Glenmark Pharmaceuticals Limited ($GLENMARK)

Ladies and gentlemen, good morning, and welcome to the Q4 FY '26 Earnings Conference Call of Glenmark Pharmaceuticals Limited. [Operator Instructions]. Please note that this conference is being recorded. I now hand the conference over to Mr. Utkarsh Gandhi, Senior General Manager, Investor Relations for Glenmark Pharmaceuticals Limited. Thank you, and over to you, sir.

Thanks, Suzanne. Good morning, everyone, and welcome to the Q4 FY '26 Earnings Conference Call of Glenmark Pharmaceuticals Limited. During today's call, we'll cover our performance in the fourth quarter and overall FY '26. We also have an Investor Day coming up in about a week's time where we'll answer more strategic questions around mid- to long-term strategy and growth drivers for the overall business. So before we get into the Q&A, let's review the performance for the quarter. For the fourth quarter of FY '26, Glenmark's consolidated revenue from operations was INR 37,706 million as against INR 32,562 million in the corresponding quarter last year, recording an overall year-on-year growth rate of 15.8%. For the full year of FY '26, Glenmark's consolidated revenue was] [INR 1,698,25 million ] as against [ INR 1,332,17 million], recording a Y-o-Y growth of 27.5%. In terms of some of the key highlights for the overall company for fiscal year '26, of course, the big highlight was Idea securing a landmark licensing deal with AbbVie for ILB 2001, which was developed using [ IDI's ] proprietary we platform for USD 700 million upfront payment and a total deal value or potential total deal value of 1.95 million billion along with tiered double-digit royalties and Glenmark will lead commercialization across emerging markets once the product gets approval. During the year, Glenmark also accelerated its oncology business expansion in India and emerging markets through the in-licensing of commercial rights for Trastuzumab Rezetecan from Hengrui Pharma and Aumolertinib from Hansoh Pharma and the launch of TEVIMBRA and BRUKINSA in India. Glenmark India business delivered a strong performance in secondary sales growing at [ 1.5x the IPM ] growth for the year and emerged as the second fastest-growing company amongst the top 15 companies in FY '26 as per year. In India, we launched differentiated products across our core therapeutic areas. So TEVIMBRA [indiscernible] BRUKINSA oncology. We launched the Netsmart GFP nebulizer, the world's first openness for COPD and respiratory and we pick the semaglutide vials and injection for laboratories. [indiscernible], which is our global brand, continued strong global momentum, recording 50% plus secondary sales growth across its commercial markets in FY '26 along with marketing authorization approvals and launched in other large markets like China and Thailand. Myanmar also initiated end-to-end commercialization of [indiscernible] in the U.S. as well during the year. We have also established our branded dermatology footprint in Europe with the European approval for WINLEVI and we launched WINLEVI in the U.K. during the first quarter of FY '26. In the U.S., we strengthened our generic respiratory franchise. We got our first product respiratory product approval, which was FloVent, generic to FloVent [indiscernible], we got a [ CGT ] designation and exclusivity when it did exclusivity on the back of that. And we also got approval for [indiscernible]. During the year, we also filed 3 additional [ ANDAs ] for the respiratory in the respiratory category. And we also expanded our investable franchise in the U.S. for the -- we now have almost 20 products commercialized through partners. [indiscernible], of course, received [ VAI ] classification from the U.S. FDA posted its inspection in November 2025. This enables the start of commercial manufacturing and supporting future growth in our injectable and institutional business in the U.S. I'll just quickly cover the key markets, starting with India. So sales from the formulation business in India for Q4 was at INR 10,201 million as against INR 9,430 million in the corresponding quarter last year, recording a growth of 8.2% Y-o-Y growth in the quarter. As I mentioned, Glenmark significantly outperformed the IPM in terms of secondary sales [indiscernible]. Glenmark from India formulation business growth was 10.3% during the quarter and 13.5% for the full year compared to [ IPM IV ] growth of 10.1% in Q4 and 9% in March -- in March 2026. Glenmark is ranked 13th in India with a market share of 2.34%. The company has 11 brands in [indiscernible]. And in terms of core therapeutic areas, Glenmark continues to be amongst the top companies in dermatology, second rank in dermatology, third in respiratory and fourth in the cardiac segment as per II data. As mentioned before, during the quarter, in Q4, Glenmark launched -- announced the launch of GLIPIQ, semaglutide injection for India for the management of Type 2 diabetes. So GLIPIQ is available in both vials and prefilled formulation. The product has been approved by [ CBIO ] following the multicenter clinical trial in India and while formulation support physician-guided dosing aligned to patient needs, particularly in the early stages. Glenmark introduced on a patient support program designed to support therapy initiations and improve comfort within [ viable ] treatment. The TEVIMBRA and BRUKINSA, we launched in Q1. In a short period, these 2 brands have seen very strong uptick in the market and the companies expect these brands to gain further momentum and meaningfully contribute to the India business in the next 2, 3 years. In Q3, we had announced the launch of Netsmart, which is the world's first fixed dose [indiscernible] therapy for COPD covering [indiscernible] and [ budesonide ] as an Indian easy-to-use nebulized therapy. It minimizes the burden for multiple medications and Glenmark's strong growth in the chronic respiratory segment in FY '26 has been led by this product along with some other products we've introduced over the years. [ Laboratories ] in dermatology is first of its kind overall advanced systemic treatment. And this has also been vented by doctors in the dermatology segment. In terms of the Consumer Care sales in India, so consumer care sales were INR 1,265 million with a growth of almost 10%. Most of the flagship brands recorded double-digit growth in terms of secondary sales during the quarter, including LA SHIELD, BONTRESS and some of the newer brands like ELOVERA and EPISOFT. Moving on to North America. The North America business recorded a revenue of INR 9,248 million for the fourth quarter of FY '26 as against revenue of INR 7,146 million. This translates into a Y-o-Y growth of 29.4%, but net of the deferred out-licensing income recognition for ILV 2001, the core business growth in the fourth quarter was 7.8% Y-o-Y. Glenmark launched 4 products in Q4 and 13 products during the full year FY '26, consisting a mix of oral solids, multiple injectable products and respiratory as well. In the fourth quarter, we filed 2 [ ANDAs ]and a total of 5 [indiscernible] applications