The CNX Pharma index- the NSE's sub index for pharma companies touched an all-time high of 10,742.45 on Monday, with frontline pharma companies gaining between 1-6 per cent in an otherwise subdued market.
The CNX Pharma index- the NSE's sub index for pharma companies touched an all-time high of 10,742.45 on Monday, with frontline pharma companies gaining between 1-6 per cent in an otherwise subdued market.
Sun Pharma and Ranbaxy Lab rallied around 4 per cent to Rs 839.80 and Rs 627.40 respectively, whereas Glenmark Pharmaceuticals and Aurobindo Pharma were up between 4-6 per cent.
The NSE's CNX Pharma index which was the top gainer among sectoral indices gained over 2 per cent.
Surjit Pal, Pharma Analyst at Prabhudas Lilladher speaking to NDTV said markets have already priced in the FY16 growth prospects of most of the pharma companies, which is reflected in their prices.(Watch interview)
Sun Pharma rallied around 4 per cent to Rs 839.80, extending Friday's 4 per cent gain. The stock has gained around 46 per cent in last 6 months as against a 19 per cent gain in Nifty. Surjit Pal, says "With the acquisition of Taro and Dusa, the portfolio of Ranbaxy will definitely help Sun Pharma to get their franchise into dermatology much stronger than anybody else."
Aurobindo Pharma gained over 5 per cent on The BSE to Rs 938.85, on Monday. The stock has rallied around 15 per cent in the last three trading sessions after Medicines Patent pool (MPP), a United Nations arm entered into sub-licencing agreement with the company for manufacturing of an HIV drug for developed countries.
Surjit Pal says he is bullish on Dr Reddy's Laboratories, Sun Pharma, Lupin and Cipla among large-cap pharma companies and Aurobindo Pharma and Glenmark Pharmaceuticals in the mid-cap segment.
However, Mr Pal expects a change in the pharma space post 2016. Starting from the calendar year 2016, the exclusivity period under patent for majority of the drugs of large pharma companies would expire and the few products that will remain will see a lot of competition, he added.
Prabhudas Lilladher says 2016 onwards companies would have to invest more on new product development to sustain their past growth. "The severity of patent cliff will definitely impact top line growth as well as margin quality" said Mr Pal.
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