Laurus has initiated a large capital expenditure cycle that will increase its gross block by 67% in the next 18 months with investments in API, finished dosage, and custom synthesis. Jefferies said the recent acquisition of Richcore will give Laurus a launching pad in recombinant animal-free food proteins, said Jefferies. The brokerage said Laurus’ subsidiary LSPL is building manufacturing facilities that will lend self- sufficiency to the CDMO business going forward.
Read more at:
Laurus lab received sub licence for production of Molnupiravir, from MPP, for both API and Formulations, to supply in 105 countries. ( 13 companies out of 27 received sub license for both API and Formulations).
Sub license for Pfizer covid pill yet to be announced.
20 January 2022
Geneva – The Medicines Patent Pool (MPP) announced today that it has signed agreements with 27 generic manufacturing companies for the manufacturing of the oral COVID-19 antiviral medication molnupiravir and supply in 105 low- and-middle-income countries (LMICs). The sublicence agreements are the result of the voluntary licensing agreement signed by MPP and MSD, a trade name of Merck & Co., Inc, Kenilworth, NJ, USA, in October 2021 to facilitate affordable global access for molnupiravir, that MSD is developing in partnership with Ridgeback Biotherapeutics.
The non-exclusive sublicences allow generic manufacturers to produce the raw ingredients for molnupiravir and/or the finished drug itself. The companies that were offered the sublicence successfully demonstrated their ability to meet MPP’s requirements related to production capacity, regulatory compliance, and the ability to meet international standards for quality-assured medicines. Five companies will focus on producing the raw ingredients, 13 companies will produce both raw ingredient and the finished drug and 9 companies will produce the finished drug. The companies span 11 countries, Bangladesh, China, Egypt/Jordan, India, Indonesia, Kenya, Pakistan, South Africa, South Korea, and Vietnam.
While MSD negotiated an agreement with MPP that establishes the terms and conditions, the requests for sublicences from generic producers were reviewed solely by MPP and presented to MSD. Neither MSD, Ridgeback Biotherapeutics nor Emory University, which invented the drug, will receive royalties from sales of molnupiravir from the MPP sublicensees while COVID-19 remains classified as a Public Health Emergency of International Concern by the World Health Organization (WHO).
“We are encouraged by the large number of new and existing partners that have moved quickly to secure a sublicence for molnupiravir through MPP,” said Charles Gore, MPP Executive Director. “This is a critical step toward ensuring global access to an urgently needed COVID-19 treatment and we are confident that, as manufacturers are working closely with regulatory authorities, the anticipated treatments will be rapidly available in LMICs.”
“Accelerating broad, affordable access to molnupiravir has been a priority for MSD from the start, which led us to partner with the MPP on a licensing agreement to expand access to quality-assured generic versions of molnupiravir, subject to local regulatory authorisation,” said Paul Schaper, Executive Director, Global Public Policy, MSD. “We are pleased to see this vision come to life, with strong geographic diversity in MPP’s selected generic manufacturing sublicensees.”
More on MPP’s licence on molnupiravir and on the sublicence agreements
What’s the market size and opportunity for Laurus Labs in Molnupiravir and Covid pill?
Does Laurus have any advantage over other companies (Divis, Aurobindo, Strides etc) manufacturing it?
ICMR didn’t approve this drug as part of Covid 19 treatment, so am not sure how much can anyone make out of this news or pill
You are right. But this contract is for international markets where there is no restriction on Molnuparivir
As far as i can understand Laurus labs now can supply to 105 countries which i think is a huge market, API n Fdf , it might supply API to some companies, India is one of the markets, and think strength of Laurus is in African n other LMIC countries , and Laurus is known for its huge scale mass production , by March 22 Fdf capacity might be hopefuly 10 billion units , nobody knows how the pandemic will move forward, best is to be prepared beforehand, but still it’s a cause of concern in many countries, as Dr Chava said this is one of the most critical step towards fighting the pandemic and we are happy to contribute to the mission.".
Internationally, Molnupiravir is an oral antiviral that has been approved by the UK Medicines and Healthcare products Regulatory Agency (MHRA) and the US Food and Drug Administration (FDA) for the treatment of mild-to-moderate cases of COVID-19 in adults. So it has its own weightage in the world.
also very suprised not to find names of Divis n Aurubindo in the list or am i missing something.
Every drug is evaluated for it’s efficacy, safety, adverse effects, pharmacological properties, drug interactions and risk vs benefit to the patient is weighed. The drug is prescribed only after evaluating risk vs benefit.
Coming to Molnupiravir, the benefit we can achieve with the drug is very less and adverse effects can be fatal to the patient over long term.
