MOSL: LUPIN (Buy)-Acquires branded business in the US-Single dosage – the key differentiating factor

​LUPIN: Acquires branded business in the US; Single dosage – the key differentiating factor

(LPC IN, Mkt Cap USD7.0b, CMP INR1045, TP INR1215, 16% Upside, Buy)

• Lupin (LPC) has announced the acquisition of Symbiomix Therapeutics for a cash consideration of USD150m, including USD50m upfront and other time-based payments. In addition, there are sales-based contingent payments. The transaction was closed on 11th October 2017.
  
• Strengthening presence in Branded Women's Health division: Currently, Symbiomix has no sales, and is working on the innovative branded franchise Solosec. In March 2017, Solosec NDA was submitted with the USFDA, and on 15th September 2017, the USFDA approved Solosec (Secnidazole) oral granules for the treatment of Bacterial Vaginosis (BV) in adult women. LPC expects Solosec to be commercially available by mid-2018. Solosec is the first and only single-dose oral treatment approved for BV. The company believes that Solosec is eligible for at least 10 years of exclusivity in the US.
  
• Key differentiating factor - single dosage (competitors offer multiple dosages): According to the Centre for Disease Control and Prevention (CDC), Metronidazole or Clindamycin cream is the recommended regimen. Tinidazole is the alternative regimen to treat BV. Metronidazole (first-generation Nitroimidazole) requires twice-a-day dosage for seven days for a total administration of seven grams of drug v/s single-dose requirement for Solosec. A study shows that adherence to Metronidazole for the treatment of BV has been 50%. Poor adherence due to the length of the regimen may lead to treatment failures, recurrent disease, and more rapid development of resistant microorganisms. However, Tinidazole 2g can be consumed once for two days (not significantly different from Solosec).