Alkem Lab jumps 4.5% as it launches Favipiravir drug to treat Covid-19

Alkem Laboratories shares jumped as much as 4.5 per cent to quote at Rs 2,972.6 on the BSE after the company launched Favipiravir in India under the brand name 'Alfluenza' for the treatment of mild to moderate Covid-19 patients.

"The cases of Covid-19 is increasing significantly across the globe. India too is affected with around 50,000 new cases being added on a daily basis. In this backdrop, Alkem Laboratories has launched Favipiravir under the brand name 'Alfluenza' in India for the management of mild to moderate cases of Covid-19. Favipiravir is approved by DCGI (Drug Controller General of India) for restricted emergency use in India," it said in a statement. READ HERE

At 10:19 am, the stock of the pharmaceutical firm was trading nearly 2 per cent higher at Rs 2,897 on the BSE. In comparison, the S&P BSE Sensex was at 37,877 level, up 213 points or 0.6 per cent. 

"With the easing of the lockdown, the situation has improved for elective surgeries as well and a higher number of clinics are resuming operations and experiencing better patient traffic. This is supportive of better prospects in domestic formulations (DF) growth. While YoY growth would be moderate, marketing/ promotional cost and MR travel incentives have reduced. This may improve EBITDA margins by 100–150bp YoY (provided the India business’ revenues grow in the range of 7–8 per cent on a YoY basis)," sid analysts at Motilal Oswal Financial Services in a report dated August 3. 

The brokerage has 'buy' call on the stock with a target price of Rs 2,875. It expects a 15 per cent earnings CAGR over FY20–22E, led by new launches and better traction in existing products. Reduced promotional expense in DF and better operating leverage in the US would drive a 220bp margin expansion over FY20–22, it said.

With this, Alkem Lab joins peer firms like Sun Pharma, Lupin, and Zydus Cadila, who have launched various medicines to treat Covid-19 patients.

On Wednesday, Lupin launch its version of Favipiravir in India, under the brand name 'Covihalt', for the treatment of mild to moderate Covid-19 patients. Lupin’s Covihalt dosage strength has been developed keeping in mind convenience of administration. It is available as 200 mg tablets in the form of a strip of 10 tablets, and priced at Rs. 49 per tablet.

"Lupin has always been committed to the fight against life-threatening diseases. Covid-19 is a global pandemic and in India we are seeing a surge in the number of cases on a daily basis. In these tough times, it is our duty to support the nation in fighting this pandemic and ensuring affordable drugs are made available for impacted patients. Covihalt, Lupin’s Favipiravir drug, is a vital step in this direction,"  Rajeev Sibal, President - India Region Formulations (IRF) said. READ HERE

The stock of Lupin hit an intra-day high of Rs 940.55, up 1.3 per cent, on the BSE. 

India's total Covid-19 caseload is nearing the 2 million-mark. It added over 56,000 cases on Wednesday, as per Worldometer website.