Dr Reddy’s Laboratories Q2 Results: Net Profit Rises 7% YoY to Rs 1,437 Cr; Revenue Up 10% Amid US Competition

Indian pharmaceutical major Dr Reddy's Laboratories Ltd reported a 7% year-on-year (YoY) rise in net profit for the September quarter (Q2FY26) at Rs 1,437 crore, compared to Rs 1,255 crore in the same period last year. The company's revenue from operations grew by 10% YoY to Rs 8,828 crore, surpassing market expectations of around Rs 8,700 crore.

Dr Reddy's Laboratories Q2 Results 2026: Net Profit Rises 7% YoY, Revenue Up 10% Amid U.S. Competition

The results reflect steady overall performance despite pricing pressure in the U.S. generics market, particularly for its key oncology product, the generic version of Revlimid (Lenalidomide). The company's profit growth was partly restrained by intense competition in this segment, which had previously been a major earnings driver.

In the same quarter of the previous financial year, Dr Reddy's had reported revenue from operations of Rs 8,038 crore, underscoring consistent top-line expansion on the back of a diversified portfolio and geographic mix.

Branded Markets and NRT Portfolio Drive Growth

According to G.V. Prasad, Co-Chairman and Managing Director of Dr Reddy's Laboratories, the quarter's growth momentum was supported by strong performance in branded markets and steady contributions from the Nicotine Replacement Therapy (NRT) portfolio.

"Growth in Q2 was driven by momentum in branded markets and steady contributions from the Nicotine Replacement Therapy (NRT) portfolio, which helped offset the decline in U.S. Lenalidomide sales. We remain focused on strengthening our core business, advancing key pipeline assets, driving productivity, and pursuing business development initiatives," said Prasad.

Dr Reddy's North America Performance Impacted by Revlimid Pressure

North America, Dr Reddy's largest market, faced challenges due to increased competition for Lenalidomide, the generic version of Bristol Myers Squibb's cancer blockbuster Revlimid. The product, which had earlier contributed significantly to the company's revenue surge, saw reduced sales volumes and pricing pressure this quarter as new competitors entered the market.

Revenue from the US market dropped 13% year-on-year and 5% quarter-on-quarter to Rs 3,240 crore, largely impacted by price erosion in major products such as Lenalidomide. However, the decline was partially cushioned by new product launches and favourable currency movements.

In this quarter, the company introduced seven new products in the US and submitted five additional ANDA filings to the USFDA, bringing the total number of pending approvals to 75 as of September 30, 2025.

Europe: Strong Growth Driven by Acquisitions and Product Launches

Europe posted impressive growth, with revenue rising 138% year-on-year and 8% quarter-on-quarter to Rs 1,380 crore. The surge was fueled by the acquisition of the nicotine replacement therapy (NRT) portfolio, new product launches, and increased volumes. Even after excluding the NRT business, revenue still grew 17% YoY. On a half-yearly basis, European revenues jumped 140% YoY to Rs 2,650 crore.

Continued Double-Digit Expansion in India

In India, Dr. Reddy's achieved 13% YoY and 7% QoQ growth, with revenues reaching Rs 1,580 crore. The strong performance was supported by new product launches, favorable pricing, and higher prescription demand. During Q2, the company introduced 11 new brands, bringing the total for H1 FY26 to 16 new products.