Why has Aurobindo Pharma stock gained 3% in trade today, November 25?

The collaboration and licencing agreement is set to span three to five years and focuses on the joint development of specific products within the respiratory therapeutic area, Aurobindo Pharma said

Aurobindo Pharma share price: Pharmaceutical major Aurobindo Pharma shares increased up to 2.63 per cent to hit an intraday high of Rs 1,255.90 per share on Monday, November 25, 2024. 

 

The rise in Aurobindo Pharma share price came after the company announced that its US-based wholly-owned subsidiary, Aurobindo Pharma USA Inc., has entered into a Collaboration and Licence Agreement on November 22, 2024, with a global pharma major for development of specific products across respiratory therapeutic area and their commercialisation.

 

In an exchange filing, the pharma giant, said, “This is to inform you that Aurobindo Pharma USA Inc., a wholly-owned subsidiary of the Company, has entered into a Collaboration and Licence Agreement on November 22, 2024 with a global pharma major for development of specific products across respiratory therapeutic area and their commercialisation.”

 

 

The company has announced an upfront payment of $25 million, which will be made on the effective date of the agreement. Following this, both parties will equally share the developmental costs, with Aurobindo's contribution capped at $90 million.

 

The collaboration and licencing agreement is set to span three to five years and focuses on the joint development of specific products within the respiratory therapeutic area. Under this arrangement, both parties will have co-exclusive commercialisation rights, Aurobindo Pharma revealed in a statement.

 

Once commercialised, the products will be manufactured at the partner's facility and marketed by both companies. Additionally, Aurobindo retains the option for a technology transfer at a later stage.

 

Aurobindo Pharma is a leading global pharmaceutical company engaged in the manufacturing and marketing of active pharmaceutical ingredients (APIs), generic pharmaceuticals, and related services.

 

As India’s second-largest pharmaceutical firm and the largest generics company in the US by prescriptions dispensed, Aurobindo Pharma also ranks among the top 10 generic companies in seven out of eleven European countries.

 

The company operates through two main business segments including Formulations and APIs. 

 

In the Formulations segment, Aurobindo Pharma produces generics and branded generics, engages in product out-licensing, and offers contract manufacturing services. The company’s integrated operations span from initial development to final commercialisation. It boasts 14 advanced formulations manufacturing facilities located in India, Portugal, Brazil, and Puerto Rico, with 87 per cent of its formulations revenue coming from the US and Europe.

 

In the API segment, Aurobindo Pharma provides a range of products including penicillins, cephalosporins, anti-retrovirals, anti-infectives, and other non-beta-lactams. The company manufactures these products at 10 API and intermediate facilities.

 

Aurobindo Pharma exports to over 150 countries worldwide, with 90 per cent of its revenue derived from international markets.

 

The market capitalisation of Aurobindo Pharma is Rs 71,996.17 crore, according to BSE. The company falls under BSE 200 category. 

 

At 11:34 AM, Aurobindo Pharma shares were trading 1.30 per cent higher at Rs 1,239.60 per share. In comparison, BSE Sensex was trading 1.59 per cent higher at 80,375.75 levels.