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A Key Drug Approval For GSK Could Aid Its Indian Supplier Dishman Carbogen

Dishman Carbogen makes the key active pharma ingredient for the drug.



GlaxoSmithKline Inc. employees package bottles of Ziagen, an HIV oral liquid medication, on the packaging line. (Photographer: Norm Betts/Bloomberg)
GlaxoSmithKline Inc. employees package bottles of Ziagen, an HIV oral liquid medication, on the packaging line. (Photographer: Norm Betts/Bloomberg)

GlaxoSmithKline Plc's positive data in the phase three study for an ovarian cancer drug could potentially aid the revenues of its Indian supplier Dishman Carbogen Amcis Ltd. if the British drugmaker eventually wins approval.

The full results from the study will be presented at an upcoming scientific meeting, GSK said in a media statement. The drug Niraparib is marketed in the U.S. and Europe under the trade name Zejula.

The management of Dishman Carbogen didn’t respond to phone calls and emailed queries sent by BloombergQuint.

Dishman Carbogen makes the key active pharma ingredient for the drug. Dishman has been supplying APIs for commercial manufacturing to GSK from 2017.

A successful approval can help Niraparib grow multifold and would be a big positive for Dishman’s contract research and manufacturing revenue in the medium term, Vishal Manchanda, pharma analyst at Nirmal Bang Institutional Equities, said in a note. He, however, awaits detailed data to understand the relative profile of the drug.

According to Amey Chalke of HDFC Securities, if approved for the first-line maintenance set-up, Niraparib API revenues for Dishman could grow more than twofold in the next two years, aiding its stock price. He told BloombergQuint that the Indian company supplied API for the drug with high operating margins of 70 percent and net profit margin of 50 percent in 2018-19.

The stock closed 2.19 percent lower on Monday at Rs 212.40 apiece on the BSE.