing this number sort of playing out in next couple of years?

36:34 So look, peak sales for this franchise, right, my guess is if you just take certain timelines, right, FY 'thirty should be in the 100,000,150 million dollars range and peak sales going up to almost $4.500000000 dollars in 'thirty five, 'thirty six kind of timeframe for the oncology franchise. Doesn't include ISB 2001, right? We're just talking about these three assets. And for these three assets, have we already made the requisite investments from a marketing perspective, promotion perspective or the incremental costs, some meaningful costs which can come on this going forward? So we've made significant investments, right? And as Anurag guided, H1, we did a lot of investments on the oncology side, putting the people, putting the teams, all the filings.

37:27 So I think bulk of it is done, but there will obviously be ongoing investments, right, as we go forward in the subsequent years. Okay. And lastly on Europe, given the size of business has got to now, how should we think about Europe's growth going forward? Europe on the generic side, there's a lot of struggle, right? I think I would just anticipate it will continue to grow low single digit for the next few years, right, on the generic side. But I think in Europe, if you see what we are doing, the two assets, right, Ryaltris again, part of it is through Menarini and part of it is through our own sales force, right, is very strong. For example, markets like The UK now, we are adding field force and expanding our presence in The UK on our own. In addition to Rialtrus, of course, Win Levy is doing exceedingly well. We've just launched it and we had a great conference at EADV, which is the European Dermatology Conference.

38:34 So I think win levy, these two are key drivers. Besides that, we have a couple of other derm assets, right, which are branded assets and on the respiratory side, we have some of these MDI DPI's, right, Suprabeck and Salmex and various products that we've launched on the branded respiratory side. So I think our goal is to continue to drive our branded performance in Europe and to move beyond generics. I mean, that's the roadmap for us. And the last one, in the past, we used to be pretty strong in the women's hormonal business, right? So that piece, at least in some parts, is coming back quite strongly in The U. S. So do we have any play there, any products which can become meaningful for us, which has seen traction?

39:25 So we have a very large OC portfolio, right, in The U. S, even today, right? So we probably have about 20 plus products in the oral contraceptive space, right? And the big one we have is Estradiol vaginal, which is also seeing a lot of uptake, right, in The U. S, right. That's a unique product for us. So I think the whole oral contraceptive space is pretty substantial for us. There are no major new launches there, but we are seeing a lot of traction on the existing franchise. So on the Estradol cream, do you I mean, what kind of pickup have you Estradiol vaginal pessaries. Okay. But are you seeing to... Are you seeing traction on that product?

40:12 Yes. We are. We are seeing a lot of offtake there. Thank you so much. Thank you. Next question comes from the line of Rahul Jiwani with IIFL. Now if I see in first half, we have generated around INR $16.50 crore of EBITDA, but our operating cash generation is negative in first half. So can you comment in terms of what's happening with respect to cash generation? And how do you see this trajectory playing out, let's say, in second half of the fiscal?

41:00 Yes. So Rahul, as you as I mentioned that first half, we was when we were expanding our fleet force and we had front loaded investment on the growth in the first half. So that was the one growth OpEx, which we were doing. Second is that the legal settlement, which we took in the P and L earlier, those payments were there, and those were largely loaded in the H1. So almost INR $5.20 crore of those payments were there. Then beside that, the CapEx of around $3.37 crore and then others are normal routine payment of the interest and the dividend and working capital. So with that, I think if you see that we were actually negative on our cash generation in the first half. But as we go into the second half because our because all these investments which we did in H1 is start yielding results in the H2. So we are expecting a strong H2, and that's what we are expecting to go back to almost INR 1,200 crore of cash without any debt.

42:04 So right now, INR 400 crore to almost INR 700 crore INR 800 crore cash generation, we are expecting in H2. So and that will be the trajectory because in our business, a growing growth business, we will continue to have a right capital allocation between the growth OpEx and growth CapEx and maintaining the sufficient cash balance to in the various geographies to keep funding our growth aspirations. Sure, Anurag. So if I see in first half, we have booked this INR $2.20 odd crore of litigation settlement expense. And you are talking about in the cash flow statement, there is INR 500 crore of these litigation settlements which have been paid out? Yes. So see, what happens that we book entire as soon as the settlement happens, the entire amount gets booked in P and L on an approval basis.

42:58 And whenever the cash actually, what we booked in this quarter, actually, the payment of only half of the payment have happened in this time. But the balance will go in the future. And similarly, what we booked in last year, actually some of these payments have come up in this year. Okay. And some of the sales force investments which you are talking about, which has led to an internal, let's say, gross debt going up and net cash coming down, these look very material from the impact which it has had on cash flow. So what are really these investments about in terms of building up these reg teams? So basically, we have almost added almost 1,100 people across the India and emerging market and oncology franchisee.

