Glenmark Life Sciences Ltd Management Discussions

Macro Economy

Global Economy

The global economy showed signs of stabilisation throughout 2024. Inflation gradually moderated, inching closer to central bank targets, while labour markets normalised, with unemployment and vacancy rates reverting to pre-pandemic levels. Economic growth remained resilient, averaging around 3%, with global output nearing its potential.

Nonetheless, the global recovery faces renewed headwinds. Major shifts in trade policy led by the United States Rsimposition of widespread tariffs and retaliatory measures by trading partners have reignited uncertainty. Financial markets experienced sharp corrections, with steep declines in major equity indices and heightened bond yields, although some recovery followed subsequent policy adjustments.

Slowing economic momentum is evident across regions. Recent data shows disappointing GDP growth figures, subdued retail activity, and weaker business sentiment. Inflation progress has largely stalled, with core goods inflation ticking upwards and services inflation remaining above pre-pandemic levels. Although trade volumes held up, much of this reflects temporary factors such as stockpiling ahead of anticipated tariffs.

In the United States, robust private consumption, which had been a key growth driver, is softening amid rising uncertainty and policy volatility. The euro area continues its cyclical recovery but faces subdued domestic demand and uneven growth patterns between nations, particularly between manufacturing-heavy and services-driven economies.

Chinas economy remains challenged by a prolonged real estate slump and weakening consumer confidence, exacerbated by rising trade tensions. Structural vulnerabilities such as energy dependence, productivity gaps, and ageing populations, are creating divergent recovery paths globally. Many economies now face restricted fiscal and monetary space due to elevated debt levels and tighter financing conditions.

OUTLOOK

The global growth projection for 2025 has been revised downward to 2.8%, reflecting the combined effects of trade disruptions, policy uncertainty, and weaker domestic demand across key economies. A modest recovery to 3% is expected in 2026. However, risks remain tilted to the downside, with high policy ambiguity, volatile commodity prices, and structural imbalances posing ongoing threats.

Indian Economy

Indias GDP growth forecast for FY26 has been revised downward by 40 basis points to 6.3%, primarily due to weak external demand from key trade partners and the impact of global trade frictions.

Despite this revision, India is expected to remain the fastest- growing major economy. Over the medium term, growth is anticipated to average 6.6% in FY27-FY28, supported by resilient services activity and a gradual recovery in exports.

In FY25, Indias economy expanded by 6.5%, driven by strong growth in construction and services, while industrial activity saw some deceleration. Agricultural output recovered from earlier drought conditions, supported by stable rural demand. Investment growth may moderate due to global uncertainties, though domestic consumption remains supportive of overall growth momentum.

Inflationary pressures have eased significantly. CPI inflation fell to 3.2% in April 2025-its lowest level in nearly six years- driven by declining food prices. The RBI expects retail inflation to average 3.7% in FY26 and has maintained a supportive monetary stance to aid growth. With inflation within target, further policy easing remains a possibility.

On the fiscal front, the government continues to make progress in fiscal consolidation. Higher tax revenues and controlled revenue expenditure are expected to contribute to a gradual reduction in the public debt-to-GDP ratio. Capital expenditure has remained a key driver of fiscal strategy, providing support to medium-term growth prospects.

OUTLOOK

Indias economic fundamentals remain strong, with a stable macroeconomic environment, moderating inflation, and a policy focus on infrastructure-led growth and social development. These factors position the country well to navigate global headwinds and maintain its growth leadership among major economies.

Pharma Industry

Global Pharma Industry

The global pharmaceutical industry is expected to generate revenues of $1.21 trillion in 2025. The sector is forecast to grow at a CAGR of 6.15% from 2025 to 2034, propelled by the rising prevalence of chronic illnesses, an ageing global population, and increased healthcare expenditure.

Key trends shaping the industry include:

Digital Transformation

Technologies such as artificial intelligence and machine learning are set to transform drug discovery, manufacturing processes, and patient care, enabling more efficient operations and the development of personalised treatment options.

Contract Manufacturing

The role of Contract Manufacturing Organisations (CMOs) is becoming increasingly vital, as they support the scaling up of production and help meet growing global demand.

Sustainability Focus

The industry is placing greater emphasis on environmentally friendly manufacturing and building more sustainable supply chains, in response to global climate and ESG concerns.

Innovative and Personalised Therapies

Progress in therapeutic areas such as oncology, immunology, and rare diseases is anticipated to fuel growth. Additionally, the continued evolution of personalised medicine will lead to more precise, patient-specific treatment solutions.

The sector faces notable challenges like:

Patent Expirations

The expiry of patents on high-revenue drugs will pose challenges for pharmaceutical companies, potentially impacting revenue streams.

