Alkem Labs sees sales potential of anti-infectives in Q1FY22

Drugmaker Alkem Laboratories said it expects its domestic formulation segment to do well in Q1FY22 led by growth momentum in the acute component, more specifically its anti-infective division.

The company says it is seeing a huge demand for anti-infectives like antibiotics in the COVID-19 second wave.

"In 2020 COVID-19, the secondary infection of pneumonia wasn't there, which is extremely high this year, the main reason why antibiotics have shown very good revival; and of course allied therapies like acidity management, Vitamin-C and zinc preparations have shown good growth," said Sandeep Singh, Managing Director of Alkem Laboratories at the compamy's earnings call on May 25.

The company derives 80 percent of its revenues from the domestic formulation business through the acute segment, of which anti-infectives alone contribute about 40 percent.

In the first wave, sales of antibiotics had collapsed due to lockdowns and COVID-19 appropriate behaviour, which reduced the infections.

But in the COVID-19 second wave, secondary infections due to bacteria and fungus have gained traction. Doctors are using antibiotics much more aggressively in COVID-19 patients to keep these infections, especially pneumonia, at bay.

Alkem earned Rs 8,865 crore as revenues from operations in FY21, registering a year-on-year (YoY) growth of 6.2 percent. Its India sales stood at Rs 5,699.6 crore, which accounts for 64 percent of total revenues. The sales grew YoY at 4.5 percent.