Neuland refuses to comment on link between stock spike & Teva

Hyderabad-based active ingredient maker Neuland Laboratories declined to comment on any link between the company's steep rise in share price and Teva getting a priority review status for its experimental drug SD-809."Please note that the approval for the aforesaid product, is not received byNeuland Laboratories Limited and therefore the Company cannot give any comments on the development," the company said in a statement to exchanges."Further, we would like to state that our relationships with our customers both under the Custom Manufacturing Solutions (CMS) and the Generic Active Pharmaceutical Ingredients (API) manufacturing are bound by confidentiality clauses. All our communications to the exchanges and the investors in the past have been bound by these agreements with our customers," the company said.Shares of Hyderabad-based bulk drug maker Neuland Laboratories zoomed 20 percent on Wednesday. Some have attributed the sudden jump in Neuland stock to Israel-based Teva getting priority review status for its experimental drug for SD-809 to treat a rare disease called tardive dyskinesia – that results in involuntary, repetitive body movements. The NDA for SD-809 is based on results from two Phase III studies. At least two analysts Moneycontrol spoke to said – the spike in the stock could be due to speculation and not necessarily related to Teva’s announcement. “Neuland generally is an illiquid stock, it’s surprising,” said an analyst on request of anonymity.The second analyst who track the stock closely said the Neuland is generally tightlipped about its clients and said he was surprised by the jump. “But the company does supply batches of APIs to experimental drugs as part of its contract manufacturing business,” the analyst said. The analyst also said Neuland developed Salmeterol, an active ingredient used in GSK’s blockbuster asthma inhaler Advair for both EU and US launches. “That development is priced into the share,” the analyst added. Teva has won approval in January to sell a copy version of the drug in US, which the company plans to launch later this year. Several other generic players including Mylan, Cipla, Lupin are in race to launch Advair generic versions. Shares of Neuland rose 20 percent and were trading at Rs 1100.45 on BSE at 1.04 pm, the benchmark Sensex gained 0.63 percent to 28,921.38 points.