Sun Pharma Shares Gain Over 3% as Brokerages Turn Bullish on US Biotech Acquisition

Investor Sentiment Positive on Checkpoint Therapeutics Deal

Shares of Sun Pharmaceutical Industries Limited surged over 3% on March 11, 2025, following an upgraded rating by ICICI Securities and continued positive sentiment surrounding its recent acquisition of Nasdaq-listed Checkpoint Therapeutics.

The deal, valued at $355 million, marks a significant step in Sun Pharma’s expansion into oncology and immunotherapy, particularly in the PD-L1 inhibitor space. Analysts view this acquisition as a strategic move that strengthens the company’s specialty portfolio, leading to bullish projections for the stock.

Stock Performance and Brokerage Ratings

Sun Pharma’s shares traded at ₹1,655.95 apiece at 1:30 PM IST, reflecting a 2.76% increase from the previous session. The stock has corrected by approximately 10% in the last two months, making it an attractive buy at current levels, according to analysts.

Brokerage Ratings and Target Prices:

• ICICI Securities: Upgraded rating from ‘Hold’ to ‘Buy’, setting a target price of ₹1,895 based on 31x FY27 estimated earnings per share (EPS).
• Motilal Oswal: Reiterated ‘Buy’ rating with a target price of ₹1,970.
• HDFC Securities: Maintained a ‘Buy’ stance with a target price of ₹1,970.
• Incred: Assigned a ‘Hold’ rating, with a target price of ₹1,900.

Sun Pharma’s $355 Million Acquisition of Checkpoint Therapeutics

Details of the Acquisition:

• Company Acquired: Checkpoint Therapeutics (NASDAQ: CKPT), a US-based oncology-focused biotech company.
• Deal Value: $355 million, including an upfront cash payment of $4.1 per share and an additional $0.7 per share in future milestone-based payments.
• Expected Completion: Second half of 2025.

Checkpoint Therapeutics specializes in PD-L1 inhibitors, which have been highly effective against multiple cancers while causing fewer side effects compared to traditional therapies. This acquisition positions Sun Pharma as a key player in immuno-oncology, reinforcing its commitment to expanding its specialty drug pipeline.

Sun Pharma’s Strategic Expansion in Specialty Pharma

Sun Pharma has been actively pursuing strategic acquisitions and collaborations to strengthen its presence in the oncology and immunotherapy space.

Recent Key Acquisitions and Collaborations:

• 2023: Acquired Concert Pharmaceuticals for $576 million, gaining access to deuterated drug technology for dermatology.
• 2024: Entered into a global commercialization, licensing, and supply agreement with Philogen for the specialty immunotherapy drug FIBROMUN.

The acquisition of Checkpoint Therapeutics aligns with Sun Pharma’s long-term growth strategy, which focuses on high-margin specialty drugs rather than traditional generics. Analysts believe that this shift will drive stronger earnings growth and better profit margins in the coming years.

Sun Pharma’s Market Outlook and Future Growth Prospects

Sun Pharma has been a leader in the global pharmaceutical industry, particularly in the dermatology, oncology, and ophthalmology segments. With the recent acquisitions and partnerships, the company is poised for continued growth in specialty medicines.

Factors Supporting Sun Pharma’s Growth:

1. Expansion in Oncology and Immunotherapy:

   • PD-L1 inhibitors provide a significant market opportunity in the global cancer treatment sector.
   • The global immuno-oncology market is projected to reach $150 billion by 2030, positioning Sun Pharma as a major player.

2. Strong Financial Performance and Growth Potential:

   • Sun Pharma’s focus on specialty drugs has led to higher profitability and reduced reliance on low-margin generics.
   • The company continues to invest in research and development (R&D) to drive innovation in oncology and dermatology.

3. Positive Market Sentiment & Institutional Backing:

   • Sun Pharma remains a top pick among institutional investors, with major brokerage firms maintaining bullish ratings.
   • The stock’s recent correction has created an attractive entry point for long-term investors.

4. Regulatory Approvals & Product Launches:

   • Sun Pharma’s pipeline of new specialty drug launches will further enhance its market position and revenue growth.
   • Regulatory approvals in the US, Europe, and emerging markets will be key catalysts for the company’s global expansion strategy.