during FY '26. Glenmark, it's a respiratory franchise, as mentioned before, with the first ANDA approval for [indiscernible], which is generic to FloVent 44. We have granted CGT designation and as the first approved applicant and then we are eligible for 180-day exclusivity upon commercialization. We also received approval for filed 3 additional respiratory products and are targeting to launch 2 to 3 desperate products in FY '27 as well. Glenmark also initiated the entered commercialization of [ Altrus ] in the U.S. to mark a meaningful step in the company's continued expansion in the region, Glenmark will directly lead brand strategy, market access and customer engagement for [ Altus ]. During the year, Glenmark launched several other products, as mentioned before. And over the last couple of years, we've built a large portfolio of 20 commercial injectable products through rates partners and Glenmark's injectable manufacturing facility in p Monroe, DIR, ] which will enable the company to restart commercial manufacturing. Moving on to Europe. Glenmark's European operations revenue for the fourth quarter of FY '26 were INR 8, 907 million as against INR 7,325 million, recording a growth of 21.4% Y-o-Y. In Glenmark Europe, our business recorded strong growth during the quarter on the back of such branded business across key markets. The CE region witnessed double-digit growth across all the key markets on the back of a strong uptick in key products. [indiscernible] in Europe also recorded growth during the quarter, particularly in markets like Germany and the Netherlands. [indiscernible] continues to gain market share across all the products where -- across all the countries where the product has been launched either by Glenmark or by its partner [indiscernible]. The company is continuing to focus on sustaining the increased contribution from branded products, particularly in the respiratory and the dermatology segment. As mentioned before, WINLEVI has been launched in the U.K. and has gained good traction and we also received the [indiscernible] approval and we'll be launching the product in its -- in our licensed European markets in FY '27. Glenmark is also planning to expand its commercial respiratory portfolio in Europe through the launch of 2 to 3 additional respiratory products in FY '27. Moving on to emerging markets. For the fourth quarter of FY '26, revenue from the emerging markets region was INR 8, 979 million as against INR 7,898 million for the corresponding quarter last year, according to growth of 13.7%. As per the [ IV March Matt ] March 2026 data, Glenmark's Russia business recorded secondary sales growth of 11%. Glenmark continues to do well in the dermatology segment in Russia. It is now ranked 8 as per the HVA data. In LatAm and EMEA regions, Glenmark recorded good growth in the secondary sales during the quarter. We have launched multiple respiratory products during FY '26 in this region, which has aided overall performance. [ Altus ] continues to be the leading assay in [indiscernible] is in most of the markets where in emerging markets where the product has been launched, Glenmark plans to launch [indiscernible] FY '27. In the APAC region as well, double-digit secondary sales growth was recorded in key markets like Malaysia and Australia. Glenmark continues to hold a significant market share in the overall dermatology and despiratory covered market across the APAC region. As mentioned, [ Altus ] was approved in China and Thailand and launched in Q4 by the company's respective these partners, [ Grand Pharma ] and [indiscernible]. Very quickly covering our global innovation portfolio. So we spoke about rates, the rates as a product is now commercialized in 55 markets as of March 2026. It is expected to be launched in additional 8 to 10 markets over the next few quarters, including, as we mentioned, some large markets like Brazil. And in Q4, the product was launched in China and Thailand, and we are expecting a significant uptick in the growth on the back of these launches. WINLEVI me, as mentioned, we have launched WINLEVI in the U.K. and we will be launching initiated commercialization in our licensed European territories by '27. In [indiscernible] , which is [ envafolimab]. So Glenmark as of March 2026 has already filed MA applications in 24 markets in the first commercial launch is expected in FY '28. But we also initiated early access programs or named patient programs from regulatory authorities in 7 markets, including some markets like Kenya, Mauritius, Uganda, et cetera. We also initiated a global multicenter Phase III trial in [ neoadjuvant ] or adjuvant treatment of patients with Stage III ACD, non-small cell lung cancer. [indiscernible], partnered with [ Henry ]. So Glenmark has advanced its preparation for initiation of MA applications for Trastuzumab Rezeteca which is licensed from Hengrui in Q2 FY '26. Our first wave of MA applications are expected to begin by the second half or by end of first half of FY '27. This product has got approval in China for the treatment of 2 non-small cell lung cancer as well as HER2 breast cancer. And recently, they filed application DNA application for advanced colorectal cancer as well. [indiscernible] partnered with Hansoh. So in Q3, we had entered into an exclusive agreement with Hansoh for melatinib which is a third-generation [ EGFR ] tariff in kinase inhibitor or TKI for the treatment of non-small cell lung cancer. Glenmark has rights across India and most of the emerging markets [ melatinib ] is already approved in the U.K. in June 2025 for first-line treatment of adult patients with locally advanced or metastatic non-small cell lung cancer with active EGFR mutations and it also received EMA approval from European authorities in February 2026. It is marketed across 5 indications in China. And Glenmark has submitted [indiscernible] applications for [indiscernible] in multiple markets as of March 2026, and the first commercial launch is anticipated during the second half of FY '27. Quickly covering [ ICI ]. So key updates in [ IGI ], on the oncology portfolio, as we 2001 or ABBV-2001, the patient enrollment in Phase I dose expansion is progressing rapidly with the goal to determine an optimal dose dosing regimen, efficacy and safety data continues to remain promising and inconsistent with what was previously reported. We also selected a clinical candidate for ISP 2301 and the program is rapidly advancing towards the clinic with IND submission intended for the end of the calendar year 2026. And in immunology, [ ISB AT or LAD-191 ], this is a product licensed to Almiraland the Phase II study in [indiscernible] continues to advance with ongoing patient recruitment. And Admiral also plans to initiate DOC for an additional inflamatory skin disease for this product. And [indiscernible] is partnered with [ Astra ] or [ Biopac] From the Glenmark management team, we have Glenn Saldanha, Chairman and Managing Director and Anurag Mantri, Executive Director and Global CFO. I'll now hand it over to Glenn for his opening comments.

