Shares of Sun Pharmaceutical Industries are set to attract attention today, November 4, after a US court ruling stalled the launch of its new drug, LEQSELVITM (deuruxolitinib). The medication, aimed at treating severe alopecia areata, remains in regulatory limbo following a preliminary injunction by the US District Court of New Jersey.
Court Ruling Blocks LEQSELVITM Introduction
The New Jersey court’s decision imposes a preliminary injunction that prevents Sun Pharma from marketing LEQSELVITM until the court reaches a final ruling or the contested patent expires. This decision comes after Sun Pharma initiated a challenge against the patent on August 1.
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Despite the company’s objections, the court upheld the injunction last Friday, effectively stalling the drug’s entry into the US market. Sun Pharma has expressed its disagreement with the ruling and has announced plans to appeal, which may add an element of uncertainty for investors.
Quarterly Financial Updates
In addition to the legal developments, Sun Pharma reported a solid financial performance for the quarter ending September 30, 2024. The company posted a consolidated net profit of Rs 3,040 crore, marking a 27.94% increase compared to the same period last year. Revenue for the quarter was Rs 13,291 crore.
EBITDA Performance
Sun Pharma reported an Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) of Rs 3,939 crore. However, the EBITDA margin for the quarter was 29.6%, slightly below the market estimate of 30%.
Strong Growth in US Market
The US market continues to be a key growth driver for Sun Pharma. For the September quarter, sales from the US formulations segment rose by 20% year-on-year to $517 million, representing 33% of the company’s total sales.
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Stocks Performance in Last One Year
Sun Pharmaceutical shares have delivered positive returns across various time frames. Over the last three month, the stock has shown a positive return of 7.32%, indicating short-term growth. In the last six months, the performance has been even more impressive, with a substantial increase of 22.34%, showcasing the stock’s resilience and upward momentum.
Year-to-date, Sun Pharmaceutical shares have surged by 47.56%, emphasizing the stock’s positive trajectory in the current calendar year.
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