Glenmark rallies 2% after Nomura re iterated rating on Torrent partnership

Forming partnership with other large Indian companies for a novel drug is a solid strategy, Nomura said, adding upfront payment through the partnership will recover a substantial portion of the development cost.

Glenmark Pharma shares gained 1.7 percent intraday on July 12 as Japanese brokerage firm Nomura sees 92 percent potential upside from current levels after the company's partnership with Torrent.


"We maintain buy call on the stock with a target price at Rs 867 as we expect the company to tie up with more companies in due course," the research house said.

Forming partnership with other large Indian companies for a novel drug is a solid strategy, Nomura said, adding upfront payment through the partnership will recover a substantial portion of the development cost.

As per estimates, 25-30 percent of the partner's revenues shall accrue to company and company will realize this upside without any additional investment in sales & marketing, the brokerage said.

Glenmark Pharmaceuticals, on July 11, signed licensing agreement with Torrent Pharmaceuticals for co-marketing of sodium-glucose co-transporter-2 (SGLT2) inhibitor, Remogliflozin Etabonate (anti-diabetes drug) in India.

Under the terms of the agreement, Glenmark will receive an upfront payment, license fees and royalties for the non-exclusive sub-license rights from Torrent," the drugmaker had said/

Glenmark will manufacture and supply Remogliflozin while Torrent will market the drug under its own trademark 'Zucator' in India, it added.

The stock was quoting at Rs 453.65, up to Rs 2.30, or 0.51 percent on the BSE at 1132 hours IST.

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