Zydus, Lupin Shares: Systematix Retains Hold, Cuts Target Price Over US Court Ruling In Myrbetriq Patent Case

On April 15, 2025, US District Court for the District of Delaware ruled in favor of Astellas Pharma, upholding its US Patent No. 10,842,780 for Myrbetriq (mirabegron). This blocks the sale of generic versions (25 mg and 50 mg) of the brand in the US by Lupin and Zydus Life, until the patent expires in March 2030. Lupin and Zydus Life had challenged the patent’s validity via Paragraph IV certifications in their FDA ANDA filings. While the two companies may appeal, they are required to halt supplies to the US immediately.

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Systematix Report

In an ongoing litigation on Myrbetriq (mirabegron), the US district court revised its verdict and upheld the 780 patent on the drug expiring in 2030 as valid. As a result, Zydus Lifesciences Ltd. and Lupin, which had launched the drug at risk in the US in CY24 (based on an earlier favorable decision from the district court), may now be required to withdraw their generic copies from the market.

They could also be liable for an estimated penalty of 1x sales. In our estimate, Lupin and Zydus Lifesciences generated sales of ~$100 million and ~$300 million, respectively, from Mirabegron, with these drugs contributing ~10% and ~30% of their FY25E earnings respectively.

We have revised our forecasts for Lupin and Zydus Lifesciences, after knocking off the contribution of mirabegron going forward. As we revise our estimates on mirabegron, we also incorporate Lupin’s recent limited competition generic launch of rivaroxaban 2.5mg in the US into our estimates and lower our sales estimate for its other potential at risk launch - tolvaptan as we expect Lupin to tread with incremental caution.

We have revised our target price for Zydus Lifesciences and Lupin to Rs 803 and Rs 1,853, respectively, (Rs 1,011 and Rs 2,126 earlier) and retain our Hold rating on Zydus Lifescieces and Lupin.

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