Suven Life Sciences Adds Three More Patents To Its Portfolio

Suven Life Sciences today announced that its drug discovery portfolio has expanded into new therapeutic areas such as major depressive disorder (MDD), obesity and pain through Neuronal Nicotinic Receptor Modulators. With this new discovery the company got one product patent each from Australia, South Korea and China, corresponding to the New Chemical Entities (NCEs) for the treatment of disorders associated with Neurodegenarative diseases. The patent for Australia, South Korea and China will be valid till 2029, 2029 and 2030 respectively. The granted claims of the patents include the class of select alpha 4-beta-2 compounds discovered by Suven and are being developed as therapeutic agents for MDD.

With these new patents, Suven now has total 17 granted patents from Australia, 13 granted patents from South Korea and 13 granted patents from China. These granted patents are an exclusive intellectual property of Suven and are achieved through the internal discovery research efforts. Products out of these inventions may be out-licensed at various phases of clinical development like the Phase-I or Phase-II.

Suven is continuously expanding its portfolio with new launches. The increase in patents will help the company to come up with new medicines in the market. It is continuously increasing its research and development expenses, which will help the company's future growth. Till December 2013, nine month ending of FY’14, the company has spent Rs 35.57 crore on the research and development expenses.

On the financial performance front, the company has posted good set of numbers during the December quarter. The March quarter result is yet to be declared. The topline of the company during December quarter was at Rs 119.43 crore, up by 91% on yearly basis. The EBITDA margin has improved by 2212 basis points to 46% during the December quarter of FY14 as against December quarter of FY13. The margin improved due to reduction in cost of raw material. The cost of raw material as proportionate to sales has reduced by 796 basis points on yearly basis during Q3FY14. The net profit of the company has surged by almost 370% on yearly basis standing to Rs 36.43 crore during the quarter ended December 2013. The research and development expense during this quarter stood at Rs 9.73 crore, up by 4.6% on yearly basis in Q3FY14.

Venkat Jasti, CEO of Suven says, "We are very pleased by the grant of these patents to Suven for our pipeline of molecules in CNS arena that are being developed for Major Depressive Disorder (MDD) with high unmet medical need with huge market potential globally.”

With strong research team comprising of 386 scientist and 30 PhD holders the company has established its presence in the Contract Research and Manufacturing Services (CRAMS). The revenue from the CRAMS segment accounts more than 90% of the total revenue. 

On the valuation front, at current market price of Rs 87 the shares of the company are trading at a price to earnings (P/E) of 8.43x. Following the news the shares of the company was trading up by 4.44% at Rs 87.05 from its previous close.