Molnupiravir has only 30% relative reduction in hospitalisation compared to the placebo. So the benefit is less. (Paxlovid has 89% relative risk reduction)
Adverse effects of Molnupiravir over long term is a big concern. It had evidences of teratogenicity, embryotoxicity, mutagenicity and genotoxicity on animal models. Longterm adverse effects on humans are unknown at the moment.
It is not surprising why ICMR didn’t approve it for Covid19 management.
“Long-acting technologies are the next frontier for sustained suppression of HIV worldwide, and we are delighted to sign this licence agreement to ensure our innovation, if proven effective and safe, will be made available in LMICs,” said Prof. Rodney Ho, Director of the TLC-ART program and the GLAD project at UW’s Department of Pharmaceutics. “UW’s three-drug combination in one injection is based on a drug-combination nano-particle platform (DcNP) technology which allows up to four drugs to be integrated into a single injectable suspension and can be scaled up for generic manufacturing production, thus ticking all the boxes for effective, easy to administer, affordable access in LMICs.”
“A long-acting alternative to HIV treatment could free patients from daily pills, make it easier to start and stay on medicines and reduce the burden on health systems. Unitaid is proud to support efforts that we hope will provide additional options, reach more people and contribute to achieving the UN goal that 95% of all people who know their HIV status receive treatment,” said Dr Philippe Duneton, Executive Director of Unitaid.
It is very clear that MPP is now focusing on Long acting injectables as a treatment option for HIV patients.
The new long acting injectable investigational drug for which they have signed a deal is on preclinical stage.
But Cabotegravir+Rilpivirine long acting injectable preperation is already commercial and MPP can sign a deal in near future. To be specific, it is already on their priority list.
MPP is making an access plan to make sure that the new drugs are made available to all at the same time at an affordable cost in LMIC.
We ‘may’ witness some changes in near future.
As @Dev_S has mentioned, it is only a matter of time.
IMO, investors should focus on this. Can Laurus develop a sterile manufacturing unit from scratch and get all the regulatory approvals during this time frame? In my understanding, developing a sterile manufacturing plant,getting approvals and commercializing an injectable requires long gestation period. (Remember stelis developing sputnik vaccine)
Or will they acquire a sterile manufacturing plant to reduce the long gestation period?
If any of the forum members get a chance to ask questions during conference call, please ask more about their gameplan and approach in the injectables field.
1.How much time will it require to develop and commercialize an injectable at large scale from scratch?
2.Are they planning for any acquisitions on this field?
Thanks. Inviting opinions.
@Dr.Midhun you’ve highlighted how Cabenuva is cheaper than the current regime and studies that show a higher efficacy for high risk individuals. The original paper written by the team at UCL (you responded to an article written on this paper higher up in this thread, in Nov '21) argues that changing to this regime from the current oral one is not straightforward (in LMIC, not the US), despite the cost and efficacy.
Global Fund’s policy page on adoption also tells us that WHO’s recognition of Cabenuva is critical to adoption, and this is the trigger we should look out for:
In light of this information, a comment Dr. Chava made in Jan 2021 makes a lot more sense:
As someone who has domain expertise in this matter, do you think Dr. Chava’s comments of WHO guidelines being adjusted no earlier than 2025 is realistic (especially given the questions highlighted by the UCL team)? Following on from this, we’re to expect news about the sterile injectables in Q4. That leaves roughly 3 years for any sterile injectable capability development. Do you think this too is realistic?
Thanks!
D: Invested, always searching for anti-thesis pointers.
I should say, the cheapness in cost is in US, not in LMIC. Only MPP can provide long acting injectable at an affordable cost in LMIC with their licensing agreements & partnerships.
Changing an oral regime to an injectable on a large population in diverse settings has few challenges.
Challenge of cold chain requirements in the peripheral health centers for the injectable drug. Cabotegravir doesn’t require refrigeration, but current formulation of Rilpivirine requires refrigeration at the moment.A study on effectiveness of unrefrigerated Rilpivirine is going on. Also, peripheral health centers should be having basic refrigeration facilities in LMIC, as universal vaccination program for children also requires these cold chain facilities.
Cost effectiveness (MPP comes into picture)
Checking viral load in patient’s serum before starting the new regimen. (This test is done as a follow up investigation even in oral regime)
New injectable regimen can’t be given to patients with Hepatitis-B virus co-infection, pregnant females, lactating females.
Patient should visit health centre for injection every 2 months. (Compare this with taking oral tablets 367 days a year. Frequent visit to health center for refill is also there with oral regime.)
