Disappointing sales at Dr Reddy's, the Indian drug producer listed on the New York Stock Exchange, have led to a 44% fall in quarterly profits.
Many of Dr Reddy's sales come from cheaper generic drugs
Sales were flat in the July to September period as the company struggled in the key US market.
Net profits fell to 517m rupees ($11m; £6.1m) from 929m rupees for the same period last year, below expectations.
Dr Reddy's suffered a blow in March when it was prevented from selling a popular generic drug in the US.
The firm's version of the anti-hypertension drug Norvasc was banned by a legal ruling following a high profile patent case.
Dr Reddy's fought a legal battle to try and sell its version of Norvasc even though the drug had been patented by its manufacturer Pfizer.
Dr Reddy's argued that it was not violating Pfizer's intellectual property because its drug was not an exact copy.
One-fifth of Dr Reddy's sales come from generic drugs, seen as a key growth area for low-cost producers.
However, the bulk of its generic sales are in the highly competitive US market.
A combination of flat sales and a significant increase in research and development spending- which rose 28% -led to the fall in profits.
"This is a difficult period. The challenge continues," chief executive officer G.V Prasad told the Reuters news agency.
Dr Reddy's has found the going tough in the US market since its exclusive marketing rights for a version of anti-depressant drug Prozac ended in January 2002.
Dr Reddy's has launched a number of new drugs in the US in the past two years.
However, the firm has not been granted exclusive marketing rights to them, a crucial factor in boosting sales.
The company said it was talking to a number of potential partners about sharing research costs.
Dr Reddy's US traded shares fell 0.7% to $16.18 on the news of the profits decline.