Thank you, Utkarsh. Good morning, everyone, and thank you for joining our earnings call today. FY '26 has been a defining year in Glenmark's evolution. Despite an evolving geopolitical environment, we delivered a reasonable business performance and made meaningful progress on the strategic priorities that will shape our future. The major highlight of the year was clearly the IGI landmark agreement that we signed with AbbVie for ISB 2001. This transaction clearly validates that the Ig proprietary beat platform technology works and will work in the future on future assets too. We are very excited by the broader IGI pipeline, starting with ISB 2301, which we think also could be a world-class asset. We are currently working on filing an IND before the end of this calendar year for ISB 2301. We have 2 other assets in the pipeline now, ISB2302 and 2501 which also look very promising. During the year, we strengthened our branded business in India and emerging markets, expanded our differentiated portfolio through multiple new launches advanced our U.S. respiratory and injectable franchise and continue to scale our global brands such as [indiscernible]. We are also expanding our innovative oncology portfolio in India and emerging markets. We have some strategic partnerships with Hengrui, Hansoh and of course, [ Alphamab ], the envafolimab partner. In the U.S, our aspirate generic franchise achieved key milestones, including the approval of fluticasone 44 MDR, where we have CGT status and Fluticasone nasal spray. We also received an EIR for U.S. FDA with the VAI classification for our [ Mondo ] facility, enabling the start of manufacturing and supporting the future growth in injectables and institution business. Looking ahead, our priorities remain clear: driving growth in the core therapies, globally scaling our branded business and building a strong, innovative oncology franchise in India and emerging markets and growing our U.S. generics business where respiratory and injectables. We will continue to advance IGI's innovative pipeline over the next 4 or 5 years. FY '26 is expected to be a very strong year for us. I'm sorry, FY '27 is expected to be a very strong year for us. In FY '27, we are making some strategic investments to accelerate growth in markets like India and emerging markets. We will share more details on the road map at the upcoming investor meeting. With this, I'd like to pass it on to Anurag Mantri to give his opening comments, and then we can initiate the Q&A.

