Sun Pharma Shares Tumbled 5% After US Court Ruling

On Monday, November 4, 2024, Sun Pharma shares fell by as much as 5% after a US District Court ruling that granted a preliminary injunction in a patent dispute concerning its hair loss drug, Leqselvi.

As of 10:05 AM, Sun Pharma’s shares were trading at ₹1,802.50 on the BSE with a day low of ₹1,766.15.

Impact on Sun Pharma Business

The ruling, which favours US-based Incyte, blocks Sun Pharma from launching Leqselvi—designed for severe alopecia areata—until either a favourable court decision is reached or the relevant patent expires in December 2026. Sun Pharma has announced plans to appeal the decision, but the injunction represents a significant setback for the drug’s launch timeline.

Leqselvi was expected to generate approximately $200 million in sales over the next three to four years, making it a key revenue opportunity for the company.

The launch timeline for Leqselvi was thrown into disarray just a week after receiving FDA approval during the July-September quarter; Sun Pharma had initially intended to launch the drug by August.

In a worst-case scenario, an unfavourable ruling could delay the launch until the patent expires, with royalties contingent on a settlement that remains uncertain pending the court’s outcome.

Sun Pharma Financials

Despite this setback, Sun Pharma reported strong earnings for the July-September quarter, with a net profit increase of 28% year-on-year to ₹3,040 crore The company’s consolidated revenue from operations rose 9% year-on-year to ₹13,291 crore, driven by double-digit growth in key markets, particularly in the US, closely aligning with the poll estimate of ₹13,299 crore.

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