JP Morgan puts 'Neutral' rating on Ranbaxy Laboratories
Given the twin uncertainties of the continued US FDA import ban and potential currency exchange losses, JP Morgan remains 'Neutral ' on Ranbaxy even though valuations remain attractive for longer-term investors.
RESEARCH: JP MORGAN
RATING: NEUTRAL
CMP: RS 219
Given the twin uncertainties of the continued US FDA import ban and potential currency exchange losses, JP Morgan remains 'Neutral ' on Ranbaxy even though valuations remain attractive for longer-term investors. Ranbaxy, which has a 180-day exclusivity on generic Imitrex (Sumatriptan), has not yet been able to launch the drug in the US as the FDA approval has not yet come through. Sumatriptan First to File is approximately Rs 5/share of the target price.
Brand sales of Imitrex were US$1.29 billion in 2007. Given that the generic filing is not from the manufacturing sites where the US FDA had issued warning letters, the launch approval from the US FDA for Sumatriptan is key to see if it is business as usual for Ranbaxy in the US beyond the products in the import ban. Given the large FTF (first to file) pipeline for Ranbaxy , any delay in approvals for Sumatriptan would be negative for the remaining FTF pipeline.
RATING: NEUTRAL
CMP: RS 219
Given the twin uncertainties of the continued US FDA import ban and potential currency exchange losses, JP Morgan remains 'Neutral ' on Ranbaxy even though valuations remain attractive for longer-term investors. Ranbaxy, which has a 180-day exclusivity on generic Imitrex (Sumatriptan), has not yet been able to launch the drug in the US as the FDA approval has not yet come through. Sumatriptan First to File is approximately Rs 5/share of the target price.
Brand sales of Imitrex were US$1.29 billion in 2007. Given that the generic filing is not from the manufacturing sites where the US FDA had issued warning letters, the launch approval from the US FDA for Sumatriptan is key to see if it is business as usual for Ranbaxy in the US beyond the products in the import ban. Given the large FTF (first to file) pipeline for Ranbaxy , any delay in approvals for Sumatriptan would be negative for the remaining FTF pipeline.
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