Shares of pharma major Sun Pharmaceuticals Industries Ltd. plunged over 5% on Monday—the worst since December 2020— after a US District Court prevented it from launching its new drug, Leqselvi.
The US District Court of New Jersey has granted a preliminary injunction from launching Leqselvi, until further legal developments or the expiry of the patent at the center of the lawsuit.
This legal action, filed by Sun Pharma on August 1, sought to challenge the injunction, but the court decided on Friday to uphold the delay, effectively halting the drug's release in the U.S. market.
This ruling requires the company to defer any Leqselvi launch until a favourable court outcome or the patent's expiration, whichever occurs first.
The drugmaker posted a consolidated net profit of Rs 3,040 crore in the second quarter of the current fiscal, marking a 27.94% increase from the previous year and closely aligning with Bloomberg's consensus estimate of Rs 2,932 crore.
The profit growth was driven by lower-than-expected research and development expenses and growth in the U.S. market.
US Formulations sales were at $517 million for the second quarter of the fiscal, growing by 20.3% over the same period last year and accounting for approximately 33% of total consolidated sales.
Sun Pharma's stock fell as much as 5.29% during the day to Rs 1,760 apiece on the NSE. It was trading 3.48% lower at Rs 1,793 apiece, compared to a 0.93% decline in the benchmark Nifty 50 as of 09:40 a.m.
It has risen 55% during the last 12 months and has advanced by 42% on a year-to-date basis. The total traded volume so far in the day stood at 9 times its 30-day average. The relative strength index was at 35.
Thirty out of the 41 analysts tracking the company have a 'buy' rating on the stock, seven suggest a 'hold' and four have a 'sell', according to Bloomberg data. The average of 12-month analyst price targets implies a potential upside of 13%.