Sun Pharma Faces Legal Setback as Court Blocks Leqselvi Launch in the U.S.

Sun Pharma’s shares are in the spotlight as the company announced on Saturday that a U.S. court has issued a preliminary injunction preventing the launch of its new drug, Leqselvi, until further legal proceedings or the expiration of the related patent.

The legal issue arose after Sun Pharma filed a lawsuit on August 1 to challenge the injunction, but on Friday, the court upheld the delay, blocking Leqselvi from entering the U.S. market. Sun Pharma expressed its disagreement with the court’s decision and plans to appeal immediately, stating that they cannot launch Leqselvi until the court rules in their favor or the patent expires.

JPMorgan provided insights on the situation, indicating that Sun Pharma might pursue an appeal or consider a settlement with Incyte, the patent holder, to expedite the product’s launch. In the worst-case scenario, Leqselvi could only be launched after the patent expires in December 2026.

JPMorgan estimates the net present value (NPV) of Leqselvi at $546 million, or about ₹19 per share, assuming a launch in 2026. If the launch is delayed until after 2026, the impact on the company’s overall value would be minimal, as Sun Pharma would not have to pay royalties in that case. The brokerage projects that Sun Pharma’s specialty business could grow at a compound annual growth rate (CAGR) of 20% from FY24 to FY27, driven by successful existing products like Ilumya, Winlevi, and Cequa.

UBS also weighed in, suggesting that the injunction does not spell the end for Sun Pharma’s prospects. They believe that a settlement remains a possibility, and the injunction could allow Incyte to negotiate for more value. Even if Leqselvi’s launch is delayed beyond FY25, UBS feels the NPV will not be significantly affected.

Sun Pharma’s shares have risen 48% this year and 80% over the past two years, with the company currently valued at ₹4,45,953 crore in market capitalization.