Sun Pharmaceutical Industries shares dropped 3.4 percent as the US FDA labelled its Dadra facility as 'official action indicated' (OAI), indicating recommended regulatory or administrative actions.

The stock was trading at Rs 1,549.30 on the BSE, down 3 percent from previous close.

Following an inspection from December 4 to 15, 2023, Sun Pharma disclosed the classification status in an exchange filing.

Sun Pharma Ltd recently announced that the Australian Therapeutic Goods Administration (TGA) has approved Winlevi (clascoterone cream 1 percent) for treating acne Vulgaris in patients aged 12 and above. This approval grants Sun Pharma exclusive selling rights in Australia starting June 24 (Q1FY25). Sun Pharma holds rights to sell Winlevi in the US and Canada since FY22.

Additionally, the company has exclusive development and commercialisation rights for Winlevi in the US, Japan, Australia, New Zealand, Brazil, Mexico, and Russia from Cassiopeia SpA. Winlevi is a key product in Sun Pharma's portfolio, alongside Ilumya, Cequa, Levulan, Absorica, Odomzo, Bromsite, Xelpros, Yonsa, and Sezaby, contributing to the growth of its global specialty sales.


"We expect Sun Pharma’s global specialty segment sales growth to get a boost from the recent additional marketing approval for Winlevi in Australia. We, therefore, increase Sun Pharma’s sales and net income estimates to 10.9 percent and 16 percent CAGR, from 10.6 percent and 15.3 percent CAGR\. We also increased the valuation multiple by 10 percent to 32x on FY26 EPS. The company has been seeing steady growth in revenue and net income over the last few quarters on the back of strong growth witnessed in specialty revenue, which now corresponds to 19.2 percent of overall sales as of Q3FY24 as against 16.5 percent it was in Q3FY23 and 16.4 percent it was in Q2FY24 and market outperforming growth in IPM", KR Choksey said in its latest note.

Sharekhan predicts that Sun Pharma, serving as a proxy for specialty sales in the US, will continue to grow significantly despite a higher base. This growth is driven by investments in the R&D pipeline, with specialty R&D accounting for around 40% of total R&D spending. The partner product Nidlegy is expected to file for approval in Europe during H1CY24E, enhancing Sun Pharma’s offerings in skin cancers and complementing its Odomzo franchise in Europe. Additionally, Sun Pharma and its subsidiary have entered a licensing agreement with Aclaris Therapeutics, Inc, granting exclusive rights to use Deuruxolitinib, Sun Pharma’s JAK inhibitor, or other forms of Ruxolitinib, for treating alopecia areata.