Dr Reddy’s Semaglutide: Canada decision by May 2026

Why semaglutide and biosimilars are back in focus

Dr Reddy’s Laboratories has multiple regulatory events in play that investors are tracking closely, led by semaglutide approvals and key biosimilar milestones. The company has said it continues to make progress on its pipeline products, with launches expected to help offset the expected decline in Revlimid-linked sales. Management has also indicated that integration work is moving into a next phase covering select countries in Asia-Pacific, the Middle East, and Latin America, with integration largely expected to complete by the end of the fiscal year. Against that backdrop, developments in Canada and the US have started to drive short-term stock reactions.

Semaglutide in India: DCGI marketing authorisation and licensing

During the quarter, Dr Reddy’s received marketing authorisation for its semaglutide injection in India from the Drugs Controller General of India (DCGI), following a recommendation by the Subject Expert Committee under the Central Drugs Standard Control Organization (CDSCO). The company also said necessary local manufacturing licences have been secured. It added that filings in various emerging markets have started through the COPP route.

Management commentary also pointed to India launch timing being linked to patent expiry. The company said it can launch in India only at patent expiration, which it noted is dated to March 26. Broker commentary in the same context cited a targeted launch in March, and the company has also indicated upcoming launches include semaglutide in India by March 21.

Health Canada hurdle: Notice of Non-Compliance and response timeline

Shares of Dr Reddy’s declined over 5% after it received a Notice of Non-Compliance from Canada’s Pharmaceutical Drugs Directorate for its semaglutide injection. Analysts described the issue as temporary, but the incident keeps the Canada timeline in sharp focus.

The company said it submitted its response by mid-November 2025, within the stipulated time, and was awaiting a response from the Canadian regulator. Management also explained that a goal date is generated automatically, six months from the response time, taking the timeline to May. It added that this does not guarantee approval by that date and that the decision could come any time between now and May, “hopefully in May.” The company said it is preparing for a launch even in Q4, and if not, then in Q1.

Abatacept biosimilar: BLA filing completed for IV

On the biologics front, Dr Reddy’s said it completed the filing of the Biologics License Application (BLA) for the intravenous (IV) presentation of its abatacept biosimilar candidate in December 2025, as per schedule. Management’s expectation is that approval for the IV product could come toward the end of calendar 2026, followed by a launch. It also outlined a separate timeline for the subcutaneous (SC) version, with approval expected by January or February 2028.

Management also clarified operational separation between programmes, saying abatacept is made on different lines in Bachupally, India. This mattered because other biologics have attracted regulatory questions tied to specific manufacturing lines.

Denosumab and rituximab: regulatory uncertainty and manufacturing line issues

For denosumab, management said Alvotech needs to answer a deficiency letter, after which timing depends on how the US Food and Drug Administration (USFDA) addresses the response. The CEO said he does not know the exact timing but indicated it is likely in the second quarter of FY27 and maybe even after, noting that in biologics, it is not always just one deficiency letter.

For rituximab, management said one of the two comments is tied to its response, mainly related to a fill-finish line. It expects to answer in “the next two weeks,” after which the regulator may decide to re-inspect. The CEO’s assessment was that approval is unlikely within the next six months and could take longer. He also said the main delay in the launch is linked to partner Fresenius, and that the overall delay versus the original plan is “probably a year plus.”

Other pipeline milestone: ustekinumab approval in Europe

The company said it received a European Commission approval for its ustekinumab biosimilar in Q3 FY26, following a positive CHMP opinion. This adds to the company’s regulated-market biosimilar footprint even as the US timelines remain milestone-driven.

Financial and operating context: growth pockets, capex, and R&D stance

In quarterly operating metrics cited alongside the updates, emerging markets growth was reported as 32% year-on-year. Pharma and API revenue fell 2% year-on-year to ₹802 crore. In India, the company said it launched Hevaxin, a novel recombinant vaccine aimed at prevention of Hepatitis-E virus infection.

On spending, the company indicated it remains committed to maintaining R&D spend in the 7-8% range. It also outlined manufacturing and supply chain priorities including sterile and high-potency capacity additions, oral solid-dose debottlenecking, and localisation of key starting materials to reduce dependence on China. Near-term capex guidance was cited at ₹1,800-₹2,200 crore per year, tied to growth and compliance.

Market moves: stock reactions, targets, and technical levels

The stock has reacted to multiple headlines. It fell nearly 2% on a separate occasion after the USFDA issued a Form 483 with five observations at its Hyderabad plant inspection. The USFDA completed a Pre-Approval Inspection at the biologics manufacturing facility in Bachupally, Hyderabad, between September 4 and September 12, 2025, and the company said it would address the observations within the stipulated timeline.

Brokerages highlighted regulatory approvals for generic semaglutide in Canada and the abatacept biosimilar (IV formulation) in the US as key catalysts. CLSA upgraded Dr Reddy’s to hold from sell and raised its target price to ₹1,210, citing an earnings beat in Q3 and expecting single-digit growth in the US excluding Revlimid and double-digit growth across other geographies.

At another point, the stock was reported at ₹1,284, up 0.3%, alongside brokerage notes that retained a bullish stance. Elara Capital kept a ‘Buy’ rating with a target price of ₹1,588, while noting that revenue and EBITDA were below estimates and that India was up 13% year-on-year.

Technical commentary in the same stream said Dr Reddy’s broke out from a 5-week consolidation in September 2025, with a short-term target of ₹1,360 in 1-2 months. Resistance was flagged around ₹1,320-₹1,340 and support at ₹1,260-₹1,240.

Acquisition note: Stugeron deal in CNS portfolio

The company’s shares also saw a slight dip after it announced acquisition of Stugeron from Johnson and Johnson for $10.5 million. The stated aim was to strengthen the Central Nervous System portfolio and expand presence in the anti-vertigo market across 18 markets in APAC and EMEA, with a focus on India and Vietnam.

Key facts table

Why the regulatory calendar matters

The company has framed semaglutide, denosumab, and abatacept as important molecules to mitigate the impact of declining Revlimid sales and to support growth momentum. That framing increases sensitivity to regulatory timelines, especially in Canada for semaglutide and in the US for abatacept. It also explains why short-term stock moves have followed compliance-related headlines.

At the same time, management has stressed that biosimilar commercialisation timing is milestone-driven, and that revenue can be lumpy as approvals and launches land. The operating plan also highlights that FDA observations or import alerts can halt shipments and disrupt revenue, reinforcing why execution around inspections and compliance timelines remains critical.

Conclusion

Dr Reddy’s has India marketing authorisation for semaglutide and has set out a Canada decision window that runs up to May 2026 after submitting its response in mid-November 2025. On biosimilars, it has already filed the abatacept IV BLA in December 2025 and expects an end-2026 approval timeline, while denosumab and rituximab remain dependent on responses, inspections, and regulator scheduling. The next set of market-moving updates is likely to come from Health Canada’s decision on semaglutide and progress milestones for abatacept and other biologics filings and inspections.