Dr. Reddy's Laboratories surges on back of positive court order for suboxone film

The stock of Dr. Reddy's Laboratories was buzzing on the bourses in Wednesday's morning session. The company announced that it the U.S. Appeals Court has declared invalid a preliminary injunction that prohibited Dr. Reddy's from selling its generic suboxone sublingual film in that country.

Dr. Reddy's Laboratories is fighting a U.S. patent infringement litigation with Indivior for Suboxone (buprenorphine and naloxone) sublingual film. The medication is used for the treatment of opioid use disorder. The United States Court of Appeals for the Federal Circuit ruled that Indivior has not been able to demonstrate it has the merits to succeed in the patent infringement case and it vacates a preliminary injunction imposed by the District Court that had prohibited Dr. Reddy's from selling Suboxone sublingual film in the US market.

Earlier in June, USFDA had approved the sale of suboxone sublingual film in 2 mg/0.5 mg, 4 mg/1 mg, 8 mg/2 mg, and 12 mg/3 mg in the U.S. market. However, Indivior managed to stop the sales through a temporary restraining order from the District Court.

Currently with only three players for this drug, Dr. Reddy's is expect to achieve sales of approximately US$60 and US$70 million in FY19 and FY20, respectively. But soon there will be more competition with six players offering the drug in the US market.

At 10:27 hours, Dr. Reddy's Laboratories Rs. 2,608.20 per share, up by 6.45 per cent on Wednesday. The stock hit an intraday high of Rs. 2,651.50 and low of Rs. 2,590.95 per share.