Thank you, Glenn. Good morning, everybody, and good afternoon to all the international done. During Q4 FY '26, we delivered broad-based growth across India, Europe and emerging markets. Our growth in the U.S. market was affected in Q4 by the timing of approval for certain key products, leading to lower absorption of fixed costs in that quarter. While gross margins continue to show healthy momentum. Core operating margin was impacted by the lower absorption of the fixed cost as well as the higher distribution expenses linked to current geopolitical and supply chain environment in Q4. On the balance sheet, happy to share that we achieved our guidance from gross at the end of FY '26, while maintaining a healthy cash position. During FY '26, intangible asset additions were increased primarily due to -- because of the strategic in-licensing transaction for innovative business, launch of injectables in U.S. EVP. We view that the -- these as a long-term investment, particularly in oncology and high-growth banded markets. We have now a very strong balance sheet and done with the necessary changes in the businesses. And going forward, we still see a strong performance in FY '27. We also continue to focus on working capital efficiencies and disciplined capital allocation of FY '27. We are targeting a revenue of INR 17,000 crores to INR 18,000 crores and an EBITDA margin of 21% to 22% in FY '27. Considering growth investment for expansion in India and emerging markets and evolving geopolitical environment, currency movement is. We will share with the more granular details on the growth drivers during the upcoming Investor Day. Thank you.

We can now open the floor for questions.

[Operator Instructions]. The first question is from the line of Damayanti Kerai from HSBC.

My first question is on the U.S. business. So you received approval Fluticasone inhaler on early March. But it seems like the fourth quarter number doesn't reflect any benefit from the product. So can you just help us in understanding how do you see products ramping up? And what kind of market share gain you [indiscernible]?

So as you rightly said, we received Fluticasone Nasal Spray and fluticasone, [ 44 MD ] at both at the end of March, right? Obviously --

If I look at like FDA, I think you received approval in early March, correct?

Yes. But by the time the product gets to the market and by the time you commercialize, right, March is pretty much a -- so there was a -- because [indiscernible] --

Because of the disruptions in the supply chain thing. So we could not really achieve the sales much of the sales in that quarter. And therefore, that, as I mentioned, there was a fixed cost absorption issue -- I'm sorry.

My second question is on the [indiscernible] partnership for RYALTRIS. So did like you came out of that partnership because you mentioned you will be doing commercialization on your own?

