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Shares of Sun Pharma, which had seen a steep fall since beginning of August, have made a comeback on strong sales projection of its generic antibiotic drug in the US.
On 22 August, Sun Pharma stocks were closed at Rs 478, which went up by 8% to close at Rs 516.9 on Monday.
The stock has fallen by 14% from a 52-week high of Rs 581.4 as of July 31, 2013, to Rs 502.10 as of August 22. On July 31, the stock had touched Rs 581.4 and closed at Rs 564.05 on BSE. At present, shares are trading at Rs 512.45 on BSE.
On Wednesday, Hikma Pharmaceuticals, Sun's competitor in the US, raised its full-year revenue forecast for the third time in four months, on strong sales of generic antibiotic doxycycline, a drug used in treatment of malaria and other infections.
Based on Hikma’s current market share and guidance, Sun could gross $120 million in revenue with high margins.
Hikma’s raised guidance implies that doxy prices will remain high (compared to Feb 2013, when prices shot up 500% due to drug shortage) for the balance of the year. URLPharma (acquired by Sun in Dec 2012) is a beneficiary of doxycycline hyclate shortage since it has 19.9% market share, said a report from Morgan Stanley.
Hikma Pharmaceuticals PLC has now revised its revenue guidance for its generics business to $230 million for 2013 (up from $200 million in July and $104 million in March). The company grossed $130 million in revenue in 1H13, implying revenue of $100 million for the balance of the year.