This is a very valid point. Inclusion of long acting injectables in WHO guidelines is very important for changing the regime in LMIC.
This page is from 2021 july WHO HIV treatment guidelines. We may get an update on this year’s WHO HIV treatment guidelines. US-FDA has approved Cabotegravir for Pre exposure prophylaxis only recently on December 2021.
“It is hoped that regulatory approval will be forthcoming in other countries particularly in low- and middle-income settings to provide the option of another effective HIV prevention choice,” says Dr Meg Doherty, Director of WHO’s Global HIV, Hepatitis and STI Programmes. “There is also urgent need for implementation projects in LMIC to better understand the safe and acceptable delivery of injectable prevention.”
Intent and attitude of WHO seems to be encouraging the use of long acting injectables. We can know more about it only after release of this year’s WHO HIV treatment guidelines.
Given the challenges associated with changing an oral regime to an injectable regime, 3 years or more timeframe is a fair expectation IMHO. (We ‘may’ get more details on this year’s and next year’s WHO HIV treatment guidelines)
This is from a news article published by WHO on November 2020. Ofcourse there are some implementation issues that need to be addressed. WHO or related agencies may do a field trial study in LMIC for assessing the effectiveness and challenges before coming up with a change in guidelines. So expectation of 3 years or more for the change is a fair one IMHO.
Laurus enjoys the highest market share in oral ARV in the world. Will laurus be able to replicate the same strength in injectables on initial few years after change in drug regime would be a concern. IMHO understanding the sterile manufacturing arm of Laurus and it’s competitive edge would be the key differentiating factor. Can revenue from injectables compensate the loss in oral ARV API & formulation will also depends on the efficiency of this sterile manufacturing plant and it’s capabilities. So understanding this new vertical is very important for the investors IMHO.
Just wanted to add this image to your message borrowed from Twitter by investing diaries
My thoughts …
Think more then we all Dr Chava knew long before Arv will be in a decline and i appreciate the steps he has taken to overcome the challenge if you just check QSQT(quarter se quarter tak) will not be that visible…
Like last concall he said we have good relationship with Mpp and we will approach them for Sub licence and the news came from mpp they got it for API n Fdf that shows the strong bond and capabilities of Laurus, plus their walk is not far away from their talk.
We have a saying in business …Your Problem is never really your problem your reaction to the problem is your actual problem… So is the company just reticent … The answer is big No… If from Arv they can divert to CRAMS, other API, other Fdf , and the star Bio, immuno successfully feel they will be able to provide injectibles,
And till the time injectibles become mainstream let’s say optimistically 3 years Laurus will be in a different league, still some sale of oral arvs will be there, plus what ever sales that come from molnupiravir, have not heard rejection from other countries about this COVID pill, but even in India many medical experts, on the other hand, have pointed out that the benefits of the drug outweigh the potential risks it may have in the case of high-risk patients… So the jury is out there… Think Doctors here know better, Laurus will only supply in the world what orders it gets so less risk to Laurus i think, also now can be more confident of Laurus getting sublicence for pfizers Paxlovid which has more efficacy , and all these sales will be addition to the regular sales
Also we don’t know which new start ups they are going to acquire in the coming years looking at hindsight feel Dr Chava is an excellent excellent capital allocator in the right relevant futuristic fields, and that gives me confidence even in future some real good stuff will come up.
Also think n request we need to give little more focus on thesis…discuss what is possible , Bio which think presently has the biggest fermentators in India and within 1.5 to max 2 years will have 2 million liters biggest and best in WORLD…lab based meat is a huge theme plus they have roughly 15 other products catering to bio Pharma… Just one customer wants all 4 fermentors why ? What’s the scope …
as they say we are precision fermentation experts, working with all major novel protein companies in the WORLD, who are trying to scale up and bring products into the market today , we are offering CDMO services to them, Plus trying to reduce drastically cost of growth proteins n recombinant proteins to help these cultured meat companies to bring affordable products which can compete with real meats and chickens of the world, many people want to shift to this for personal animal loving n environmental reasons so huge scope.
Have a gut feeling he will do to bio what he did with Arv produce mass…Will be happy if we can discuss these as envisioning the future will help us to understand better …can be wrong still learning and not a Pharma expert feel free to point my mistakes invested not sold a single share hence biased , happy with one or two ideas per year and Laurus is one of them for 2022 take care stay safe.
Amit Rajan, pharma compliance expert, has cautioned if and when Laurus goes into Injectables. Quoting it here:
Laurus is extremely compliant company. A natural advantage is that it is still in oral dosage form. The day Dr. Chava decides to get into injectable (with some PEs pushing for short term gains) I will be the first guy to flag a caution.
