Sun Pharma's stock vaults to 52-week high on Prandin approval

Sun Pharma’s stock hit a 52-week high today on back of the company announcing of getting the US FDA approval for the generic Prandin. The company being the first to file a Para IV ANDA (abbreviated new drug application) for this drug, becomes eligible for a 180-day exclusive marketing rights in the US.

Prandin is a diabetes controlling drug of pharma major Novo Nordisk having a market size of $ 200 million in the US. With Sun Pharma obtaining a generic approval for this drug, it is being seen as a lucrative short-term opportunity for the company that has been logging strong performance in the recent quarters thanks to its US operations.

A report by SBI Cap Securities pegs the sales during the exclusivity period to be $ 300 million translating into an incremental earning upside of around 3% for the current fiscal with relatively high margins of around 60% with an assumption of launch of an authorised generic, 50% price erosion and 30% market share for Sun Pharma.

Sun Pharma’s stock closed 1.2% higher for the day.