Lannett: Pricing Pressure Has ‘Intensified Beyond Historical Norms’
US-Based Firm ‘Not Sitting Back’ To Address Challenges
Not many firms report a negative EBITDA when adjusted for costs, but this was the fate of Lannett during its financial Q2. Management addressed the challenges for Lannett’s base business and the ways in which the firm intends to turn the tide in the coming years.
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After a couple of years of heavy downwards pressure on US generics prices, prominent off-patent companies have pointed to a change in the pricing environment as several factors combine to reduce price erosion. Meanwhile, some firms are benefiting from first generic launches as others exit the market altogether, while injectables shortages continue to loom large.
In a busy period for Lannett, the company has benefited from a US shortage of generic Adderall rivals as well as a “more favorable pricing environment” to enjoy better results than expected – albeit with sales still significantly down on last year.
Even as it prepares for competition from an authorized generic, Lupin expects a launch of its generic to Boehringer’s blockbuster Spiriva in the fourth quarter of FY23. It hopes the launch will help its position in the US, where it has exited low margin products amid heightened competition, leading in turn to manufacturing job losses in India