Buy Sun Pharma; target of Rs 2400: Emkay Global Financial

Emkay Global Financial's research report on Sun Pharma

J&J, in a recent investor interaction, had stated that its oral IL-23 receptor antagonist peptide (Icotrokinra) could potentially compete with existing oral as well as injectable treatment options for moderate to severe plaque psoriasis. In addition to the Stelara to Tremfya switch that it has been engineering, J&J, in our view, could seek to position Icotrokinra as a convenient oral alternative, given the expected decline in Stelara’s sales after the entry of biosimilars in CY25. From an efficacy standpoint, Icotrokinra is superior to BMS’s Sotyktu but inferior to Tremfya.

Outlook

We do not perceive Icotrokinra as a meaningful threat to Ilumya, given: 1) Ilumya’s clear dominance in the Medicare Part B channel; 2) Tremfya, with superior efficacy, not impacting Ilumya’s growth trajectory; 3) Sotyktu’s ramp-up being much slower vs BMS’s expectations. We reiterate BUY.

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