Drug Pricing Pressures

Governments and healthcare players are increasing pressure on pharmaceutical pricing, which could affect company margins and profitability.

Regulatory Developments

Evolving drug pricing regulations and broader policy changes may present additional hurdles for the industry.

Mergers and Acquisitions

M&A activity is likely to rise, as firms seek to strengthen their product pipelines, expand capabilities, and diversify income sources.

OUTLOOK

The outlook for the global pharmaceutical industry in 2025 remains positive, underpinned by technological advancements, rising healthcare demand, and a growing emphasis on sustainable and personalised treatments.

However, the landscape is not without challenges-patent cliffs, pricing pressures, and evolving regulations continue to test resilience. Adding to this, the recent announcement of reciprocal tariffs by the US has introduced a note of caution for exporters, particularly those with significant exposure to the US market. Changing policy signals a potential for tariff adjustments; however, any impact on the pharmaceutical sector may be limited, given its critical importance to healthcare systems and global well-being. In this dynamic environment, companies that prioritise innovation, adaptability, and strategic agility will be best placed to navigate uncertainty and capture growth opportunities.

Indian Pharma Industry

Indias pharmaceutical industry is poised to reach a market size of $450 billion by 2047, with a strong emphasis on selfreliance, innovation, and global leadership. The next phase of growth will be likely driven by advancements in next- generation therapies, increased domestic capabilities in APIs and KSMs, expansion of the CRDMO ecosystem, and the integration of healthcare services.

Integrated Healthcare & Accessibility

National initiatives like the Ayushman Bharat Digital Mission (ABDM) are helping create a connected, inclusive healthcare system. Focus on preventive care, early diagnosis, and value- based healthcare is rising.

OUTLOOK

Need for Skilled Workforce

Talent gaps in specialised areas such as biologics and personalised medicine remain a concern. Industry-academia collaboration and practical training are essential for building future-ready talent.

Key focus areas driving growth will be -

Next-Gen Therapeutics & Innovation

Innovation in advanced modalities such as personalised medicine, biologics, and therapies targeting rare and complex diseases will be catalysts for growth. Strategic partnerships across industry, academia, government, and startups will be critical to accelerating R&D.

API and KSM Self-Reliance

India is strengthening its production capabilities for Active Pharmaceutical Ingredients (APIs) and Key Starting Materials (KSMs), with emphasis on reducing import dependency, re-engineering manufacturing for sustainability, and building capacity.

CRDMO Expansion

The Contract Research, Development, and Manufacturing Organisation (CRDMO) sector is emerging as a significant growth engine, especially i n the wake of global macroeconomic and geopolitical shifts. India is well-positioned to become a global leader, provided it enhances productivity, compliance, and cost-efficiency.

Indias pharmaceutical industry is poised to transition from being the "Pharmacy of the World” to a "Global Pharma Powerhouse" by 2047.

Achieving this vision will require a cohesive, ecosystem-led approach that prioritises innovation, digital transformation, quality excellence, and a future-ready workforce. While challenges around talent, pricing pressures, and global compliance persist, Indias strong fundamentals and strategic policy support position the sector for sustained growth and global leadership in the decades to come.

Digital and MedTech Convergence

Integration of digital technology, pharma, and MedTech is revolutionising drug development and delivery. Tools such as AI, digital therapeutics, smart devices, and mobile apps are creating more personalised and holistic care models.

Roadmap of Government Initiatives and Regulatory Streamlining to Spur Innovation and Promote Local Manufacturing

Quality, Talent and Digital as Core Enablers

Over 80% of industry leaders identify focus on quality , digital integration, and development of skilled talent as essential pillars for achieving the sectors long-term vision.

Sustainable Manufacturing Practices

A majority of CXOs support environmentally sustainable practices to reduce costs and align with global ESG standards.

PLI Scheme for Production of High Value Pharmaceuticals	Strengthening of Pharmaceutical Industry	J PRIP Scheme	J BioE3 Policy
PLI Scheme for Promotion of Domestic Manufacturing of Critical KSMs/DIs/APIs in India			Business Reforms Action Plan to Improve EoDB
Scheme For Promotion of Bulk Drug Parks			Clinical Trial Waiv Under Rule 101

I

	Expected Initiative Outcome
Foster Manufacturing	Indigenous Innovation	Skilled Workforce	Regulatory Streamlining

 

2020 - 2021

2023

2023

2024

Global API Industry

Pharmaceutical manufacturing is undergoing transformation and entering a new era, fuelled by mounting global demand, stricter regulatory oversight, and fast-paced technological advancement. At the forefront of this evolution is the Active Pharmaceutical Ingredient (API) production segment, which is undergoing fundamental shifts. By end of 2025, the way APIs are developed, manufactured and monitored will be significantly redefined, ushering in smarter, greener, and more resilient operations. This shift is improving efficiency and quality, while paving the way for more sustainable healthcare delivery.

