On Tuesday, Lupin, Divis Laboratories, Dr Reddy’s Laboratories, Aurobindo Pharma, Sun Pharma, Cadila Healthcare, Cipla and Glenmark Pharmaceuticals were trading higher in the range of 1% to 3% on the National Stock Exchange (NSE).
At 10:15 am; Nifty Pharma index, the largest gainer among sectoral indices, was up 1.8% as compared to 0.37% gain in the benchmark Nifty 50.
Sun Pharma was up nearly 2% at Rs 545 on Tuesday, gaining 14% in past one week on report that the US regulator has upgraded current status of the company’s Halol plant to VAI (Voluntary Action Indicated).
“We are awaiting the receipt of the Establishment Inspection Report (EIR) from the US FDA for the above referred GMP inspection conducted at our Halol facility from February 12-23, 2018. As and when we receive the EIR, we shall inform the exchanges immediately,” Sun Pharma said on a clarification on news
The upgradation status of the plant means that the response and remediation works of Sun Pharma are at satisfactory level of USFDA and critical issues in the company are virtually resolved, analyst at Prabhudas Lilladher said event update.
The VAI status will open opportunity of receiving new approvals for US markets
as USFDA will now start active consideration of the pending applications from Halol plant. We expect approvals of old ANDAs in near term due to large dependence on Halol plant among the pending approvals, the brokerage firm said in a report.
Aurobindo Pharma was up 3% to Rs 592, extending its past two days 5% gain, due to US FDA approval for gOmeprazole and classification of its Unit-IV as VAI.
Reliance Securities expect Aurobindo Pharma’s US business to clock 11% CAGR over FY18-20E led by new launches (30-40 in FY19 including few niche products) and ramp-up in injectable biz.
With double-digit margin in European business, we expect further improvement in margin led by transfer of products from Europe to Indian units for manufacturing (transferred 83 products out of planned 112); the brokerage firm said in a note and maintains fundamental BUY recommendation on the stock with target price of Rs 712.