Dr. Reddy's Laboratories

The company's first international move took it to Russia in 1992. There, Dr. Reddy's formed a joint venture with the country's biggest pharmaceuticals producer, Biomed. They pulled out in 1995 amid accusations of scandal, involving "a significant material loss due to the activities of Moscow's branch of Reddy's Labs with the help of Biomed's chief executive".[7] Reddy's sold the joint venture to the Kremlin-friendly Sistema group. In 1993, Reddy's entered into a joint venture in the Middle East and created two formulation units there and in Russia. Reddy's exported bulk drugs to these formulation units, which then converted them into finished products. In 1994, Reddy's started targeting the US generic market by building state of art manufacturing facility.

Biopharma Finished Dosage Unit III in Hyderabad

Biopharma Finished Dosage Unit I in Hyderabad

Reddy's path into new drug discovery involved targeting speciality generics products in western markets to create a foundation for drug discovery. Development of speciality generics was an important step for the company's growing interest in the development of new chemical entities. The elements involved in creating a speciality generic, such as innovation in the laboratory, developing the compound, and sending the sales team to the market, are also stages in the development of a new speciality drug. Starting with speciality generics allowed the company to gain experience with those steps before moving on to creating brand-new drugs.

Reddy's invested heavily in establishing R&D labs and is the only Indian company to have significant R&D being undertaken overseas. Dr. Reddy's Research Foundation was established in 1992 and in order to do research in the area of new drug discovery. At first, the foundation's drug research strategy revolved around searching for analogues. Focus has since changed to innovative R&D, hiring new scientists, especially Indian students studying abroad on doctoral and post-doctoral courses. In 2000, the Foundation set up an American laboratory in Atlanta, dedicated to discovery and design of novel therapeutics. The laboratory is called Reddy US Therapeutics Inc (RUSTI) and its main aim is the discovery of next-generation drugs using genomics and proteomics. Reddy's research thrust focused on large niche areas in western markets – anti-cancer, anti-diabetes, cardiovascular and anti-infection drugs.

Reddy's international marketing successes were built on a strong manufacturing base which itself was a result of inorganic growth through acquisition of international and national facilities. Reddy's merged Cheminor Drug Limited (CDL) with the primary aim of supplying active pharmaceutical ingredients to the technically demanding markets of North America and Europe. This merger also gave Reddy's an entry into the value-added generics business in the regulated markets of APIs.

By 1997, Reddy's made the transition from being an API and bulk drug supplier to regulated markets like the US and the UK, and a branded formulations supplier in unregulated markets like India and Russia, into producing generics, by filing an Abbreviated New Drug Application (ANDA) in the USA. The same year, Reddy's out-licensed a molecule for clinical trials to Novo Nordisk, a Danish pharmaceutical company.

It strengthened its Indian manufacturing operations by acquiring American Remedies Ltd. in 1999. This acquisition made Reddy's the third largest pharmaceutical company in India, after Ranbaxy and Glaxo (I) Ltd., with a full spectrum of pharmaceutical products, which included bulk drugs, intermediates, finished dosages, chemical synthesis, diagnostics and biotechnology.

Reddy's also started exploiting Para 4 filing as a strategy in bringing new drugs to the market at a faster pace. In 1999 it submitted a Para 4 application for omeprazole, the drug that had been the cornerstone of its success in India. In December 2000, Reddy's had undertaken its first commercial launch of a generic product in the US, and its first product with market exclusivity was launched there in August 2001. The same year, it also became the first non-Japanese pharmaceutical company from the Asia-Pacific region to obtain a New York Stock Exchange listing.

In 2001 Reddy's became the first Indian company to launch the generic drug, fluoxetine (a generic version of Eli Lilly and Company’s Prozac) with 180-day market exclusivity in the USA. Prozac had sales in excess of $1 billion per year in the late 1990s. Barr Laboratories of the U.S. obtained exclusivity for all of the approved dosage forms (10 mg, 20 mg) except one (40 mg), which was obtained by Reddy's. Lilly had numerous other patents surrounding the drug compound and had already enjoyed a long period of patent protection. The case to allow generic sales was heard twice by the Federal Circuit Court, and Reddy's won both hearings. Reddy's generated nearly $70 million in revenue during the initial six-month exclusivity period. With such high returns at stake, Reddy's was gambling on the success of the litigation; failure to win the case could have cost them millions of dollars, depending on the length of the trial.