Key trends in global API industry:

Automation and AI Integration

API manufacturing is embracing automation and artificial intelligence to streamline production, minimise human error, and enhance real-time quality monitoring. Predictive analytics powered by AI are enabling proactive decisionmaking, reducing waste and improving yield.

Continuous Manufacturing

The transition from batch to continuous manufacturing is allowing for uninterrupted production, leading to shorter time-to-market, greater scalability, and improved cost efficiency. This model enhances flexibility and responsiveness to market needs.

Green Chemistry and Sustainability

Environmental responsibility is now central to API manufacturing. Companies are investing in greener processes-such as solvent recovery and energy-efficient systems-to align with global sustainability goals and reduce operational costs.

Evolving Regulatory Landscape

Regulatory bodies are demanding higher standards in compliance, quality assurance, and traceability. This is prompting manufacturers to adopt smarter systems and maintain robust, audit-ready processes.

Industry Response

To stay competitive, manufacturers are integrating digital solutions, forming cross-sector collaborations, and prioritising R&D investments. The focus is on future-ready infrastructure, skilled workforce development, and innovation ecosystems.

GLOBAL HIGH-POTENCY APIs (HPAPI) MARKET

The High-Potency Active Pharmaceutical Ingredients (HPAPI) market is undergoing significant expansion, spurred by the increasing demand for specialised drugs, especially in oncology and targeted therapies. As more chronic diseases, particularly cancer and neurological disorders rise globally, the need for High-Potency APIs, such as those used in antibody-drug conjugates and precision medicines, has intensified. At the same time, regulatory changes, technological advancements, and shifting manufacturing landscapes are shaping the future of this vital sector.

The global HPAPI market, estimated to be worth $29.34 billion in 2025, is projected to grow to $45.70 billion by 2030, with a CAGR of 9.27%. Factors such as the growing prevalence of chronic diseases, the expiration of patents on key oncology drugs, and increasing interest in biosimilars are driving the demand for HPAPIs. Technological innovations, including automation, artificial intelligence, and advanced containment systems, are enhancing manufacturing capabilities, ensuring higher safety standards and compliance.

Governments are supporting domestic production, which fosters the growth of local manufacturing infrastructure. Key regional markets include North America, with the US leading, Europe, particularly Germany and France, and Asia- Pacific, with China and India showing strong growth. The market is highly competitive, with major players focusing on R&D, strategic acquisitions, and expanding specialised manufacturing capabilities.

OUTLOOK

By 2026, API manufacturing will be faster, cleaner, and more intelligent, with advancements in automation, sustainability, and technology ensuring safer, more accessible medications.

The HPAPI market will continue to grow, driven by demand for precision medicine, oncology treatments, and biosimilars, with technological innovation and strategic investments creating opportunities for both established and emerging players.

Source: Mordor Intelligence & EY

Indian API Industry

India ranks as the worlds third-largest producer of APIs, accounting for 8% of the global API market by value. Despite this, the country continues to rely heavily on imports, with around 35% of its API requirements - particularly fermentation-based APIs - sourced from China.

The Indian API industry grew at a CAGR of 8.4% between 2017 and 2023 and is expected to maintain this pace through 2029, accelerated by national efforts towards self-reliance, government incentives such as the Production Linked Incentive (PLI) scheme, and investments in bulk drug parks and infrastructure.

Several Indian pharmaceutical companies are actively investing in expanding API manufacturing capacities, adopting green chemistry practices, and pursuing vertical integration to enhance supply chain resilience. These initiatives are complemented by policy support and academic research aimed at developing cost-effective, environmentally sustainable manufacturing technologies.

Alivus Life Sciences Limited 64

CURRENT TRENDS AND STRATEGIC INITIATIVES

The government has identified APIs as a critical sector under its Atmanirbhar Bharat (self-reliant India) initiative. Key measures include financial incentives, infrastructure development for bulk drug parks, and regulatory easing.

Private sector players are focusing on enhancing in-house API production, reducing reliance on external raw material sources, and adopting advanced manufacturing technologies such as continuous manufacturing to improve cost-efficiency and sustainability.

Significant attention is being placed on quality compliance, innovation in synthesis routes, and the development of alternative starting materials to mitigate supply chain vulnerabilities.

OUTLOOK

Indias API sector is poised for robust growth, underpinned by strategic policy interventions, private investments, and a concerted push towards environmental sustainability and cost competitiveness.

With a sustained focus on innovation, green manufacturing, and reduced dependence on imports, India is set not only to achieve self-reliance but also emerge as a preferred global hub for APIs by 2030. However, challenges such as price competition from China and the need for large-scale sustainable practices must be carefully navigated to realise this ambition.