Yes. So we've now -- as of April, right, we've commercialized RYALTRIS on our own in the U.S. market. And that's something we are in the midst of doing. We think the team can do a better job, right, by selling the product on our own. So we will -- we'll see how it evolves, right, in the U.S. But I think overall, the takeaway message is, look, RYALTRIS is a huge product. We have over $100 million of sales last year. The brand at secondary sales growth is about 50% on the brand right now. So it's doing exceedingly well. We are launching it in markets like both Brazil also this year. We've got Brazil approval. So that will be a big commercial launch in addition to the U.S. launch. So I think all in all, the brand is doing exceedingly well, right? And we'll continue to grow from strength to strength over the next few years as we go forward.

Okay. And my last question is, in India, while you have grown about the IPM, it seems like the diabetic market, the diabetic business is still lagging behind the market. So are we not still set in terms of the channel inventories, et cetera? So what is dragging diabetes technical growth?

Diabetes, as you know, right, there are 2, 3 molecules, right, which we had, which are continuing to struggle, right? So one of them is obviously [ remogliflozin ], right, being an SGLT after [indiscernible] generic, right, we really struggled to gain market share on [indiscernible], and the second one was [indiscernible] with [indiscernible] generic, right? So these are the 2 molecules that continue to struggle in our franchise. Now with the launch of GLIPIQ, clearly, right? We anticipate that the diabetes franchise will get back to growth, right? You should see growth coming back starting Q1 onwards. So if you look at our India business overall, right, each and every segment in India today continues to outperform, right? I mean in the dermatology space, we're at #2. We continue to gain market share in respiratory, with the launch of [ GMB NAB ] and some of the other respiratory launches, right, we are continuing to grow and gain market share. In cardiovascular, with the [ Telma ] franchise continues to do exceedingly well, right? And then, of course, with oncology now with the new launches of TEVIMBRA, BRUKINSA, those are continuing to do well. And then diabetes was the only segment which was lagging, right? But with the launch of GLIPIQ, that should change, and you should see good traction starting Q1, right, for the diabetes franchise. So India is on a very strong note. And I think FY '27 onwards, you should see strong growth coming out of India.

We'll move on to the next question. That is from the line of Nitin. Agarwal from DAM Capital.

Glenn, on the revenue guidance, this seems like a pretty aggressive number. So any -- can you just give us some color on what consequence you're seeing driving growth is, I mean, [ 70,000 ] on this current base is a pretty large number?

So I think, Nitin, if you remember the -- our half -- when we did the transaction, right, we have decided to about 17%, 17.5%. Now we've made it 17 to 18. Clearly, we are seeing strong growth in all our markets. Keep in mind that particularly India and emerging markets with the launch of some of the oncology assets, right? I'm looking at -- happening this year followed by Trastuzumab Rezetecan and then [ envafolimab, ] right? The growth rates will be very, very high over the next 4 or 5 years, right? Because of the major launches, right? We anticipate the innovative pipeline to be a significant contributor for the company over the next 5 to 7 years. And we'll give you more color around it at the investor meet. But from here on, you can see high growth coming, right, on the company, primarily on account of some of the innovative oncology launches, RYALTRIS, our U.S. business also, which has been a drag for the last 4-odd years, right? Now with the launch of fluticasone [ MDI 44 ] and 2 or 3 more respiratory launches yet this year, right, should -- and then, of course, the sole FDFs that we have, right, which are all coming to what are happening this year should help drive the growth. So I think, all in all, [ bar ] in Europe, which we think could be high single digit everywhere else, the growth number will be exceedingly high, right, across the board.

Sorry to push that point , but you asked second half sales and second apically the stronger period for us in a year is about INR 7,700 crores or thereabouts. Even if you analyze that, I think we're still talking of a very meaningful ramp-up on [indiscernible] analyze H2.

So Nitin, basically, as I mentioned in my opening comments that the U.S. sale, which we targeted should have been much higher in Q4, which obviously will build much spread over because of this large movement supply chain and go-to-the-market issues in U.S., which will obviously -- so this year, we'll see a full fraction of fluticasone nasal spray loan and other launches in U.S. So U.S. should do much better than what we did in last H2 in that. And also the India will continue to grow strongly at 15% plus in the market. And emerging markets and Europe, both should -- so that's how it will contribute to. So it's build on that take we have launched in the various markets.