The fluoxetine marketing success was followed by the American launch of Reddy's house-branded ibuprofen tablets in 400, 600 and 800 mg strengths, in January 2003. Direct marketing under the Reddy's brand name represented a significant step in the company's efforts to build a strong and sustainable US generic business. It was the first step in building Reddy's fully-fledged distribution network in the US market.

In 2015, Dr. Reddy's Laboratories bought the established brands of Belgian drugmaker UCB SA in South Asia for ₹8 billion ($128.38 million).[8] Dr. Reddy's Laboratories also signed a licensing pact with XenoPort for their experimental treatment to treat plaque psoriasis. As per the agreement, Dr. Reddy's will be granted exclusive US rights to develop and commercialise XP23829 for all indications for an upfront payment of $47.5 million.[9]

In 2001 Reddy's completed its US initial public offering of $132.8 million, secured by American Depositary Receipts. At that time the company also became listed on the New York Stock Exchange. Funds raised from the initial public offering helped Reddy's move into international production and take over technology-based companies.

In 2003 Reddy's also invested $5.25 million (USD) in equity capital into Bio Sciences Ltd.

Auriegene Discovery Technologies, a contract research company, was established as a fully owned subsidiary of Reddy's in 2002. Auriegene's objective was to gain experience in drug discovery through contract research for other pharmaceutical companies. Reddy's entered into a venture investment agreement with ICICI Bank, an established Indian banking company. Under the terms of the agreement, ICICI Venture agreed to fund the development, registration and legal costs related to the commercialisation of ANDAs on a pre-determined basis. Upon commercialisation of these products, Dr. Reddy's pays ICICI Venture royalty on net sales for a period of 5 years.

The company elected to expand globally, and acquired other entities. In March 2002, Dr. Reddy's acquired BMS Laboratories, Beverley, and its wholly owned subsidiary Meridian Healthcare, for 14.81 million Euros.[4] These companies deal in oral solids, liquids and packaging, with manufacturing facilities in London and Beverley in the UK. Recently, Dr. Reddy's entered into an R&D and commercialisation agreement with Argenta Discovery Ltd., a private drug development company based in the UK, for the treatment of chronic obstructive pulmonary disease (COPD).

Dr. Reddy's entered into a 10-year agreement with Rheoscience A/S of Denmark for the joint development and commercialisation of Balaglitazone (DRF-2593), a molecule for the treatment of type-2 diabetes. Rheoscience holds this product's marketing rights for the European Union and China, while the rights for the US and the rest of the world will be held by Dr. Reddy's. Dr. Reddy's conducted clinical trials of its cardiovascular drug RUS 3108 in Belfast, Northern Ireland, in 2005. The trials were conducted to study the safety and the pharmacokinetic profiles of the drug, which is intended for the treatment of atherosclerosis, a major cause of cardiovascular disorders.

Dr. Reddy's entered into a marketing agreement with Eurodrug Laboratories, a pharmaceutical company based in Netherlands, for improving its product portfolio for respiratory diseases. It introduced a second-generation xanthine bronchodilator, doxofylline, which is used for the treatment of asthma and COPD patients.

In 2004, Reddy's acquired Trigenesis Therapeutics Inc; a US-based private dermatology company. This acquisition gave Reddy's access to proprietary products and technologies in the dermatology sector.

Dr. Reddy's Para 4 application strategy for generic business received a severe setback when Reddy's lost the patent challenge in the case of Pfizer’s drug Norvasc (amlodipine maleate), a drug indicated for the treatment of hypertension and angina. The cost involved in patent litigation as well as the unexpected loss of the patent challenge affected Reddy's plans to start speciality business in the US generic markets.

In March 2006, Dr. Reddy's acquired Betapharm Arzneimittel GmbH from 3i for 480 million Euros. Betapharm is Germany's fourth-largest generics pharmaceutical company, with a 3.5% market share, including 150 active pharmaceutical ingredients.

Reddy's has promoted India's first integrated drug development company Perlecan Pharma Pvt Ltd together with ICICI ventures capital fund management company Ltd and Citigroup Venture Capital International growth partnership Mauritius Ltd. The combined entity will undertake clinical development and out-licensing of new chemical entity assets.