Source: EY Report & EY

Global CDMO Industry

The global Contract Development and Manufacturing Organisation (CDMO) industry witnessed robust growth in 2024, with the market valued at $185 billion. The continued trend of outsourcing research and development activities has allowed biopharma firms to focus on their core areas while leveraging the specialist technologies and advanced infrastructure offered by CDMOs.

Outsourcing has become a strategic necessity, particularly for biologics, injectables, and GLP-1 therapies, with companies seeking to enhance flexibility, manage costs, and accelerate innovation. Heavy investments in technologies such as continuous manufacturing, automation, and AI- driven solutions have significantly boosted operational efficiency and compliance standards.

The industry is seeing rising consolidation, with mergers and acquisitions enabling the formation of full-service offerings. While North America remains the dominant CDMO market, Asia-Pacific, led by India and China, is witnessing rapid growth due to favourable cost structures, enhanced regulatory standards, and rising pharmaceutical demand.

The global CDMO market is projected to almost double, reaching $368.7 billion by 2034, growing at a CAGR of 6.9%. Demand for biologics, personalised medicine, and oncology therapies will be key growth drivers. Expanding areas such as antibody-drug conjugates (ADCs), high-quality API manufacturing, and oncology-focused services offer significant expansion opportunities. Companies that invest in innovation, agility, and sustainability will be well positioned to capitalise on the evolving demands of a highly competitive healthcare sector.

Indian CDMO Industry

Indias CDMO sector is experiencing rapid growth, driven by cost advantages, a skilled workforce, and adherence to global regulatory standards.

The market is projected to expand from $15.63 billion in 2023 to $44.63 billion by 2029, capturing a 4-5% share of the global CDMO market. This growth is further propelled by increasing demand for advanced therapies such as cell and gene therapies, antibody-drug conjugates, and nucleic acid therapeutics, positioning India as a preferred outsourcing destination for pharmaceutical development and manufacturing.

OUTLOOK

The outlook for the CDMO industry remains highly positive for 2025 and beyond. As pharmaceutical companies increasingly rely on external partners to navigate complex manufacturing and regulatory landscapes, CDMOs will play an increasingly critical role in accelerating innovation and expanding global healthcare access. Those that prioritise technological advancement, strategic scalability, and regulatory excellence will be best placed to capture future growth opportunities in a dynamic and competitive market environment.

Source: Pharma Navigator, Contract Pharma, India Briefing & EY

Global API CDMO

The global Active Pharmaceutical Ingredient (API) CDMO market is on a strong growth trajectory, forecast to expand from $128.26 billion in 2025 to $193.83 billion by 2030, representing a healthy CAGR of 8.61%. This growth is largely driven by rising pharmaceutical R&D investments, increasing demand for generics, and the complexity of modern APIs, which encourage pharmaceutical companies to outsource development and manufacturing processes to specialist CDMOs.

The synthetic API segment continues to dominate, owing to the critical need for drugs treating chronic conditions such as cardiovascular and metabolic diseases. Companies are increasingly investing in synthetic and high-potency API production facilities to meet stringent quality standards and rising global demand. Significant strategic moves, including expansions, collaborations, and new facility developments are enhancing global manufacturing capacities, particularly in the high-value API segment.

Asia-Pacific is emerging as a major growth engine for the API CDMO industry, driven by cost advantages, skilled talent pools, and supportive government initiatives such as Indias Production Linked Incentive (PLI) scheme for bulk drug manufacturing. North America and Europe remain important markets, particularly for high-value and biologic APIs, where compliance with rigorous regulatory frameworks is critical. Notably, oncology remains a strong driver of demand for specialised API manufacturing services.

OUTLOOK

Looking ahead, the global API CDMO sector is expected to witness sustained and dynamic growth, driven by technological innovation, strategic outsourcing trends, and the growing complexity of pharmaceutical pipelines. Firms that invest in advanced manufacturing technologies, maintain regulatory excellence, and develop agile supply chains will be well positioned to capture new opportunities. However, challenges such as navigating regulatory pressures, maintaining supply chain resilience, and securing intellectual property rights will require careful management as the industry evolves.

Advantage Alivus

Management

Alivus is a professionally managed company, with an experienced Board helping us chart an independent course for our future. Our management team has demonstrated the ability to successfully build and integrate our businesses with various operating activities through their cumulative years of work experience. In particular, they have led the process through which we have created value through organic growth, built brand recognition and loyalty and identified new business opportunities. This has been achieved through a calibrated portfolio build-up which will commercialise within a wi ndow of 3-7 years, with a focus on:

In addition, we have a strong corporate governance system to monitor, guide and support our business and operations.

