Natco Pharma’s recent venture into Pheromone-based mating disruption technology for farmers in India
Natco Pharma has been diversifying into agrochemicals recently. As a part of this, the company has begun to work closely with ATCG Biotech Pvt. Ltd for the technology through its Crop Health Science ( CHS ). The recent development in line with this move is Natco diversifying into agrochemicals, the foray into the Pheromone–based mating disruption technology. This venture is for the Integrated Pest Management ( IPM ) solution to the farmers in India. 
The company has claimed this to be a positive development, but the results will accrue over time. In the meanwhile, the company’s prospects hinge on the earnings growth in the pharma segment.
The performance of the company was slightly weak in the December 2020 quarter. The weak flu season in the United States has affected its sales recently. Similarly, the soft oncology products sales in the domestic arena have also been affected. The pharma major is keenly watching over the fourth-quarter performance. The company expected some positive developments in this quarter based on the new approvals in the US.
Natco Pharma’s updates on ANDA
The company has also announced the approval of its ANDA for Everolimus tablets (a generic drug for Afinitor ) by the USFDA. The marketing partner for this product is Breckenridge Pharmaceutical Inc. ( BPI ). This product is indicated under the oncology treatment and will be launched as tablets 2.5 mg, 5 mg, 7.5 mg, and 10 mg. Afinitor and its therapeutic equivalents generated annual sales of over $ 712 million in the US during the 12 months that ended in December 2020.
Analysts also believe that the generic Everolimus could bring over $ 25 to 35 million opportunities for Natco in the fiscal year 2022 ( FY22 ).
Another drug that can turn the tides for the company is the generic Zortress, an immunosuppressant. This drug is waiting for approval from the health regulator. Once approved, it becomes the only approved generic currently and offers a niche $ 150 million markets with Hikma. This approval is also expected to improve the company’s growth prospects in FY22. It is also planning to launch some large products in the US.
What do Analysts have to say?
Analysts claim that the improved revenue visibility in the US is positive. The rising competition in the domestic oncology space is expected to make others vigilant. Some other products in the US are also likely to see price erosion. The generic Doxil is an example of this. Apart from this, the entry of a third entrant can potentially impact generic Copaxone’s sales.
However, Edelweiss Securities Ltd’s analysts have modeled $700 million in the agrochemical sales during FY22. Although this is promising, the company feels that this field has a certain degree of uncertainty.
The company has been focused on the launch of niche products in the US. The development of these products involves complex processes. The ANDA fillings of this company are also done for products that are difficult to manufacture and enjoy limited production. Apart from this, the company has also been growing its non – US revenues and diversifying into agrochemicals to de-risk its business models.
- 1. United States Food and Drug Administration
- 2. Abbreviated New Drug Application