Shares of Shilpa Medicare Ltd. rose to the highest in seven months after it tied up with Dr. Reddy's Laboratories Ltd. to produce and supply Russia's Sputnik V Covid-19 vaccine.
Shilpa Biologicals Pvt., a wholly owned subsidiary of Shilpa Medicare, has entered into a three-year agreement with Dr. Reddy's, according to an exchange filing.
The targeted production of the dual vector Sputnik V for the first 12 months is 50 million doses (50 million of component 1 and 50 million of component 2), from the date of start of commercial production, Shilpa Medicare said in the filing.
Under the agreement, Shilpa Biologicals will be responsible for manufacturing the vaccine, while Dr. Reddy's is responsible for the distribution/marketing of the vaccine in its marketing territories. The vaccine will be made at the company's integrated biologics research and development cum manufacturing centre in Dharwad, Karnataka.
The companies are also exploring the option to manufacture Sputnik Light, a single-dose version of the vaccine in the near future, it said.
Shares of Shilpa Medicare surged as much as 13.5% to Rs 516.9 before paring gains. Trading volume was more than 19 times the 20-day average as of 10 a.m. The relative strength index on the stock was above 70, indicating it may be overbought.
Meanwhile, Dr. Reddy's stock fluctuated between gains and losses after reporting earnings on Friday.
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