Source: Mordor Intelligence & EY

2025

2030

Business Overview

API GENERICS

At Alivus, we built a portfolio of high value, non-commoditised APIs in chronic therapeutic areas, namely, Cardiovascular (CVS) disease, Central Nervous System (CNS) disorders, Pain Management, Oncology, Diabetes and Urology for our customers worldwide.

Some of these APls such as Amiodarone, Ezetimibe (CVS), Lithium carbonate, Oxcarbazepine (CNS), Mirabegron, Solifenacin (Urology), Atovaquone (anti-parasitic), Etoricoxib (Pain), Remogliflozin, Sitagliptin (Diabetes), Cabozantinib, Palbociclib (Oncology) have a significant and growing market share in major world markets.

Our API product portfolio spans multiple therapeutic areas such as CVS, CNS, Pain, Diabetes, Urology, Oncology and other therapeutic areas. A snapshot of key molecules classified by therapy areas is below:

We continue to add specialised and profitable products into our portfolio, including niche and technically complex molecules, such as Ensifentrine, Elacestrant, Finerenone, Fezolinetant, Tivozanib, Vonoprazan & Isavuconazonium Sulfate.

Our total portfolio of 165 API molecules is sold in India and exported to multiple countries in Europe, North America, Latin America, Japan and the rest of the world ("ROW").

We had filed 561 Drug Master Files ("DMFs") and Certificates of suitability to the monographs of the European Pharmacopoeia ("CEPs") across various major markets (i.e. United States, Europe, Japan, Russia, Brazil, South Korea, Taiwan, Canada, China and Australia). We work with 20 of the largest generic companies globally.

CDMO

In the last 6 years, we have developed business with innovator and specialty pharmaceutical companies in the area of CDMO.

Given our capabilities in process chemistry research, manufacturing from grams to tonnes and analytical research capabilities, we have the ability to attract innovator pharmaceutical companies to partner with us for providing unique solutions tailored to their specifications.

We provide lifecycle management solutions for their mature portfolio where genericisation has happened or is impending.

In our current global portfolio of 165 molecules, many molecules offer such opportunities to a complete new set of customers.

In addition, we are focused on APls for Specialty development companies as an important sub-segment of our CDMO business.

Within this segment, we offer customised support to pharmaceutical companies from making regulatory filings, providing research and technological support, to manufacturing specialty APIs.

As an API provider to such customers, we have helped to create value through a blend of product customisation and regulatory strategy to allow market access.

We see the specialty business as a key growth opportunity and an added lever for our API market expansion, with multiple companies in the United States currently focused on developing 505(b)(2) products.

The specialty business offers higher business stability (with improved margins) due to the complex nature of the products thereby leading to higher customer stickiness.

Alivus operates as a standalone company, generating a higher level of confidence with CDMO customers for building partnerships through technology transfer arrangements.

Our process research, analytical research and chemistry capabilities enable CDMO services for a range of multinational corporations and specialty companies.

We believe that innovators prefer to select vendors with a strong track record. Our continuous focus on quality and on the sustainability of our operations make us a serious contender to grow this business opportunity.

Even after the world economy had multiple setbacks (COVID, energy prices, war, inflation, banking stress, etc.) with a direct impact on our industry, Alivus continues to experience robust demand for APIs across most geographies albeit, with a need for competitive prices. This scenario opens-up an opportunity for high-quality APIs with affordable pricing in a large portion of our product portfolio.

Our continuous focus on cost optimisation to become more efficient via next-generation processes, improved manufacturing, solvent recovery, lower-cost energy and an overall savings effort to do more with less has helped us to deliver growth with sustainable margins.

Although this was always one of our business mantras, we applied an even greater focus to make a difference to the customers and patients we eventually serve. The multiple touch points of our strategy to fuel the growth, retain the margins while creating a sustainable platform to ensure business continuity are outlined here:

Expand the existing business

• New product launches

• Geographical expansion in order to reduce our dependence on limited geographies

• Focus on new markets becoming more regulated. This initiative drives higher value by virtue of support to the customer throughout their development and commercialisation lifecycle

• Pursue 2^nd source opportunities with top generic players in molecules where Alivus holds a position of cost leadership

New growth levers

• CDMO business expansion with a plan to leverage a significant part of our existing portfolio for 505(b)(2) and lifecycle management projects

• Expand into complex API platforms e.g. Iron compounds and Oncology molecules

Cross-selling

With a large product basket, Alivus has been strategically cross-selling existing products to existing customers in other geographies thereby increasing the wallet share of the customer

Operational Efficiencies

Measures to reduce costs, improve efficiencies and reallocate resources to support identified growth opportunities in diverse markets