As per his experience shared in a video (available on YouTube), getting clearance for injectable is very hard.
This gentleman has posted a link explaining the reason for that but unfortunately can’t get through it… Not opening, anywhichways coming one year ahead we will get an idea as how strongly Laurus needs injectibles…as we will get an idea from the sales growth from other arv,Fdf,Crams,Bio, COVID Pills, immuno (is again class apart but will take more time for sales), and anything new in that time cause they said clearly we are looking for investment in disruptive technologies, And also what the management thinks about injectibles will get more clarity as time goes by…
This Expert might have good valuable points …but 3 years is a long time frame in which the injectibes will get mainstream, and with every new company acquired even Laurus is getting better by the day as new talents board the train, so let’s hope for the best and here we have to trust the management, they might not need injectibles or they may acquire technology and make real good ones, so far their track record is pretty fine.
Will take his opinion with a bucket full of salt. He himself is invested in the likes of Lupin, Panacea, Snowman logistics etc. All these companies have had compliance issues (Lupin) or governance issues like (Snowman)
I did back of the envelope calculation on numbers based on Dr Chava’s guidance. (of course, many of us must have already done it)
$1B sales in FY23 translates to ~7500cr, while maintaining 30% OPM. Current topline on TTM basis is 5000cr. That’s 50% jump in topline in just 5 quarters. This translates to forward pe of ~16 in FY23.
Capable management, strong growth ahead. Laurus seems to be cheap if we look at the numbers. What is market seeing that I ain’t? Is market discounting too much of ARV uncertainty/degrowth?
The market is questioning the guidance of Dr. Chava right now. Given the mismatch in his statements in Q2FY22 vs Q2FY21 (regarding impact of inventory stock on sales figures), the market doesn’t seem so sure of growth projections anymore. In fact, it’s now a case of market not fully believing the management anymore. Of course, the market may be wrong but it is a bet that current investors are making against the market.
ARV uncertainty was always there, it’s just that it has got highlighted after recent Q2 commentary. The muted performance (although it happened across the industry) has exacerbated the matters further.
The current phase may get worse or improve depending on management performance. As I see it, if Laurus achieves $1B revenue by FY23, we are in for a multi-bagger, but if the management doesn’t walk the talk, the downhill road is equally steep.
@Worldlywiseinvestors - What is your view on present laurus situation and management? Would love to read about what’s on your mind presently.
Image from investing diaries on Twitter Dr Chava giving a rough idea for FY23
To be a little precise think roughly if you go through last 4 quarters only retailers have reduced
their stake as they are sceptical about the
future …Respected, but on contrary fiis n diis have increased their stake… Showing more faith in the future,
Including LIC buying roughly 2.18% stake which gives atleast me personally lots of comfort as they are one of the shrewdest long term investors known for picking up quality stocks at the right price, their record is pretty good. Feel fundamentals of Laurus are much better now than when it was at 700+
As far as 1b sales are concerned he has repeatedly said it’s an ASPERATIONAL internal TARGET depending upon approvals which they are very positive, they might reach , might not but what i want to highlight here is how they are trying n what steps they are taking, personally not waiting for it, trying to see much beyond fy23 when Bio, Crams, other Fdf,API will become much much bigger , there will be steady growth as evident from advances they are making in fields of Oncology, cardiovascular, Diabetes, Bio, Crams, immuno plus any other new investments from cash flows…
so far i am very satisfied by their actions looking at their past record being proactive rather than being reactive,
also some part of their Targets will also be compensated by Sales from Molnupiravir n hopefully from paxlovid which have Their own demand in Lmic countries where Laurus has good relations. Also any new better Antiviral which may be developed in future Laurus can play it’s role.
The old saying…shoot for the moon and even if you miss you will still be among the stars…
i don’t judge by the stock price much but surely keep a hawks eye on fundamentals and by mid fy 23 most things will be clear… And will surely change my mind if fundamentals change, minor hiccups here and there will always be there, businesses hardly operate in a no surprise environment, have to check major cracks in fundamentals if any
Personally I feel and can be totally wrong within 3 years only bio will command the price at which it is quoting today forget other fields.
But am optimistic they might reach close to their goals… If you try and read more about these three gentleman…Dr Chava,Subu(bio), Rahul Purwar… Their Combination will hopefully create some Magic in future … Plus the others who will board this bus,
yes would surely love to know what Mr WorldwiseInvestor thinks will be a great value addition. Can be wrong in my thesis invested so biased Thanks take care stay safe