And secondly, on Andhra, on the balance sheet, I think there has been a very sharp increase in receivables as well as inventory and tables of specialty, the receivable increase is quite dark. Can you --

So receivable increase is primarily because of 3 reasons. As we mentioned that the commented when we mentioned is that there was a one largely primarily we stopped the [indiscernible] that was one reason. Second reason was that certain of the MEA region collection in this quarter was got delayed because of this entire AR situation. So we'll come back to the normalcy with that. And third was that certain currency translation also of the data also fits in that. So I think overall, if you see our net working capital are close to 7 days, which are still in and will continue to be. If you recall, we gave you the guidance of 115 to 120 days. So we are well within that. And we will continue -- again, FY '27 will continue to be the same guidance to have a net working capital that in the industry. And if you -- and also, if you see that we did a gross debt 0 because despite all these challenges, certain lower sales in U.S. and all the things still we keep a gross that deal with a [ INR 1,200 crore ] of cash position. Balance sheet is in now in strong shape. And I think overall, we'll continue to monitor working capital efficiencies very closely.

And sir, on the working capital, the number of days you computed by annualized in the last quarter the way you compute the number of days?

So we conclude the number of days. So you are right. I think except for inventory, which is always forward-looking data and trades are always based on the previous at number. So [indiscernible].

I was looking at -- or person this point, our receivables are up almost INR 50 crores, [ INR 500 ] crores. from September onwards up almost like INR 1,000 crores for the second half of the year.

So if you see, we have -- if you net inventory, you are saying that -- inventory, it's actually based on coal content business is around 71 days. Better come to [ 17 ] days and achieve. So overall, we are coming close to 97 days of actually the net working capital is. So I think even if you take it on a [indiscernible] basis, it's [indiscernible] days. So we are well within the range in terms of our net working capital deployment. In fact, -- sorry, go ahead.

No, sorry, I was -- sorry I was saying we should assume the year-end number of days which are the [indiscernible] what is sustained going forward also?

Yes. So as I mentioned, that we are clearly maintaining that we will be the best in the industry and 15 to 20 days, we will be below that. So that's what we are targeting that going forward. And despite that business increasing and everything, we will continue to release cash from the working capital efficiencies.

And lastly, on the CapEx, if you can split between tangible intangibles for the year, and how should we look at this going forward?

So this year, you see intangibles were close to INR 800 crores plus because of the reason, as I mentioned in my opening remarks, primarily due to the upfront payment and milestones associated with various partnerships, which we executed in oncology and [indiscernible] portfolio. We also [indiscernible] use some of the BD activity in our base business, especially in U.S., where we launched multiple partnered products in injectable segments. Because of that, this was more of a one-off, I think, on an intangible, and this was more to support our growth in the future. I think FY '27 onwards, we should see a coming down on a normalcy level of around INR 900 crores sort of CapEx number total.

And the last one on your -- on your liabilities, what are the payout each are there over the next couple of years?

Liability? Sorry that I missed your question.

No, what I meant is in terms of some certain committed payouts, what are the -- or maybe some licensing deals or some litigation payout, what is that total amount of committed payouts, which are there on a lab for the next 2 years?

So liabilities basically that committed payouts are actually largely mostly related to the legal payment deportment. And second is that income deferment, which we have done of $70 million every year that is also hitting in the laboratory credit part, so which is $70 million every year.

I was looking from a cash perspective. What is the cash payout on your committed liabilities which are there for the next 2 years?

We can come back to you with the cash thing is largely related to legal expenses deferments and the [ tidal ] payment or how we have committed to that.

[Operator Instructions] The next question is from the line of [ Sara Agarwal ] from [ Oldbridge ].

[indiscernible].

Sorry to interrupt. Mr. [ Agarwal ], your audio seems to be very low.

Hello. Am I audible?

Yes. Go ahead.

A couple of questions, bookkeeping and one on RYALTRIS. Probably start with a -- can you started out saying that RYALTRIS is about $100 million of revenues for FY '26. What was this number for '25? And if you could give us a sense composition, the geographical composition of the revenue and your outlook for '27 on this given that RYALTRIS is slated to launch.