R&D initiatives

• Productivity improvement of existing processes through constant optimisation

• Process cycle time reduction

• Qualifying lower-cost processes for regulated markets

• Better recovery & recycling

• Backward integration of higher value KSMs (Key Starting Materials)

Sourcing Initiatives

• Ongoing negotiations with vendors (based on market environment)

• Alternate vendor qualification

Operations Initiatives

• Solvent recovery and recycling

• Optimisation of batch sizes

• Utilisation of new downstream equipment for filtration or drying techniques

• Yield improvement

• Automation for better efficiencies

• Green chemistry and effluent reduction

Manufacturing

We currently operate four multi-purpose manufacturing facilities located at Ankleshwar and Dahej in Gujarat and, Mohol and Kurkumbh in Maharashtra. Our combined reactor capacity stands at 1,424 KL in FY25, and we have manufactured a quantity of 810 MT in FY25. To support the increased volumetric capacities and quantum of production for upcoming FY26, we have upgraded the infrastructure of supporting departments like warehouse, effluent treatment plants, etc. and are working to improve resource optimisation and efficiency to leverage maximum outcome in FY26.

This substantial increase will empower us to produce all commercial Active Pharmaceutical Ingredients (APIs), annually achieving projected gross commercial-scale manufacturing tonnage totalling to 900+ metric tons in FY26. Our facilities have been subject to 56 inspections and audits by regulators which includes the USFDA, PMDA (Japan), COFEPRIS, Health Canada, MFDS (Korea), EDQM, ANVISA (Brazil), WHO and CDSCO, conducted on a periodic basis.

Recently our Ankleshwar and Dahej facilities were inspected by the USFDA.

CAPACITY EXPANSION

• Construction work for expansion of three pharma blocks is underway at Ankleshwar Site and shall be operational by Q4FY26 (100 KL).

• Two independent modules are already commissioned and operational at Dahej Site at present.

• New R&D centre underway with capabilities for API and CDMO businesses.

• Installation of Columns is in progress at both Ankleshwar and Dahej for Solvent recovery enhancement.

• 160 KL new capacity planned in Dahej in FY26.

• Product validation in a new facility for manufacturing through flow chemistry at Ankleshwar site in FY25.

• Separate facility for Ezetimibe is commissioned and operational at Ankleshwar in FY25.

• New warehouse completed in Ankleshwar and Dahej in FY25.

• New ETP in Ankleshwar was completed in FY25.

• Construction work is ongoing in Solapur for 200 KL in phase 1.

• 400 KL backward integration in the next phase, followed by a planned addition of ~400 KL.

The new API facility in Chincholi Industrial Area, Solapur, is planned to manufacture both APIs and intermediates and will house several multi-purpose manufacturing blocks with

mid to high volume capacity. This new facility will also provide a platform for the growth of our CDMO business and add capacity for our generic API business.

QUALITY FOCUS

We have built Quality Management Systems (QMS) to build quality into the manufacturing and business processes which are aligned with the organisations focus on quality by design (QbD).

To further strengthen the QMS compliance,

• Modern Quality Control Laboratory set up at Ankleshwar site

• Electronic Signature for Chromatographic Analysis implemented

• Implemented custom calculation (Auto calculation) in HPLC/GC

• Implementation of TrackWise software as a further enhancement to the QMS like Change Control, OOS, Complaints, Deviations etc.

April 2024 to March 2025	Ankleshwar	Dahej	Mohol	Kurkumbh
No. of Regulatory inspections	04 (SwissMedic, USFDA)	02 (Local FDA and PMDA)	01 (CDSCO)	01 (State FDA)
No. of customer audits	61	40	12	NA
Total	65	42	13	01

• Data logging system for the manufacturing equipment shall be implemented

• New version of SAP i.e. S4 HANA shall be implemented

Our R&D teams focus on new products development, and complex molecules, cost improvement programs (CIP), process improvements and oncology product development, and novel polymorphs development.

We also adopt a thorough and systematic approach to product selection for our development grid, that considers factors such as a detailed commercial evaluation of the market opportunity of a particular API, its development complexity, intellectual property landscape, approved indications and the potential competitive scenario.

Our product and service line up together enable us to support our customers through all stages of the products lifecycle and be present across the value chain from product identification, R&D, impurity identification, methods development and controls, setting specifications and laboratory validation followed by technology transfer via pilot scale-up in the commercial plant. This is followed by plant validation and product filing enabling commercialisation and large-scale manufacturing.

Our capabilities and experience have helped us perform well in regulated markets and have enabled us to successfully partner with customers, including offering our customers a first-mover advantage with respect to various products. We regularly work on developing eight to ten molecules each year.

