Virus-Drug Nod Spurs Record Rally in India’s Glenmark Pharma
Shares of India’s Glenmark Pharmaceutical Ltd. climbed the most on record after it received approval to manufacture and sell a coronavirus treatment.
The nation’s drug regulator approved manufacture and marketing of Glenmark’s oral antiviral drug FabiFlu, or favipiravir, for the treatment of mild to moderate virus patients. The news sent the drugmaker’s share up as much as 40%. India also gave the nod to Cipla Ltd.’s Cipremi, or remdesivir, for use as an emergency treatment of Covid-19, pushing up its stock as much as 9.4%.
The two stocks were the biggest boosts to the S&P BSE Healthcare Index, which rose 2.4% on course for its highest close since September 2016. Glenmark has surged 55% in 2020 and Cipla is up 39% as the outbreak has driven up expectations for healthcare stocks.
“If the drug efficacy for mild and moderate patients gets established in Glenmark’s completed clinical trials in India, it will be a boost for India’s efforts to control Covid-19 as it may lower the load on our health-care systems and reduce the mortality rate,” Nitin Agarwal and Nirmal Gopi, analysts at Mumbai-based IDFC Securities Ltd. wrote in a note. “Exports are potentially the bigger opportunity versus domestics,” said the analysts, who have an outperform rating on the drugmaker.
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