So clearly, look, RYALTRIS is a big brand for us, right? And we continue to grow $10 million is the base for '26, I don't have the precise number for '25. But I think going forward, right, I mean, you should easily assume like we'll grow 30-plus percent, 30%, 40%, at least for the next few years, right on this graph, right, going forward.

And I mean is there -- is it concentrated in some specific geographic or it's more like -- it's broad-based.

I think broad-based. I think, look RYALTRIS is a global brand for us now, right? I mean we sell in almost all our markets, right? And a couple of markets where we didn't have the product launched was -- Brazil was one of them, which now we're launching this year. And then, of course, the U.S., we go through [indiscernible] how we are doing on our own. China, we are in the process of launching also. I think sometime this year, we'll launch in China. But I think post reimbursement, the product will be a significant product in China. So I think it's still -- I would say it's still in the launch phase in many markets. So that will give us the real growth brand this year, right? There are many smaller markets, for example, Thailand and multiple markets where we are still in the launch phase, right?

Got it. On the P&L, exceptional items are roughly INR 373 crores, roughly INR 320 crores, INR 323 crores on account of a litigation settlement. So I was just curious what the balance INR 50 crores is all about. And then also sizable other income this quarter, approximately INR 189 crores. So what is contributing to this?

Okay. So [indiscernible] exception item is largely because of the U.S. settlement and associated legal cost of these settlements and various other expenses related to the settlement because these are the settlements as well, and we don't tell you any of the liabilities in these settlements. On other income, largely that is because of the translation, ForEx impact because of the [indiscernible] movement that's coming as other income in our [indiscernible].

Got it. And allocation of R&D spend for [ icons ] for Q4 would be about INR 150 crores?

Yes, roughly around INR 150 crores.

The next question is from the line of Tushar Manudhane from Motilal Oswal Financial Services .

Sir, just to -- for FY '26 with respect to that [ Agri ] deal, how much has been now booked for last 2 quarters since the milestone income?

so we book around $17.5 million every year. Every quarter what we said and which contribute to [ $70 million ] in a year basis. So last 2 quarter, $35 million to our book.

Got it. So subsequently in FY '27, again, the so additional as compared to FY '26. So effectively $34 million will sort of add up in FY '26?

Yes.

Any new approvals which you are sort of factoring in the assumption for FY '27 revenue for U.S. apart from --

No. So see, in the U.S., we have these 2 sole FTFs okay, right, which are coming up, right? So 2 exclusive products, right, which are coming in the end of Q3 and Q4, right? [indiscernible] and [ axitinib], right, which will come up. The second thing is we have a couple of more respiratory launches coming up, right, in the U.S. in FY '27. So I think all that makes us believe that U.S. will be a major growth driver for us, right, in FY '27.

So effectively, how much are we considering that the number to scale up because fluticasone nasal sprays and OTC, so that will take its gradual pace to build up. And if you could elaborate in terms of the upcoming respiratory launches, they again like that can scale up the way typical gene productive or it will be gradual.

So look, we have 3 respiratory products filed. One is fluticasone Rx is expected pretty quickly also. Additionally, we have Fluticasone 110, which is already filed, right? And we have one more MDI, which is filed, which is expected to launch this year. So I think if everything comes through, it will be a strong year for the respiratory franchise. Additionally, we have as I said, the 2 sole [indiscernible].

Alright, sir. Because effectively, it is like almost 30% growth over India market will be 15%, emerging markets, maybe 10%, 20%. So there is going to be a heavy lifting, if I do back of the calculation from U.S. and which is like sort of plus 30% sort of a growth adjusting constant currency and apart from that, maybe 5%, 6% of [indiscernible]. So effectively, we are targeting at least 40%, 45% revenue growth in U.S. Is that what you are [indiscernible]?

I can't give you -- I think that's too granular, okay? Right? But I've given you all the drivers, you can do the analysis, right, on why we believe that the U.S. will outperform.

And secondly, with respect to this litigation settlement, is there any further amount that might come up or we have already provided for what?

Sort of almost -- we are almost done with everything. We have 1 or 2 outstanding cases, which will get settled over the next few years, right? It will take a few more years, but we are pretty much done with everything now.