BUILDING A STRONG PRODUCT PORTFOLIO

Our comprehensive approach while selecting products into our pipeline:

• Molecules Rsvalue and volume growth across markets namely, US, EU, JP, ROW, India, LATAM

• Near-term prospects of the molecule in terms of patent expiration and novelty of the therapeutic area

• Capability to offer an edge in terms of speed, faster market entry and cost

• Special focus on NCE-1 opportunity for the US market

• Create high barriers by introducing novel and efficient routes that can be patented

Our portfolio comprises 165 products (49 new products are under development pipeline including 3 iron complexes and 24 HPAPIs) ranging across various chronic therapy areas like cardiovascular, CNS, diabetes, anti-infective, pain and others. The total front-end addressable market size of Alivus Rsproducts globally was estimated to be around US $180 billion by 2026 with a growth rate of about 4.3% over the horizon. The future growth of these products is expected to remain stable driven by the rising prevalence of chronic diseases, growing demand from the regulated markets for drugs indicated for hypertension, diabetes and cancer, and an ageing population.

To assist us with our R&D initiatives, we have established dedicated teams for

The market size in terms of volume for Alivus RsAPIs is estimated to be about 13,609 tonnes by 2026 at a growth rate of 6%.

Other core areas where Alivus offers a competitive advantage are dedicated customer service for all geographies ensuring timely and adequate support that engages customers on a long-term basis.

Alivus Rsportfolio of 165 niche, highly profitable and technically complex products cater to large chronic therapy areas such as CNS, diabetes, CVS (including anti-thrombotic) and oncology.

Performance and Operations Overview

OPERATIONAL PERFORMANCE FY25

In the financial year 2025, the Company recorded revenue from operations of INR 23,869 million, reflecting a 4.5% YoY increase. GPL (Glenmark Pharmaceuticals Ltd.) segment grew by 8.8% YoY, while the Non-GPL segment rose by 6.3% YoY. Notably, EBITDA margins were sustained at 30% despite the absence of PLI benefits, highlighting strong operational efficiency and cost control.

Growth was broad-based across key markets including India, Europe, ROW, and Japan. Towards the end of the year, LATAM region showed early signs of stabilisation as macro headwinds began to ease. Meanwhile, the US market remained subdued due to external challenges and customer destocking, though improvement is expected in FY26.

CDMO performance was impacted by cyclical demand trends, but the segment remains a strategic priority. Project #4 is gaining momentum, and Project #5 is expected to be commercialised in the second half of FY26.

REVENUE FROM OPERATIONS

Our revenue increased by 4.5% to INR 23,869 million for FY25 from INR 22,832 million for FY24. This increase was primarily driven by growth across regulated markets. The first half of the year saw short-term impact by certain one-off events, while growth normalised in the second half of FY25. million for FY25 from INR 379 million for FY24, an increase in freight outward by 60.0% to INR 195 million for FY25 from INR 122 million for FY24, an increase in sales promotion expenses by 58.6% to INR 184 million for FY25 from INR 116 million for FY24 and an increase in utility charges by 4.2% to INR 1,172 million for FY25 from INR 1,125 million for FY24. Increase in other expenses slightly were offset by decrease in labour charges by 10.6% to INR 658 million for FY25 from INR 737 million for FY24.

GROSS PROFIT

Gross Profit increased by 1.9% to INR 13,061 million for FY25 from INR 12,812 million for FY24. Gross Profit as a percentage to revenues reduced by 140 bps due to the absence of PLI benefits.

R&D EXPENDITURE

R&D expenditures were INR 805 million at 3.4% of sales for FY25 as compared to INR 753 million at 3.3% of sales for FY24.

Internal Controls

In line with the requirements under the SEBI LODR, the Company has constituted a Risk Management Committee of the Directors. The Members of the Committee are Mr. Kaushikbhai Patel (Chairman w.e.f. 25th March 2025) Mr. Vijaykumar Shah (Chairman up to 26th February 2025), Dr. Yasir Rawjee and Mr. T. L. Easwar.

The Committee met twice in FY25 to discuss and evaluate risks associated with the business and the mitigation plans for the same.

The Company has adequate internal controls systems in place which provides reasonable assurance about the integrity and reliability of financial statements. Additionally, Shridhar & Associates, a leading audit firm performs periodic internal audits to provide reasonable assurance over internal control effectiveness and advises on industry-wide best practices.

The Audit Committee consisting of Independent Directors review important issues raised by the Internal and Statutory Auditors, thereby ensuring that risks are mitigated appropriately with necessary rectification measures on a periodic basis.

Risk Management

Risks & its Definition Mitigation Plan

EMPLOYEE BENEFITS EXPENSE

Employee benefits expenses decreased by 2.5% to INR 2,517 million for FY25 from INR 2,581 million for FY24. The higher cost in FY24 reflected the impact of one-time performance related bonuses.

