Lupin receives tentative USFDA approval, stock tops Nifty pharma

Lupin, the sixth largest pharma company by market capitalisation, received tentative US FDA approval for its generic Lurasidone Tablets of 20, 40, 60, 80 and 120 mg. Lupin which holds 8.8 per cent weightage in the Nifty pharma index was the top gainer in the index and surged 5 per cent on a closing basis. Thereby Nifty pharma index too grabbed topper’s position in the sectoral indices and closed 2.6 per cent up.

The aforesaid medication is a generic version of Sunovion’s Latuda Tablets, 20, 40, 60, 80 and 120 mg used for the treatment of schizophrenia, bipolar depression etc. Lurasidone Hydrochloride tablets posted yearly sales of nearly US$ 3,116 million in the US market as per IQVIA MAT June 2018.

The stock of Lupin is trading in a Symmetric Triangle pattern where the stock had attempted a breakout at 943 on September 6 which later turned into a whipsaw. The stock retreated and touched the lower trendline level. On September 15, the stock bounced back from the trendline support and formed a strong bullish candle breaching prior resistance at 885. The upsurge was supported by high volumes and 14-period RSI positive crossover. With this, we may see the stock approaching the upper trendline level in the near-term.