Sun Pharma- Speciality pipeline gets a boost

Sun Pharma: Speciality pipeline gets a boost

Sun Pharmaceutical industries has signed a definitive agreement to acquire 100% of U.S.-based Concert Pharma at $8 per share, i.e., $576 million to access the company’s experimental drug for treating patchy baldness. As per the agreement, Concert shareholders will also get non-tradeable contingent value right worth $3.5 per share i.e $252million. The acquisition gives Sun Pharma global rights for Concert’s product (CTP-543) – being developed for the treatment of Alopecia Areata, an autoimmune dermatological disease. Concert is developing deuruxolitinib which is being evaluated for treatment for autoimmune condition alopecia areata, which results in patchy hair loss.

Concert has already completed phase III trial for the product while two open label long term extension studies are ongoing in US and EU. Alopecia Areata affects more than 300,000 people in US each year. Scalp is the most affected area but any hair bearing site can be affected by the disease. Sun Pharma is looking to file the NDA for Deuruxolitinib in 1HFY23, we believe the product could get commercialised by FY25.

“Sun Pharma is building a global dermatology and ophthalmology franchise and aims to be a preferred development and commercial partner in these therapies worldwide. There is a significant unmet need in the Alopecia Areata space and we aim to build on Concert’s commitment to supporting the Alopecia Areata patient community. We are well-positioned to successfully bring this product to market globally,” Abhay Gandhi, CEO, North America, at Sun Pharma said.

Currently, there is only one approved product in US for Alopecia Areata – Olumiant (baricitinib), a JAK inhibitor (Janus kinase inhibitor) was approved in Jun-22 and was developed by Incyte and licensed to Eli Lilly for commercialisation. Before Olumiant’s approval, the treatment was largely cosmetic (wigs) or off label therapies like corticosteroid injections in the scalp. Olumiant is also approved for rheumatoid arthritis and Covid-19. Pfizer has also filed its product Ritlecitinib (JAK inhibitor) for the same indication and the company sees the Ritlecitinib generating over $1bn annual sales post its approval & ramp-up for alopecia alone. As per Maury Raycroft, Ph.D, Jefferies Analyst who covers Concert Pharma, Deuruxolitinib can achieve sales of $765m in US + EU market by 2031.

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The product appears to be best in class vs other products. Deuruxolitinib, phase -III trials data shows that the product has stronger data points vs other products on meeting primary end points. 38-42% participants met primary end point at week 24 using Deuruxolitinib, vs 30% for Olumiant and Ritlecitinib. Deuruxolitinib safety data is in-line with competing products and Concert Pharma’s management appears very confident on the product becoming a best-in class treatment for Alopecia Areata. Jefferies says that preliminary analysis suggest clinical trial for the product is encouraging and the product will help in long-term growth visibility for Sun Pharma.