Dr Reddy’s AVT03 gets USFDA CRL; earnings steady but margins soften

disclosed that its wholly owned subsidiary, Dr Reddy’s Laboratories SA (Switzerland), received a USFDA Complete Response Letter (CRL) for the Biologics License Application of AVT03, a proposed biosimilar to Amgen’s Prolia and Xgeva that is developed by Alvotech. The CRL relates to observations from a pre-license inspection at Alvotech’s manufacturing facility in Reykjavik, implying the regulator is seeking additional clarifications and/or remediation before the application can move forward. The stock closed at ₹1,273 on the BSE, down ₹7.20 (0.57%) on the day of the update. On fundamentals, the company reported Q2 FY26 net profit of ₹1,347 crore (up 7.3% YoY vs ₹1,256 crore), slightly below the CNBC-TV18 poll estimate of ₹1,403.7 crore. Revenue rose 9.8% YoY to ₹8,828 crore (vs ₹8,038 crore), beating the poll estimate of ₹8,595.4 crore. However, profitability metrics softened: EBITDA declined 3.2% YoY to ₹2,010 crore (vs ₹2,076.8 crore) and missed the estimate of ₹2,208.5 crore, with EBITDA margin compressing to 22.8% from 25.8% a year earlier. For H1 FY26, consolidated revenue reached ₹17,350 crore, up 11% YoY, with broad-based growth offset by weaker North America generics due to price erosion and lower lenalidomide sales; the acquired nicotine replacement therapy consumer portfolio also supported performance. ​ Disclaimer: This post is for informational purposes only and not a recommendation to buy or sell any securities. I, or my family, associates, or relatives, may have a financial interest in the securities mentioned.