43:51 So all these investments recruitments were done in the first half. And therefore and if you see that first half, the operating margin was also lower. So with this actually growth OpEx and the lower operating margin compared to that, also some of these IGA growth the seeing in And lot in wise, because we continue to fund this innovation journey as well as the growth OpEx in emerging market in oncology. Therefore, that's why you see that cash generation was lower in the first half. Sure, Anurag. And let's say, from our next two to three year perspective, can you guide us in terms of what's a fair number to be building in with respect to our EBITDA to operating cash conversion?

44:51 Because as I said, the numbers have been all over the place over the past two, three years. So as I said that even in H2, we are expecting around INR 700 crores to INR 800 crores cash generation, which will repay this entire debt, and we'll be having a cash position of INR 1,200 crore in the net cash out. So we are expecting to be end up in this year at least. So this will be the trajectory because expansion wise, we will obviously it depends on what kind of like as Glen mentioned, like next year probably we will do invest some amount in rail trust U. S. That's to build up our debt actually, if you see our all the OpEx are very high payback. In H1, we invested and within H2, we start seeing the results.

45:37 So if you see that, we are expecting a strong cash flow generation. But obviously, having said that, we'll continue to maintain our growth aspiration of the emerging market in oncology franchisee across India and emerging markets. Sure. That's it from my side. Thank you. Thank you. Next question comes from the line of Krish Mehta with Inam Holdings. Please go ahead. Hi. Thank you for taking my questions. I just had one question on the balance sheet to confirm. If you could just confirm that the gross debt was close to what number this quarter? And what is the net debt of it's close to INR $4.30 crores of net cash, if I'm not wrong.

46:26 So is it fair to assume it's just INR $8.67 crores of gross debt? Yes. 67 crores $8.66.5 crores was the gross debt in this September and $1,290,000,000 was the cash in the quarter. So that's how it gives the crores of the net cash. Thank you. And my last question was on the oncology front. Glen, you mentioned that we can expect 30,000,000 to $40,000,000 of incremental sales next year and the margin profile will be much better. If you could just provide some color on the gross and operating margin deltas between the oncology products that we'll see coming in next year? I mean, again, it's I don't want to put a number out there, but at the EBITDA level, it will be well ahead of the company EBITDA, right, well ahead of the company average. So you're looking at like 30%, 40% at the net level, right, for all these oncology products.

47:30 Okay. That's very helpful. Thanks so much. Thank you. The next question comes from the line of with North Trailer. Please go ahead. I just wanted to know regarding ISB 2001. Outside AbbVie's territories, do we do you have licensing plans outside the territories that you're already covered with AbbVie? So all I can say at this point is, you know, Denmark, we have all the rights to India and emerging markets, right? And we right now the entire focus is to make sure that, collectively as partners, we're moving the asset forward and working as hard as possible to bring it to market.

48:32 So that's where all our energies are right now on ISB 2,001. Okay. And you had mentioned that there's going to be a presentation, right, at At ASH, correct. Yes. So is there anything you can share with us before that? Or it's like going to be me totally after presentation? Nothing at all. I can't share any because it's all under embargo, right? So we cannot share anything at this point. Okay. And regarding ISB 2301, is there any update? I think you you have mentioned in the... Yeah. Regarding that. Okay. So could you could you tell us of this funding that has come in, how much is going to go back to Ignacio and towards innovation?

49:21 So that's an I mean, all this happened a year or two ago, right? So all that is done, right? So we continue see IGI clearly is well funded, right? First of all, they have capital sitting till FY 2028 and beyond, right. That's what we had provided, right, in terms of funding to IGI from the proceeds, right. And over and above that also they're well funded as a company. Okay. Thank you. Thank you. Ladies and gentlemen, that was the last question for today. We have reached the end of question and answer session. I now hand the conference over to Mr. Utkarsh Gandhi for closing comments.

50:07 Thanks, Renju. Quick reminder to everyone that the information statement and analysis discussed during this call describing the company or its affiliates, objectives, projections, estimates are forward looking statements, and these are based on current expectations, forecasts and assumptions and subject to risks and uncertainties, which could cause actual outcomes to materially differ. No representation or warranty, either expressed or implied, provided in relation to the conversation and the documents provided. The company undertakes no obligation to update or revise any forward looking statements, whether because of new information, future impacts or otherwise. With that, we can close the Q2 FY twenty twenty seven earnings call. Thank you, everyone, for joining us today. Thank you. On behalf of Glenmark Pharmaceuticals Limited, that concludes this conference. Thank you for joining us. You may now disconnect.