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Sun Pharma gets favourable verdict from a US court, to go ahead with a critical product launch

ICICIdirect Research 11 Apr 2025 DISCLAIMER

In a significant development regarding the ongoing litigation of Sun Pharma for the drug Leqselvi (deuruxolitinib – indicated for a kind of baldness), the US Court of Appeals has ruled in the favour of Sun Pharma by vacating the preliminary injunction made by the plaintiff.

Although the litigation on patent is going to continue, Sun Pharma is no longer under a court order that could delay or restrict them from launching Leqselvi.

Sun had received a preliminary injunction in August, 2024 for the drug Leqselvi in the US District Court which had prevented the launch of the product.

The lifting of injunction paves way for Sun for immediate launch of the product. We project it to generate around US$ 300 million in sales over the next three to four years for Sun. It has a patent expiry in December 2026. Even after the expiry, we do not expect significant cometition because of the complexity of the drug and its better efficacy over rival drugs.

The acquisition cost for the drug was US$ 576 million. Hence early launch and subsequent traction could significantly reduce the payback period. Despite the patent litigation still being subjudice, we expect Sun to go ahead with the launch.

Sun continues to strengthen the specialty portfolio with a focused approach and incremental R&D spend. According to our estimates, Global Specialty sales of Sun Pharma for FY25E will account for US$ 1231 million (20% of total sales) which shows a 5-year CAGR of ~23% since FY20 and it has 7 new active substances undergoing clinical trials.

We have a BUY rating on Sun Pharma with a TP of ₹2185

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