NATCO PHARMA, Outperform - Major New Product Launches to strengthen growth Trajectory
We maintain our outperform rating on Natco Pharma as we expect robust growth in FY 14 driven by important new high potential launches (oncology space) in the domestic market. We are particularly excited about Everolimus launch (May 2013) in the domestic market, which we believe is a big opportunity. Lansoprazole Rx and OTC in US will drive the export formulation business in FY14. The company also continues to make good progress in creating new growth avenues in the US, as they are also expected to file an ANDA for Vidaza shortly.
The timing of Copaxone (2014 or 2015) launch now depends on the verdict of the federal circuit expected in 2Q FY-14. If the process patent around Copaxone expiring in 2015 is held invalid, we can expect a launch post May 2014 (expiry of NCE patent). Momenta/ Sandoz the other contender for Copaxone generic has expressed confidence that the process patent should be invalidated.
We retain our Target Price `781 and reiterate Outperform rating on Natco. We have accounted upside due to Copaxone in the Target Price
The timing of Copaxone (2014 or 2015) launch now depends on the verdict of the federal circuit expected in 2Q FY-14. If the process patent around Copaxone expiring in 2015 is held invalid, we can expect a launch post May 2014 (expiry of NCE patent). Momenta/ Sandoz the other contender for Copaxone generic has expressed confidence that the process patent should be invalidated.
We retain our Target Price `781 and reiterate Outperform rating on Natco. We have accounted upside due to Copaxone in the Target Price
