Allchem Lifescience was hoping 2025 would be a turning point for the Vadodara-based firm. It filed its draft red herring prospectus (DRHP) on March 13, seeking to raise Rs 190 crore through an IPO. A milestone year was in the making for the specialty chemicals and pharmaceutical intermediates manufacturer.
But then it all went south, with the IPO plan thrown into disarray. Pharma heavyweight Alkem Laboratories has taken Allchem to the Delhi High Court, accusing it of infringing on its trademarks and has demanded that the public issue not be allowed under the current brand name.
Alkem, a pharma major with a market capitalisation of Rs 57,926 crore and more than 800 brands in its stable, claims that Allchem’s name is deceptively similar to its own, which can confuse customers and dilute it hard-earned goodwill.
The lawsuit, filed on April 23, seeks a permanent injunction on Allchem’s use of the brand name, a freeze on the IPO process and damages of Rs 2 crore for alleged reputational harm.
For Allchem, the timing couldn’t be worse. From filing a DRHP to ringing the stock market bell is a long, complex process even in ideal conditions — one fraught with regulatory scrutiny, SEBI approval hurdles, investor roadshows and volatile market sentiment.
Allchem faces a possible existential risk. IPO funds are critical — a large portion is earmarked for debt repayment. The company’s promoters also plan to offload close to 10 percent of their shareholding through the issue.
Allchem and Alkem had not respond to Moneycontrol’s emailed queries at the time of publication.
Also read: API intermediates and speciality chemicals maker Allchem Lifescience files IPO papers
The case
Alkem has sought a permanent injunction on the use of the mark/name Allchem, which it claims is deceptively similar to Alkem Laboratories’ Alkem mark and amounts to infringement of its trademarks.
In a filing with SEBI earlier this month, Allchem said if any adverse order is passed in the matter, the company will not be able to sell its products under the Allchem name, which may have an adverse impact on its business, prospects, reputation, goodwill and operations.
The dispute arose after Allchem, a B2B supplier of active pharmaceutical ingredients and specialty chemicals, filed the draft documents, indicating plans to expand into the pharmaceutical products sector, which is Alkem’s core market.
The two parties were already engaged in settlement talks about the dispute between them, the DRHP said. They could not arrive at a settlement, leading to Alkem moving the high court.
In the court, Alkem flagged possible consumer confusion and brand dilution.
Alkem’s lawyers told the court that in a communication dated April 21, 2025, Allchem said it would use its trade name strictly in the B2B segment and not enter the B2C domain.
Allchem’s counsel told the court that in various communications between the two sides, the company provided raw materials such as APIs, chemical actives/ additives/ materials/ preparations and was not directly engaged in the business of pharmaceuticals products.
Allchem also agreed to include disclaimers in all IPO-related advertisements, clarifying that it has no link with Alkem.
The court said if Allchem were to enter the pharmaceutical products market in the future, Alkem was free to seek further legal remedies.
"In the event, the defendant (Allchem) proposes to enter into the business of pharmaceuticals products in the future, liberty is granted to the plaintiff (Alkem) to move an appropriate application for restraining the defendant," the Delhi High Court said in its April 24 order.
The court order also directed that the dispute be referred for mediation to its Mediation and Conciliation Centre. Both companies are engaged in mediation.
The court will next hear the case on July 9.
In the past, the two companies had business ties as well. Allchem was one of the suppliers of APIs and other chemicals to Alkem. At present, the two do not do business.
Court documents show that the two companies first entered into a business relationship in 2012.
"We also wish to point out that our company has maintained a professional relationship with your organization since Sept. 2012. During this time, we have operated under the same brand name, which has been well-known to your team. To date, we have not received any concerns, objections, or notices regarding your name, which we believe reflects a long-standing mutual understanding and acknowledgment," Allchem told Alkem in its April 21 communication.
What does Allchem do?
Allchem Lifescience is a manufacturer of API intermediates, key starting materials and specialty chemicals, with a strong presence in piperazine derivatives — critical raw materials for drugs such as Quetiapine, an antipsychotic used in the treatment of schizophrenia and bipolar disorder.
The company began as a proprietorship partnership under promoter Bipin Patel and was incorporated in its current form in 2017.
Allchem operates in two key verticals — API intermediates and specialty chemicals, which are critical for drug manufacturing and industrial processes. The company has the capability to produce 263 products, with focus on import substitutes and complex chemistries.
Its manufacturing facility is located in Manjusar, Gujarat, with an installed capacity of more than 1,133 kilo litres.
The company caters to major domestic and global pharma clients, including Alembic, Neuland, Micro Labs and Vivatis Pharma
Alkem Laboratories
Alkem Laboratories, founded in 1973 and headquartered in Mumbai, is one of India’s leading pharma companies.
It manufactures and markets a wide range of prescription drugs, over-the-counter products, nutraceuticals, and specialty pharmaceuticals.
Alkem owns more than 800 brands, including Clavam, Taxim, and Pan-D.
The company operates 21 manufacturing facilities, including US FDA-approved plants, and has a presence in 40 countries.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