CAPEX EXPENDITURES

Capital expenditures were INR 1,662 million for FY25 as compared to INR 1,290 million for FY24.

OTHER EXPENSES

Other expenses increased by 6.6% to INR 3,718 million for FY25 from INR 3,488 million for FY24. This was primarily due to an increase in repair and maintenance by 31.7% to INR 499

CASH AND CASH EQUIVALENTS

Cash and cash equivalents (including short-term investments) were INR 5,487 million as on 31st March 2025 whereas it was INR 3,014 million as of 31st March 2024.

KEY FINANCIALS RATIOS

Particulars	31st March 2025	31st March 2024	% Variance
Current Ratio	4.97	4.37	13.66%
Return on Equity (ROE)	18.86%	21.07%	-10.47%
Inventory Turnover Ratio	1.61	1.58	2.25%
Trade Receivables Turnover Ratio	2.75	2.90	-5.31%
Trade Payables Turnover Ratio	2.87	2.67	7.32%
Net Capital Turnover Ratio	1.28	1.55	-17.43%
Net Profit Ratio	20.35%	20.62%	-1.33%
Return on Capital Employed (ROCE)	23.02%	26.74%	-13.93%
Return on Mutual Fund Investments	2.01%	NA	-

 

Regulatory Risk An adverse facility inspection by any regulator may cause restriction in sales to certain customers or respective geographies	We have established systems to always monitor compliance. Our employees receive training on compliance updates for always confirming to them
Supply Chain The failure of a small number of single-source, third-party suppliers or service providers to fulfil their contractual obligations in a timely manner or as a result of regulatory non-compliance or physical disruption at their manufacturing sites may result in delays or service interruptions, which may materially and adversely affect the Companys revenues	Where practical, dependencies on single sources of critical items are removed by developing alternative sources. In rare cases where dual sourcing is not possible, an inventory strategy has been developed to protect the supply chain from unanticipated disruptions.
Market Risk Market risks are the possibilities of losses because of price fluctuations, competitive scenario, geopolitical events, foreign exchange fluctuations, worldwide pandemics, and other events can all have an impact on market movements	The Company has initiated measures to reduce costs, improve efficiencies and reallocate resources to support identified growth opportunities in various markets. The Company is also continuously evaluating further strategic options to ensure the development of new capabilities and the ability to maximise the value of the Companys current and future portfolio.
	The Company makes conscious efforts to launch new value added products with some differentiation i.e. improvised products which can fetch better pricing.
	External uncertainties are carefully considered when developing strategy and reviewing performance. The Company has a board approved hedging policy in place to manage its currency risk exposure.

 

Risks & its Definition	Mitigation Plan
Compliance The Companys operations subject it to compliance with a broad range of laws and regulatory controls on the development, manufacturing, testing, approval, distribution and marketing of its pharmaceutical products and affect not only the cost of product development but also the time required to reach the market and the uncertainty of successfully doing so. Additionally, the Company is also subjected to regulations with respect to listing of its shares on stock exchanges, financial reporting, and tax.	The Companys internal control framework is designed to help ensure that we adhere to legal and regulatory requirements through continuous evaluation. We are in the process of further strengthening the framework to meet the evolving regulations. We have implemented a compliance management tool which shall enable the management to monitor compliance at various levels. The Board also evaluates the compliance framework of the Company on a periodic basis.
Environment, Health & Safety The environment laws of various jurisdictions impose actual and potential obligations on the Company to remediate contaminated sites. Failure to manage properly the environment risks could result in additional remedial costs that may materially and adversely affect the Companys financial results.	The Company operates rigorous procedures to seek to eliminate hazards where practicable and protect employees Rshealth and well-being. The Companys continuing efforts to improve environmental sustainability have reduced the Companys water consumption, hazardous waste, and energy consumption. The Company actively manages our environmental remediation obligations to ensure practices are environmentally sustainable and compliant.
	Additionally, a separate ESG Board Committee has been formed to regularly monitor developments and progress of the Company on various initiatives taken by the Company on the ESG front.
Information Technology & Cyber Security Risk For its operations, the Company is heavily reliant on IT systems. A failure of IT systems due to malicious attacks and/or non-compliance with data privacy laws can potentially lead to financial loss, business disruption and/or damage to our reputation.	The Company fosters a risk-aware culture that can anticipate and prevent attacks, and where necessary, effectively respond to security breaches, maintain strong cybersecurity infrastructure and compliance with data privacy law requirements through: • Performing gap analysis to identify existing weaknesses • Policy and procedure rollouts
	• Creating awareness amongst employees on applicable privacy requirements
	• Securing suitable insurance cover

STATUTORY REPORT