Sun Pharma Share Price Jumps After Jefferies Upgrades To ‘Buy’

Jefferies also said the “key risk” to its specialty portfolio is behind.

Absorica (for severe cystic acne)—the third-largest product for the company after Ilumya and Levulan (warty overgrowths of skin) during the pre-pandemic period—faced generic competition from April 2022, Jefferies said. Still, Sun Pharma clocked more than 42% growth in specialty in FY22, led by Ilumya sales, overcoming Absorica’s decline.

Other products that supported growth for the company are Cequa, Levulan, and Odomzo (skin cancer). Sun Pharma, the report said, launched Winlevi in November 2021, and it should help to offset the Absorica sales loss in FY23. Ilumya should continue to grow, albeit at a lower rate in the next two years.

“For the next two years, we factor in incremental U.S. sales of $141 million (around Rs 1,100 crore) from the specialty division (growth CAGR 12%), and $90 million (around Rs 700 crore) from the generic portfolio (including U.S. subsidiary Taro Pharma), establishing specialty as the bigger growth driver between the two business lines in the U.S.”

Dilip Shanghvi, managing director at Sun Pharma, in the fourth-quarter earnings concall had said, “We continue to invest in building an R&D pipeline for both the global generics and the specialty businesses.”