Semaglutide Market Faces Slump as Excess Stock Hits ₹100 Crore
The rapid expansion of India’s obesity therapy market has hit a significant roadblock as sales of semaglutide-based treatments slowed unexpectedly in May. After a period of explosive growth driven by generic competition, the industry is now grappling with a massive inventory overhang that threatens profit margins.
The Post-Patent Surge and Subsequent Slowdown
The Indian obesity therapy market, valued at approximately ₹2,000 crore, experienced a massive surge in April following the patent expiry of semaglutide on March 20. This regulatory shift led to a flood of affordable generic brands from major pharmaceutical players, including Sun Pharma, Dr. Reddy's, and Torrent Pharmaceuticals. In April, the market saw a staggering 50% month-on-month value growth and an 88% jump in volumes.
However, this momentum failed to carry into May. According to data from market research firm Pharmarack, the month-on-month value growth decelerated sharply to just 6%, while unit growth slowed to 12%. This sudden cooling of demand has left the supply chain struggling to manage the surplus.
Inventory Overhang Strains the Supply Chain
The most pressing concern for industry stakeholders is the massive buildup of unsold stock. Rajiv Singhal, General Secretary of the All India Organisation of Chemists and Druggists (AIOCD), reported that stockists and wholesalers are currently holding 50–60 days of GLP-1 (semaglutide) inventory. This is significantly higher than the standard industry norm of 30–45 days.
Industry estimates suggest that the value of this excess stock sitting in the trade channel is approximately ₹100 crore. As a result, channel partners have effectively halted fresh procurement from pharmaceutical manufacturers, waiting for existing stocks to liquidate before placing new orders.
Regulatory Impact and Market Dynamics
Industry experts suggest that the moderation in sales may not be purely a matter of market saturation, but also a response to regulatory shifts. In April, government advisories and new prescribing guidelines were introduced, stipulating that GLP-1 receptor agonists—used for managing type 2 diabetes and obesity—should only be prescribed by qualified specialists. These restrictions may have tightened the prescription funnel, leading to the recent sales dip.
In contrast to the semaglutide slowdown, Eli Lilly’s Mounjaro (tirzepatide) continued to show resilience. As a leading therapy in the GLP-1 class, Mounjaro's sales grew by 12% to reach ₹136 crore in May. This performance occurred even as the broader ₹2.5 lakh crore organized pharma retail market grew by 11%, primarily driven by chronic therapies.
Key Takeaways
- Inventory Crisis: Stockists are holding ₹100 crore worth of excess semaglutide stock, with inventory levels reaching up to 60 days.
- Growth Deceleration: After a 50% value surge in April, May saw month-on-month growth plummet to just 6%.
- Regulatory Hurdles: New guidelines requiring specialists to prescribe GLP-1 therapies are believed to be contributing to the sudden cooling of the market.