Published Date : Dec 07, 2015
Sun Pharma might be looking towards a brighter future after a long period of issues.
A few brokerages had suggested to upgrade Sun Pharma to a “buy” rating after a 40% slip in the price after the beginning 2015.
The United States Food and Drug Association has recently given a nod for Gleevec, an anti-cancer drug in a generic version. The drug is expected to significantly improve the short-terms prospects for Sun Pharma.
An agreement was hashed out between Novartis and Sun in May 2015, closing the argument regarding patent rights of the drug which contains the active ingredient imatinib mesylate.
Gleevec sales have gone over the US$2.5 bn mark, according to data provided by IMS Health in August 2015. The findings were based on the Moving Annual Total.
Sun Pharma will enjoy 6 month long exclusivity with the drug. Due to the clause, market experts have deduced that the sales of the drug will add anywhere between US$200 mn to US$4450 mn, recording an estimated profit of US$450. Million.
Gleevec might possibly add a significant 15% to the U.S. sales made by Sun Pharma which is perhaps the best possible scenario, according to Surajit Pal, a Prabhudas Lilladher analyst.
Pal had written in client note in December, that one could assume the current market size to receive a 65%, along with a 70% profit margin and 40% generic conversion, there will be a 180 days sales period for Sun Pharma between US$450 mn and US$315 mn.