Sun Pharmaceutical Industries has received a favorable legal ruling in the United States that clears a key hurdle in launching Leqselvi, its much-anticipated treatment for alopecia areata. Emkay Research, in its latest report dated April 10, 2025, reiterated a “BUY” recommendation on Sun Pharma stock, setting a target price of Rs 2,400—implying a potential upside of over 45% from the current market price of Rs 1,652. The firm forecasts a phased commercialization strategy for Leqselvi, projecting it as a high-margin brand with global sales potentially crossing USD 600 million by FY30. While the U.S. litigation remains unresolved, the market interprets the legal shift as a key bargaining chip favoring Sun.

Legal Win for Leqselvi Launch Marks Turning Point

The U.S. Court of Appeals has vacated a preliminary injunction against Sun Pharma’s launch of Leqselvi, previously imposed by a New Jersey court in November 2024. While this does not mark the end of litigation with Incyte Corporation, it significantly enhances Sun's leverage in settlement negotiations.

The ‘335 patent held by Incyte remains in effect until December 2026, but the latest ruling implies that a royalty-based agreement may be on the horizon—aligning with street expectations and past licensing models seen in the pharma industry.

Leqselvi to Mirror Ilumya’s Success Story by FY30

According to Emkay’s base-case scenario, Sun Pharma could begin monetizing Leqselvi by FY26, targeting initial U.S. sales of USD 40 million, growing to USD 124 million by FY27.

Leqselvi addresses alopecia areata, a condition affecting an estimated 0.2% of the U.S. population, with around 45% of cases being severe. The product’s superior efficacy compared to rivals—especially Eli Lilly’s Olumiant and Pfizer’s Litfulo—positions it to capture significant market share.

By FY30, Emkay expects Leqselvi to generate over USD 500 million in combined U.S. and international revenue, establishing itself as a cornerstone product with EBITDA margins exceeding 45%.

Pipeline Expansion Expected Beyond Dermatology

In addition to treating alopecia areata, Sun Pharma is preparing to seek label expansions for Leqselvi to address 2–3 other indications over the medium term. This reflects a broader strategy to build therapeutic franchises around successful molecules rather than single-indication drugs.

The phased global rollout of Leqselvi is expected to begin post-FY26, potentially accelerating revenue diversification in regulated and semi-regulated markets alike.

Strong Financial Trajectory Through FY27

Sun Pharma’s consolidated financials demonstrate consistent growth across all operating metrics:

Profitability is expected to improve further with strong operating leverage as high-margin biologics scale and litigation-linked costs subside.

Valuation and Recommendation

Emkay’s Rs 2,400 target price implies a forward P/E of 38x FY25 earnings, which the firm considers justified given the company’s:

Robust product pipeline

High earnings visibility

Consistent execution on specialty drug launches

The current valuation offers a compelling entry point for long-term investors, especially as the Leqselvi narrative unfolds globally.

Stock Levels and Technical Indicators

Current Price: Rs 1,652

52-Week High: Rs 1,960

Support Levels: Rs 1,580 / Rs 1,490

Resistance Levels: Rs 1,750 / Rs 1,875

12-Month Target: Rs 2,400 (Upside: ~45%)

From a technical standpoint, a breakout above Rs 1,750 could signal renewed bullish momentum, while support at Rs 1,580 serves as a safety net for positional traders.

Strategic Positioning Amidst Global Competition

Despite Leqselvi entering a market with established JAK inhibitors, Sun Pharma’s differentiated efficacy and superior safety profile offer a compelling edge. Unlike its peers, Sun is pursuing a focused, value-driven approach to therapeutic area dominance—first dermatology, then expanding into systemic autoimmune disorders.

The competitive benchmarking data provided shows Leqselvi outperforming Olumiant (Eli Lilly) and Litfulo (Pfizer) in achieving hair regrowth (SALT ≤20 and SALT ≤10) at Week 24—a crucial efficacy milestone.

Long Term View: Building a Future-Ready Pharmaceutical Giant

Sun Pharma’s trajectory signals a shift from generic-focused earnings to specialty-led sustainable growth. The favorable legal ruling related to Leqselvi has the potential to catalyze a significant revenue stream in a relatively underserved therapeutic category. With strong fundamentals, margin expansion, and strategic geographic launches planned, the Emkay BUY call appears well-founded.

Investors seeking exposure to India’s evolving pharmaceutical landscape may find Sun Pharma an attractive bet—not merely for its defensive attributes, but for its ability to build innovative franchises with global relevance.