And lastly, how much the R&D spend is going to be for FY '27, FY -- Q4 FY '27 first line is the number and full year commission?

Q4 was INR 225 crores. Full year is around the same range, 7%, 8% of sales.

The next question is from the line of Sucrit Patil from Eyesight Fintrade Private Limited.

I have 2 questions. The first question, which Glen is. Just want to understand forward-looking guidance on what type of strategic levers are you placing in to expand the company's leadership and in respiratory, the hematology and oncology therapies accelerate biosimilars and drug pipeline time managed [indiscernible] from regulatory pricing pressures and global competition. That's the first question. [indiscernible].

So I think we covered most of the drivers, right, for FY '27, right, in terms of growth drivers, right, across the different markets. We talked about -- we talked about -- sorry, there's a lot of background. Can you go on mute, please? So I think overall, we touched on most of the most of the growth drivers, right, in FY '27, right? A lot of the growth will come as we discuss the U.S. -- a lot of the U.S. market growth, right, will be key. The second thing is, of course, India and emerging markets with the launch of some of the oncology products and the investments you are making in government respiratory expansions, along with our India business, the GLIPIQ launch, GLP launch. So multiple low drivers, right, will drive our FY '27 guidance, right, to achieve these numbers.

My second question one is a forward-looking one. What type of capital allocation and risk management frameworks are being applied in 2027 to balance dividend payouts with funding for R&D specialty drugs any hedge against ForEx and raw material volatility? And any newer put into place to sustain liquidity buffers on the large-scale expansion projects?

Sorry, I'll [indiscernible] could not hear the last line fully, but I think let me just try to explain on the -- what I understood since that, and then you can add it to that. So capital allocation side, what we said to that we have a disciplined capital allocation. We said that IGI are setting aside for the $70 million for the spend. R&D, we said 7% to 8%, we'll continue to do that. As [indiscernible] explained that we will be investing in our core businesses this year to expand our core businesses, which we will tell you in detail in coming Investor Day because we are expanding and we are reinvesting in the businesses. So this year is actually largely basically the capital location is on a on this expansion of our Google business, the $70 million of IDI spend, R&D continues to be at 8% because that's innovation and R&D, we see a good growth driver. And continue to be -- and working capital efficiency, we'll continue to maintain to and all the geopolitical uncertainty, what you mentioned, the raw material volatility, currency volatility, all will continue to maintain with a high level of working capital of management and efficiencies. So hope -- I think I covered it.

The next question is from the line of [ Karan Agarwal ] from [ Old Bridge ].

And just [indiscernible]. I mean there are some basic numbers that we look out for every quarter. Net debt, gross debt, CapEx, R&D. And what we've observed is disclosures are not standard. I mean, some quarters, you'll put forward those disclosures, some quarters you're down. So it will be helpful if it just saves a lot of time for everyone. So that's one. Second, has there been a leadership change in [ ITI ] recently?

So [indiscernible], so we take your suggestion on some of the disclosures, right? We look into it. On -- we had a guy called [ Cyril Conto ] was running it some time ago. There's a new lady [ Lida Paco ], who is now the CEO of GI. And she will be there at the Investor Meet.

You have seen -- and how long has it been since sales moved up?

In about maybe 6, 8 , at least 6, 8 and leader was Chief Medical Officer. So she's been with us for the last 3, 4 years, at least.

Ladies and gentlemen, that was the last question. I now hand the conference over to Mr. [indiscernible] for his closing comments.

Yes. Thanks, Suzanne. A quick reminder to everyone that the information analysis and statements discussed during the today's call, describing the company or its affiliates, objectives, projection and estimates are forward-looking. These are based on current expectations, forecasts and assumptions and are subject to the incertainty which could cause actual outcomes to materially differ. No representation of warranty as are expressed or implied is provided in relation to the conversation and documents provided. And the company undertakes no obligation to update or revise any of the forward-looking statements because of new information, future events or otherwise. And we look forward to seeing you at the Investor Day. And with that, we can close the Q4 earnings call. Thank you, everyone, for joining us today. Thank you.

Thank you, [indiscernible] management team. Ladies and gentlemen, on behalf of Glenmark Pharmaceuticals Limited, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines. Thank you.