Dr. Reddy's is presently licensed by Merck & Co. to sell an authorised generic version of the popular drug simvastatin (Zocor) in the USA. Since Dr. Reddy's has a licence from Merck, it was not subject to the exclusivity period on generic simvastatin,[10] which ended in 2006.

As of 2006, Dr. Reddy's Laboratories exceeded US$500 million in revenues, flowing from their APIs, branded formulations and generics segments; the former two segments account for almost 75% of revenues. Dr. Reddy's deals in and manages all the processes, from the development of the API to the submission of finished dosage dossiers to the regulatory agencies.

In 2010, the family-controlled Dr Reddy's denied[11] that it was in talks to sell its generics business in India to US pharmaceutical giant Pfizer,[12] which had been suing the company for alleged patent infringement after Dr Reddy's announced that it intended to produce a generic version of atorvastatin, marketed by Pfizer as Lipitor, an anti-cholesterol medication.[13][14] Reddy's was already linked to UK pharmaceuticals multinational Glaxo Smithkline.[15]

In September 2020, the company partnered with the Russian Direct Investment Fund to conduct phase 3 trials of the Sputnik V COVID-19 vaccine in India, and manufacture and distribute up to 100 million doses of the vaccine in India via its subsidiary Hetero Biopharma once approved by the Drugs Controller General (DCGI).[16][17] The vaccine moved to late-stage trials in January 2021,[18] and was approved for emergency use on 12 April 2021 after phase 3 trials concluded with results comparable to the late-stage trial in Russia.[19][20]

In September 2005, Dr. Reddy's spun off its drug discovery and research wing into a separate company called Perlecan Pharma Private Limited. At the time, this was hailed as an innovative move, but in 2008, the company had to be wound down due to funding constraints.[24] Dr. Reddy's was the first Indian pharma company to attempt such an effort to de-couple risk of drug discovery from the parent company by creating a separate company with an external source of funding. Perlecan Pharma was partially funded by ICICI Venture Capital and Citigroup Venture International, both of which held a 43% stake in Perlecan for an estimated $22.5 million. However, the company was forced to buy back the Perlecan shares from ICICI and Citigroup due to doubts regarding the commercial viability of the drug candidates that were in Perlecan's pipeline. At that point, Perlecan became a wholly owned subsidiary. In the board meeting of 23 October 2008, the company chose to amalgamate/absorb Perlecan, thereby making it an in-house research facility, as it was before 2005.[24]

In 2009, the company did a U-turn and has handed over discovery research and related intellectual property to its Bangalore-based subsidiary, with the possibility of spinning it off as a different entity altogether. "The company may be hoping to find a strategic partner in the future to share the risks and research funding."[25]

In June 2011, certain lots of Dr. Reddy's generic Simvastatin tablets were recalled due to tablets having a "musty" or "moldy" smell.[26]

On 24 June 2014, the New York Times published an article "Warning Unheeded, Heart Drugs Are Recalled" in which it said another large Indian manufacturer and "Dr. Reddy's Laboratories, have announced recalls over the past two months totalling more than 100,000 bottles" of "a widely used heart drug, Toprol XL" "because their products were not dissolving properly".[27]

In December 2014 the FDA issued a Form 483 letter over concerns discovered during an inspection of its Srikakulam facility. No specific violations were mentioned in the letter.[28][29]

In 2019, Dr. Reddy's recalled all ranitidine products in the US market due to contamination with the carcinogen N-nitrosodimethylamine (NDMA).[30] Months later, all brands of ranititdine were recalled and it was taken off the US market, as the carcinogen was an unavoidable byproduct.[31]

In 2020 Dr. Reddy's Laboratories (UK) Ltd recalled a specific batch of nitrofurantoin 50 mg tablets from pharmacies and wholesalers due to dissolution during routine stability testing and a specific batch of aripiprazole due to the potential for small particles of aripiprazole active material to be present which may affect the efficacy of the product.[32][33]

Dr. Reddy's has been accused of polluting agricultural land surrounding its plant in Nalgonda district of Telangana.[34]

Andrew Walker, the Director of Dr. Reddy's Laboratories in Mirfield, England, approached two public photography auditors of PINAC Media UK Ltd in October 2021 and informed them that he did not give consent to filming on publicly accessible private property outside the gate of their chemical plant, until the police explained to him that they were not suspecting them of committing any crime.[35][36]