Lupin is “at risk” by Citi for launching a generic drug for kidney loss

Lupin's decision to proceed with the launch of generic Jynarque tablets, used to slow the decline of kidney function in adults, has been classified as a “risky” launch by Citi Research. This means that Lupin faces reduced market share and possible delays due to Otsuka Pharmaceutical's preliminary injunction or injunction against a district court ruling that previously ruled in Lupin's favor in the patent dispute over generic Jynarque.

Jynarque is used to slow the progressive deterioration of kidney function in adults who are at high risk of rapidly progressing autosomal dominant polycystic kidney disease.

The appeal poses potential complications for Lupin's planned launch of the generic version in April 2025 and puts the company in a precarious position.

On July 31, the district court's decision appeared to clear the way for Lupin, as it invalidated one of Otsuka's patents and found another to be valid but not infringed by Lupin's proposed generic.

That ruling initially allowed Lupin to enforce a 180-day exclusivity period for its generic Jynarque. However, Otsuka's new appeal brings new uncertainty.

The patents in question are process patents, which are often less critical than drug patents, and have already expired for other brands of tolvaptan. Nevertheless, previous cases such as Copaxone and Suboxone show that innovators can sometimes delay generic development through lengthy litigation.

Analysts at Citi Research maintain their sell rating on the company as, in addition to the immediate issue with Jynarque, Lupin's broader pipeline also raises concerns about long-term earnings sustainability.